4 GOP Senators Flag Concerns With Medicaid Cuts In House O’Care Draft Bill

Four Republicans senators hailing from states that have expanded Medicaid under the Affordable Care Act fired a shot across the bow — in the form of a letter to Senate Majority Leader Mitch McConnell (R-KY) — against the changes to the program that were included in draft House Obamacare repeal legislation.

“While we support efforts to repeal and replace the Affordable Care Act and make structural reforms to the Medicaid program, we are concerned that the February 10th draft proposal from the House of Representatives does not provide stability and certainty for individuals and families in Medicaid expansion programs or the necessary flexibility for states,” the letter, signed by Sens. Rob Portman (R-OH), Shelley Moore Capito (R-WV), Cory Gardner (R-CO) and Lisa Murkowski (R-AK), said.

If Republicans lose three votes in the Senate, their Obamacare repeal bill is doomed.

There are 20 Republican senators representing Medicaid expansion states, and how to handle the issue has become a flashpoint in the Obamacare repeal debate. GOP lawmakers have floated freezing enrollment on the expanded Medicaid programs before winding them down. The Feb. 10 draft bill would scale back the expansion in 2020, allowing the states to continue covering their expanded populations but with far less funding to do so from the federal government.

More generally, Republicans are seeking to transform the Medicaid program into a block grant, meaning the states would get a lump sum instead of a match rate that allows the funding to adjust according to the program’s costs. States would be allowed to accept the block grant on per capita basis, meaning that the sum would be determined per person and would rise if more people enrolled. Even still, a per capita cap would result in $584 billion in cuts in federal funding for the program over 10 years, according to a slide show by health care policy experts presented to governors last month.

GOP leaders have stressed that the Feb. 10 draft was a work in progress and that they were considering other changes. However, they have held more recent drafts under lock and key, with the intention of unveiling the final bill this week.

Reports Monday sourced to those who have seen more recent forms of the legislation suggest some changes have been made, but it’s unclear what adjustments have been considered on the Medicaid proposals. Republicans have reportedly backed away from changing the way that employer-based plans were treated in the tax code — which was framed as a crucial revenue booster for the bill’s Obamacare replacement elements — suggesting that major cuts to Medicaid will be needed to pay for the tax credits for individual insurance lawmakers are considering.

Read the full letter from the expansion state Republicans to McConnell below:

The Honorable Mitch McConnell
Majority Leader
U.S. Senate
Washington, DC 20510

Dear Majority Leader McConnell,

As you know, Medicaid covers more than 72 million Americans and is the core of the health care safety net for individuals across the country. The Affordable Care Act destabilized the private insurance market and created an unsustainable path for both the states and the federal government in Medicaid. While we support efforts to repeal and replace the Affordable Care Act and make structural reforms to the Medicaid program, we are concerned that the February 10th draft proposal from the House of Representatives does not provide stability and certainty for individuals and families in Medicaid expansion programs or the necessary flexibility for states.

We are concerned that any poorly implemented or poorly timed change in the current funding structure in Medicaid could result in a reduction in access to life-saving health care services. The Medicaid population includes a wide range of beneficiaries, many of which cycle on and off Medicaid due to frequent changes in income, family situations, and living environments. The Department of Health and Human Services reports that nearly one-third of individuals covered under the Medicaid expansion have a mental health or substance use disorder. As the largest payer of mental health and substance use services in the United States, it is critical that any health care replacement provide states with a stable transition period and the opportunity to gradually phase-in their populations to any new Medicaid financing structure.

We believe Medicaid needs to be reformed, but reform should not come at the cost of disruption in access to health care for our country’s most vulnerable and sickest individuals. Any changes made to how Medicaid is financed through the state and federal governments should be coupled with significant new flexibility so they can efficiently and effectively manage their Medicaid programs to best meet their own needs. We also believe a gradual transition is needed to ensure states have the time to successfully implement these new changes. The Affordable Care Act is not working for states or the federal government and must be repealed and replaced with a plan that reforms Medicaid and protects individuals and their families over the long term. However, the February 10th draft proposal from the House does not meet the test of stability for individuals currently enrolled in the program and we will not support a plan that does not include stability for Medicaid expansion populations or flexibility for states.