Exclusive—Senator Lindsey Graham: Block Grants ‘Truly and Fundamentally a Different Approach than Obamacare’

Senator Lindsey Graham (R-SC) told Breitbart News in an exclusive interview that while the congressional  leadership’s healthcare bills kept Obamacare’s infrastructure in place, his coalition’s plan to repeal and replace “is truly and fundamentally a different approach than Obamacare.”

Breitbart News reported on former Senator Rick Santorum’s plan to block grant Obamacare to the states. Santorum continues to work with Sen. Lindsey Graham, House Freedom Caucus Mark Meadows (R-NC), and Wisconsin Governor Scott Walker on a Republican alternative to the Affordable Care Act. These lawmakers’ support for the idea could culminate in a consensus that could allow the bill to pass through the Senate and fulfill Republicans’ promise to repeal and replace Obamacare. Meadows told Breitbart News Daily that the plan has “real merit.”

Santorum told Breitbart News that the plan could pass through the House and the Senate. Graham concurs with Santorum, suggesting that bill goes much further than the House-passed American Health Care Act (AHCA) and the Senate leadership’s Better Care Reconciliation Act (BCRA). Graham told Breitbart News:

Number one, we promised to repeal and replace, not to change the margins here. The House and the Senate bills were definitely improvements to Obamacare; however, it’s a stretch to say that they were a Replace because we did not really, the infrastructure stayed in place. This is truly and fundamentally a different approach than Obamacare. It relies upon the concept of federalism. Instead of Washington, DC, managing Obamacare, having national exchanges, having payments going to insurance companies to prop up the system that cannot work. We’re going to block grant the health care to the states.

The House-passed AHCA and the Senate’s BCRA kept much of the infrastructure of Obamacare in place. Instead of the Obamacare subsidies for low-income Americans to purchase health insurance, congressional leadership swapped out the subsidies for refundable tax credits for Americans to purchase health insurance. Unlike the Santorum and Graham plan, the AHCA and the BCRA kept Obamacare’s federal exchanges and winded down Obamacare’s Medicaid expansion, although, Medicaid expansion was eliminating after several years. Graham’s plan eliminates Obamacare’s Medicaid expansion. Conservatives chided the original AHCA for not repealing enough of Obamacare, labeling the legislation, “Ryancare” and “Obamacare-Lite.”

Senator Graham explained to Breitbart News the construct behind the plan to repeal and replace Obamacare through block grants. Graham told Breitbart News:

They’ll have to cover pre-existing illnesses; they cannot use the money for roads and bridges or football stadiums. They have to spend the money on health care. It gives the consumer a voice they would never have in Obamacare. You can complain to your congressman or senator, but we do not run the program. Trying to find somebody in charge of your health care is almost impossible. Most of the people that run Obamacare are unelected bureaucrats. It is very hard to get their attention when things do not work well and Obamacare is based upon the idea of an unlimited printing press, you just keep printing money. Under the block grant approach, you can complain to somebody about the quality of your health care. That somebody would be your representative and the governor of the state. Chances are the person you are complaining has the same doctor that your family has. From a consumer’s point of view you have a much stronger voice, from an accountability perspective you have a much stronger voice in how it works because it will not be a 50 state conglomerate. There will be 50 different state solutions.

Here’s the construct. We are going to repeal the individual mandate, and the employer mandate. That generates about $200 billion in savings. The states can reemploy the individual mandate and the employer mandate if they would like but you cannot drag everyone else down with you. You can go to single-payer health care in a state if you wanted to, I think you would be foolish, but you cannot drag 49 other states with you.

So, what we did this will repeal the individual and employer mandate, and medical device tax. We left the other taxes in place and created a block grant. Under Obamacare, four states got 40 percent of the money. That’s New York, California, Maryland, and Massachusetts. They’re 20 percent of the population and so by 2026 our goal is to have parity. It will be roughly the same no matter whether you live in South Carolina or California. We help states that did not expand their Medicaid under Obamacare catch up. High-cost expansion states will have a glide path down to a number that will be parity by 2026.

Senator Graham told Breitbart News that key to getting the new Obamacare repeal plan to pass through Congress remains the governors’ support for the bill. Graham said, “So what we’re trying to do is get governors on board. The intellectual force behind this for governors has been Scott Walker from Wisconsin and Doug Ducey from Arizona. One expansion state and one non-expansion state. Most Republican states did not take Medicaid expansions. By 2026 we want to have parity. We’re trying to lock the formula down this week and send the text to CBO so they can score it.”

Senator Graham explained how the bill will increase flexibility for states to implement their own health care systems. Conservative states will have much greater freedom to implement their health care plans compared to Obamacare.

