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Cassidy-Graham is the Latest Attempt to Take Away Healthcare Coverage from Thousands of West Virginians

The latest attempt to repeal the Affordable Care Act, the Cassidy-Graham bill, would cut West Virginia’s funding for Medicaid by $2.0 billion by 2027. This would undermine health coverage for tens of thousands of West Virginian’s and threaten the state’s historic gains in health coverage stemming from the Affordable Care Act.

The Cassidy-Graham bill cuts health coverage in two main ways.

Block Grants are no replacement for ACA provisions.

The biggest cuts in the Cassidy-Graham bill come from converting the ACA’s Medicaid expansion and marketplace subsidies with smaller, temporary block grants. According to the bill’s sponsors, this block grant would give states “flexibility,” allowing them to maintain the coverage available under the ACA, if they wanted to do so while enabling other states to experiment with alternative approaches. In reality, however, states would not be able to maintain their coverage gains made under the ACA, because the block grant funding would be an insufficient amount to maintain coverage levels equivalent to the ACA. The block grant would provide $239 billion less between 2020 and 2026 than projected federal spending for the Medicaid expansion and marketplace subsidies under current law.

In 2026, this funding would completely go away, leaving states with 100 percent of the cost for the people covered under these programs. This cut would almost certainly leave states no choice but to discontinue these kinds of coverage. The result is that, beginning in 2027, Cassidy-Graham would be virtually identical to a repeal-without-replace bill — except for its additional Medicaid cuts through the per capita cap, described below. The non-partisan Congressional Budget Office (CBO) estimated that the repeal-without-replace approach would ultimately leave 32 million more people uninsured. The Cassidy-Graham bill would presumably result in even deeper coverage losses than that in the second decade.

A permanent and ongoing cut to traditional Medicaid

Like prior House and Senate Republican repeal bills, the Graham-Cassidy bill would radically restructure and cut the rest of Medicaid, outside of the ACA’s Medicaid expansion. It would end the federal-state financial partnership under which the federal government pays a fixed percentage of a state’s Medicaid costs. It would instead impose a per capita cap, under which federal Medicaid funding would be capped at a set amount per beneficiary, irrespective of states’ actual costs, and would grow each year more slowly than the projected growth in state Medicaid costs per beneficiary.

The result would be deep cuts to federal Medicaid spending for seniors, people with disabilities, families with children, and other adults (apart from those affected by the bill’s elimination of the Medicaid expansion). Notably, these per capita cap cuts would come on top of the cuts to Medicaid expansion funding and marketplace subsidies under the block grant discussed above.

Starting in 2025, the annual adjustment of per capita caps is reduced to an even lower level, creating even deeper cuts to Medicaid. In 2027, after the block grants disappear and Medicaid per capita caps are further reduced,  combined would result in a $2.042 billion federal funding cut for West Virginia.

Cassidy-Graham's Large Cuts to Federal Health Care Funding Grow Even Larger Starting in 2027

Disruptions to the individual markets

In addition to hurting healthcare coverage through major Medicaid cuts, Cassidy-Graham would also disrupt the individual market. The Cassidy-Graham bill would immediately eliminate the individual mandate requiring everyone to have some kind insurance coverage or else pay a fine, which the Congressional Budget Office estimated would result in 15 million more uninsured in the following year.

The bill’s elimination of the ACA marketplace subsidies and start of a block grant in 2020 would cause massive additional disruption. States would lack guidance, standards, or administrative infrastructure for creating their own coverage programs, and insurers would have no idea how the individual market would operate, including what their risk pools would look like. Insurers would most almost certainly impose large premium rate increases to account for uncertainty; some would likely exit the market altogether.

Then in 2027, when the block grant disappeared entirely, insurers would face a market without an individual mandate or any funding for subsidies to purchase coverage in the individual market. Yet they would still be subject to the ACA’s prohibition against denying coverage to people with pre-existing conditions or charging people higher premiums based on their health status. Many insurers would likely respond by withdrawing from the market, leaving a large share of the population living in states with no insurers, as CBO has warned about previous repeal-without-replace bills.

