One of the peculiar aspects of the debate over Republican aspirations to “repeal and replace” Obamacare is how little of it revolves around the provision that has accounted for the majority of uninsured Americans obtaining coverage under the Affordable Care Act: the state option to expand Medicaid eligibility. Instead, most of the talk has been about the private insurance exchanges, and the subsidies that help pay for individual policies, and the purchasing mandates designed to encourage younger and healthier Americans to participate, and the mandated benefit packages, and the regulations against preexisting-condition exclusions and overcharging old folks. That’s understandable due to the incredible complexity of the exchanges and the high visibility of premium increases and insurers pulling out of the exchanges altogether.
But any “repeal and replace” scheme absolutely has to deal with Medicaid. And left to their own devices, Republicans would almost certainly pursue an idea that’s been nestled in various Ryan budgets and was embraced by Donald Trump on the campaign trail: a Medicaid “block grant” that would to a greater or lesser degree shift responsibility for indigent health care to the states, in the process saving the feds a big chuck of change and getting rid of all those headachy policy decisions related to a troublesome, Democratic-leaning constituency.
Unfortunately for the GOP, 31 states — including 16 governed by Republicans — accepted the ACA Medicaid expansion, going in exactly the opposite direction conservatives nationally have supported. Some —including the current vice-president of the United States (who was then governor of Indiana) — rationalized accepting the filthy federal lucre (a much higher federal match rate covering new enrollees) for an expansion because the Obama administration let them conduct conservative-sounding policy experiments, mostly involving the kind of premiums and co-pays Medicaid beneficiaries normally don’t have to deal with.
So the political and substantive complexity of squaring a Medicaid block grant with Medicaid expansion on the ground has helped place Medicaid on the back burner for the Trump administration and congressional Republicans, as something that would probably be handled in a second budget bill later in 2017, or perhaps even in freestanding legislation — or, well, somewhere far down the road.
Now there are signs that is changing. Politico’s Jennifer Haberkorn reports that the transformation of Medicaid could be in the very first budget-reconciliation bill aimed at “repealing” Obamacare — the bill already authorized by a budget resolution that was whipped through Congress last month. But the above-mentioned dilemmas have not gone away:
Medicaid is proving to be the most complex piece of a replace plan in the repeal bill. Republicans want to dramatically overhaul the program by imposing spending caps tied to the number of enrollees in a state. But they are running into problems sorting out such details as whether funding should be allocated based on state enrollment before Obamacare or after.
My guess is that they will come up with a Solomon-style solution, picking some arbitrary enrollment figure halfway between states that expanded Medicaid and states that did not — recognizing that there were major state variations even before Obamacare. But the key thing to understand is that putting a Medicaid block grant into the “repeal” bill means it can be enacted without Democratic votes. And more generally, doing so successfully would mean Republicans had succeeded in all but abolishing a key Great Society federal-safety-net program by making it “about” Obamacare. For the many millions of Americans who would ultimately be affected — including the majority of Republican voters who have no idea Obamacare repeal will affect Medicaid — it would represent a classic bait and switch.
It would be a very good time for Democrats and others who care about guaranteeing that the poorest and sickest Americans have access to lifesaving health care to stop playing the GOP game of getting down into the weeds of Obamacare’s private-insurance provisions and beginning pointing and shouting about what Republicans may be about to do to Medicaid.