Health Care For All Letter to Senate Finance Committee in Opposition to Graham-Cassidy ACA Repeal Proposal
The Graham-Casidy proposal to repeal the Affordable Care Act seems to have stalled, with Republican senators expressing public opposition, but the defeat of repeal isn't guaranteed.
Public pressure needs to be maintained to keep these senators accountable and to pressure other senators to join in opposing the Graham-Cassidy plan.
As part of an ongoing effort to prevent the passage of this damaging bill, on Monday, September 25, Health Care For All submitted comments to the Senate Committee on Finance detailing why this bill would be harmful for health care consumers in Massachusetts and throughout the country. The bill would undermine protections for people with pre-existing conditions, lead to millions of people becoming uninsured, and greatly reduce federal funding for health care. The proposal would be particularly damaging for states such as Massachusetts that have expanded Medicaid, as these states would see large cuts to federal funding, placing massive financial strain on state budgets.
The Oral Health Advocacy Task Force which HCFA leads also submitted a letter focusing on the alarming oral health aspects of the Graham-Cassidy bill. That letter is available here.
Read our full letter below
Dear Chairman Hatch and Ranking Member Wyden:
On behalf of Health Care For All (HCFA), thank you for the opportunity to submit comments on the Graham-Cassidy-Heller-Johnson health care proposal. HCFA is a Massachusetts nonprofit advocacy organization working to create a health care system that provides comprehensive, affordable, accessible, and culturally competent care to everyone, especially the most vulnerable among us. We achieve this as leaders in public policy, advocacy, education and service to consumers in Massachusetts.
We write to voice our extreme opposition to the Graham-Cassidy-Heller-Johnson proposal. We are very discouraged that instead of continuing down a bipartisan path and working on issues to improve the strength and stability of the Affordable Care Act’s (ACA) marketplaces, the sponsors of this legislation have put forward a proposal that will:
- Eliminate the financial assistance that helps low- and moderate-income families purchase health care coverage;
- End expanded Medicaid coverage that helps millions of low-income adults;
- Gut Medicaid through deep, permanent cuts that would grow over time and threaten care for millions of low-income seniors, children, and people living with disabilities and shift massive costs and risks to states;
- Jeopardize access to life-saving and effective treatments for addiction and weaken states’ efforts to address the current crisis of drug overdose deaths
- Undermine essential protections for people with pre-existing conditions; and
- Resurrect - and worsen - the devastating cuts in coverage and benefits that the American public and the majority of Congress have already rejected.
The Graham-Cassidy-Heller-Johnson proposal threatens the health and financial security of millions of Americans including older adults, low-and moderate-income families, people living with disabilities, children, seniors, veterans and people with pre-existing conditions. It does nothing to improve affordability or availability of coverage for consumers and will likely result in approximately 665,000 Massachusetts residents losing coverage by 2027.1 This proposal will undermine the financial stability of our health care system and place additional fiscal strains on our state budget. We have come so far in Massachusetts, extending health coverage to 97.5% of our residents.2 To build support for the proposal, some have specifically singled out Massachusetts due to our state allegedly receiving a disproportionate amount of federal health care funds.3 Yet federal funds provided to Massachusetts mostly reflect the success we have had in our outreach and enrollment efforts, which have resulted in the lowest uninsurance rate nationally.
The Graham-Cassidy-Heller-Johnson proposal disproportionately impacts Massachusetts and other states that have expanded Medicaid. The bill would unravel this success in Massachusetts and devastate the lives of people in our state and across the country. Below we lay out in more detail our concerns with this proposal and the devastating impact it will have on consumers.
Eliminates programs that serve as a lifeline for low- and moderate-income families.
This proposal takes away health coverage from millions of Americans, and replaces it only with the possibility of inadequate and temporary coverage. It ends the ACA’s successful Medicaid expansion, which has extended coverage to nearly 12 million newly eligible low-income adults (about 300,000 people in Massachusetts alone). It also eliminates the ACA tax credits that 10 million low- and moderate-income people nationwide – and over 200,000 Massachusetts residents4 – rely on to afford coverage in the individual market. Although it replaces this funding with a block grant to states, the proposal offers no guarantee that states will provide an alternative affordable coverage option to former enrollees – and indeed the block grant is inadequate to pay for comparable benefits. From 2020 through 2026, block grant funding would be at least 7% ($95 billion) below projected spending under current law, including an $8 billion loss in federal funding to Massachusetts.5 Regardless, the block grant ends in 2027, leaving states and former enrollees with no help whatsoever. We do not believe it is likely that Congress would reauthorize additional funds for these programs at a later date, because the funds would no longer be in the baseline of the federal budget. Congress would therefore have to identify and reauthorize a new funding stream – something that would be extremely difficult, if not impossible.
Threatens care for low-income seniors, children, consumers with substance use disorders and people living with disabilities.
This proposal also threatens the care of millions of low-income seniors, children and people living with disabilities who relied on the Medicaid program even before enactment of the ACA.
By capping and slashing funding for the traditional Medicaid program by 12% ($1,079 billion) between 2020 and 2036, the per capita cap would force Massachusetts to cut payments to health care providers and health plans, eliminate optional services, and restrict eligibility – all of which could restrict access to important health care services for Medicaid enrollees.