 

Senate Health Bill (BCRA) Would Hit West Virginia Hardest

While it is unclear what version of the legislation the U.S. Senate will plan to take up on Tuesday (7/25) when they vote to proceed to repeal and replace the Affordable Care Act (ACA), the revised version of the Better Care Reconciliation Act (BCRA) would be particularly harmful to West Virginians.

An updated report from the national Center on Budget and Policy Priorities shows that West Virginia would be among the hardest hit states in the nation. Not only would the number of uninsured West Virginians grow by nearly 300 percent – the largest increase in the nation (See Map) – but it would reduce federal Medicaid/CHIP spending by half or $1.8 billion by 2022. Last-ditch efforts by Senate leadership to offer more money to Medicaid expansion states won’t fix this bill either. Below is a quick summary of BCRA’s impact on West Virginia and here’s a one-page fact sheet.

West Virginia Would Sustain Huge Coverage Losses

  • 211,000 West Virginians would lose coverage by 2022 if BCRA is passed.
  • The BCRA would increase West Virginia’s non-elderly uninsured rate from five percent to over 19 percent, a 299 percent increase, more than any other state.
  • 1 out-of-seven non-elderly West Virginians who would have coverage under the ACA would lose it because of the BCRA.

West Virginia’s Medicaid and CHIP Programs Would Be Cut in Half

  • The BCRA would cut West Virginia’s CHIP program by 47 percent by 2022 (compared to 26 percent nationally)
  • The number of people enrolled in Medicaid would fall by more than half by 2022, or 263,000 people.

 BCRA Would Drastically Increase West Virginia’s Costs to Maintain Medicaid Expansion

  • The state’s cost to maintain expansion would rise by 50 percent by 2021, 100 percent by 2022, and 150 percent by 2023.

 BCRA Would Make Access to Substance Use Disorder Treatment Less Available

  • West Virginia has the highest drug overdose death rate in 2015.
  • The share of West Virginians with substance use or mental health disorders who were hospitalized but uninsured fell from 23 percent in 2013 to five percent in 2014.
  • Rolling back expansion would roll back coverage for the 33 percent of West Virginia expansion enrollees who used mental health or substance use disorder services in 2014.

 

Senate Health Care Bill Cuts Medicaid to Pay for Tax Cuts for the Rich – UPDATED

The Better Care Reconciliation Act (BCRA), the latest Republican plan to repeal and replace the Affordable Care Act (ACA), was introduced in the U.S. Senate on June 22, 2017, and is awaiting a vote. In its current form, the bill would eliminate most of the provisions of the ACA, including its tax provisions, and drastically cut Medicaid, essentially ending Medicaid expansion and instituting per capita caps. The end result of these changes for West Virginia would be a large tax cut for a small number of the wealthiest individuals in the state, while tens of thousands would lose Medicaid coverage.

The two largest tax provisions that would be repealed are the  Additional Medicare Tax, which is a 3.8 percent tax on wages for taxpayers with wages exceeding $200,000 ($250,000 for married earners), and the Net Investment Tax, which is a 3.8 percent tax on investment income for taxpayers with income exceeding $200,000 ($250,000 for married couples). Repealing these two taxes would cost over $31 billion, with 85 percent of the benefit going to the top 1 percent of Americans.

According to the Institute on Taxation and Economic Policy, only 11,100 West Virginians would benefit from the repeal of these two taxes, or only 1.2 percent of taxpayers in the state. The tax cut would be worth $46 million for West Virginia, with 96 percent of the savings going to the wealthiest 1 percent in the state, or those earning more than $346,000/year.

On the health care coverage side, federal funding for Medicaid would be $102.2 billion lower in 2022 under the BCRA than under the ACA, a 26.4 percent decline. Federal funding for premium tax credits and cost-sharing reductions would also fall by $38.2 billion, an 84 percent decrease. West Virginia would lose $1.8 billion in federal spending, a 48.9 percent decrease compared to current law.

