Planning for Life

Senate to Poor, Disabled and Elderly: You're On Your Own

Posted by Harry S. Margolis on June 23, 2017

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By Harry S. Margolis

The repeal Obamacare millipede has dropped its next foot with the Senate Republican "draft" bill released on Thursday, June 22nd, the so-called Better Care Reconciliation Act. In many millipede7.jpgways it's more draconian than the House's American Health Care Act (AHCA), especially with regard to Medicaid funding. Yet, it maintains much of the structure of the Affordable Care Act (Obamacare), which has caused four Republican Senators -- Ted Cruz, Rand Paul, Ron Johnson, and Mike Lee -- to say they will not support it. A fifth, Dean Heller, has also come out against the bill due to its planned cuts in Medicaid, leaving its passage in its current form in doubt.

Here are a few of its features:

  • Its subsidies for low-income Americans hoping to buy in to the insurance pools are somewhat more generous than the House version that based subsidies more on age than income.
  • It delays the end of Medicaid expansion to 2021, postponing some of the effects of repeal.
  • Likewise, it also postpones implementation of per capita block grants -- limiting the growth in federal participation in state Medicaid programs to a certain amount per beneficiary.
  • But when they do kick in, the cap on growth will be tied to general inflation rather than medical inflation, which has been much lower historically. This could cause even greater cuts to Medicaid than AHCA with no provision for funding an aging population, cost increases due to recessions or new diseases such as Zika or the opioid crisis, or the costs of new cures. This change could have a severe detrimental effect on care for seniors. (Read more on this topic here.)
  • Unlike AHCA, the Senate proposal does not permit the states to eliminate preexisting condition protections.
  • On the other hand, it does permit them to change the requirements for health insurance policies, hopefully bringing down the cost, but meaning policies may not cover vital services such as mental health care.
  • As does AHCA, the Senate bill repeals taxes that were enacted to help fund ACA, including the tax on high-cost health insurance plans. The tax cuts would save wealthier taxpayers almost $600 billion over ten years.
  • Under the Senate bill, Medicaid would not be required to cover mental health services after 2019.

Senate Majority Leader Mitch McConnell hopes this bill will pass before the July 4th holiday. It's a "draft", so it could change and change again. Without the support of the four conservative senators, it can't pass. If it's changed to satisfy them, it may lose the support of some more moderate senators. Of course, as we saw on the House side, the repeal millipede has many feet. If this bill fails, another may well succeed down the road.

Click here to read NPR's comparison of the two Republican bills and the Affordable Care Act.

Topics: Affordable Care Act, Medicaid

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