No eligibility category would be immune to the impacts of these cuts. Since children make up almost one-half of the Medicaid beneficiaries nationally (about 36% in Massachusetts)6, they cannot possibly be protected if cuts of this magnitude are enacted. Cuts to Medicaid would also leave consumers with substance use disorders without access to the most effective treatments for addiction and to life-saving overdose medicine. Seniors and people living with disabilities would also face painful cuts, since Medicaid is the primary payer for long-term services and supports. Community Based Services – the services that keep people with cognitive and physical impairments home and in their communities – are “optional” in Medicaid. The fiscal pressure created by per capita caps will likely lead states to cut back on these services, forcing seniors and people living with disabilities out of their homes and into institutions for their care. The burden will likely hit communities of color, where Medicaid enrollment is high, especially hard.
Pushes massive new costs onto states.
All states, including Massachusetts, would take on new risks and costs because this proposal converts the overall Medicaid program into a per capita cap. Under this proposal, the federal government would cap its payments to states for most enrollees, and those caps would grow more slowly than actual Medicaid expenditures, leaving Massachusetts with insufficient funding to meet its current obligations. In addition, states would be fully exposed to any unexpected health care cost increases, such as from a natural disaster, an aging population or medical innovations. The per capita cap alone would reduce federal Medicaid spending by 12% ($1,079 billion) by 2036.
On top of those cost shifts, the 31 states that expanded Medicaid under the ACA – including Massachusetts – will be at risk for far deeper cuts. This proposal ends all federal matching funds for the Medicaid expansion in 2020. Some of the funds that the federal government would have spent on Medicaid expansion get rolled into the block grant, but the block grant does not make up for Massachusetts’ losses. The block grant is inadequate overall, the formula favors non-expansion states (it redistributes funding from expansion to non-expansion states), and it ends entirely in 2026, leaving states with no funding to replace the lost expansion funds.
Because federal dollars for Medicaid account for about 20% of state budgets (about 24% net of federal funding in Massachusetts)7, FitchRatings “believes substantial Medicaid cuts would require states to make material budget adjustments over the next decade and beyond.”8 And by pulling coverage from so many, this proposal would drive up uncompensated care costs on local communities, state budgets, safety net providers, and hospitals, and further putting budget pressures on other important areas of state budgets, including education, social services, transportation and infrastructure.
Increases premiums and out-of-pocket costs and destabilizes the individual market.
By repealing the individual mandate and eliminating advanced premium tax credits and cost sharing reductions, this proposal would drive up premiums and cause insurers to exit the ACA’s marketplaces. As we know from previous CBO projections, repealing the individual mandate alone would increase the number of uninsured individuals by 15 million and cause premiums to increase by 20 percent. Furthermore, by replacing the financing of the ACA’s financial assistance with a block grant without any guarantee that states would direct their temporary block grant funds toward financial assistance, this proposal puts Massachusetts residents who currently rely on financial assistance at risk for sharply higher out-of-pocket costs and coverage loss.
Beyond the impact of this proposal on individuals, insurers currently offering plans through the Health Connector would face extreme uncertainty. Because this proposal allows states to change the market reform rules under the ACA and because there are no requirements or standards on how states must use the block granted money, insurers may face unpredictable risk pools. To make up for this uncertainty, insurers would likely impose large premium increases to protect themselves from unpredictable claims costs or choose to exit the marketplace completely. This means that consumers who purchase coverage on the individual market would likely have fewer coverage options, much higher premiums and no guarantee of financial assistance to shield them from the increasing out-of-pocket costs.
Eliminates critical consumer protections.
This proposal allows states to eliminate one of the most popular and important consumer protections under the ACA – the prohibition on charging higher premiums based on a person's health status or a pre-existing condition. This means that in states that choose to eliminate this requirement, insurers could charge individuals with even relatively mild pre-existing conditions thousands of dollars above standard rates to obtain the same coverage as someone without a preexisting condition. Additionally, this proposal allows states to waive the requirement that insurers cover essential health benefits including mental health services, substance abuse treatments and maternity care. This could lead to discrimination against segments of the population (e.g., older adults, LGBT community) or consumers with specific chronic conditions (e.g. mental health or substance use disorders). For example, this could return us to a time when insurers only covered short-term, minimal treatment for mental health or substance use disorders, if they covered it at all. Before the ACA, almost half of plans in the individual market excluded addiction treatment.
Lacks transparency and opportunity for meaningful input.
We believe that everyone should have a say in the decisions that affect their health. With only one hearing scheduled days before a possible vote, and without a full CBO score to properly evaluate the budgetary and coverage loss impacts, it is impossible to have an open and deliberative process that would allow for a true evaluation of and meaningful input on the policies in this proposal that would affect millions of people and one sixth of the US economy. We encourage a return to “regular order,” as requested by many members of the Senate and supported by the American public, which would require the opportunity for stakeholders, including industry experts, providers, consumers and state policymakers to weigh in.
Thank you for the opportunity to submit comments in strong opposition to the Graham-Cassidy-Heller-Johnson health care proposal. This legislation would have extremely detrimental impacts on millions of Americans and hundreds of thousands of Massachusetts residents. We urge the Senate to reject this legislation.
CC: Senator Elizabeth Warren