The decrease in funding would force West Virginia to end Medicaid expansion, and make further restrictions to Medicaid eligibility. According to the Urban Institute, 264,000 West Virginians would lose their Medicaid coverage due to the loss of federal funding. Overall, 218,000 West Virginians would lose health insurance coverage, quadrupling the state’s uninsured rate.

 

The cost to give 11,100 of the wealthiest West Virginians millions in tax cuts is 218,000 uninsured West Virginians. The “savings” from the cuts to Medicaid are poured directly into tax cuts which overwhelmingly benefit the wealthy. Overall, for every West Virginian who would benefit from the tax cuts in the Senate health care bill, 24 would lose their Medicaid coverage. The core of the BCRA is taking away health care from millions of people in order to pay for a tax cut for the rich.

 

***UPDATE***

New numbers from the Urban Institute provide estimates for the number of children affected by the Senate’s health care bill. In West Virginia, the number of uninsured children would increase by 19,000 by 2022 under the Senate health care bill, a 475% increase. The uninsured rate for children in West Virginia would increase from 1.1% to 6.2%. West Virginia would have the largest increase in the share of its children who are uninsured in the country.

How Many Jobs Could the AHCA Cost West Virginia?

A recent report from the Economic Policy Institute looks at how many jobs could be lost in each state under the Republican health bill – the American Health Care Act. The AHCA – which would repeal the Affordable Care Act (ACA) – is like a zombie – it just does not seem to quite die.

Yet every attempt to bring it forward for a vote in the House has failed as many moderate Republicans remain nervous about the impact the legislation will have back home. And for good reason. Nonetheless, an effort by leadership and President Trump to regroup and hold a vote in the house over the next month in underway.

The Republican repeal will strip away the Medicaid expansion in West Virginia, reduce and cap federal Medicaid funding, and roll back the marketplace premium and cost-sharing subsidies for private insurance. Not only would many more West Virginians go back to being uninsured, the Republican repeal bill will strike a devastating blow to West Virginia’s struggling economy.

What would the Republican repeal bill mean for health insurance coverage in West Virginia?

– More than 800,000 West Virginians would be at risk of losing their health insurance coverage or face exorbitant premiums for a plan that does not cover pre-existing conditions.

– West Virginia would face a $4 billion cut in federal funding for the Medicaid program over 10 years (2019 to 2028), effectively shifting those costs to the state.

Federal cuts of this magnitude will force West Virginia to cut children, seniors, people who need long-term care, people with disabilities, and struggling low-income workers from the Medicaid program, as well as cut critical health services, and cut payments to hospitals, doctors, and other providers.

What would the bill mean for jobs in West Virginia? Nearly 23,000 jobs would be at risk in West Virginia by 2022. West Virginia would be in the top five states with the largest reduction in job growth as a share of the total employed population – a 1.45 percent average annual job less.

– 7,436 jobs in District 1 (Representative McKinley)
– 6,778 jobs in District 2 (Representative Mooney)
– 8, 701 jobs in District 3 (Representative Jenkins)

The Affordable Care Act resulted in billions of federal dollars flowing into West Virginia. With the ACA Medicaid expansion in 2014, the new federal dollars constitute the single most important economic stimulus package for this state in recent memory, creating jobs, boosting our economy, and supporting our rural hospitals and health-care providers. The health-care sector is one of the few sectors in West Virginia that has seen job growth in the last five years.

These health and economic security gains of West Virginia families would be at risk if Washington revives an ACA repeal effort. No state has more to lose than West Virginia if this zombie bill arises again.

 

Report: West Virginia to Lose Jobs, Funding Under ACA Repeal

Previous data shows that a repeal of the Affordable Care Act will more than double the number of uninsured people in West Virginia. Read.

A new report by the Economic Policy Institute looks at a repeal’s impact on employment. It estimates how the combination of tax cuts and spending cuts will affect employment across the nation.


The report’s main findings show:

– ACA repeal would cut federal spending nationwide by about $109 billion in 2019 and taxes by about $70 billion in 2019.

