Sens. Graham, Cassidy Offer Alternative Health Care Plan That Gives States Power to Decide to Keep or Replace Obamacare

By Melanie Arter | July 13, 2017 | 8:17 PM EDT

Sen. Lindsey Graham (R-S.C.)

(CNSNews.com) - Sens. Lindsey Graham and Bill Cassidy (R-La.) unveiled the details of their alternative health care plan on Thursday, which gives Obamacare money to the states in the form of a block grant and lets governors decide how best to deliver health care to residents.

In an interview with CNN's "At This Hour With Kate Bolduan," Graham said the Graham-Cassidy bill repeals the individual mandate and employer mandate among other things. 

"We're keeping the taxes in place on the wealthy. We're repealing the individual mandate, the employer mandate, the medical device tax that 75 senators voted to repeal," Graham said.

"There's about $500 billion of money. Rather than try to run health care from Washington, we're going to block grant it to the states, and here's what will happen: If you like Obamacare, you can reimpose the mandates at the state level. You can repair Obamacare if you think it needs to be repaired. You can replace it if you think it needs to be replaced," Graham added.

"It will be up to the governors. They've got a better handle on this than any bureaucrat in Washington," he said.

"Senator Cassidy, how does this pass the Jimmy Kimmel test as you laid it, meaning how does this way of putting forth health care ensure that people can afford the coverage that they need?" Bolduan asked.

Late night talk show host Jimmy Kimmel, whose son was born with congenital heart disease, called out Cassidy through Twitter, saying people with preexisting health conditions shouldn't be denied medical care.

The "Jimmy Kimmel test" refers to, as described in a June 25 article of The Hill, was a phrase coined after Kimmel tweeted: "Reminder for Sen @BillCassidy: Kimmel test is 'No family should be denied medical care, emerg or otherwise, because they can’t afford it.'"

"Yeah, because you're giving money back to the states to make sure that those who have needs are able to have their needs addressed," Cassidy said.

"By the way, if we couple this with the Ted Cruz amendment, which allows people to purchase insurance through health savings accounts, you could imagine that a state would put money into someone's health savings account, with which you could purchase the insurance which you needed. 

"The essential health benefits would still be there. We can't repeal those as part of that process, and so you'd still have this protection. This perfectly fulfills the Jimmy Kimmel test," Cassidy said.

When asked whether every state gets the same amount of money if the Obamacare money is given in the form of a block grant, Graham said, "We're going to come up with a formula that will be fair to the states. 

"It will have an inflation rate that will be regionally based, so the inflation rate will be there, but we're going to have it based on region, and we're gonna incentivize states who are more efficient if they can beat the inflation rate, they don't lose the money. They keep the money, and they can spend it on other forms of health care," Graham said.

"So the formula going back to the states is important, but here's the main thing. Instead of a refundable tax credit going to individuals and the tax code being used to manage health care, we're going sever health care policy from the federal tax code," he said.

Graham said the money will not be an individual entitlement, but each state will be treated fairly, "and the more efficient you are, the more money you'll have."

"Speaking of entitlements, what does this mean for Medicaid? Through this plan, do you guarantee that people on Medicaid don't lose coverage?" Bolduan asked.

"Medicaid is a completely separate issue. We're going to try to make Medicaid more sustainable," Graham said. "I'll let Dr. Cassidy talk about Medicaid."

"Regarding the taxes, it may be those taxes that are being kept will be eventually repealed, but it will be done as part of comprehensive tax reform, not as part of this," Cassidy said.

"Our problem has been trying to combine tax reform with replacement of Obamacare. Putting those two together has not worked. We now sequence it and hopefully can accomplish both," Cassidy said.

"But on the taxes, if you leave the Obamacare taxes in place on the wealthy, are you no longer-- are you giving up on repealing Obamacare?" Bolduan asked.

"No, absolutely not," Cassidy said. "We're actually giving, as Senator Graham said, the money back to the states. The states can decide what they want to do. A blue state can do a blue thing - a red state, a red thing. My state is gonna repeal and replace Obamacare with something which gives power to the patient, but that starts by us giving power to the state."