A pair of leading Republican and Democratic senators reached an agreement Tuesday to fund key federal health-care subsidies that President Trump ended last week — and the president expressed support for the plan.
But it was unclear whether Senate GOP leaders would embrace the proposal, leaving its long-term prospects in doubt.
The compromise from Sens. Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.) would provide states with greater flexibility under the Affordable Care Act in exchange for authorizing cost-sharing reduction payments known as CSRs for two years. Those payments help offset deductibles and other out-of-pocket costs for low-income consumers who obtain insurance under the ACA.
“Yes, we have been involved and this is a short-term deal because we think ultimately block grants going to the states is going to be the answer,” said Trump, referring to a Republican push to block grant health-care funding individually to states. His comments came just days after he moved to end the CSR payments and punt the issue to Congress.
Republican leaders did not immediate endorse the Alexander-Murray framework, raising new questions about whether it would find any traction.
“We haven’t had a chance to think about the way forward yet,” said Senate Majority Leader Mitch McConnell (R-Ky.) at his weekly news conference, minutes after the deal was announced about 20 feet away outside a Republican policy luncheon.
Speaking to reporters Tuesday afternoon, Alexander said the deal he has struck with Murray would extend CSR payments for two years and provide states “meaningful flexibility” under the ACA’s existing 1332 waiver program. He said the proposal would offer states greater freedom by allowing them to make changes to insurance offerings as long as the plans had “comparable affordability,” which is a slightly looser definition than the existing one.
The proposal would also allow insurers to offer catastrophic insurance plans to consumers aged 30 and older on ACA exchanges, while maintaining a single risk pool. To speed the approval of 1332 waivers, it would shorten the time period for federal review of state waiver applications, expedite review for states in emergency circumstances and those with waiver proposals that have already been approved for other states, and allow governors to approve state waiver applications rather than requiring state legislative approval. It also would assess the budget impact of any state proposal over the life of the waiver, rather than on an annual basis.
Alexander emphasized that the legislation would not allow states to change the essential benefits insurers are now required to offer individuals and small businesses under the ACA, or let insurers discriminate against consumers with preexisting conditions. “This takes care of the next two years,” the senator said, standing off to the side as GOP leaders emphasized the importance of tax reform before the television cameras. “After that we can have a full-fledged debate on where we go long-term on health care.”
Trump stopped the CSR payments last week. In doing so, he not only dealt a blow against the ACA, which conservative activists have wanted to dismantle and congressional Republicans have tried and failed to repeal this year. He also handed off the matter to Congress, forcing it to decide whether to appropriate funding for the subsidies.
Earlier Tuesday, Sen. Lindsey O. Graham (R-S.C.), who was golfing with Trump on Saturday when the president discussed the prospect of negotiations with Alexander on the phone, said that even if a deal is struck, it may not be enough of an overhaul to satisfy core Republican voters.
“That will be his challenge, how much is enough? I can’t support the payments until you get some reform, but I realize that for the base, it’s going to be about not keeping Obamacare in place,” Graham told reporters.
For now, many Republican senators are distancing themselves from the emerging Alexander-Murray plan.
“I don’t know. I’m not sure what the Senate should do,” said Sen. Orrin Hatch (R-Utah) said Tuesday morning.
John Wagner and Amy Goldstein contributed to this report.