We can expect to see a flurry of activity concerning health care within the next two weeks. The reason is that according to the arcane rules of the US Senate, changes to Obamacare that need only 50 votes to pass must not only be within certain parameters but must also be passed by September 30. After that, any changes must go through the normal process and will require 60 votes to break a filibuster and the Republicans have only 52 votes.
The last Republican attempt at substantially weakening Obamacare failed with only 49 votes in favor, with three Republicans Susan Collins, Lisa Murkowski and John McCain voting against. Lindsey Graham and Bill Cassidy have proposed another bill and the Center for Budget and Policy Priorities has analyzed it and tells us what its impact will be, and it is not good, targeting seniors, people with disabilities, families with children, and the poor for its most drastic cuts.
- Eliminate the ACA’s marketplace subsidies and enhanced matching rate for the Medicaid expansion and replace them with an inadequate block grant. Block grant funding would be well below current law federal funding for coverage, would not adjust based on need, would disappear altogether after 2026, and could be spent on virtually any health care purpose, with no requirement to offer low- and moderate-income people coverage or financial assistance.
- Convert Medicaid’s current federal-state financial partnership to a per capita cap, which would cap and cut federal Medicaid per-beneficiary funding for seniors, people with disabilities, and families with children.
- Destabilize the individual insurance market in the short run — by eliminating federal subsidies to purchase individual market coverage and eliminating the ACA’s individual mandate to have insurance or pay a penalty — and in the long run. After 2026, once the bill’s block grant funding ends, it would amount to repeal of the ACA’s major coverage provisions with no replacement — an approach that the Congressional Budget Office (CBO) estimated would cause 32 million people to lose coverage and lead individual markets to collapse in most of the country.
Cassidy and Graham are hopeful that this time they can limit defections to at most two senators. Since McCain is Graham’s BFF, he will likely vote for this bill and has already signaled his intent to do so. Collins and Murkowski have not yet stated their intentions. But even if they vote no, another no vote is still needed. Rand Paul has said that he would oppose it but he has proven to be a weak reed when it really counts and can be swayed.
We will have to wait and see how each senator evaluates the negative impact for their own state and the response of their constituents. According to the CBPP, all states will suffer a negative financial impact (apart from the impact on actual people) but some more so than others.
In 2026, the 20 states facing the largest funding cuts in percentage terms would be Alaska, California, Connecticut, Delaware, the District of Columbia, Hawaii, Kentucky, Louisiana, Maryland, Massachusetts, Minnesota, Montana, New Hampshire, New Jersey, New York, North Dakota, Oregon, Rhode Island, Vermont, and Washington. These states’ block grant funding would be anywhere from 35 percent to nearly 60 percent below what they would receive in federal Medicaid expansion and/or marketplace subsidy funding under current law.
Of those states, Alaska, Kentucky, Louisiana, Montana, and North Dakota have Republican senators while Arizona, Colorado, Ohio, and West Virginia also have Republican senators and will face major cuts. It is the Republican senators from those states that will be the target of lobbying efforts.