Study: Most states would take a hit from new GOP health bill
WASHINGTON — Most states would take a stiff budgetary hit if the latest Senate GOP health care bill becomes law, according to an analysis released Wednesday. That would likely result in more uninsured Americans.
The study by the consulting firm Avalere Health found that the Graham-Cassidy bill would lead to an overall $215 billion cut to states in federal funding for health insurance, through 2026. Reductions would grow over time.
“A reduction in federal subsidies for health insurance is likely to result in more people being uninsured,” said Caroline Pearson, a senior vice president at Avalere, which specializes in health industry research. The study itself did not make estimates of the impact on insurance coverage.
States that voted for President Donald Trump would not be immune from cuts, though deep-blue California and New York face the deepest reductions. West Virginia, a Trump bastion, would see a $1 billion cut from 2020-2026.
The Avalere analysis comes as Senate leaders are rushing a vote on the legislation by the end of the month, before the expiration of special budget rules that allow passage by a simple majority. The findings could take on added importance, because the nonpartisan Congressional Budget Office says it can’t complete a full analysis of the bill by the Sep. 30 vote deadline.
Named for Republican Sens. Lindsey Graham of South Carolina and Bill Cassidy of Louisiana, the bill would repeal much of the Obama-era Affordable Care Act and limit future federal funding for Medicaid. That federal-state health insurance program covers more than 70 million low-income people, ranging from newborns to elderly nursing home residents. Compared to current projected levels, Medicaid spending would be reduced by more than $1 trillion, or 12 percent, from 2020-2036, the study found.
The bill would also end Obama’s health insurance subsidies and put money into a big pot that would distributed among the states. Governors and legislatures would have broad leeway on how to spend the money, and could also seek waivers from ACA insurance requirements. Though insurers would still have to cover people with medical problems, in some states they may be able to charge them more.
The Avalere study also found that over 20 years cuts could potentially total more than $4 trillion, but that scenario appears unlikely. It’s based on a literal reading of the bill, under which legal authority for the big pot of money to subsidize coverage would expire after 2026. Typically, Congress renews expiring programs.
Still, the study found more losers than winners. Thirty-four states would see cuts by 2026, while 16 would see increases. Among the losers are several states that were key for President Donald Trump, including Florida, Pennsylvania, Michigan, and Ohio.
Arizona and Alaska would be losers, a detail that could be important. Sens. John McCain, R-Ariz., and Lisa Murkowski, R-Alaska, are seen as undecided on the legislation, and Republican leaders cannot afford many defections.
New Jersey Republican Gov. Chris Christie said Wednesday he is opposed to the Graham-Cassidy bill because of cuts to his state, estimated by Avalere at $10 billion from 2020-2026.
Texas would be the biggest winner, with a $35-billion funding increase by 2026. Georgia, Alabama, Tennessee and Virginia would also see funding gains, as would Wisconsin and Wyoming.
Within states, the analysis found that there could be winners and losers among people at different income levels. Because the GOP bill focuses on providing money to cover poor people and the near-poor, states may decide to reduce support for middle-class people who now receive subsidies under Obama’s law.
Funding for the Avalere report was provided by the Center for American Progress, a liberal think tank. Avalere said it maintained full control over the research and the think tank did not influence the findings.
GOP leaders and the White House are pushing for a vote next week.
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