GOP Moves to Limit Medicaid Spending in Obamacare Repeal Measure

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By Alex Ruoff

House Republicans plan to cap the federal contribution to state Medicaid programs based on their enrollment size, according to a leaked draft text of the House’s bill to repeal the Affordable Care Act.

The draft, dated Feb. 10 and obtained by Bloomberg BNA from a member’s office, would end the health law’s Medicaid expansion funding by 2020 and cap payments to states based on how many people are enrolled in their public insurance program for the poor. The leaked draft shows Republicans also plan to end the law’s individual mandate but create new penalties for people who lack health insurance coverage.

However, two Republican staffers cautioned Bloomberg BNA Feb. 24 that lawmakers were still debating many of the details of the repeal plan. While conservatives are likely to end Medicaid expansion funds, estimated at $277 billion between 2020 and 2026, there is still uncertainty about how the federal government will change other contributions to state programs.

House Republicans are expected to unveil legislation to repeal parts of the ACA after lawmakers return to Washington Feb. 27. House Speaker Paul Ryan (R-Wis.) vowed to pass a repeal of the health care law by the end of March, and conservatives remain committed to that timeline. The legislation, once released, is likely to move quickly through the House but could face a difficult road through the Senate.

Cutting Medicaid funding is likely to prove unpopular among lawmakers and governors from states that have expanded their health insurance programs for the poor. Sen. Lisa Murkowski (R-Alaska) told the Alaska Legislature Feb. 22 that she wouldn’t support any ACA repeal that cut Medicaid funding.

Congressional Republicans are still debating how much money the federal government should offer states in grants to help the very sick and the poor as well as how to change requirements for Medicaid programs to give states the opportunity to test new insurance models.

The draft repeal bill would offer $100 billion over 10 years in grants to states to help them give insurance coverage to particularly expensive or poor people. States would be allowed to set up high-risk insurance pools for people with health conditions that require costly medical services or assist people with high copayments and premiums.

Democrats and progressive groups warned that the draft legislation’s changes would raise the cost of insurance for many Americans, particularly young people.

“The Republican bill raises families’ costs, weakens coverage, and pushes millions of Americans off of health coverage of any kind,” Democratic Leader Rep. Nancy Pelosi (D-Calif.) said in a statement.

Under the leaked draft, Americans would get tax credits based on their age rather than income to help them purchase health insurance.

The draft replaces the ACA’s subsidies with an age-adjusted tax credit that would total $2,000 for individuals under 30 and $4,000 for those over 60. The credit would kick in in 2020, according to the draft, which was first reported by Politico.

To contact the reporter on this story: Alex Ruoff in Washington at aruoff@bna.com

To contact the editor responsible for this story: Kendra Casey Plank at kcasey@bna.com

For More Information

The draft text of the bill is at http://src.bna.com/mt8.

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

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