BCRAP bill includes $2B to help states spend money on hookers & blow.

I've had to spend most of the afternoon/evening taking care of my kid (he has a 2-hour karate class Monday evenings), so I'm just now getting a chance to actually read the CBO's score of the GOP Senate's BCRAP bill, beyond their general summary of the score which I simply posted verbatim (with a handful of highlights and notes) earlier today.

There's a lot to digest; I'm sure everyone's already heard the main lowlights/takeaways: 22 million losing coverage by 2026 (14 million kicked off of Medicaid, 7 million losing individual market coverage, 1 million miscellaneous/rounding, I presume), "deficit savings" of around $321 billion (giving Mitch McConnell $202 billion to try and buy the votes he needs from a handful of "moderate" Senators) and so on. I'll be writing my full analysis for tomorrow, though there's probably not much point in it, since every other healthcare reporter will already have beaten me to the punch.

However, there's one little bit which infuriates me so much I have to get it off my chest right now. But first, the setup:

The ACA allows for states to apply for waivers which would let them overhaul the structure of their healthcare system into something other than the ACA's Medicaid expansion + individual market exchange arrangement...but only if the state can prove that whatever they have in mind would a) be budget neutral; b) provide at least as many state residents with healthcare coverage as the ACA does; and c) ensure that the coverage provided to those residents is at least as comprehensive/generous as it is under the ACA.

As Nicholas Bagley explained over at Vox the other day, the BCRAP bill guts these requirements. It keeps the first one (can't increase the federal deficit)...but kills off the other two, making the waivers virtually open-ended, uncontrolled blank checks for states to do pretty much whatever the hell they want to with the money:

The Senate bill retains this waiver provision — but removes the guardrails that ensured state-based alternatives would offer strong coverage. Under the Senate bill, to get a waiver, a state doesn’t have to demonstrate anything about coverage. Instead, it just has to show that the plan won’t “increase the federal deficit.” Once a state makes that showing, the bill is explicit: The secretary of health and human services “shall” approve the plan.

Not “may” approve the plan — “shall.” This is a crucial legal distinction. The Supreme Court has squarely held that this sort of mandatory language means what it says: If the condition is satisfied, the secretary has no choice but to give his approval.

...the bill says that a state must submit a “description” of how its plan would “take the place” of the rules it waives...But the description has no legal bearing on whether to grant the waiver. Again, if the state’s plan doesn’t increase the deficit, the secretary has to approve it. Period.

The bill goes further to grease the wheels for waivers. Under Obamacare, a state had to pass a law in support of the proposed waiver, which meant legislatures had to give their approval before the state could experiment with novel approaches to health insurance. The Senate bill would cut legislatures out of the equation.

...And once a waiver is granted, the Senate bill says that the federal government cannot terminate the waiver, no matter what...It says that a waiver “may not be cancelled” before its expiration. If state officials blow the Obamacare money on cocaine and hookers, there’s apparently nothing the federal government can do about it. At the same time, the bill expands the duration of waivers from five years to eight years.

The biggest fear, of course, is that states would jump all over these waivers in order to allow carriers to drop Essential Health Benefits currently required by ACA regulations. That's the one which everyone keeps talking about: Goodbye maternity services, substance abuse treatment, mental health services, etc. It could also indirectly lead to the return of annual/lifetime limits, including on employer-provided policies.

OK, so as ugly and stupid as all of that is, what else is stuck in my craw on the State Waiver front?

This was brought to my attention by healthcare journalists/bloggers Hannah Recht and Louise Norris, and when I read what they were referring to, it made me sick to my stomach:

Evening CBO narrative status pic.twitter.com/fhydtliNb7

— Hannah Recht (@hannah_recht) June 27, 2017

Yep, it's on page 140 of the bill. $2 billion that states can use through 2019. I can think of better ways to use $2 billion...

— Louise Norris (@LouiseNorris) June 27, 2017

Sure enough, if you scroll down to Page 140 of the BCRAP Discussion Bill, you'll find this:


(a) IN GENERAL.—Section 1332 of the Patient Protection and Affordable Care Act (42 U.S.C. 18052) is amended—
(1) in subsection (a)—
(A) in paragraph (1)—
(i) in subparagraph (B)—
(I) by amending clause (i) to read as follows:
‘‘(i) a description of how the State plan meeting the requirements of a waiver under this section would, with respect to health insurance coverage within the State—
‘‘(I) take the place of the requirements described in paragraph (2) that are waived; and
‘(II) provide for alternative means of, and requirements for, increasing access to comprehensive coverage, reducing average premiums, and increasing enrollment; and’’; and
(II) in clause (ii), by striking ‘‘that is budget neutral for the Federal Government’’ and inserting ‘, demonstrating that the State plan does not increase the Federal deficit’’; and
(ii) in subparagraph (C), by striking ‘‘the law’’ and inserting ‘‘a law or has in effect a certification’’;
(B) in paragraph (3)—
(i) by adding after the second sentence the following: ‘‘A State may request that all of, or any portion of, such aggregate amount of such credits or reductions be paid to the State as described in the first sentence.’’;
(ii) in the paragraph heading, by striking ‘‘PASS THROUGH OF FUNDING’’ and inserting ‘‘FUNDING’’;
(iii) by striking ‘‘With respect’’ and inserting the following:
‘‘(A) PASS THROUGH OF FUNDING.—With respect’’; and
(iv) by adding at the end the following:
‘‘(B) ADDITIONAL FUNDING.—There is authorized to be appropriated, and is appropriated, to the Secretary of Health and Human Services, out of monies in the Treasury not otherwise obligated, $2,000,000,000 for fiscal year 2017, to remain available until the end of fiscal year 2019, to provide grants to States for purposes of submitting an application for a waiver granted under this section and implementing the State plan under such waiver.

Yes, if I'm reading this correctly--and according to both Recht and Norris, I appear to be--the BCRAP bill would utilize a whopping $2 BILLION in federal funds to go towards helping states submit the waiver applications.

Now, aside from the fact that even assuming all 50 states applied for one, this would still break out to $40 million per state (which sure sounds like a hell of a lot of money just to put together a "waiver grant application"), think about what this really means for a moment.

Update: Norris points out that the money would also go towards implementing such a plan, not just submitting the application, so that makes more sense.

That $2 billion is presumably part of the $1.2 TRILLION in "savings" the GOP would achieve by killing off Medicaid expansion, starving pre-ACA Medicaid and slashing CSR payments altogether along with cutting premium tax credit funding in half.

That means they're effectively planning on using $2 billion of the money stolen from the Medicaid fund and using it to essentially bribe the states into submitting waivers.which themselves would take away some of the services needed by the very people who were just kicked off of Medicaid onto individual market plans.

I'd call this a stunning level of gall, but for all I know, gallbladder surgery could be one of the Essential Health Benefits cut by the waivers here in Michigan.