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Health care industry groups line up against Graham-Cassidy bill

From left, Sen. Dean Heller, R-Nev., Sen. Bill Cassidy, R-La., Sen. Ron Johnson, R-Wis., and Sen. Lindsey Graham, R-S.C., hold a press conference on Capitol Hill in Washington, Wednesday, Sept. 13, 2017, to unveil legislation to reform health care. (AP Photo/Andrew Harnik)

Republicans are rejecting criticism from numerous health care industry groups over the legislation to repeal and replace the Affordable Care Act they plan to vote on next week, but some policy experts say those organizations raise valid concerns.

The proposal put forward by Sens. Lindsey Graham, R-S.C., Bill Cassidy, R-La., Dean Heller, R-Nev., and Ron Johnson, R-Wis., would replace much of the federal funding provided under the ACA, also referred to as Obamacare, with block grants that states would have more flexibility in spending.

As the Senate barrels toward a legislative deadline to pass an Obamacare repeal by a simple majority next week, many questions remain about the Graham-Cassidy bill and it is not clear answers will be forthcoming before the vote.

In the last week, more than three dozen groups representing patients, health care providers, or insurance companies have issued public statements or released letters to Senate leadership opposing the Graham-Cassidy bill.

According to the American Medical Association, the bill violates the principle of “first do no harm.”

“Similar to proposals that were considered in the Senate in July, we believe the Graham-Cassidy Amendment would result in millions of Americans losing their health insurance coverage, destabilize health insurance markets, and decrease access to affordable coverage and care,” wrote AMA President James Madara in a letter to Senate leaders.

Sixteen patient and provider groups, including the American Heart Association and the March of Dimes, signed a statement saying much of the bill just repackages flawed provisions from the last failed Senate health care reform bill.

“This bill would limit funding for the Medicaid program, roll back important essential health benefit protections, and potentially open the door to annual and lifetime caps on coverage, endangering access to critical care for millions of Americans,” the organizations state.

Most of the organizations fighting Graham-Cassidy readily acknowledge that the ACA is far from perfect. Some identify numerous areas where they would like to see improvements, but they all argue this legislation is not the best path forward.

“While we cannot support this proposal, we will keep working to find the right solutions that reflect the commitment we all share: affordable coverage and high-quality care for every American,” American’s Health Insurance Plans President and CEO Marilyn Tavenner wrote in a letter to senators that outlined six legislative proposals insurers would like Congress to enact instead.

These suggestions include stabilizing the individual market, guaranteeing access to coverage for all Americans, and ensuring that reforms “rely on the strengths of the private market, not build a bridge to single payer systems.”

Even some conservative groups adamantly opposed to Obamacare have proven hesitant to embrace what could be Republicans’ final attempt to repeal it.

“AAPS cannot exactly support Graham-Cassidy because it does not repeal ACA. We do not, however, oppose it, and we do support certain concepts,” said Jane Orient of the Association of American Physicians and Surgeons, pointing to the block grants, reductions in Medicaid funds, and rollback of the ACA’s mandates.

The Citizens’ Council for Health Freedom also sounds unenthusiastic.

“Let your members of Congress and the U.S. Senate know that you know it’s NOT A REPEAL…and that you know the redistribution of your wages and premium dollars will continue under the ACA if it passes,” says a post on its website listing a dozen criticisms of the measure.

Opposition is not unanimous. Some health care policy experts agree with Senate Republicans that, with a deadline looming, this bill is better than none.

The Heritage Foundation argues Graham-Cassidy falls short of a full repeal and recommends some market-driven changes to it before the Senate votes, but its experts applaud the proposed reform of Medicaid, saying it would “put federal financing of Medicaid on a sustainable path.”

“Members of Congress should not be under any illusion that passing Graham–Cassidy relieves them of the burden of continuing to reform the health care system in a more patient-centered, market-based direction,” wrote Edmund Haislmaier and Robert Rector in a report published Wednesday.

Haislmaier, a senior research fellow in health policy studies, dismissed the complaints from various advocacy groups in an interview Thursday.

“I think these are special interests, trying to protect their revenue streams,” he said.

According to Haislmaier, organizations that could benefit financially promoted the ACA based on inaccurate claims, and he suggested they are using similar tactics now.

“Who was it that lobbied states in every state legislature to expand Medicaid? It was the hospital association,” he said.

An aide to Sen. Graham alleged that some organizations speaking out against the bill are motivated by political concerns.

“A number of groups who have spoken out played leading roles in creating Obamacare,” said spokesman Kevin Bishop. “It’s not surprising they would oppose Graham-Cassidy. Even President Obama -- with his criticism just yesterday -- sees Graham-Cassidy as a threat to his legacy.”

Bishop also defended the sweeping changes to the health care system that groups have criticized.

“Obamacare centralized power and control of health care in Washington,” he said. “Graham-Cassidy moves money and power out of Washington and returns it to states and patients.”

Those opposing the bill bristled at the suggestion their position is anything less than genuine.

“As you see in our letter, our position and principles are driven by the goals we share with policymakers: More choices, lower premiums, help for those who need it, and lower costs for hardworking taxpayers,” said Kristine Grow, senior vice president for communications at America’s Health Insurance Plans.

“As Congress has considered repealing and replacing the law, we have used a very specific set of criteria to analyze every proposal that has been introduced,” said Eric Gascho, vice president for policy and government affairs at the National Health Council. “Through our careful analysis of the Graham-Cassidy amendment, we have found that it does not meet the needs of people with chronic conditions. The proposal will allow insurers in some states to charge higher rates for people with pre-existing conditions and will likely result in millions of people losing coverage.”

Sen. Cassidy offered his own explanation on CNN Wednesday.

