Latest Version of Cassidy-Graham Still Has Damaging Cuts to Health Care Funding That Grow Dramatically in 2027

Like prior versions, the latest version of the bill from Senators Bill Cassidy and Lindsey Graham to repeal and replace the Affordable Care Act (ACA) would cut federal funding for health coverage for the large majority of states over the next decade (see Table 1).  And the cuts would grow dramatically in 2027, when the bill’s temporary block grant (which would replace the ACA’s Medicaid expansion and marketplace subsidies) would expire and its Medicaid per capita cap cuts would become increasingly severe.  We estimate that in 2027 alone, the bill would cut federal health care funding by $298 billion relative to current law (see Figure 1), with the cuts affecting all states.

In fact, starting in 2027, Cassidy-Graham would likely be even more damaging than a straight repeal-without-replace bill because it would add large cuts to the rest of Medicaid — on top of eliminating the Medicaid expansion — by imposing a per capita cap on the entire program.  The Congressional Budget Office (CBO) has previously estimated that the repeal-without-replace approach would ultimately leave 32 million more people uninsured.[1]  Cassidy-Graham would presumably result in even deeper coverage losses than that in the second decade as the cuts due to the Medicaid per capita cap continue to deepen.

  • Eliminate the ACA’s Medicaid expansion and ACA’s marketplace subsidies in 2020 and replace them with an inadequate block grant.  Under our estimates, the block grant would provide about $239 billion less between 2020 and 2026 than projected federal spending for the Medicaid expansion and marketplace subsidies under current law, with the cut reaching $40 billion (16 percent) in 2026.  The block grant would not adjust based on changes in states’ funding needs, and it could be spent on virtually any health care purpose, with no requirement to offer low- and moderate-income people coverage or financial assistance.  And, as noted, the block grant would disappear altogether in 2027.
  • The enormous cut in 2027 reflects two factors.  First, the block grant would disappear in 2027.  The bill’s sponsors have claimed that the rules that govern the budget reconciliation process, which allows the bill to pass the Senate with only 50 votes, necessitated that the proposed block grant be temporary.  In reality, however, nothing in those rules prevents the bill from permanently funding its block grant.  Furthermore, the expiration of the temporary block grant would create a funding cliff that Congress likely couldn’t afford to fill.  Even if there were significant political support for extending the inadequate block grant in the future, budget rules would very likely require offsets for the hundreds of billions of dollars in increased federal spending needed for each additional year.[3]

The G.O.P.’s War on the Poor

Four years ago, on the 50th anniversary of Lyndon Johnson’s war on poverty, House Republicans led by Paul Ryan issued a report declaring that war a failure. Poverty, they asserted, hadn’t fallen. Therefore, they concluded, we must slash spending on the poor.

..  it calls for the widespread imposition of work requirements for Medicaid, food stamps and other programs. But that would have the effect of sharply reducing those programs’ coverage.

.. This decline in coverage wouldn’t be the result of large numbers of people earning their way out of poverty. Instead, many poor Americans would, for a variety of reasons — poor health, job instability for low-wage workers, daunting paperwork imposed on those least able to deal with it — find it impossible to meet the requirements, and be denied aid despite remaining poor.

.. whatever the evidence, Republicans always reach the same policy conclusion. Was the war on poverty a failure? Let’s stop helping the poor. Was it a success? Let’s stop helping the poor.

.. And let’s be clear: We’re talking about the whole party, not just the Trump administration. In particular, Republican governors are fanatical about cutting benefits for their lower-income residents.

.. In Maine, voters overwhelmingly approved an initiative to expand Medicaid under the Affordable Care Act. But Gov. Paul LePage has refused to implement the expansion — a vast majority of which would be paid for with federal funds — despite a court order, and has declared that he’s willing to go to jail rather than see his constituents get health care.

Dollars, Cents and Republican Sadism

G.O.P. opposition to programs helping the less fortunate, from food stamps to Medicaid, is usually framed in monetary terms. For example, Senator Orrin Hatch, challenged about Congress’s failure to take action on the Children’s Health Insurance Program, a part of Medicaid that covers nearly nine million children — and whose federal funding expired back in September — declared that “the reason CHIP’s having trouble is that we don’t have money anymore.”

.. the suffering imposed by Republican opposition to safety-net programs isn’t a bug, it’s a feature. Inflicting pain is the point.

.. The federal government would initially pay the full cost, and even in the long run it would pay 90 percent, meanwhile bringing money and jobs into state economies.

Yet 18 states — all of them with Republican-controlled legislatures, governors or both — still haven’t expanded Medicaid. Why?

.. G.O.P. politicians simply don’t want lower-income families to have access to health care and are actually willing to hurt their own states’ economies to deny them that access.

..  the Trump administration declared that it would allow them to do so. But what was driving this demand?

.. The reality is that a vast majority of adult Medicaid recipients are in families where at least one adult is working. And a vast majority of those who aren’t working have very good reasons for not being in the labor force: They’re disabled, they’re caregivers to other family members or they’re students. The population of Medicaid recipients who “ought” to be working but aren’t is very small, and the money that states could save by denying them coverage is trivial.

.. most of the money they could save by kicking people off would be federal, not state, dollars. So what’s this about?

.. The answer, surely, is that it isn’t about saving money, it’s about stigmatizing those who receive government aid, forcing them to jump through hoops to prove their neediness. Again, the pain is the point.

.. In fact, a 10-year extension of CHIP funding would save the government $6 billion.

..  Making lower-income Americans worse off has become a goal in itself for the modern G.O.P., a goal the party is actually willing to spend money and increase deficits to achieve.

What Will Trump Do to American Workers?

With Steve Bannon out of the White House, it’s clearer than ever that Donald Trump’s promise to be a populist fighting for ordinary workers was worth about as much as any other Trump promise — that is, nothing.