Graham continued: “There’s going to be three forms of flexibility. 1332 waivers from the HHS, which the governors like. There is going to be waivers through the children’s health program CHIP, which is a fairly flexible program, we’re going to be as flexible as possible with reconciliation and the parliamentarian. The fourth level of flexibility comes through the administration, Labor Department, HHS, they will have a wide ability to make waivers and grant flexibility.”

Increased flexibility with health insurance regulations could allow Republican states to design more innovative and more affordable health care plans.

Sen. Graham revealed that not only has he worked with Health and Human Services (HHS) Secretary Tom Price and Centers for Medicare and Medicaid (CMS) Administrator Seema Verma on a plan for his proposal, they have will also work to draft the formula used to figure out how much money every state gets for their local health care system.

“They have helped us design the formula. We have been working close with the administration to try to find a formula that would have been spent on Obamacare and block grant it back to the states and achieving parity by 2026, with as much flexibility as possible. This will be the end of single-payer health care because the money and the policy making will be out of Washington,” the South Carolina senator said.

Graham told Breitbart News that he believes that the bill will score better than the House-passed American Health Care Act (AHCA) and the Senate leadership’s Better Care Reconciliation Act (BCRA). Graham told Breitbart News:

I think this bill will score very well. I think it will score well in terms of fiscal deficit impact. I think it will do as good as the House bill if not better. Once you repeal the individual and employer mandate, 14 million people will drop coverage because they no longer have to pay the fine. So 14 million just made a personal choice. I don’t feel like I’m denying anyone coverage because they made a choice.

Here’s what they can’t lose sight. Obamacare is a nightmare, it will never work, these exchanges cannot be propped up. It was always the plan to go to single-payer health care. It’s to make insurance so costly in the private sector that people will drop coverage and then pay the fine and their employees will join the exchanges and then people will have cradle to grave health care. I think that’s Obamacare goals was.

I think that the goal of Obamacare was to take over the patients that to exchange. This is a stake in the heart of Obamacare through a block grant.

Graham said that he believes that Sen. Lamar Alexander (R-TN) – the Health, Education, Labor, and Pensions (HELP) Committee chairman – will likely hold hearings in September on his proposed plan to repeal and replace Obamacare.

Graham also suggested that the plan could get to the 50 votes necessary for a repeal and replace legislation to pass through the Senate and perhaps a couple of votes from the Senate Democrats.

Graham explained, “When it comes to getting to 50, Alaska does very well under this approach. I think we can get Senator McCain, Senator Murkowski if it works out well for their states. So, conceptually John likes it if it’s good for Arizona. If you can get it to 50, I do not think that a Democrat is going to make it the 50th vote, but I do believe that once we get 50 Republicans there’s going to be a handful of Democrats that will vote for more money and more flexibility for their states.”

Graham criticized the House and Senate leadership’s approach to repealing and replacing Obamacare, arguing that the leadership “got too much in the weeds of tweaking Obamacare.” He argued that Republicans should have started from their principles to revert power back to the states, rather than tweaking the government’s power to hand out health care as an entitlement. Graham also said that he will continue to work with Senators Ted Cruz (R-TX) and Mike Lee (R-UT) on empowering states with more regulatory flexibility to implement their health care plans and lower premiums.

Graham also suggested that House Freedom Caucus members Mark Meadows and Sen. Bill Cassidy (R-LA), and former Senator Rick Santorum have been instrumental in pushing forward this strategy to empower states to create their own health care systems. Rick Santorum was instrumental in passing welfare reform in the 1990s, and Freedom Caucus chairman Mark Meadows led the drive that improved the AHCA enough for the bill to pass through the House.

Graham told Breitbart News:

I’m working with Mark Meadows in the House. The Freedom Caucus guys have been terrific. You know, this should have been our first idea, not our last idea. As Republicans, I think we got too much in the weeds of tweaking Obamacare. We should have went back to our basic philosophy of getting as much money and power out of Washington as possible. If we started with this concept, we would’ve had it done by now. I had a bill that would have allowed people to opt out of Obamacare and so Rick Santorum called me and said, “Why don’t we just block grant and instead opting out?” So myself, Rick Santorum, and Mark Meadows started meeting and if this becomes law it will be because of Rick Santorum, he’s been indispensable. Bill Cassidy has been a great partner. Santorum has been instrumental, he knows his stuff backwards and forwards. We just need to remember this whole experience. When you [are] confronted with what happened in Washington you shouldn’t try to make Frankenstein look better, we should build something new.

Graham concluded, “This is may be the most important thing that I’ll ever do. If we can take money and power out Washington when it comes to health care, then we can achieve a great feat. Health care that is closest to the patient is the best health care.”