Though Congress doesn’t look likely to repeal and replace the Affordable Care Act anytime soon, President Donald Trump’s fiscal year 2019 budget proposal is counting on billions of dollars’ worth of savings from doing just that.
The budget, which the White House released Monday, supports a two-pronged strategy to repeal and replace the healthcare law.
First, it calls on Congress to enact legislation similar to the ill-fated Graham-Cassidy-Heller-Johnson bill, which would funnel money that currently goes toward ACA subsidies and Medicaid expansion into a “Market-Based Health Care Grant Program.” It would also put a per capita cap on funding for the traditional Medicaid program and redistribute federal funding from Medicaid expansion states to nonexpansion states.
After that happens, the budget calls for “additional reforms to help set government healthcare spending on a sustainable fiscal path that leads to higher value spending.” That would include aligning the Market-Based Health Care Grant Program, Medicaid per capita cap and block grant growth rates with the Consumer Price Index, which the administration says is a metric more in line with Medicaid per enrollee spending growth before the ACA.
Republicans tabled the Graham-Cassidy-Heller-Johnson bill—their last attempt at repealing the ACA in 2017 after several failed attempts—once it became clear it lacked the votes needed to pass it in the Senate. GOP leaders have shown little interest in revisiting it this year, but Trump’s 2019 budget makes it clear that the administration is not willing to abandon the key legislative priority of eliminating the ACA.
“The administration is committed to rescuing states, consumers and taxpayers from the failures of Obamacare and to supporting states as they transition to more sustainable healthcare programs that provide appropriate choices for their citizens,” the budget says.
Through repealing and replacing the healthcare law, the administration expects about $680 billion in net deficit savings over 10 years, according to a budget brief from the Department of Health and Human Services.
The budget would also cut roughly $1.4 trillion from Medicaid—most of that due to the administration’s ACA repeal and replacement proposal.
In addition, it would cut nearly $5 billion from Medicare through both legislative policies that are “designed to improve drug pricing and payment, address opioids, reform payment and delivery systems, and simplify government-imposed provider burdens, address fraud waste and abuse, and reform the Medicare appeals process,” according to HHS.
Some experts, though, are skeptical that the administration's drug-pricing proposals, which were released before the budget, would actually be effective at lowering costs.