His agenda, such as it is, amounts to reverse Robin Hood with extra racism — the conventional Republican strategy of taking from struggling families to give to the rich, while distracting lower-income whites by attacking Those People, with the only difference being just how blatantly he plays the race card.

.. So is the Trump agenda dead? Not necessarily, because trickle-down has never been the whole story of the Republican assault on workers. Or to put it another way: Don’t just watch Congress, keep your eyes on what federal agencies are doing.

.. According to the Congressional Budget Office, back in 1980 the top 1 percent paid 33 percent of its income in federal taxes. Under Reagan, that share briefly fell below 25 percent. But as of 2013, the most recent year covered, Obama’s tax hikes had brought federal taxes on the 1 percent back up to 34 percent of income.

.. Medicaid, which in 1980 covered only 7 percent of nonelderly Americans. Today that number is up to 21 percent.

.. While the rich still pay taxes and the safety net has in some ways gotten stronger, the decades since Reagan have nonetheless been marked by vastly increased inequality, with stagnating wages for most, but soaring incomes for a tiny elite. How did that happen?

Yes, globalization probably played some role, as did technology. But other wealthy countries, just as exposed to the winds of global change, haven’t seen anything like America’s headlong rush into a new Gilded Age. To understand what happened to us, and in particular to American workers, you need to look at policy

.. truck drivers, whose pay used to make them members of the middle class. No more: Their real wages have fallen about a third since the 1970s, with most of the decline taking place during the Reagan years.

.. What happened to truckers was, basically, the collapse of their bargaining power due in part to a changed ideological climate — not least at the National Labor Relations Board — that encouraged private employers to fight unionization, and in part to deregulation that undercut the position of unionized firms.

.. Does anyone doubt that financial deregulation played an important role in surging incomes at the very top of the income distribution?

Comments:

Nothing in his history as a developer showed any inclination to a friend of working people:

  • He bought foreign steel because it was cheaper;
  • he imported foreign workers because he could pay them less and they are more vulnerable;
  • he stiffed small contractors because they couldn’t fight back.

.. I bristle when i hear the chattering class call Trump a populist. He’s not. Like the entire GOP, he is a classist, mouthing platitudes to fool the masses but acting as reverse Robin Hoods when it really counts. The entire charade of repealing ACA is a prime example

.. Populists are politicians who fight to help people who need the federal government to protect them against the rich and powerful.

.. James J: .. For those who do not know and associate with members of the working class, voting against one’s own economic self interest is a head-scratcher. But today’s working class is not your father’s working class. It certainly is not MY father’s working class.

Dad, because of The Depression and then war in Europe, never graduated high school. But he was an avid reader — our small working class home in a Midwest auto town was filled with books, newspapers and magazines of all varieties. He and our neighbors were union and they knew the issues.

Today’s working class has an appetite for information, but the source of that info is polluted. It comes from outlets owned by the same corporate billionaires who are picking workers’ pockets for 40 hours a week.

The outlets — Fox News, Breitbart… — are managed by very intelligent, very schooled and very slick pros. They play the intellectually lazy and proudly uneducated like a symphony; the best cons are the ones where the marks walk away thinking they got the best of the deal.

Today’s working class thinks it understands complex issues because its members read Tweets and listen to manipulating right-wing talk radio all day.

And once whipped into a hateful lather by millionaires con artists like Rush and Hannity and Bannon, economic self interest disappears behind a fog of anger and dogma.

Return Medicaid to Its Rightful Role

The program should provide poor Americans with quality care, not shoddy coverage.

Over the same period, enrollment in Oklahoma skyrocketed from just under 500,000 to over a million. This means one-quarter of the state’s population is on medical welfare. Medicaid covers 57% of all births in Oklahoma, according to the Oklahoma Health Care Authority. Up to 72% of all children are on Medicaid at some point in their first five years, according to the authority. Government dependency expanded during a period of significant income growth here. Per capita income in Oklahoma grew 70.9%, from $26,720 in 2003 to $45,682 in 2016

The GOP’s Fatal Infatuation

Once the governors took expanded Medicaid payments, they were hooked.

What an irony it is that one of the Republican arguments made now for preserving ObamaCare’s Medicaid expansion is the opioid crisis. Even after the Supreme Court ruled in 2012 that Medicaid’s expansion was optional, some Republican governors got hooked on the promise of federal cash flow to the horizon.

.. Medicaid has become most states’ second biggest budget outlay, behind K-12 education.

.. Medicaid “works” only if no one notices it’s robbing Peter to pay Paul. The Peters getting robbed to make Medicaid work include doctors who are supposed to serve this population.

.. Medicaid paid physicians on average 66 percent of what Medicare paid for services, down from 72 percent in 2008.

.. Medicaid is already a fiscal ruin and lowest-common-denominator medicine. Advocates say it’s better than nothing for the poor or uninsured, but well-controlled studies put even that claim in doubt.

Republican Senators Face Pushback From Governors on the Health Bill

That means Republican leaders must flip at least seven of the nine GOP senators who have already said publicly they oppose the bill, a challenge compounded by the recess.

.. In a recent Wall Street Journal/NBC News poll, 16% of respondents said the version of the bill passed by the House was a good idea.

.. Mr. Hutchinson has advocated that the health bill either maintain higher levels of funding or exempt elderly and disabled people from caps on Medicaid spending. Without the extra federal help, he said, he would be forced to end the Medicaid expansion immediately.

.. “Providing extra flexibility to the governors to design programs which are suited for their particular populations is a good thing,” Louisiana Gov. John Bel Edwards, a Democrat, told reporters last week. “But we cannot pretend that giving me all the flexibility in the world will allow me to provide meaningful coverage to the same people who have it today if you give me half as much money.”