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U.S. Senate Abandons Graham-Cassidy-Heller-Johnson ACA Repeal and Replace Proposal

September 26, 2017

Faced with a tide of opposition from health care stakeholders, advocates, patients and consumers, the U.S. Senate abandoned an effort to vote on the Graham-Cassidy-Heller-Johnson (GCHJ) plan to repeal and replace the Affordable Care Act (ACA).

The legislation would have repealed the financing structure under the ACA that supports access to coverage; imposed a capped funding mechanism for Medicaid; and weakened important consumer protections. A preliminary estimate by the Congressional Budget Office concluded that the number of people with comprehensive health insurance that covers high-cost medical events would be reduced by millions compared with the baseline projections.

The Senate had been trying to pass the legislation prior to September 30, the deadline for action under the budget reconciliation process which would allow passage with a simple majority vote and fast-tracked legislative procedure.

Earlier today, nearly 30 of Pennsylvania’s leading health care provider organizations, including HAP, sent a joint letter to the Pennsylvania Congressional delegation outlining deep policy concerns about the GCHJ plan. 

The letter expressed concerns about four key aspects of GCHJ:

  • Market-based Health Care Block Grant—GCHJ would “eliminate funding for premium tax credits, cost-sharing reduction payments, and enhanced federal matching payments for Medicaid expansion after 2019,” instead opting for a block grant system. The group cautioned that Pennsylvania would be faced with insufficient resources to support coverage for individuals currently covered through Medicaid expansion and the health insurance marketplace.
  • Medicaid—GCHJ would “impose a per capita cap, which would limit federal funding to a set amount per beneficiary, regardless of actual costs.” Cosigners expressed concern that the policy would force Pennsylvania to make difficult choices in balancing the needs of vulnerable groups.
  • Consumer Protections—GCHJ would allow states “to eliminate coverage of ‘essential health benefits,’ remove the ACA’s cap on out-of-pocket costs for enrollees, and allow insurers to charge” higher costs for older and sicker patients—pricing many consumers out of the market. Plans also could opt out of covering needed services. The group highlighted the importance of those protections in helping millions of Pennsylvanians gain greater financial security and improved health.
  • Disruption and Uncertainty—GCHJ would repeal the individual and employer mandates, create a serious financial cliff after the block grant program’s funding expires in 2026, and place a burden on states to stand up new health care programs in just two years. These policies would undercut the stability of the insurance market, and lead to reduced coverage.

The group urged federal lawmakers to reject the policy approach and place a focus on market stabilization policies that will preserve coverage and access to affordable health care.

Earlier this week, HAP sent a letter to Pennsylvania’s Congressional delegation outlining hospital-specific concerns about the GCHJ plan.

On the national level, hospitals, physicians, and insurers spoke with a collective voice in opposition to the proposal through a joint statement that highlighted concern for patient protections, dramatic cuts to Medicaid, destabilization of the individual insurance market, and an unworkable implementation timeline.

HAP and partnering health care organizations in Pennsylvania had previously shared fall priorities with the Pennsylvania Congressional Delegation, urging lawmakers to:

  • Provide certainty for patients and providers by extending funding for the Children’s Health Insurance Program and continuing cost-sharing reduction payments
  • Support care to vulnerable patient populations through community health centers, small and rural hospitals, and safety-net providers
  • Protect the Medicaid program

Please contact Laura Stevens Kent, vice president, federal advocacy, or Jeff Bechtel, senior vice president, health economics and policy, for more information.

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