– The combination of tax cuts and spending cuts in an ACA repeal would reduce national job growth by almost 1.2 million in 2019, all else equal. That is because the spending cuts would hurt job growth more than the tax cuts would help it. The benefit cuts would come mostly out of the pockets of cash-constrained households that will be likely to significantly cut back their spending in response to lower disposable income, while the tax cuts would disproportionately go to high-income households who tend to save a significant portion of increases in disposable income.

– The jobs that would be lost are not just health-care jobs.

– The top 15 job-losing states, as measured by jobs lost as a share of both the total employment and the share of residents under age 65, are Arizona, Colorado, Kentucky, Louisiana, Maryland, Montana, Nevada, New Jersey, New Mexico, North Carolina, Oregon, Rhode Island, Vermont, Washington, and West Virginia.

– West Virginia would lose $1.2 billion in federal health-care dollars.

– Total employment in West Virginia would drop by 2 percent and 15,412 jobs in West Virginia would be lost.

– ACA repeal would eliminate 20 out of every 1,000 jobs in West Virginia.

Congress should act responsibly and move forward with legislation that makes positive improvements to the Affordable Care. Any vote to repeal all or part of the current law should move simultaneously with a legislation that clearly defines what comes next for the West Virginia economy, for the West Virginia state budget, and for insurance coverage in our state. This legislative package should be vetted through the normal legislative process that allows for committee hearings and public input, and requires the normal 60 vote approval in the Senate.

 

Who Are the West Virginians Who Would Lose Coverage Under ACA Repeal?

A recent WVCBP report looked at many of the people who could lose health coverage from the repeal of the Affordable Care Act – including small business workers and those working in various industries. Last week, the Urban Institute released state fact sheets with more demographic information on this population – with details on income, age, race, education, and employment status.

Of the estimated 184,000 West Virginians who would lose coverage from repealing the ACA, 84 percent have incomes below 200 percent of the federal poverty level – which is considered the amount of income a typical family needs to make ends meet. Approximately 44 percent of those that could lose coverage are below the federal poverty line, which was $24,300 in 2016. If the ACA is repealed, the share of those below the federal poverty line without health insurance would grow fourfold, from 7 percent to 28 percent, according to the Urban Institute.

blog post aca repeal working families

Repealing the ACA would especially impact those in West Virginia without a college degree. Of the 171,000 adults who would lose coverage, 90 percent do not have a college degree. Approximately 91 percent are white, while 5 percent are black and 2 percent are Hispanic.

Among West Virginians who are expected to lose coverage, 73 percent are in working families. This figure is even higher for some families: 79 percent of children and 80 percent of parents who would lose coverage are in families with at least one worker.

 

Proposed ACA Replacement Approach Leaves Important Questions Unanswered

U.S. Senators Shelley Moore Capito (R-W.Va.), Bill Cassidy, MD (R-La.), Susan Collins (R-Maine), and Johnny Isakson (R-Ga.) unveiled the outline of the Patient Freedom Act of 2017, a one-page document describing a proposed legislative approach that could follow the repeal of the Affordable Care Act. However, the proposal raises serious questions and leaves important questions unanswered.

Based on what is known, the proposal shifts major decisions about how to respond to a repeal of the Affordable Care Act. At the same time, states will have less federal dollars to help subsidize the cost of health insurance and preserve gains made under the ACA. This West Virginia Center on Budget and Policy report takes a deep dive into what West Virginia will lose with an ACA repeal.

States have two options with federal assistance and a third option with no federal assistance under the proposal:

States Can Keep Some ACA Provisions But With Significantly Less Federal Dollars 
– The total subsidy dollars West Virginians receive through the ACA Marketplace would be cut. Ninety-five percent of the federal premium tax credit and cost-sharing subsidy dollars would be avaiable. It is unclear if those federal dollars would keep pace with inflation or if purchasing power will shrink dramatically over time. It is also unclear if federal dollars will increase if more people become eligible to receive subsidy dollars.
– The fate of federal dollars that support Medicaid expansion is also unclear. The proposal fails to outline if the current Medicaid federal matching dollars partnership would continue or if only a limited amount of federal money would be available.

