Kansas, also a non-expansion state, would consider using the funds for a high-risk pool as well, according to Lieutenant Governor Jeff Colyer.

“We want more control to design a program that is for Kansans,” said Colyer, a Republican. “Kansans can make their own decisions about health care; those decisions don’t need to be in the hands of a faceless bureaucrat in Washington.”

Broad Opposition

States may be tempted to use the funding, in the form of block grants, for unrelated purposes, said Matthew Fiedler and Loren Adler, the authors of the Brookings report.

The bill contains “no apparent legal barriers to diverting funds to unrelated uses,” they wrote. States could use it to fund existing health programs and free up those dollars to be used elsewhere or to pay for health benefits for state employees, they said.

The bill has generated broad opposition among doctors, hospitals and health insurers, as well as state Medicaid plans. On Thursday, the National Association of Medicaid Directors, a group representing the state plans, said it was concerned the Graham-Cassidy bill would undermine “efforts in many states and fail to deliver on our collective goal of an improved health-care system.”

John Baackes, chief executive officer of L.A. Care Health Plan, which offers coverage options through Medicaid and via California’s Obamacare exchange, anticipates the repeal of the individual mandate and a reduction in funds will throw the state’s health programs “into a tailspin.”

“The unintended consequences are going to be horrendous,” Baackes said in an interview. “It’s as if the thinking is, ‘We’re going to cut the federal share and throw all the money to the states to figure out.’ You’re not giving them flexibility to print money.”

California would lose $61.7 billion in federal funding from 2020 to 2026 if the Graham-Cassidy legislation passes, according to the Kaiser Family Foundation. He predicted that under the Graham-Cassidy bill, young, healthy people who purchased insurance to comply with the coverage rule would likely drop their plans, leaving insurers with older, sicker people. That would likely destabilize the insurance markets.

L.A. Care is a member of the Washington lobby group America’s Health Insurance Plans, which along with the Blue Cross Blue Shield Association, another insurer trade group, came out Wednesday in opposition to the Senate bill.