Senate Republicans set to release health care bill, but divisions remain

Washington Post

Senate Republicans on Thursday plan to release a health care bill that would curtail federal Medicaid funding, repeal taxes on the wealthy and eliminate funding for Planned Parenthood as part of an effort to fulfill a years-long promise to undo Barack Obama's signature health care law.

The bill is an attempt to strike a compromise between existing law and a bill passed by the House in May as Republicans struggle to advance their vision for the country's health care system even though they now control both Congress and the White House.

The Senate proposal largely mirrors the House measure with some significant differences, according to a discussion draft circulating Wednesday among aides and lobbyists. While the House legislation pegged federal insurance subsidies to age, the Senate bill would link them to income as the Affordable Care Act does. The Senate proposal cuts off Medicaid expansion for states more gradually than the House bill but would enact deeper long-term cuts to the health care program for low-income Americans. It also removes language restricting federally subsidized health plans from covering abortions, which may have run afoul of complex Senate budget rules.

But on the eve of the bill's release, Senate Majority Leader Mitch McConnell, R-Ky., faced the prospect of an open revolt from key conservative and moderate GOP senators, whose concerns he has struggled to balance in recent weeks. Republicans familiar with the effort said Senate leaders have more work to do to secure the 50 votes needed to pass the measure, with Vice President Mike Pence set to cast the tiebreaking vote, from the pool of 52 GOP senators. No Democrats are expected to support the bill.

Republican aides stressed that the plan is likely to undergo more changes to secure the votes needed for passage, but there were major concerns Wednesday from senators on opposite ends of the GOP spectrum.

"My main concern is I promised voters that I would repeal — vote to repeal Obamacare. And everything I hear sounds like Obamacare-lite," said Sen. Rand Paul, R-Ky.

Sen. Shelley Moore Capito, R-W.Va., whose state expanded Medicaid and has been pushing for a more gradual unwinding of that initiative than many conservatives prefer, said she is waiting to scrutinize what is released but has not seen anything yet that would make her drop her concerns with the proposal.

"Up to this point, I don't have any new news — tomorrow we will see it definitively — that would cause me to change that sentiment," she said.

Like the House bill, the Senate measure is expected to make big changes to Medicaid, the program that insures about 74 million elderly and lower-income Americans and was expanded in most states under the ACA. In effect, the revisions would reduce federal spending on the program.

The Senate measure would transform Medicaid from an open-ended entitlement to one in which federal funding would be distributed to states on a per capita basis. It would also seek to phase out the program's expansion — although at a more gradual rate than the House version.

Yet the Senate bill is expected go further than the House version in its approach to cutting Medicaid funding in the future. In 2025, the measure would tie federal spending on the program to an even slower growth index than the one used in the House bill. That move could prompt states to reduce the size of their Medicaid programs.

That provision, a nod to conservative lawmakers led by Sen. Patrick Toomey, R-Pa., risks alienating moderates, including Capito and Sen. Rob Portman, R-Ohio, who also represents a state that expanded Medicaid under the ACA. Some Republicans worry that such a move would force states to cut services or coverage, potentially leaving millions of low-income people without sufficient health care.

The growth rate that is applied to Medicaid spending going forward has major implications, said Sen. Susan Collins, R-Maine. "That inflater is critical, because it translates into billions of dollars over time," she said.

Portman and Capito have also been pushing for the inclusion of a $45 billion fund to treat and prevent opioid addiction. As of early Wednesday afternoon, the opioid money was not included in McConnell's proposal, according to a top GOP senator and Senate aide familiar with the discussions.

"I don't think there is right now," Senate Finance Committee Chairman Orrin G. Hatch, R-Utah, said when asked whether the legislation includes a distinct opioid fund. "It might have to be considered separately."

But Portman and Capito, like all senators, will have a chance to introduce amendments to the bill when it heads to the Senate floor, which McConnell said is likely to happen next week. This process will allow senators to draw attention to the causes they have championed and potentially change the final bill.

Moderates who are on the fence about whether to support the Obamacare overhaul are likely to be pleased at the bill's approach to insurance subsidies because they would be based on financial need, potentially preserving coverage for more people who got insurance under the ACA.

Subsidies are currently available to Americans earning between 100 percent and 400 percent of the federal poverty level. Starting in 2020, that threshold would be lowered to 350 percent under the Senate bill — but anyone below that line could get the subsidies if they're not eligible for Medicaid.

That provision, said Larry Levitt, senior vice president for special initiatives at the Henry J. Kaiser Family Foundation, would be "a real benefit to poor people in states that don't expand Medicaid."

In a move that is likely to please conservatives, the draft also proposes repealing all of the ACA taxes except for its so-called Cadillac tax on high-cost health plans in language similar to the House version. Senators had previously toyed with the idea of keeping some of the ACA's taxes.

It would also eliminate federal money for Planned Parenthood. Federal law already prevents taxpayer funding to pay for abortions except to save the life of the woman or in the case of rape or incest. But some Republicans want to ban all federal funding for Planned Parenthood, which also provides health services such as birth control, because their clinics provide abortion services.

Like the House measure, the Senate bill would eliminate two central requirements of the current health care law: that individuals provide proof of insurance when filing their annual tax returns and that companies with 50 or more employees provide health coverage for their workers.

In a move that is critical to insurers, the Senate measure would continue to fund for two years cost-sharing subsidies that help 7 million Americans with ACA plans. House Republicans have challenged the legality of the $7 billion in subsidies — which help cover consumers' deductibles and copays — in court, and insurers have warned that they will have to hike premiums dramatically next year unless the federal government commits to continuing the payments.

McConnell has told Republican senators that he wants to maintain protections for people with preexisting conditions under the law. But it was not clear to some lawmakers Wednesday what that would entail.

"I haven't seen the draft yet. I like the idea of preexisting conditions being more firmly clarified," Portman said.

Paul criticized GOP leaders for potentially keeping some of the ACA's "most expensive regulations," which he says are the primary drivers of higher premiums.

"It may well be that prices don't come down at all," he said.

But the Senate proposal may change rules for waivers that states can file with the Centers for Medicare and Medicaid Services that could allow them to potentially scale back some of these federal mandates.

While the details of McConnell's proposal are expected to be made public Thursday, much of focus in recent weeks has been on the process used to draft the bill.

Democrats and even some Republicans have been critical of Senate GOP leaders for crafting the proposal behind closed doors without hearings and consideration of the legislation by the relevant committees.

Several, GOP senators have expressed concern about moving quickly to a vote before they fully understand how it would impact health insurance markets and their constituents.

Sen. Ron Johnson, R-Wis., said that in addition to actually reading the bill, "I'll also want to get full input from constituencies in Wisconsin."

Given the fact that there may be just a week between the bill being posted and a final vote, he added, "I find it hard to believe we'll have enough time."

The Washington Post's Amy Goldstein and Kelsey Snell contributed to this report.

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