States Use Federal Dollars To Create Health Savings Accounts
– States can take the reduced federal support and deposit a limited amount of money into eligible individuals’ Roth Health Savings Accounts to purchase a high-deductible health insurance plan. The states will administer this.
– Eligibility guidelines for qualifying for health savings accounts as well as the amount of money per person is murky.
– While the option for states to continue Medicaid expansion appears intact, it is unknown if the current financial partnership will continue or if the federal dollars will be limited or keep up with inflation.
– States have the option to discontinue the Medicaid expansion and put an allotment of dollars into health savings accounts. Lower-income West Virginians could put that money toward high-deductible plan premiums.

It is unknown if consumer protections, such as prohibiting insurance companies from charging higher premiums to any person with pre-existing conditions, based on gender or age, or other factors used as a basis to charge higher premiums pre-ACA, will remain under the above options.

Additionally, the proposal appears to eliminate requirements that insurance companies spend a specific portion of the plan premiums on health-care benefits rather than administrative costs and profits. 

Finally, the individual mandate requiring everyone to purchase health insurance will be repealed. This will drive up insurance premiums for those who do buy insurance as those without insurance prolong seeking treatment and going the insurance pool. An Urban Institute report describes the impact of an individual mandate repeal on the private insurance market and the ACA Marketplace. Urban estimated the individual market would be near collapse, with a 92 percent reduction in enrollees coupled with a dramatic increase in premiums, undoing the progress made in making this market accessible and affordable.

ACA Repeal Increases Federal Budget Deficit

We know that repealing the Affordable Care Act will increase the number of uninsured Americans by tens of millions. We also know it will significantly raise premiums for people who purchase health insurance in the individual market (people without employer-based health insurance and who are not eligible for Medicaid or Medicare). Read.

Members of Congress who care about the size of the federal budget deficit should take note that repealing the ACA also could significantly increase the federal budget deficit.

In June, 2015 the Congressional Budget Office of the U.S. Congress analyzed the budgetary effects of repealing the ACA and estimated that it would increase federal budget deficit by $137 billion over the 2016–2025 period.

ACA deficit

ACA Repeal Restores Tax Breaks for the Wealthy
Among other reasons for the impact on the deficit, the prior ACA repeal bill vetoed by President Obama immediately provided a tax cut to individuals with incomes over $200,000 and couples with incomes over $250,000 a year.

Low- and moderate-income people pay Medicare taxes on all of their income. However, before the ACA, higher income people did not pay taxes on all of their income. The ACA ended this inequity in Medicare taxes.

An ACA repeal would restore this Medicare tax break for the wealthy:
– Millionaire household would receive a tax cut on average of $49,370 a year
– For multimillionaire tax filers – with incomes above $3.8 million a year – the average tax cut would be $195,000

ACA tax cuts

Without this and other revenue in the ACA, any replacement plan can only leave more people without insurance and others with higher premiums and copayments.

 

Further Analysis Confirms Potential Harm Of ACA Repeal

Yet another analysis confirms the potential harm of repealing the Affordable Care Act. The Congressional Budget Office and the Joint Committee on Taxation examined the impact of the repeal bill passed by Congress in 2015 and 2016 (H.R.3762).

Tens of Millions Would Lose Health Care Quickly
– 18 million more people would be uninsured in the first year after repeal
– 27 million people would be uninsured after repeal of the ACA marketplace premium subsidies and the Medicaid expansion
– 32 million people would be uninsured by 2026

ACA blog
Premiums in the Individual Health Insurance Market Would Increase Dramatically
– 20 to 25 percent increase in premiums in the first year after repeal
– 50 percent increase after repeal of the ACA marketplace premium subsidies and the Medicaid expansion
– Premiums would about “double by 2026”

ACA Repeal Will Cause Chaos in the Nation’s Individual Health Insurance Markets
– For people without employer-based coverage or public health insurance, it could mean no insurance options are available to them 
 About half of the nation’s population lives in areas that would have no insurers offering coverage in the individual market in the first year after repeal

– By 2026, three-quarters of the population would have no insurers

The West Virginia Center on Budget and Policy will release an Issue Brief that outlines the potential risks of an ACA repeal to West Virginians next week. 

