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Avalere Health's President Is Concerned About Health Care Bill's Effects


First comes the bill. Now comes the price tag. This morning, the Congressional Budget Office is expected to release its score of the Senate version of the Republican health care bill. Senate Majority Leader Mitch McConnell says that, with that in hand, he wants to push forward for a vote on this bill by the end of the week. So far, national polls show that the latest plan to repeal and replace Obamacare is generally unpopular with many Americans. The bill has many industry critics, too, like our next guest. His name is Dan Mendelson, and he is the president of the consulting firm Avalere Health.

Thanks so much for being with us this morning.

DAN MENDELSON: It's my pleasure to be here.

MARTIN: We're expecting a CBO score on the Senate bill today, as I mentioned. Any way to anticipate what that might say?

MENDELSON: Well, our estimates are that the bill probably eliminates coverage for about 20 million low-income individuals. And then it's going to save the federal government a lot of money, primarily due to the reductions in Medicaid spending over time.

MARTIN: So that hews really closely with what the House bill did. That was going to cut nearly 23 million more Americans from health insurance and also make significant reductions in the federal deficit. What do you make of the proposed cuts to Medicaid? The draft bill proposes cutting Medicaid by hundreds of billions of dollars. Republicans say this is about giving the power to the states to allocate their own Medicaid spending. What's the risk there?

MENDELSON: Yeah, what the bill does is it limits increases in Medicaid spending over time, and it puts in place a hard and fast mechanism to enforce that states will be keeping their Medicaid spending under control. And, you know, it's - this is problematic, I think, primarily due to the coverage effects that we just talked about. But then, also, it potentially threatens institutions, like hospitals that serve the poor and really derive a lot of their revenues from doing that.

MARTIN: The bill also removes the mandate for people to buy insurance, which means there's no penalty if you don't have it, no incentive for people to get it. Is that going to be untenable for insurance companies in the end?

MENDELSON: You know, interestingly, I think that, right now, we have to acknowledge the fact that the mandate is simply not working. There are about 10 million people covered under the exchanges right now. If the mandate were working, we'd probably have about 25. So, you know, in the current situation with the mandate really not working, then the question really is, how do you get individuals who really should be insured under this program signed up?

I think that there is an issue with the bill in that it would allow someone to decide not to be covered, wait for a long time and then only when they're ill, sign up for coverage. I do expect that the Senate will be addressing that issue at some point over the course of the week.

MARTIN: So is this a good bill or a bad bill? I mean, is this something you could support?

MENDELSON: Look, fortunately I don't have to make that decision because I'm not sitting in the Senate. I think that, really, you have to look at the primary effects of the bill, which are problematic for low-income individuals. It's the Medicaid reductions and the fact that so many people would not be covered over time. And those are really the primary effects.

MARTIN: Dan Mendelson, president of Avalere Health, a consulting firm, thanks so much for your time this morning.

MENDELSON: My pleasure. Transcript provided by NPR, Copyright NPR.

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