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Medicaid Still Key Sticking Point in GOP Health Debate

Additional changes impacting the entitlement program are under consideration

Sen. Lisa Murkowski, R-Alaska, is one of several GOP members who have not yet publicized their position on the revised bill to repeal and replace the 2010 health law. (Bill Clark/CQ Roll Call)
Sen. Lisa Murkowski, R-Alaska, is one of several GOP members who have not yet publicized their position on the revised bill to repeal and replace the 2010 health law. (Bill Clark/CQ Roll Call)

Just hours after Senate Majority Leader Mitch McConnellunveiled an updated bill to overhaul the U.S. insurance system, lawmakers hesitant about the proposed changes to Medicaid huddled in the Kentucky Republican’s office in search of a solution.

The members, which included Sens. Lisa Murkowski of Alaska, John Hoeven of North Dakota, Shelley Moore Capito of West Virginia and Rob Portman of Ohio, were also joined by Centers for Medicare and Medicaid Services Administrator Seema Verma.

At stake is up to $772 billion in federal Medicaid funding over the next 10 years, according to an analysis from the Congressional Budget Office of the GOP’s previous draft.

And as Republicans look to seize on a rare opportunity to pass a massive entitlement overhaul, resistance within their conference threatens that, as well as their seven-year goal to repeal and replace former President Barack Obama’s signature domestic achievement.

“We’re just going to keep talking and keep looking. Still a lot of unanswered questions,” Capito told reporters leaving McConnell’s office. “No decision made.”

While in the meeting, Capito’s office released a statement saying she still had “serious concerns about the Medicaid provisions.”

Two Republicans — Sens. Rand Paul of Kentucky and Susan Collins of Maine — have already vowed to oppose the motion to proceed to the measure. On that vote, which is expected to be held early next week following the release of the CBO analysis of the updated draft, McConnell can only afford to lose the support of one more Republican member and still call in Vice President Mike Pence to break a 50-50 tie.

And while the new draft included several additions designed to sway hesitant lawmakers, it remains to be seen whether that will be enough.

“We continue to work on the bill and that’s going to continue to happen,” Hoeven told reporters. “We brought up some things that we think will give us some more help on Medicaid.”

It’s unclear exactly what changes are under consideration; Hoeven and others largely declined to comment on details. But one possible route is more funding, according to Senate Majority Whip John Cornyn.

“We’re trying to reconcile the different interests of expansion states with non-expansion states to get everyone on board,” the Texas Republican said. “Until we get to the magic number of 50, after an open amendment process and a voterama, that’s success and it’s an ongoing process. Probably one of the most complicated legislative processes that I’ve been involved in.”

McConnell is pulling out all the stops. He included an additional $45 billion in funding to help states combat the opioid epidemic, a nod to Portman and Capito, whose states have been ravaged by prescription drug abuse. For Murkowski, he included a provision that will direct more of the proposed stabilization fund to Alaska.

“We have been working to make sure that high-cost states have some way forward, and you see that reflected on that provision,” Murkowski told reporters walking outside the Capitol, claiming credit for that language along with her state GOP counterpart Sen. Dan Sullivan.

The revised draft also adjusts the formula to determine federal funding for rural hospitals, known as the Disproportionate Share Hospital program, a key concern of Hoeven and others. 

One way leadership is trying to ease concerns is by acknowledging that some of the more severe cuts will not take place until 2025. 

“Most of the concern I’ve heard has to do with what happens in the ninth and 10th year, when it adjusts to a lower rate of inflation,” Sen. Lamar Alexander of Tennessee, a close McConnell ally, said. “If that turns out to be a problem, Congress could always — has eight years to fix that.” 

The Cruz Dilemma 

Apart from Medicaid, it is unknown how some members will react to a provision included at the behest of Sens. Ted Cruz of Texas and Mike Lee of Utah that would allow — under certain conditions — insurers to offer plans that do not comply with the current law’s requirements to cover pre-existing conditions, for instance. Health experts and the insurance lobby have warned that such a measure could increase health care costs for sicker individuals.

“I think this new bill represents a substantial improvement over the previous version and there are several changes that significantly improve our ability to reduce premiums, which has been my central focus from the beginning,” Cruz said. “In my view the way we unify the conference and bring Republicans together is focus on reducing premiums.”

When asked whether he could support the language, Lee said he was “still looking at it.”

In an effort to combat criticism over the provision, McConnell included an additional $70 billion in funding to help insurers cover high-risks individuals. Whether that is enough to assuage concerns is up in the air. 

“I think our members by and large like at least in concept what he’s trying to do. We think it’s great to give people more choices and the freedom to actually buy the insurance products that they want, but clearly we have to also look at how that affects the broader insurance pool but I think part of that gets addressed,” Senate Republican Conference Chairman John Thune of South Dakota said of the measure.

When asked whether GOP leadership provided any assurances that individuals with existing medical conditions would continue to be covered under the Republican bill with the addition of the measure from Cruz and Lee, Sen. Cory Gardner of Colorado said “that’s something we’ve got to understand and the questions that we have to find out.”

Despite McConnell’s best efforts, there are signs that the new draft may not be enough to reach the elusive 50 votes needed to advance the legislation under the fast-track budget procedure known as reconciliation that Republicans are using.

Just minutes before GOP leadership was set to unveil the updated language that was drafted behind closed doors with no public input, Republican Sens. Lindsey Graham of South Carolina and Bill Cassidy of Louisiana were on television pitching an alternate proposal.

“If you’ve got a proposal in Washington that your governor thinks hurts your state, you’re in trouble,” Graham told reporters. “We’ve got $500 billion we’re willing to give the states through some kind of fair formula.”

The GOP duo has at least one supporter in their corner: former Republican Sen. Rick Santorum of Pennsylvania.

“It takes the policy out of Washington and gives it to the states. It allows for innovation, it allows for tailoring the health care system to the needs of the people in the state,” he told Roll Call in a brief interview in the Capitol, where he has set up shop all week trying to persuade members to back the plan.

When asked whether any governors have signed on, Santorum said he has spoken to “three so far.”

Niels Lesniewski, Sandhya Raman and Andrew Siddons contributed to this report.

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