 

 

 

 

 

184,000 West Virginians Could Lose Coverage with Partial Repeal of Affordable Care Act

With the new Trump Administration’s promise to repeal and replace the Affordable Care Act (ACA or Obamacare), Congress is now considering partial repeal through the budget reconciliation process, to avoid a filibuster. The repeal maybe phased in over time, but no replacement plan has been defined. The budget reconciliation process only allows changes to components of the law with federal budget implications, which would allow for the elimination of the Medicaid expansion, the federal financial assistance for Marketplace coverage (premium tax credits and cost-sharing reductions), and the individual and employer mandates. It is unclear if the January vote to repeal without replace will pass. Some Republican Senators (such as Lamar Alexander R-TN and Susan Collins R-ME) have publicly expressed concern about voting to repeal in the blind without any replacement plan identified.

The Urban Institute has done an analysis of healthcare coverage and spending if the ACA is partially repealed through the reconciliation process, similar to the one passed last summer and vetoed by President Obama.

The Urban Institute projects that 184,000 West Virginians would lose healthcare coverage in 2019 under a ACA repeal, a 208% increase in the number of uninsured. This includes low-wage working West VIrginans would lose Medicaid coverage due to the elimination of Medicaid expansion, those for whom coverage becomes unaffordable due to the loss of premium tax credits, and healthy individuals who can afford coverage but are no longer required to purchase it. Without insurance, many West Virginians will put off seeking care until their condition is serious or even life threatening, and more expensive to treat. The ACA repeal could cause a growing number of medical bill bankruptcies that leave West Virginia families destitute.

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While the number of uninsured West Virginians would dramatically increase with the ACA repeal, a much smaller share of the uninsured would be eligible for financial assistance.  Under a partial repeal through reconciliation,  only 13 percent of the 272,000 uninsured West Virginians would be eligible for any financial assistance (all under Medicaid or CHIP), because of  the elimination of both the Marketplace tax credits and the Medicaid eligibility expansion. In contrast, under the ACA, 71 percent of the remaining 88,000 uninsured would be eligible for either Medicaid/CHIP or tax credits through the
ACA’s Marketplaces in 2019.

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West Virginia would also stand to lose billions in federal funding with the repeal of the ACA. Under the ACA the federal government is projected to spend $35 billion from 2019-2028 funding West Virginia’s Medicaid/CHIP program, and $2 billion on premium tax credits for West Virginians. The a partial repeal of the ACA, federal funding for Medicaid would fall to $23 billion over that time frame, and the premium credits would be eliminated, a loss of $14 billion in federal funding. This loss of federal funding would threaten the state’s healthcare infrastructure and likely destroy jobs across the state.

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In addition, as the number of uninsured increases, the amount of uncompensated care – the cost of health care for the uninsured and underinsured –  would increase. Uncompensated care is paid for in a variety, some of it is financed by the federal government, some by state and local governments, some by the healthcare providers, and some of it is passed on to insured patients through higher costs. While the ACA reduced uncompensated care through coverage expansion, its repeal would dramatically increase the costs of uncompensated care for the healthcare system. Under current law, uncompensated care is projected to cost the healthcare system $656 billion over the next 10 years, with the federal government spending $262 billion, state and local governments spending $164 billion, and providers spending $230 billion. With a repeal of the ACA, uncompensated care costs would increase by $1.1 trillion over the next 10 years. However, federal programs must be increased to cover the additional costs above the current levels, which previous ACA repeal bills have not done. If no federal action is taken, state and local governments and providers would have to $1.1 trillion uncompensated care increase themselves.

The ACA, while not perfect, has become a foundation of health security for thousands of West Virginia families. Its repeal will have a significant impact on the state, as will any replacement plan, when it is defined. But as of now, tens of thousands of West Virginians stand to lose their healthcare coverage, while the state and the healthcare industry must prepare to lose billions in federal funding.