“All I can say is, everyone fears change. Everyone says, ‘Even if it's from worse to better, I don't want change,’” he said.

Sandy Ahn, an associate research professor at the Center on Health Insurance Reforms at Georgetown University sees a relatively obvious reason for the opposition: Graham-Cassidy is “a really bad bill, a bad bill for consumers, for states overall.”

“I think the current proposal would definitely harm patients and consumers and I think all those groups are right to be concerned and voice opposition to the bill,” she said.

According to Larry Jacobs, director of the Center for the Study of Politics and Governance at the University of Minnesota, widespread unified resistance to health care reform by stakeholder organizations used to be common, going all the way back to the 1950s, but divisions formed in the 1990s and became wider during the fight over the ACA. It is noteworthy that they now seem to be coalescing around opposition to this bill after some stayed silent during previous repeal debates.

“It really speaks to the fact that reality on the ground has changed and that the stakeholders have adapted to that new reality…,” Jacobs said. “These groups have all kind of moved on. Now the Republicans are saying, ‘Ah, let’s go back.’”

In the face of this opposition, Cassidy, Graham, and Vice President Mike Pence have embarked on a media blitz promoting the bill and insisting complaints are either misinformed or disingenuous. Critics have so far been unmoved by their arguments.

Graham-Cassidy does enshrine protection for those with pre-existing conditions, but it allows states to seek waivers of federal requirements if they explain how they intend to provide “adequate and affordable” coverage. Those terms are undefined and the bill could open the door to substantial premium hikes for the least healthy patients.

“That’s misleading language, because once you tell the states you can waiver out of this, it doesn’t really have any import,” Jacobs said.

While Haislmaier acknowledged the bill as written provides broad latitude for waivers, he said states would likely have no desire to waive popular patient protections and none have indicated they intend to do so.

“There’s nobody out there who is looking for a way to throw sick people off of coverage,” he said.

According to Ahn, the ACA’s federal standards were necessary in the first place because states were not providing sufficient protection or were dumping patients with pre-existing conditions in high-risk pools with unaffordable coverage. If states suddenly have Medicaid budget shortfalls because of this law, there may be pressure to revert to such policies.

“If you really want to gamble on that, that states won’t do that, that’s just not a great policy approach,” she said.

Cassidy claimed Wednesday that the bill would actually increase coverage, a position that inspired skepticism among many policy experts. Senators are not expected to have a reliable non-partisan analysis of the law’s effect on the number of people with insurance coverage before they vote next week, if such a predictive analysis is possible at all.

Estimating the impact on coverage is tricky because the crux of Graham and Cassidy’s approach is state flexibility. This is one reason why the Congressional Budget Office says it will take weeks to produce a full analysis.

“The analysts in the CBO are really overwhelmed by the complexity of doing essentially 50 state models,” Jacobs said.

No matter how unbiased the analysts are, Haislmaier said the outcome of any study of this bill will be debatable.

“You have to make certain assumptions about what is done with the money and what is done with the waivers,” he said.

According to Ahn, the uncertainty about the bill’s consequences is exactly why Congress typically holds hearings and brings in experts to discuss the implications of legislation before voting. One hearing will be held on Graham-Cassidy next week in a committee that has no jurisdiction over health care policy.

“There hasn’t been a lot of transparency,” Ahn said. “They’re obviously not talking to a broad range of experts.”

The bill’s authors do not dispute that some states would receive significantly fewer dollars than they would under the current law. They maintain it is unfair that states that accepted the Medicaid expansion under the ACA receive more funding than those that refused it.

“I’m not sympathetic to the states on that,” Haislmaier said. “Some states just got a gift.”

Critics say the states receiving less funding could just accept the Medicaid expansion if they want more federal dollars, but Haislmaier argued the current program is fundamentally unaffordable and inequitable because the federal government pays for a larger percentage of coverage for those who qualify under the expansion than under traditional Medicaid. He pointed to one case where a Connecticut graduate student who already had insurance signed up for Medicaid because they technically had no income.

“The question is why should the federal government give those states more money…to cover Starbucks baristas and grad students…than we give you to cover poor people and the elderly?” he asked.

The Kaiser Family Foundation estimates federal funding for coverage expansions and Medicaid would be $160 billion less than under current law during the period between 2020 and 2026. The average Medicaid expansion state would see an 11 percent reduction in federal funds, while the average non-expansion state would get a 12 percent increase.

Graham-Cassidy only provides block grant funds through 2026, after which there would be an even bigger drop in federal funding in 2027 unless the program is reauthorized. Cassidy insists it would be, but there is no guarantee.

Although many health care industry and patient groups are encouraging bipartisan solutions to stabilize insurance markets and rein in premium costs, Republican leadership’s embrace of Graham-Cassidy appears to have torpedoed a real attempt at such legislation, led by Sens. Patty Murray, D-Wash., and Lamar Alexander, R-Tenn.

With insurers and regulators preparing to finalize premiums for 2018 in the weeks ahead, time is running out to take legislative action to forestall substantial rate hikes spurred by uncertainty.

“I would hope that we would step back and do what’s right for the American people, which is to work in a bipartisan way, find common sense solutions to make sure everyone in this country, no matter who you are, no matter where you live, you have access to quality, affordable healthcare,” Sen. Gary Peters, D-Mich., said Wednesday. “I believe that can only be done in a bipartisan way.”

Aside from the handful who remain undecided, though, Republicans are pressing ahead in support of the Graham-Cassidy bill despite complaints from the stakeholders affected by it.

“For Alabama, it would mean about three times more money than it’s getting now,” Sen. Richard Shelby, R-Ala., said. “I believe this is federalism at its best. I think if we can get the votes to do it, we should do it.”

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