Senate’s health care bill shreds Medicaid and essential health benefits, and more

The draft is subject to change but even so, what we see today is a Senate wishlist that could hurt America’s most vulnerable.

Senate Majority Leader Mitch McConnell, R-Ky., meets with reporters following a closed-door strategy session at the Capitol in Washington, Tuesday, June 20, 2017. CREDIT: AP Photo/J. Scott Applewhite
Senate Majority Leader Mitch McConnell, R-Ky., meets with reporters following a closed-door strategy session at the Capitol in Washington, Tuesday, June 20, 2017. CREDIT: AP Photo/J. Scott Applewhite

Any hopes that Senate Republicans would moderate their House colleagues’ health care bill were dashed on Thursday when Senate Majority Leader Mitch McConnell (R-KY) finally unveiled his chamber’s long-awaited version of the GOP health plan. Sen. McConnell’s bill looks a lot like the House’s American Health Care Act — except where its cuts to coverage, particularly Medicaid are even harsher.

Here are some key Senate market reforms in the Senate draft released Thursday:

  • Elimination of the individual and employer mandates.
  • Premium taxes based on age, income, and geography like Obamacare but, but with adjusted thresholds that disproportionately hurt older and poorer Americans:
  • Begins to cut Medicaid program expansion starting in 2021, with a three-year phase out. (This will not matter for 8 states with “trigger laws,” which terminate immediately once federal funds are affected.) And then cuts the rest of the budget’s program too.
  • Tax cuts for the wealthy by repealing Obamacare tax increases.
  • Cost sharing subsidies end in 2020, but could end earlier if the Trump Administration cuts them off.
  • States can still waive Obamacare regulations, such as essential benefits.
  • Planned Parenthood could face a one-year Medicaid funding freeze.

The Senate Republicans who largely shaped the health care bill looked to make the House-passed bill more palatable for its moderate and conservative members. The result was a bill that differs in some respects from the AHCA while being largely the same in its net effect.

The Senate bill looked to break away from the American Health Care Act (AHCA) but still does irreparable damage to:

Medicaid

A major point of contention for the Senate has been the House-passed bill’s approach to Medicaid. Under Obamacare, the federal government and states share the costs of insuring low-income people. Thirty-one states expanded Medicaid health coverage to 138 percent of the federal poverty level; 14 of those states have at least one Republican senator.

Under current law, federal money matches funds to states, and adjusts accordingly. Under the House-passed bill, each state would instead get a fixed amount of money every year, that’s adjusted to inflation rate. States would have the option to get a fixed “per capita cap” or “block grant.” The Senate bill’s “per capita cap” and “block grant” would grow more slowly than House’s, meaning great cuts under the Senate version of the law.

Essential Benefits

First question: Does the Senate bill protect people with preexisting conditions? No.

Under the House-passed bill, specifically under an amendment proposed by Rep. Tom MacArthur (R-CT), states could opt out of certain Obamacare regulations by applying to three waivers: 1.) states can set an age ratio “higher” than the 5 to 1, meaning insurers could charge older Americans more 2.) states can set their own essential benefits and 3.) states could permit insurers to engage in health status underwriting.

Senate Republicans say insurers cannot deny patients with preexisting conditions under the Senate bill, but states can still change what qualifies as an essential benefit by applying for a waiver. That means people with preexisting conditions could get an insurance plan, but not one that covers what they need. And unlike the House’s MacArthur-waivers, the Senate’s version (called 1332 waivers) allow states to define the terms of their exemption, subject to federal review. (These waivers existed under the ACA but with more qualifications.)

Next steps:

What Senate Republicans released Thursday is a wishlist, and it will likely change in order to adhere to the Senate’s budget rules. Even so, if Majority Leader Mitch McConnell and his working group — made up of 13 white men — could vote on this bill next week, they would.

The Senate is looking to pass the bill under reconciliation, a budgetary procedure that allows a bill to pass with just as simple majority. For a bill in the Senate to do this, it needs to comply with the Byrd Rule against folding “extraneous matter” into a bill passed through reconciliation.

For example, the Senate bill freezes money to family planning organizations that provide abortion. This provision may disappear if the Senate parliamentarian believes it violates the rule.

The Senate is looking to get a Congressional Budget Office score either Friday or Monday, and then vote by next Friday. President Donald Trump told a reporter the Senate health bill will be negotiated. He did not say whether he considers the bill, like its House counterpart, to be “mean.”