Analysis: Cassidy-Graham health care proposal certain to cut coverage

Comparison with earlier study shows at least 15 million lose insurance

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WASHINGTON — It’s safe to say the new proposal to undo the Affordable Care Act, if it becomes law, would lead to fewer Americans having health insurance.

Some argue more than 22 million people could left without. Others say it would be fewer.

Why is 22 million an important figure? It’s how many more people would lack coverage under the Better Care Reconciliation Act — the health care bill the Senate tried but failed to pass in July. That estimate haunted Republicans as they tried to defend an already unpopular piece of legislation.

Republicans in the Senate won’t have to combat such an unpopular number if they vote on the Cassidy-Graham bill next week, as Majority Leader Mitch McConnell, R-Ky., has announced he intends.

That’s because the Congressional Budget Office — the official scorekeeper for the legislative branch — says it will release only a partial analysis by then. It will take several more weeks to estimate the bill’s costs and how many more people may be uninsured than under Obamacare.

On one hand, voting without this key information means Republicans will endure more criticism that they’re ignoring the measure’s impact on a sizable segment of the population and economy. On the other, it means they’re not up against another scary number from the scorekeepers yet.

And yet the question remains: How would the bill repealing and replacing parts of the Affordable Care Act, advanced by Sens. Bill Cassidy, R-La., and Lindsey Graham, R-S.C., affect coverage? We have a few clues.

A big reason for the coverage reductions under the failed Senate bill was because it would have trashed the requirement to buy coverage or pay a fine — the individual mandate. The Congressional Budget Office previously estimated that would mean about 15 million fewer people buying plans right away.

Like the failed bill, Cassidy-Graham also gets rid of the individual mandate. So it appears the measure would result in at least 15 million fewer insured Americans, if scorekeepers use the same methods.

But how would cuts to Medicaid and marketplace subsidies further affect coverage rates?

Cassidy-Graham enacts cuts to traditional Medicaid that are comparable with those envisioned under the failed bill, reducing nationwide spending on the program by about 8 percent by 2026. But up until 2027, when there’s a big funding cliff if the law were to expire, Cassidy-Graham appears to maintain more of the funding for rate subsidies and Medicaid expansions allowed under Obamacare than the earlier bill.

Under that bill, the federal government would have spent $389 billion less on subsidies between 2020 and 2026, according to the nonpartisan scorekeepers. But under Cassidy-Graham, it would spend $243 billion less during the same period on both subsidies and Medicaid expansion combined, according to a projection by the left-leaning Center on Budget and Policy Priorities. Avalere Health set the figure at $215 billion in an analysis Wednesday.

So some conservatives argue Cassidy-Graham could result in more people receiving coverage than would have under the failed Senate bill — depending on how states implement it.

“States could take the fact they’ve regained control of the insurance rules in their markets and have a lot of money from the federal government and could end up with something that covers a lot more people,” former Congressional Budget Office Director Doug Holtz-Eakin said. “I can make the case they could beat that number.”

Assumptions about how states will behave are key. Under Cassidy-Graham, the federal dollars used for subsidies and Medicaid expansion would go to the states in a lump sum they could use in a huge variety of ways. That makes calculating the coverage effects of the Cassidy-Graham bill decidedly difficult, experts say.

For the scorekeepers to come up with a ballpark figure for how many people would have health coverage under the GOP measure, the agency must make a lot of assumptions.

To top it off, 36 states — including Iowa — are holding governor races next year, making it incredibly difficult to predict how they’d all act.

These reasons are why health policy firn Avalere hasn’t yet released an estimate of how many people would have coverage under Cassidy-Graham, said the group’s founder, Dan Mendelson. It’s a little easier to make assumptions about how states like California or New York, which are more actively involved in providing care to residents, would act than to guess the behavior of less-involved states like, say, Mississippi or Kansas.

“It is very dependent on state decision-making,” Mendelson said.

Under the bill, states would have only two years — until 2020 — to make and then enact those decisions.

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