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Today in Obamacare: the big hurdle to block-granting Medicaid — explained by a GOP legislator who wants to do it

Bay Area Activists Protest Cuts To Medicaid Photo by Justin Sullivan/Getty Images

GOP legislator: Block-granting Medicaid will be “harder” than I thought

Yesterday afternoon, I interviewed Rep. Phil Roe (R-TN), a conservative legislator who co-chairs the GOP Doctors Caucus and authored the Republican Study Committee’s Obamacare replacement plan. We spent most of the time talking about that health care bill, and you can read that full conversation here.

But one of the things Roe told me that surprised me the most was that he has begun to think block-granting Medicaid is going to be much harder than he initially expected. Here was the full answer:

What I thought was going to be easy was I thought Medicaid, we’d just block-grant it to the states. That one actually is going to be a little harder than I thought. The reason is there are states like New York, states that expanded [Medicaid]. How do you cover that 10 or so million people on Medicaid?

Why this is surprising: There is a lot that divides Republicans on health policy right now (what exactly to do about the Affordable Care Act, for example). But if there is one major idea that unites them, it is block grants for Medicaid.

It’s in the budget proposal that House Budget Chair Rep. Tom Price, the newly confirmed health and human services secretary, released this year. It was in Trump’s own health care platform during the campaign. And it is what Trump adviser Kellyanne Conway was talking about on television news in early January as the administration’s preferred path forward.

In its simplest form, turning Medicaid into a block grant simply means handing control of the program — and the funding for it — over to the states. Republicans have talked about how this would give states way more control over how Medicaid dollars get spent and increase their ability to experiment with the program. You can read a more in-depth explainer on the policy here.

This idea gets rave reviews from most conservatives, Roe included. It feels like the votes may exist in Congress, for this type of idea. So I was interested to hear him say that he felt it might be a hard goal to deliver on.

Why it isn’t surprising: Block grants usually mean something else: a massive cut to Medicaid spending that could throw tens of millions of people off the program. And the politics of that — just at the moment that Obamacare added millions of people to Medicaid — are, as Roe acknowledged, tricky.

Roe told me that just before I came in his office, he’d been on the phone with two state senators from Montana who had questions about the future of Medicaid expansion. My colleague Andrew Prokop recently counted up a list of 20 Republican senators from states that expanded Medicaid. These might be people who theoretically support block grants but are worried about what will happen to the people in their states who gained coverage.

"I'm from a state that has an expanded Medicaid population that I am very concerned about," Sen. Shelley Moore Capito (R-WV) told Talking Points Memo last month. "I don't want to throw them off into the cold, and I don't think that's a strategy that I want to see. It's too many people. That's over 200,000 people in my state. So we need a transition. I think we'll repeal and then we'll work during the transition period for the replacement vehicle."

Roe isn’t from a state that expanded Medicaid. The fact the he is also talking about the challenges is notable — it shows how far concern has spread in the Republican caucus.

Kliff’s Notes: Today’s top three health policy reads

“Maryland’s All-Payer Model — Achievements, Challenges, And Next Steps”: “Maryland committed to limiting the growth in the per capita hospital revenues for all payers to the long-term growth rate of the State’s economy (3.58 percent per year). Actual growth was much lower (1.47 percent in 2014 and 2.31 percent in 2015), and the year-to-date growth in 2016 over 2015 was 0.35 percent per capita.” —Nelson Sabatini, Joseph Antos, Howard Haft, and Donna Kinzer, Health Affairs

“Obamacare more popular than ever, now that it might be repealed”: “What’s changed is that the prospect of Obamacare’s repeal has become much more real. Mr. Trump identified it as a top domestic policy priority, and Congress rapidly passed a budget bill laying the groundwork for a broader repeal.” —Margot Sanger-Katz and Haeyoun Park, New York Times

“Health insurers warn of wider defections from ACA marketplaces for 2018”: “Tavenner and Janet Trautwein, chief executive of the trade group representing health insurance brokers and agents, emphasized that health plans must decide in the next few months whether they will participate in ACA marketplaces for 2018. After several major insurers dropped out of the program for 2017, both predicted that more might follow suit unless they have enough confidence in the government’s policies to set realistic prices­ for next year.” —Amy Goldstein, the Washington Post

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