The states with populations that would be hurt most by such a scheme aren’t California and New York, but cash-strapped, smaller, mostly-rural states or Rust Belt states that decided to expand Medicaid, often in order to meet extraordinary statewide health crises. These states are not liberal bastions Graham claims are favored by Obamacare; rather these states—Louisiana, Arkansas, Arizona, Kentucky, Ohio, Indiana, Maine, Iowa, Alaska, New Mexico, North Dakota, West Virginia, and Montana—are largely dominated by Republicans, and make up a large swathe of the party’s geographic base.
While the exact effects of Graham-Cassidy are so complex and dependent on state decisions that the Congressional Budget Office announced it won’t be able to properly score the bill for weeks at least, a rough picture of the best-case funding scenario in each state is emerging. A new analysis of that scenario from consulting firm Avalere finds that Graham-Cassidy would reduce overall federal health funding to all states by $215 billion by 2026, and by $4 trillion by 2036.
But within those larger cuts, the states that lose most are of particular interest. Graham-Cassidy contains two major provisions that will constrain funding over time: The allotment formula that purposefully underfunds the combined Medicaid expansion and premium tax-credit block grants to states, and the implementation of a per-capita cap on regular Medicaid spending. While the per-capita cap will underfund Medicaid over time because it doesn’t keep up with inflation, over the near-term, the block grant would dominate immediate funding impacts.
And the Avalere analysis finds that between 2020 and 2027 those impacts would pull about $100 billion from the aforementioned states. Only 11 states—all places that have declined the Medicaid expansion—would gain funding over that term. The biggest beneficiary of this reprioritization would be Texas, which would gain $24 billion in funding. Texan politicians have repeatedly fought the Medicaid expansion, against arguments from hospitals, public-health officials, patients, and economists.
The collection of red states that would lose under Graham-Cassidy is notable. Their governments fought for Medicaid expansion against the party line because they were often in dire need of those funds. Kentucky, New Mexico, and Louisiana are the three poorest states in the country, and Louisiana, Arkansas, West Virginia, Indiana, Ohio, and Maine are all among the worst 10 states in infant mortality. Many of those states score close to last in other health indicators. Additionally, West Virginia, Ohio, Kentucky, Maine, and New Mexico are on the front lines of the opioid epidemic, and have needed extra Medicaid funds to buoy health infrastructure that has been incredibly strained.
The gains in those states have been palpable. For example, in Louisiana, which has had expanded Medicaid for less than two years, uninsured rates have dropped, diagnoses for chronic conditions have risen, and state coffers have been less stressed. Providers and patients in rural Maine have grown increasingly vocal about the usefulness of the Medicaid expansion, and the expansion has been vital to efforts in West Virginia in combating a multitude of public-health problems, all while caring for the health issues of coal miners.