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Republicans taking political risk on health care reform

Profile image for Ricardo Alonso-Zaldivar
Ricardo Alonso-Zaldivar, Associated Press

WASHINGTON -- Republicans are taking a big political risk on health care.

They're trying to scale back major benefit programs being used by millions of people. And they're trying to do it even though much of the public is leery of drastic changes, and there's no support outside the GOP.

It's not stopping them.

After seven years attacking former President Barack Obama's health care law, Republicans are finally in control of the entire government and say they have to deliver now. Yet they're not talking much about the trade-offs that come with sweeping changes, not to mention estimates that millions more people could be uninsured.

"I don't think anything of this consequence has ever been passed in the entitlement arena," said Jim Capretta, a health policy expert with American Enterprise Institute, a business-oriented think tank. "It's a piece of legislation that would be highly consequential."

Unprecedented "is a perfectly fair characterization," said Lanhee Chen, who was policy adviser to former GOP presidential nominee Mitt Romney. Like Capretta, Chen agrees with the general direction congressional Republicans are taking, if not all the specifics.

Senate Republicans are winnowing down policy options in search of 51 votes to advance House-passed legislation this summer.

Some of the central issues in the GOP's health care gamble:

Historic shift

Health care programs usually grow faster than other government services. Republicans want to break that decadeslong trend, although they'd leave Medicare largely untouched for now.

The talk is all about repealing the 2010 Affordable Care Act. But the GOP's American Health Care Act would have lasting impact on Medicaid, the federal-state program covering about 70 million low-income and disabled people, including many elderly nursing home residents.

Republicans would phase out richer financing that the Obama-era law provides states that expand Medicaid to cover low-income adults. More significantly, the GOP would limit future federal spending for the broader program. Medicaid has been an open-ended entitlement, with the feds matching part of what every state spends, about 60 percent on average.

The House-passed GOP bill would cut $834 billion from projected federal Medicaid spending over a decade, leading to a reduction of about 17 percent in people covered by the program, according to the Congressional Budget Office.

"There is no capacity at the state level to pick up the slack if the federal government withdraws its commitment," Sen. Ben Cardin, D-Md., said at a recent budget hearing. Some Republican governors also question the plan.

Health and Human Services Secretary Tom Price said Medicaid can be more efficiently managed by the states, and that open-ended federal financing doesn't necessarily mean improved health for beneficiaries.

Goals and objectives

In addition to reducing federal health spending, Republicans want to lower premiums for those who buy their own health insurance, an estimated 20 million people. About half receive subsidies under the Obama law, but the rest pay full freight and many have seen steep premium increases stemming from changes under that law.

"Across America, premiums are skyrocketing, insurers are fleeing, and the American people are paying much more for much worse coverage," President Donald Trump said recently in Cincinnati.

Republicans would try to lower premiums by loosening some of the law's requirements, including standard benefits and a guarantee that those in poor health won't be charged more. People would be required to maintain "continuous coverage" to avoid penalties.

The CBO estimates the GOP approach would lead to lower premiums than under current law, but the trade-offs could be significant.

FEATURED PHOTO: President Donald Trump with Health and Human Services Secretary Tom Price are seen March 24 in the Oval Office of the White House in Washington. (Pablo Martinez Monsivais/AP)