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September 22, 2017

Graham-Cassidy would give states 2 years to make huge changes. That's 'not enough time,' experts say.

Daily Briefing

The Senate GOP's latest Affordable Care Act repeal bill (HR 1628), among other things, would require states to significantly overhaul their health care systems, but experts say if the bill were to become law, states could struggle to meet a tight transition timeline.

The bill, proposed by GOP Sens. Lindsey Graham (S.C.) and Bill Cassidy (La.), would beginning in 2020 eliminate the law's Medicaid expansion for low-income individuals, as well as the federal subsidies to help middle-income U.S. residents purchase coverage on the exchanges. In their place, the bill would allocate federal funding to states through a block grant system and ask states to use those funds broadly to facilitate health care access.

Challenges states might face under Graham-Cassidy

But, according to the New York Times' "The Upshot," states could find it difficult or impossible to implement such major reforms to their health care systems—including making political choices, filing applications, hiring contractors, and constructing the new health systems—in just two years.

For instance, "The Upshot" reports, many states took more than two years to answer "comparatively simple questions" under the ACA, such as whether to run their own exchange or expand their Medicaid programs.

Jon Kingsdale, the former executive director of the Massachusetts Health Connector, said two years is "not enough time for most states to figure it out."

Even if states were to decide to implement a system comparable to the ACA, with an insurance market that provides income-based subsidies, they still would need to develop appropriate technology to verify eligibility and link insurance purchases with state assistance. According to "The Upshot," that won't be easy: Under the ACA, the Obama administration had about four years to develop the ACA's enrollment system—which had problems when it was launched.

Other states might undertake more expansive reforms, such as implementing a single-payer public health plan. Those states would face major political choices in deciding what parameters to set for the program, according to "The Upshot."

Further, Axios' "Vitals" reports, states might have to pass legislation to:

  • Amend insurance laws;
  • Create agencies to administer the new federal block grant funds; and
  • Implement new programs or tax credits.

Nicholas Bagley, a University of Michigan health law professor, said, "Graham-Cassidy doesn't require states to pass a law in order to ask for a waiver." But, he added, "As practical matter, a state that wants to create the infrastructure to allow it to parcel out and spend the block grants will probably have to secure legislation allowing it to do so."

Mike Leavitt, former HHS secretary under George W. Bush who currently runs a consulting firm that builds state exchanges, said, "There are different levels of complexity involved in states, and there's different levels of capacity, and there's different levels of experience."

If states were unable to decide on their preferred approach to health care within the law's two-year timeframe, they could face significant consequences, "The Upshot" reports. For instance, states unable to create a plan and file an application would not be eligible for new grant funding.

Overall, several experts said they felt confident states would find a way to secure the block grant funds, according to "The Upshot," But they were less sure whether states would actually use those funds in a way that provides health insurance coverage to individuals currently covered under the ACA (Sanger-Katz, "The Upshot," New York Times, 9/21; Baker, "Vitals," Axios, 9/21).

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