Pa., N.J. could lose big under latest Obamacare repeal
Critics say the latest attempt to repeal Obamacare punishes states that chose to give health coverage to more residents.
Republicans' latest attempt to dismantle the Affordable Care Act could slam Pennsylvania and New Jersey with the loss of billions of dollars in federal health-care funding, along with other states that like them chose to expand Medicaid coverage to the working poor.
Meanwhile, states that chose not to expand Medicaid could see a flood of money from the federal government under the bill, written by Sens. Lindsey Graham (R., S.C.) and Bill Cassidy (R., La).
The result, critics say, would be a political redistribution of funds from mostly Democratic-controlled states to mostly Republican ones.
"It actually will penalize states that go out of their way to help more people," said Robert I. Field, a law and health policy professor at Drexel University. That would include Ohio and New Jersey, whose GOP governors expanded Medicaid.
The bill is the sixth attempt this year to repeal President Obama's Affordable Care Act, a long-held Republican goal that's running out of time: Senate rules that allow Republicans to pass a repeal with only a simple majority expire on Sept. 30.
The bill has been marketed as a way to "even out" federal health-care funding among the states. Traditionally, Medicaid has covered low-income mothers, children, people with disabilities, and the elderly. Under the Affordable Care Act, states could opt for increased federal funding to expand the program to anyone who makes up to 138 percent of the poverty line. (For a single person, that would be about $16,600.)
New Jersey opted in in 2014; Pennsylvania followed in 2015. Nearly 1.1 million Pennsylvanians are insured under the ACA, according to state data, including more than 700,000 who got coverage through the Medicaid expansion.
About 900,000 New Jerseyans got coverage under the ACA, NJ.com reported in 2016. Govs. Wolf and Christie have both decried the Graham-Cassidy bill.
Graham-Cassidy would repeal the Medicaid expansion and the subsidies that helped people get coverage in the individual insurance markets, replacing them with block grants calculated by a state's low-income population.
States would then be allowed to spend the block grants however they want — which the bill's supporters say will allow states flexibility to create health-care systems that work for them.
But several analyses of the bill suggest that Medicaid-expansion states would receive less money than they would have under the ACA. And the bill would change the way the traditional Medicaid program is funded, setting a cap on money spent per patient instead of simply covering the cost of their care.
Statistics from the Kaiser Family Foundation suggest those reductions could cost Pennsylvania $12 billion in federal health-care funding by 2026; New Jersey could lose $6.4 billion. Other analyses have estimated lower figures that follow the same trend line. Meanwhile, a typical state that didn't expand Medicaid could see a 12 percent bump in federal money, the Kaiser analysis found.
"It would be almost as if an employer said, 'We're not going to buy your health insurance anymore. We're going to give you money so you can buy whatever you want on your own. Here's a fraction of what we had been spending. Enjoy your freedom to buy whatever you want,' " Field said. "If you're giving more flexibility to the states but also taking money away from them, you're sabotaging your own goal."
Under the bill, it's unclear what would happen to people who got Medicaid under the expansion — or people who bought subsidized insurance — because it's up to each state to decide how to spend the block grants that would replace those programs, and how to make up the potential losses.
"There's no real guarantee at all" that those people will keep their coverage, said Gary Claxon, a vice president at the Kaiser Family Foundation who coauthored the foundation's state-by-state breakdown of the bill's impact. "It's entirely up to states to determine what people get. And they're asking each state to come up with a new coverage scheme without any of the federal infrastructure. It's going to be a wild time were it to pass."
And, he added, the bill makes no provisions for the block-grant system after 2026, which could create even more uncertainty for patients and legislators in the future. He called the redistribution of funds "primarily partisan."
Conservative think tanks like the Heritage Foundation have argued that the bill returns power to the states, eases unnecessary regulations, and ensures Medicaid dollars are spent on the neediest Americans. But the bill also allows states to waive popular ACA provisions, including requirements that insurers cover preexisting conditions and certain benefits.
Claxon said the bill is the most extreme of this year's repeal attempts.
"I'm afraid the likelihood is pretty high" that the bill will pass, Sen. Bob Casey (D., Pa.) said in an interview, and encouraged concerned constituents to call lawmakers.
"They want to make radical, really damaging changes to our health-care system that will hurt millions of people," Casey said. "And when people lose their health care, we're all diminished. We're less safe as a country."
His counterpart, Sen. Pat Toomey (R., Pa.), who helped author a previous repeal attempt, said through a spokesperson that he and his staff were still reviewing the bill. Sen. Rand Paul (R., Ky.) has consistently opposed the Graham-Cassidy bill, but Sens. Susan Collins (R., Maine) and Lisa Murkowski (R., Alaska), who helped kill the last Obamacare repeal, remain undecided. (The Independent Journal Review reported Thursday that Republicans had sweetened the bill with special benefits for Alaska in the hopes Murkowski would come on board.)
Health-care advocates have been mobilizing all week; the Pennsylvania Health Access Network is organizing a series of hearings across the state next week.
"Over the next few days we're really ramping up efforts," said Antoinette Kraus, PHAN's director. "Everyone will know someone impacted by this bill."
Staff writer Don Sapatkin contributed to this article.