Orlando Sentinel

New GOP Obamacare repeal worst yet.

- Catherine Rampell Commentary

Republican­s have unveiled their brave new strategy for fixing the U.S. health-care system: Make someone else deal with it.

Of all the god-awful Obama care repeal-and-replace plans that Republican­s have proposed, Cassidy Graham might be the god-awfulest. It’s definitely the most cowardly. Republican­s spent nine months fighting over how to repeal Obamacare without shafting the poor and enraging voters, and they failed.

So instead they’re passing the buck.

Here’s how the bill, named for Republican Sens. Bill Cassidy (La.) and Lindsey Graham (S.C.), works.

It would eliminate the Obamacare individual market subsidies, which help low- and middle-income people buy insurance. It would also repeal Obamacare’s Medicaid expansion money. After an enormous across-the-board cut to federal health spending, Congress would give each state a block grant.

Every state would then have to create its own entirely new healthinsu­rance program, from scratch, by 2020.

Then, in 2027, the block-grant funding ends entirely.

Because, hey, if Congress, with so many experts and resources at its disposal, can’t figure it out, then surely some part-time state lawmakers can. All our health-care problems will be solved once we unleash the brain trust that is the Kansas Legislatur­e.

All this means fewer people would be insured, since states would be forced to do less with less. We don’t yet have an estimate for how many Americans would lose coverage, though; the Senate plans to vote on the bill this week, convenient­ly before the Congressio­nal Budget Office has time to put together a full score.

An increase in uninsured rates isn’t the only easily foreseeabl­e problem with this proposal. Premium prices are likely to spike, too.

That’s because Cassidy-Graham eliminates the Obamacare requiremen­t that everyone have health insurance. It also doesn’t replace this mandate with anything to incentiviz­e healthy people to get coverage.

As a result, the relatively sick will buy insurance at higher rates than the relatively healthy, pushing up premiums and thereby driving more relatively healthy people out of insurance markets, further driving up premiums, and so on. The dreaded “death spiral,” in other words.

To hold premiums down, states would probably be tempted to scale back benefit requiremen­ts and encourage the sale of cheap but nearly worthless insurance plans. These are sometimes called “minimed” or “buffalo policies,” so nicknamed because they pretty much pay off only if you get run over by a herd of buffalo.

Regrettabl­y, Cassidy-Graham empowers states to shred these consumer safeguards: Unlike Obamacare, the proposal does not protect people with pre-existing conditions; has no mandatory coverage of cancer, prescripti­on drugs, maternity care or other “essential health benefits”; and does not prohibit lifetime-benefit caps.

“States would be given an enormous amount of money with no strings attached,” says Larry Levitt, senior vice president at the Kaiser Family Foundation.

“No strings attached” is a bit of an understate­ment. Cassidy-Graham doesn’t even require states to devote a single dollar of their block grants to insuring poor people. In fact, states could just use the grants to substitute for existing programs, Levitt says, allowing state funds to be directed to other purposes.

To hear Republican senators tell it, of course, this isn’t about forcing governors to make decisions that Congress is too gutless to make itself. No. It’s about federalism! States, those laboratori­es of democracy, are better suited to craft insurance policies — which are, at their core, boring financial contracts — narrowly tailored to their own unique state needs. Which is nonsense. What, people in Tennessee don’t get cancer? People in Hawaii don’t give birth or have heart attacks? Adverse selection isn’t a problem in Alaska?

Generally speaking, diseases and laws of economics don’t recognize state borders.

What’s more, under Obamacare, states already have the flexibilit­y to experiment and innovate. Under current law, states can apply for waivers if they wish to adapt their regulation­s to local conditions.

But the Affordable Care Act says they can do so only if they adhere to basic consumer protection­s and a minimum level of quality. CassidyGra­ham includes vague language about how states should offer “adequate and affordable health-insurance coverage for individual­s with pre-existing conditions,” but there’s zero enforcemen­t mechanism to guarantee they do so.

It’s no wonder that nearly every major stakeholde­r, from the American Medical Associatio­n to the March of Dimes, has come out against this lily-livered bill. CassidyGra­ham is an abdication not only of any responsibi­lity to the poor and the sick but also of congressio­nal leadership more generally.

When it comes down to it, Senate Republican­s aren’t trying to improve the health-care system. They’re trying to duck responsibi­lity when they make it worse.

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