An overview of the Graham-Cassidy-Heller-Johnson (GCHJ) Amendment to Repeal and Replace the Affordable Care Act (ACA)

capitol-buildingBy the North Carolina Medical Society

Summary

The Graham-Cassidy-Heller-Johnson (GCHJ) proposal seeks to repeal the Affordable Care Act (ACA) and replace it with block grants provided to states to assist individuals in paying for health care.1 Essentially, GCHJ will replace federal money on Medicaid Expansion, tax credits, cost-sharing reduction subsidies, and basic health plans with the block grant monies.1 States would be able to decide for themselves how they would spend the lump sum of money, e.g., from subsidizing premiums to setting up high-risk or reinsurance pools.2,3 The goal of GCHJ is to return power to the states and to equalize Medicaid funding across all states.1

 

In summary, GCHJ will:

  • Repeal ACA individual and employer mandates
  • Repeal marketplace (premium and cost-sharing) subsidies
  • Repeal the Medical Device Tax
  • Retain private market rules, while allowing states to waive premium rating rules, including:
    • Prohibition on health status rating
    • Essential health benefits
    • Medical loss ratio rebate requirements
  • Repeal authority to cover Medicaid expansion adults as of September 1, 2017 for non-expansion states and as of January 1, 2020 for expansion states.
  • Establish a new short-term federal reinsurance program, with federal funding of $25 billion over 2 years (2019-2020)
  • Establish supplemental funding for community health centers of $422 million for the 2017 fiscal year
  • Establish a new state block grant program, the Market-based Health Care Grant Program, appropriated at $1.176 trillion over 7 years
  • Redistribute federal Medicaid funding to provide a per capita allotment to states starting in 2020
  • Increase maximum contributions to health savings accounts
  • Prohibit Medicaid funding for Planned Parenthood for one year
  • Allow states to institute work requirements for Medicaid (excluding the elderly, pregnant mothers, and disabled)
  • Strengthen the ability for states to waive ACA regulations, including those that:
    • Provide protections for those with pre-existing conditions
    • Require the provision of essential health benefits (e.g. hospitalization, maternity care, prescription drugs, mental health and substance abuse services)

 The block grant will be run through CHIP and is subject to mandatory appropriation.1 GCHJ specifically prioritizes bringing all states to funding parity by 2026;1 however, funding authorization is only through 2026.4

North Carolina

The Congressional Budget Office (CBO) has announced that it plans to offer a preliminary assessment of the bill; however, a full analysis of GCHJ will not be available for at least another few weeks.5

State-by-state analyses of federal funding that states would either lose or gain under GCHJ was conducted by the Center on Budget and Policy Priorities (CBPP).6 Since North Carolina did not accept Medicaid expansion and has one of the highest utilizations of subsidies for individuals on the exchange, results show North Carolina (NC) in the losing category.6 A study by Avalere confirmed that NC is expected to lose at least $1 Billion in federal funding in the first year alone.7

Graham Cassidy state map

Through 2026, NC is projected to lose $9 Billion.7 These numbers are in comparison to the current law and projections.  The NCMS understands that these numbers are likely to change as the proposal evolves over time.

NCMS Position

North Carolina Medical Society (NCMS) members care deeply about the patients they serve each day, and are committed to working to improve health care coverage. With that in mind, the following are key priorities for North Carolina physicians and physician assistants as we move forward on any proposed legislation.

  • Ensure our patients are able to access affordable, sustainable and quality health coverage. This is our top priority.
  • Maintain or improve coverage for the more than 500,000 North Carolinians currently covered under ACA plans;
  • Provide predictability for North Carolinians, including patients, businesses and providers by publicizing any changes to the health plans before the repeal takes effect;
  • Adopt provisions to stabilize North Carolina’s insurance market;
  • Provide physicians with better analytics to make better value based decisions to further the transformation of health care in America;
  • Protect North Carolina’s ability to provide health coverage by ensuring federal funds available for that coverage are equitably allocated among the states, and are not based on historical spending amounts;
  • Provide improvements focused on maximizing value for all North Carolinians.

We recognize there are areas within the Affordable Care Act that should be improved, and we reiterate our commitment to work collaboratively with you to create the best solutions. We believe working together can help North Carolina’s patients maintain, and possibly improve their coverage.

 

UPDATE:  The proposed amendment is likely to not even make it to a vote as Sen. Mitch McConnell (R-KY) has announced that they cannot reach the threshold number of Republican votes to pass the measure. (Reported by Politico / 09-26-17 / 03:36pm http://www.politico.com/story/2017/09/26/obamacare-repeal-failure-republican-senate-243148 )

Resources

 

  1. Bill Cassidy, M.D. United States Senator for Louisiana. Read About Graham-Cassidy-Heller-Johnson. Published July 27, 2017. https://www.cassidy.senate.gov/read-about-graham-cassidy-heller-johnson. Accessed September 19, 2017.
  2. The Kaiser Family Foundation. Summary of Graham-Cassidy-Heller-Johnson Amendment. September 2017. http://files.kff.org/attachment/Summary-of-Graham-Cassidy-Heller-Johnson-Amendment. Accessed September 19, 2017.
  3. Congressional Record – Senate. H.R. 1628. July 27, 2017. https://www.congress.gov/ crec/2017/07/27/CREC-2017-07-27-pt1-PgS4440.pdf. Accessed September 19, 2017.
  4. Luhby, T. What’s in the latest Obamacare repeal bill? CNN Money. September 19, 2017. http://money.cnn.com/2017/09/18/news/economy/obamacare-repeal-graham-cassidy/. Accessed September 19, 2017.
  5. Roy, Avik. Take Two: Inside Bill Cassidy’s Plan to Replace Obamacare. Forbes: The Apothecary. September 17, 2017. https://www.forbes.com/sites/theapothecary/2017/ 09/17/take-two-inside-bill-cassidys-plan-to-replace-obamacare/#39fbcd861181. Accessed September 19, 2017.
  6. Leibenluft, J., Park, E., Broaddus, M., Aviva, A.D. Like Other ACA Repeal Bills, Cassidy-Graham Plan Would Add Millions to Uninsured, Destabilize Individual Market. September 18, 2017. https://www.cbpp.org/research/health/like-other-aca-repeal-bills-cassidy-graham-plan-would-add-millions-to-uninsured. Accessed September 19, 2017.
  7. Carpenter, Elizabeth, Sloan, Chris; Avalere: Graham-Cassidy-Heller-Johnson Bill Would Reduce Federal Funding to States by $215 Billion. http://avalere.com/expertise/managed-care/insights/graham-cassidy-heller-johnson-bill-would-reduce-federal-funding-to-sta. Accessed September 21, 2017.
  8. Texas Medical Association

 

 

 

 

 

 
 

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