Does the Senate Health Bill Have More Heart?

From the start, Sen­ate Re­pub­lic­ans have made one thing clear: Their Obama­care-re­peal bill would be dif­fer­ent from the House meas­ure. At the same time, Pres­id­ent Trump has de­clared he wants le­gis­la­tion with “heart” that’s less “mean” than the House ver­sion.

So does the newly un­veiled Sen­ate bill achieve either goal? It de­pends on which part of the bill you look at.

The Sen­ate le­gis­la­tion still aims to nar­row the Af­ford­able Care Act’s tax cred­its (even if they are more gen­er­ous than in the House bill), provide sub­stan­tial tax cuts for the wealthy, and even­tu­ally end the Medi­caid ex­pan­sion while pro­pos­ing even deep­er cuts on the over­all pro­gram than the House le­gis­la­tion.

“Like the House bill, the Sen­ate bill is primar­ily an in­stru­ment to cut taxes massively for wealthy in­di­vidu­als and cor­por­a­tions while im­pos­ing massive Medi­caid cuts,” said Timothy Jost, a pro­fess­or at Wash­ing­ton and Lee Uni­versity School of Law. Al­though Jost said the private-in­sur­ance sec­tions were strik­ingly dif­fer­ent, he would not de­scribe them as “less mean.”

“I sus­pect that few­er people will lose cov­er­age but that their cov­er­age will im­pose such high cost-shar­ing as to be use­less for many,” he said.

In a state­ment, Sen. Lamar Al­ex­an­der praised the bill and touted pro­tec­tions for preex­ist­ing con­di­tions. “To be­gin with, the draft Sen­ate health care bill makes no change in the law pro­tect­ing people with pre-ex­ist­ing con­di­tions, no change in Medi­care be­ne­fits, and in­creases Medi­caid fund­ing—that’s Ten­nCare—at the rate of in­fla­tion,” the Ten­ness­ee Re­pub­lic­an said.

As for wheth­er Trump thinks the new Sen­ate bill is “mean,” White House spokes­wo­man Sarah Hucka­bee Sanders didn’t give a clear an­swer when asked by re­port­ers Thursday.

“I haven’t had that con­ver­sa­tion, but I do know that he made a state­ment earli­er that said this is a ne­go­ti­ation, and so he’s go­ing to con­tin­ue that pro­cess with both House and Sen­ate mem­bers and his ad­min­is­tra­tion un­til we get the best bill that we can, and that will be the one that he signs,” Sanders said.

Here are some of the key ele­ments of Sen­ate lead­er­ship’s re­peal and re­place of Obama­care:

Medi­caid

On one of the biggest stick­ing points for sen­at­ors—Medi­caid—the draft bill ap­pears to be try­ing to ap­pease some mod­er­ates while giv­ing a win to the con­ser­vat­ives.

The pro­pos­al would provide a three-year glide path when phas­ing out the Medi­caid ex­pan­sion start­ing after 2020. By 2024, levels of fund­ing would be re­stored to pre-ACA levels. Sen. Rob Port­man had wanted a phase-out, al­though he has been press­ing for a sev­en-year pro­cess.

At the same time, the Sen­ate bill pro­poses even deep­er cuts to the Medi­caid pro­gram than were in­cluded in the House le­gis­la­tion. The growth rate for the per-cap­ita cap on spend­ing start­ing in 2025 would be set at the gen­er­al in­fla­tion rate, which is something that Sen. Pat Toomey had been ad­voc­at­ing. This is a slower growth rate than what was in­cluded in the House bill.

But Sen. Susan Collins im­me­di­ately said this pro­vi­sion was a con­cern for her. “That trans­lates in­to lit­er­ally bil­lions of dol­lars, and it would res­ult in states cut­ting back eli­gib­il­ity or rur­al hos­pit­als go­ing un­der be­cause of un­com­pensated care, and those are ser­i­ous prob­lems,” she said.

The Amer­ic­an Academy of Pe­di­at­rics also called out this part of the Sen­ate bill. “The bill in­cludes mis­lead­ing ‘pro­tec­tions’ for chil­dren by pro­pos­ing to ex­empt them from cer­tain Medi­caid cuts,” the group said in a state­ment. “A ‘carve-out’ for chil­dren with ‘med­ic­ally com­plex’ health is­sues does little to pro­tect their cov­er­age when the base pro­gram provid­ing the cov­er­age is stripped of its fund­ing.”

Tax cred­its

After at­tend­ing a caucus brief­ing on the lan­guage, Sen. Bill Cas­sidy told re­port­ers he does think the le­gis­la­tion is less “mean,” point­ing to changes in the tax cred­its. Un­like in the House bill, which pro­posed a flat tax based on age, the Sen­ate pro­poses to have tax cred­its based on age, in­come, and geo­graphy, mak­ing them more gen­er­ous.

However, they will still be nar­row­er than the Af­ford­able Care Act’s tax cred­its. Un­der cur­rent law, people between 100 to 400 per­cent of the poverty level are eli­gible for the cred­its, but the Sen­ate pro­pos­al would lower that to 350 per­cent. The draft bill would also lower the ac­tu­ar­ial value for the bench­mark plan, which would likely lower the dol­lar value of the premi­um tax cred­its.

Cas­sidy did say he would have to eval­u­ate the gen­er­os­ity of the tax cred­its to de­term­ine wheth­er, as the Medi­caid ex­pan­sion is scaled back, lower-in­come people will no longer be able to af­ford in­sur­ance.

Sta­bil­iz­ing pro­vi­sions

The draft text re­leased Thursday in­cludes a short-term sta­bil­iz­a­tion fund to provide $50 bil­lion to­wards re­in­sur­ance in the first four years. For 2018 and 2019, $15 bil­lion would be provided, and then $10 bil­lion would be provided for the sub­sequent two years.

The le­gis­la­tion would also com­mit to fund­ing the cost-shar­ing-re­duc­tion pay­ments through 2019. In­sur­ance com­pan­ies have said these pay­ments are vi­tal to the sta­bil­ity of the mar­ket­place.

Waivers and state flex­ib­il­ity

In­stead of tak­ing up the struc­ture in the House bill—which had also al­lowed sick­er pa­tients to be charged more if they have a lapse in cov­er­age—the Sen­ate is look­ing to stream­line the pro­cess for waivers that already ex­ist un­der the ACA.

Seni­or GOP Sen­ate staff said Thursday that states would be able to use these tools, known as 1332 waivers, to make changes to the es­sen­tial health be­ne­fits that policies are re­quired to cov­er.

But Jost said that states would not be able to waive com­munity rat­ing re­quire­ments, as would be al­lowed un­der the struc­ture of the House bill in lim­ited cir­cum­stances. Un­der the AHCA, states could opt to al­low people with preex­ist­ing con­di­tions to be charged more if they had a lapse in cov­er­age.