UPDATE: Graham-Cassidy 2.0: The bullsh*t piles up so fast you need wings to stay above it.


Late Sunday night, Axios managed to get ahold of a copy of the revised version of the Graham-Cassidy bill...and it's a complete and utter travesty.

Here's direct links to the bill itself and to the GOP's table showing what they claim would be the net federal funding changes from 2020-2026 for each state relative to current law...but they pulled one hell of a fast one.

Here's the original table...

...which makes it look as though total federal funding for states like Alaska, Arizona, Kentucky, Maine, Ohio and West Virginia (i.e., the states with the "moderate" Republican Senators who Bill Cassidy and Lindsey Graham are trying to bribe) would be higher under the Graham-Cassidy bill.

HOWEVER, as Topher Spiro of the Center for American Progress immediately pointed out, take a closer look at that fourth column, "GCHJ State Savings". What's up with that?

Well, it says in the footnotes:

* State savings represent State spending no longer required as match on Medicaid expansion (VIII Group).

In other words, they're trying to count the 10% of Medicaid expansion funding which the states would otherwise be contributing towards covering those Medicaid enrollees as an increase in federal funding...which I believe is otherwise known in accounting/fraud circles as "double-counting", though there might be a different term which covers this type of financial misrepresentation.

I decided to plug the numbers above into a spreadsheet to see what the actual change in federal healthcare funding would be using the GOP's own estimates. Lo and behold (click image for full-size version):

As you can see, instead of gaining 3% in federal funding, Alaska (Lisa Murkowski) would actually lose 3%, or $99 million. Instead of gaining 4%, Kentucky (Rand Paul) would lose 6%, or $1.7 billion. Instead of gaining 9%, Ohio (Rob Portman) would lose 3%, or $1.6 billion. And instead of gaining 5%, West Virginia (Shelley Moore Capito) would lose 5% or nearly $500 million.

Now, the other two states would still come out ahead through 2026: Maine (Susan Collins), which hasn't expanded Medicaid in the first place, would gain a whopping 43% in total funding, or nearly $1.5 billion...and Arizona (John McCain) would still end up gaining 6% (about $1.7 billion) compared to current law. However, the other four "bribe target" states would still be screwed.

Nationally, the GOP's own estimates project over $40 BILLION in lost federal healthcare funding for the states as a whole, or about 3% overall. And where is the lost money coming from?

Well, take a close look at California and New York, each of which would lose 22% of their federal funding compared to current law. That's a whopping $86 BILLION stolen from the two largest blue states. And where does all that money go? By an amazing coincidence, Florida and Texas, the two largest red states, just happen to walk away with an additional $32.4 billion between them.

But wait, there's more!

.@sangerkatz @ddiamond @onceuponA @larry_levitt Does "GCHJ relative to current law" not include Medicaid per capita caps? Section 1903A pic.twitter.com/BBXQNP48qd

— Josh Zeitlin (@josh_zeitlin) September 25, 2017

Seriously, folks: these #'s floating around don't even include the cap to Medicaid program (was $1 trillion cut from '20-'36 in prior draft)

— Jacob Leibenluft (@jleibenluft) September 25, 2017

What they're referring to here is the fact that the Graham-Cassidy bill would cap the formula for Medicaid funding at a much lower rate than now, meaning that starting in 2027, after the "block grants" above were discontinued, starting in 2020, federal Medicaid funding relative to current law would drop more and more every year in every state, even the ones gaining money in the short term.

IMPORTANT UPDATE: OK, it's even worse than I thought. For some reason I thought the Medicaid per capita funding cap didn't kick in until 2027, but it turns out that it would start in 2020. That means, according to Politico...

The bill authors' new estimates don't account for major federal funding cuts resulting from transforming Medicaid from an open-ended entitlement into a budgeted program, according to the Center on Budget and Policy Priorities, a left-leaning think tank. Medicaid spending caps in the previous version of Graham-Cassidy, which remain in the revised bill, would have reduced federal funds to states by $120 billion between 2020 and 2026 -- and by more than $1 trillion through 2036, according to a recent study from Avalere Health.

In other words, you can knock another $120 billion off the tally, for a grand total net loss of $160 BILLION by 2026...and I'm pretty sure that some of that extra $120B would come out of the hide of every state, including Alaska and Maine.

I've updated the table above to reflect this important omission!

