Revisiting Graham-Cassidy

President Trump has stated that he wants a new healthcare proposal. His budget called from major Medicaid and exchange cuts as well as the Graham-Cassidy framework of state blockgrants to cover far fewer people in the exchange and Medicaid expansion populations.

In the short run this is irrelevant. There probably are fifty one votes in the Senate for something like Graham-Cassidy to pass. The Majority Leader would be willing to schedule that vote.

There are not 218 votes in the House to pass Graham-Cassidy. Nor is there a Speaker willing to schedule a vote on Graham-Cassidy if it was likely to pass.

However, it is worthwhile to look at the logic of the plan. It is a major cut to federal spending and a major redistribution of federal spending. Right now, more federal money goes to states that aggressively implement the Affordable Care Act or have very high cost markets. That means states like California which aggressively outreach for every single possible enrollment and expanded Medicaid will get more federal ACA money than states like Mississippi or South Dakota which have not expanded Medicaid and have not aggressively pushed enrollment on the Exchanges.

Graham-Cassidy wants to give block grants to states that over time converge to a narrow band on a per-capita basis. It reduces the overall pool of money available and then shifts the remaining funds to states that have done opposed the ACA’s implementation. There were variants where money would be freed up to throw at Senators from states that had implemented the ACA and Medicaid Expansion aggressively but whose votes might be needed to pass the bill.

During the summer of 2017, I tracked the outside evaluation of federal fund flows to states in 2026 under the counter-factual of Graham-Cassidy being implemented and current law of the ACA with CSR funding as the baseline. The coastal states got hammered while the Great Plains, Mountain West and the Deep Confederacy did well.

Circumstances have changed. The three major changes are more states have expanded Medicaid since September 2017, the termination of CSR payments increased effective net subsidies for more people and the elimination of the individual mandate probably depressed enrollment. The 2017 scores will need to be updated, but I think a 2019 score of Graham-Cassidy would be similar.

10 replies
  1. 1
    CarolDuhart2 says:

    Reason 1001 why elections are important. Because Dems hold the House, all Trump can do is bluster. He’d sign something if it ever got to his desk, but unless it gets through the House, it never will. Also, that’s even healthcare to repeal is because of 2006-2008. We got a federal mandate and structure on healthcare, and millions more in state expansion of Medicaid. How many people are still alive and healthy because of that mandate?

  2. 2
    rikyrah says:

    So, basically, it’s a piece of shyt legislation.

    But, we already knew that.

  3. 3
    Patricia Kayden says:

    The GOP healthcare plan boils down to one short phrase: “Don’t get sick”.

    The end.

    P.S. Thank goodness Democrats control the House.

  4. 4
    Matt McIrvin says:

    But Republicans control the Supreme Court, so they could get it passed by throwing out the whole ACA and then offering an ultimatum: this or nothing. It could work.

  5. 5
    Keith P. says:

    Just to be clear, Mick Mulvaney’s view of covering pre-existing conditions is “pre-existing conditions will be covered so long as you maintain insurance throughout.” That rarely comes out on TV, and even rarer for anyone to mention that that’s how pre-existing conditions were already covered *before* ACA.

  6. 6
    Chyron HR says:

    @Matt McIrvin:

    The house can pass a better (actually good) bill and tell the GOP that it’s that or nothing.

  7. 7
    zhena gogolia says:

    Mr. Brocklehurst: What must you do to avoid going to hell?

    Jane Eyre: I must keep well and not die.

  8. 8
    Mary G says:

    @Keith P.: And the insurer can charge a sky high premium for crap coverage too.

    Fortunately I think this proposal is just like the one Twitler pulled out of his ass right before the midterms that there would be another 10% tax cut for the middle class, and McConnell and Ryan were like, not gonna happen.

  9. 9
    scuffletuffle says:

    @zhena gogolia: Kudos!

  10. 10
    Brachiator says:

    Trump’s new strategy seems to be “let’s kill the ACA now, and promise Trump Brand Utopian Replacement Health Care after the 2020 election.”

    President Donald Trump said in a string of Monday night tweets that Republicans won’t be voting on a new health care plan until after the 2020 elections.

    “The Republicans are developing a really great HealthCare Plan with far lower premiums (cost) & deductibles than ObamaCare,” Trump tweeted. “In other words it will be far less expensive & much more usable than ObamaCare. Vote will be taken right after the Election when Republicans hold the Senate & win back the House.”

    Trump is betting that voters are stupid enough to fall for this trick.

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