The Graham-Cassidy amendment represented a radical overhaul of how health care coverage is financed and delivered, raising anew the question of federalism – what should the federal government guarantee and how much state variation should be supported?
The legislation tossed most critical health care coverage and policy decisions to states without giving them sufficient time or resources to carefully and thoughtfully take up the challenge. States were required, for example, to submit a plan to the federal government by March 2019 that would answer the very questions Congress has been unable to:
- What is the best way to make health care coverage affordable, and at what cost and through what channels?
- How can government operate the Medicaid program more efficiently and still serve those most in need?
States have long been laboratories of innovation, testing new approaches and financing, but this wholesale consignment through block grants of new responsibility on such a short timeline, stretches the idea of state flexibility to the breaking point. State implementation of these programs requires data and analytics that states may not have. Coupled with significant cuts in resources, Graham-Cassidy complicated state revenue by capping provider taxes and ultimately funding each state’s Medicaid program equally without regard for variation in programs and health care costs.
Proponents of the amendment argued that the United States spends twice what other developed nations do on health care, but with poorer health outcomes. We spend more to get less so, they explained, so states should apparently be able to off-set funding reductions through new-found efficiencies and the added flexibility that the amendment afforded them. But the cuts would take effect in 2020, and it is highly unlikely that states could innovate their way to that degree of savings.
More important, the amendment addressed only Medicaid and insurance in the individual health care market; today most health coverage is funded by employers. Bottom line, Graham-Cassidy expected states to address total health care costs when they have little capacity to do so. It leaves the biggest payers – employer-based coverage and Medicare — untouched and, if enacted, the amendment would have subjected them to inevitable cost shifts, given the reductions in federal funding to states. The underlying costs of our health care system defines the cost of health care premiums and they need to be thoughtfully and comprehensively addressed. This amendment did not do that and it eradicated funding for public health and prevention – the cornerstones of preventing costly diseases and their accompanying high price tag.
As these various repeal and replace efforts progress in Washington, states continue to be on the health care frontline, confronting worried consumers and the providers who serve them. The issues in Graham-Cassidy were staggering, as this summary reveals. As state-based exchanges ramp up for open enrollment in November, the challenges of Graham-Cassidy were simply too great to overcome in too short a period of time.
The rush to enact Graham-Cassidy and similar legislation reveals deep ideological divide. How much should market forces prevail? How much should government intervene? This debate is an important and longstanding one and needs truly bipartisan engagement. To be sure, the Affordable Care Act was enacted along party lines, albeit after a long, public process. If Graham-Cassidy was enacted, it too would be along partisan lines. Will the debate continue, moving from one ideology to the next dependent on which party is in power? Or, might Congress embrace the bipartisan effort begun by Sens. Lamar Alexander and Patty Murray? Their initial work to find a short-term solution to address the stability of the individual market has promise and could be a critical foundation for a broader discussion that is deliberative, evidence-based, and reflective of the enormous impact that this policy change will have on families across the country and those who care for them.