Putting lipstick on a pig....

Graham, Cassidy revise Obamacare repeal bill, appealing to holdouts

By RACHANA PRADHAN and DAN DIAMOND

Senate Republicans have updated their last-ditch Obamacare repeal bill in an effort to win over skeptical party members ahead of a key deadline this week, according to a copy obtained by POLITICO on Sunday night.

Sens. Lindsey Graham, Bill Cassidy and allies in recent days have tried to revise the legislation before their ability to pass repeal with a simple majority expires on Sept. 30. Enough Republican senators have raised opposition to their approach to put the bill's passage in doubt, prompting President Donald Trump to publicly pressure holdouts on Twitter this weekend.

The revised bill includes new provisions that would steer more federal funding to Alaska, Arizona and Kentucky. All three states are home to pivotal GOP swing votes who either have opposed or expressed concerns with the bill — Sens. John McCain, Rand Paul and Lisa Murkowski. However, Democrats said Senate Republicans are using misleading numbers to obscure massive funding cuts still in the Graham-Cassidy plan.

Under the revised text, the bill's authors now project increases in federal funding for Arizona (14 percent), Kentucky (4 percent) and Alaska (3 percent), which would have seen declines under the previous version, according to a leaked analysis from Trump's health department. In particular, Murkowski's home state would uniquely benefit from Sec. 129, which allows the state with the highest separate poverty guideline — Alaska — to receive a 25 percent hike in federal matching funds for Medicaid.

McCain came out against the Graham-Cassidy plan on Friday, and Paul has sharply criticized the plan for preserving too much of Obamacare's taxes and insurance regulations. GOP leaders have aggressively courted Murkowski, who voted against a previous repeal bill in July and has withheld support for Graham-Cassidy. On Sunday, Sen. Ted Cruz said he doesn’t support the plan and suggested fellow conservative Sen. Mike Lee of Utah also opposed it.

On Sunday — before the latest bill text was publicly released — Trump tweeted that key states with holdout senators would win under the latest plan. "Alaska, Arizona, Maine and Kentucky are big winners in the Healthcare proposal," the president tweeted at 6:21 p.m.

But critics of the repeal effort said updated projections don't add up. 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.

Alaska, Arizona, Kentucky and West Virginia would still receive less funding under Graham-Cassidy compared to Obamacare, according to Topher Spiro, a health analyst with the left-leaning Center for American Progress. In Twitter postings, he said the bill’s authors were accounting for money states saved as a result of ending Obamacare’s Medicaid expansion to low-income adults, which is overwhelmingly funded by the federal government but requires states to pay a fraction of the cost.

The bill also includes new provisions that would give states more freedom to eliminate federal insurance regulations, as Cruz and Lee have requested. For instance, states could lift existing caps on out-of-pocket costs, which currently prevent insurers from offering bare-bones insurance policies. As a result, people could potentially buy health plans featuring cheaper premiums but higher out-of-pocket costs, which are more attractive to healthier customers.

“This revised bill is tantamount to federal deregulation of the insurance market,” Larry Levitt of Kaiser Family Foundation said. “If there were any doubt that people with pre-existing [conditions] are at risk of being priced out of individual insurance, this bill removes them.”

Some of the revisions made to the bill are intended to pass muster with the Senate parliamentarian, who can rule out provisions that don't adhere to the strict rules of the budget procedure Republicans are using to repeal Obamacare. For instance, a new provision (Sec. 204) establishes conditions for states receiving funding grants and making insurance market changes that are intended to comply with the parliamentarian’s rules. Provisions flagged by the parliamentarian would be stripped out or subject to a 60-vote threshold that would run into certain opposition from Democrats.

After Sept. 30, Republicans would need 60 votes, rather than 50, to gut the health care law.

Spokespeople for Graham and Cassidy did not immediately respond to requests for comment Sunday night.