Senators Lindsey Graham (R-SC) and Bill Cassidy (R-LA) released their ACA repeal/replace plan on Wednesday, a $1.2 trillion legislative package that would reconfigure the ACA and give more power to states to implement health reform. They were also joined by Senators Dean Heller (R-NV) and Ron Johnson (R-WI) as original co-sponsors, along with former Senator Rick Santorum (R-PA) as a surrogate of the proposal. Their bill could be the final attempt at passing a reconciliation repeal/replace of the ACA before that vehicle expires at the end of the month. The legislation is currently under review by the non-partisan Congressional Budget Office, the outcome of which will likely dictate whether there would be enough votes in the Senate for passage under reconciliation. However, Republican leadership, including Senate Majority Leader Mitch McConnell (R-KY), have suggested that there will not be any further votes on repeal/replace until possibly next year as they instead focus on bipartisan health reform efforts and must-pass legislation.
The Graham-Cassidy proposal would dramatically restructure the ACA from the federal government to the states, reduce the scope of the marketplaces, and eliminate the law’s individual and employer mandate penalties (retroactive to 2016), Medicaid expansion, and advanced premium tax credits. However, all of the law’s taxes would be retained, with the exception of the medical device tax, in order for the funds to then be repurposed as block grants to states to determine how to apply these funds at a state level. Theoretically, Democratic-leaning states could then implement a state-level version of the ACA while Republican states could implement their own reforms. States would also have greater authority to implement changes through the ACA’s Section 1332 waivers and to allow for the establishment of small business association health plans. Additionally, their proposal calls for establishing a temporary market stabilization program, with $10 billion allocated for 2019 and $15 billion for 2020.
Notably absent from the proposal’s unveiling was Senator John McCain (R-AZ), who suggested last week that he might be open to considering the bill, contingent on the final bill text and it undergoing committee hearings. McCain was one of three Republican senators to oppose the Health Care Freedom Act (HCFA) that led to the vote’s failure in July and would be critical for passing any reconciliation bill by the end of the month. With McCain’s support, there would likely be–at most–only exactly enough votes to pass under reconciliation, which requires 51 votes. It is presumed that Republican Senators Susan Collins (ME) and Lisa Murkowski (AK) would remain opposed, leaving Vice President Mike Pence charged with casting a tie-breaking vote if McCain and all other Republicans votes in favor. Early estimates showed as many as 46 votes in favor of the proposal when it was unveiled on Wednesday. Earlier today, Senator Rand Paul (R-KY) announced he would oppose the plan on the basis that he "can't support a bill that keeps 90 percent of Obamacare in place."
Complicating the prospects for passage is McCain’s call for moving the bill through the traditional legislative process to include committee hearings. This would greatly slow down the timetable and the clock is quickly running out as the ability to use reconciliation on health reform expires on September 30 based on a ruling by the Senate parliamentarian. Neither the Senate Finance or HELP Committees have indicated they will bring the bill up for consideration, although Senator Johnson said he would hold a hearing in the Senate Homeland Security and Governmental Affairs Committee that he chairs if the other committees of jurisdiction do not hold a hearing prior to the end of the month.
The September 30 deadline is important because after that date, Republicans would not have enough votes to reach the 60-vote cloture threshold for consideration that is required outside of the reconciliation process. If Republicans want to repeal and replace portions of the ACA with only a simple majority in the Senate, they will either need to attempt another vote this month using the Fiscal Year (FY) 2017 vehicle or re-purpose the FY 2018 reconciliation vehicle that was intended for tax reform (and therefore forgo tax reform via reconciliation). Any other effort would require 60 votes to overcome a Democratic filibuster. If they use the FY 2017 vehicle, any differences between the Senate version and the House-passed American Health Care Act (AHCA) would need to be worked out prior to final passage.
Senator Cassidy has suggested that this bill need not necessarily be passed under reconciliation, arguing that their proposal is a non-partisan effort and should therefore garner support from Democrats who may see it as a way to retain the ACA in friendly states. But the legislation has been met with stiff opposition by Democrats including Senator Patty Murray (D-WA), the ranking member of the Senate HELP Committee, who said that bringing that bill up for a vote could threaten true bipartisan health reform legislation. Further, no Democrats have suggested that they have any interest in supporting this proposal, calling into question Cassidy’s non-partisan claim as only Republicans have shown support.