In addition, of course, the new version of the bill does try to win over Alaska Senator Lisa Murkowski a different way: By jacking up the percentage of non-ACA Medicaid covered by the federal government (i.e. the Federal Medical Assistance Percentage, or FMAP). Right now, Alaska is scheduled to only have 50% of their non-expansion Medicaid covered by the federal government. Graham-Cassidy would now raise that to 75%* (while also raising Hawaii's from around 55% to 70%* due to each of these states having a higher Federal Poverty Level definition than the 48 contiguous states:


Section 1905(b) of the Social Security Act (42 U.S.C. 1396d) is amended in the first sentence—
(1) by striking ‘‘, and (5)’’ and inserting ‘‘, (5)’’; and
(2) by inserting before the period the following:

‘‘, and (6) only for purposes of payments for medical assistance under this title (excluding any such payments that are based on the enhanced FMAP described in section 2105(b)), in the case of a State for which the Secretary issued under the authority of section 673(2) of the Omnibus Budget Reconciliation Act of 1981 a separate poverty guideline for 2017 that is higher than the poverty guideline issued by the Secretary for 2017 which is applicable to the majority of States, the Federal medical assistance percentage determined for such a State under this subsection for the second, third, and fourth quarters of fiscal year 2018, and for each fiscal year thereafter, shall be increased (after such determination but prior to any other increase which may be applicable and in no case to exceed 100 percent) by, in the case of the State with the highest separate poverty guideline for 2017, 25 percent of the weighted average (based on spending) of the Federal medical assistance percentages determined for the fiscal year for States which did not have a separate poverty guideline issued for them for 2017, and in the case of the State with the second highest separate poverty guideline for 2017, 15 percent of the weighted average (based on spending) of the Federal medical assistance percentages determined for the fiscal year for States which did not have a separate poverty guideline issued for them for 2017’’.

*UPDATE: Thanks to David M. in the comments for noting that I might be misinterpreting this a bit; he's pretty sure that the 25% & 15% figures refere to the increase over the average FMAP percent for the other 48 states, which would likely be more like a 14 point bump for Alaska and 9 points for Hawaii.

Either way this would still be a massive bribe, so the larger point stands, just not as large of one as I thought.

Why did they bother throwing Hawaii in there alongside Alaska? Well, it's not because they think they have a chance in hell of getting HI Senators Schatz or Hirono to vote yes. The only reason I can think of is to provide a fig leaf so that Murkowski could try and claim that the bill doesn't include any "special, Alaska-only" favors. "See!" she could say, "This has nothing to do with Alaska specifically! It also applies to Hawaii, so it's not a bribe to me!" She could even try to claim there's nothing party-based about it: "Hawaii is a blue state with two Democratic Senators, so that means it's totally nonpartisan!"

Both of these arguments are an utter crock, of course; the GOP knows damned well that Schatz and Hirono are "no" votes no matter what, so they can pretend to bribe them as well in the interest of "bipartisanship". If Murkowski is disingenous enough to try and use that as an excuse, she'd immediately piss away every ounce of integrity she presented a few months back.

There's all sorts of other ugliness here; Larry Levitt of the Kaiser Family Foundation has already written up some of the worst of it:

The revised Graham-Cassidy bill is in effect federal deregulation of the insurance market. https://t.co/1tClwaHqLT

— Larry Levitt (@larry_levitt) September 25, 2017

States no longer have to submit waivers of insurance rules under the revised Graham-Cassidy bill. They just have to describe their plans.

— Larry Levitt (@larry_levitt) September 25, 2017

Under the revised Graham-Cassidy bill, states decide how much insurers can charge people who are sick, required benefits, and cost-sharing.

— Larry Levitt (@larry_levitt) September 25, 2017

Under the revised Graham-Cassidy bill, states can alter the federal cap on patient out-of-pocket costs, allowing for bare bones insurance.

— Larry Levitt (@larry_levitt) September 25, 2017

Remember the single risk pool requirement? The revised Graham-Cassidy bill allows multiple risk pools.

— Larry Levitt (@larry_levitt) September 25, 2017

If there was any question about Graham-Cassidy's removal of federal protections for pre-existing conditions, this new draft is quite clear.

— Larry Levitt (@larry_levitt) September 25, 2017

There may be more, but in general, Levitt's first tweet above pretty much says it all: Near-total federal deregulation of the individual health insurance market. A libertarian's dream. A decent person's nightmare.

UPDATE: OK, I've plugged in the additional $120 billion in lost federal funding on a state-by-state basis using Avalere Health's estimates (click image for full-size version)

As you can see, assuming Avalere's estimates/projections are accurate, by 2026, Maine would still come out ahead by about $470 million, but the losses would be devastating for the other five "bribe target" states: Arizona would now lose $3.3 billion, while Alaska would still be $99 million in the hole, Kentucky would be down $2.7 billion, Ohio down $6.5 billion and West Virginia would lose nearly $1.5 billion.

Meanwhile, California would be hit for a jaw-dropping $72.6 billion and New York would lose $43.5 billion.

My own state of Michigan, FWIW, would lose $8.5 billion by 2026.

And all of this would be before the block grants are ripped away entirely.