Republican Repeal and Replace Proposal

A proposal put forth by Senators Graham, Cassidy, and Heller seeks to provide more control to states by consolidating marketplace subsidies and Medicaid funding into a lump sum. This drastic change would particularly disadvantage states that expanded Medicaid, as they would receive a steadily decreasing share of the funds until they face a complete cut-off in 2027. While the proponents argue it fosters state-level innovation, critics highlight that it could result in reduced insurance coverage for low-income Americans, as states may not utilize the funds for direct health insurance coverage. The complexity of the reforms raises concerns about whether states have the capacity to manage broader administrative functions previously overseen by federal agencies.