July 21, 2017

Status of "Repeal and Replace" as of the End of This Week

3 min

Repealing and replacing the Affordable Care Act (ACA) has long been a priority of congressional Republicans, yet recent events in Washington suggest that accomplishing this goal will be harder than originally anticipated. In early May, the House of Representatives narrowly passed the American Health Care Act of 2017 (AHCA). The AHCA rolled back a host of ACA provisions, including the individual and employer mandates and numerous taxes funding the expansion of healthcare coverage. The Congressional Budget Office (CBO) projected that enactment of the bill would result in cutting over $830 billion from Medicaid and 23 million people losing coverage by 2026. Rather than embrace the AHCA, Senate Republicans crafted their own bill, the Better Care Reconciliation Act of 2017 (BCRA). Similarly, it would effectively eliminate the mandates and numerous taxes associated with the ACA. Notably, however, it differs in its approach to Medicaid. The CBO projected that enactment of the BCRA would remove $772 billion from Medicaid and would increase the number of uninsured Americans by 22 million by 2026. The Senate scheduled a vote on the BCRA prior to Congress's July 4 recess, but it was ultimately cancelled by Republican leadership because of a lack of votes.

To garner support for their bill, Senate Republicans issued an update to the BCRA on Thursday, July 13. The update left in place several ACA taxes on high earners and allocated additional funds toward insurance costs and fighting the opioid epidemic. The update also contained a provision, known as the "Cruz Amendment," which would allow an insurer to offer less expensive plans that do not meet the ACA's essential health benefit standards, provided that the insurance also offered at least one plan that did meet these standards. Within several days, two Republicans—Susan Collins of Maine and Rand Paul of Kentucky—announced that they would vote against the BCRA. This put Republican leaders in a precarious position. With a 52-48 majority in the Senate (and Vice President Pence holding the tiebreaking vote), they could not afford another no vote. After learning over the weekend that Senator John McCain would be taking a medical leave, Republican leadership decided to delay a vote on the BCRA update.

We began this week (July 17-21) watching to see whether additional Republican Senators would come out against the bill and awaiting a CBO score on the BCRA update. On Monday night, Senators Jerry Moran of Kansas and Mike Lee of Utah derailed the bill by announcing that they would not support it. Within hours, the Republican strategy shifted. Senate Majority Leader Mitch McConnell and President Trump both expressed a desire to pass "Repeal Only" legislation that would dismantle the ACA but give legislators two additional years to agree on a suitable replacement. This strategy was short-lived, however, as three Republicans denounced the repeal-only approach, which the CBO estimates would cut Medicaid by $842 billion and result in 32 million people losing coverage by 2026. On July 20, Republican Senators released a third version of the BCRA. The bill is nearly identical to the second version, but it does not contain the Cruz Amendment. The CBO estimates that enactment of BCRA 3.0 would cut $756 billion from Medicaid and increase the number of uninsured Americans by 22 million by 2026.

As of the close of this week, it appears that the Senate Republicans are readying for a vote this coming Tuesday—although it is unclear which bill they will put forward. We will be closely following and reporting on the unfolding events.

Please contact the authors if you have questions about repeal and replace efforts.