Nevada Governor Brian Sandoval, left, and Senator Dean Heller speak with media inside the Grant Sawyer State Office Building in Las Vegas on Friday, June 23, 2017. Daniel Clark/The Nevada Independent

Gov. Brian Sandoval said Thursday that the flexibility fellow Republican Sen. Dean Heller promised will be good for Nevada in a health-care bill he’s sponsoring is a “false choice” because the legislation will also slash funding.

Sandoval, in a statement to The Nevada Independent, said he would not “pit seniors, children, families, the mentally ill, the critically ill, hospitals, care providers or any other Nevadan against each other” because of the steep cuts to federal funding the state would face if the Heller-sponsored measure were to pass. A state analysis, also obtained by The Nevada Independent, agrees with independent calculations from various health-care organizations estimating Nevada will lose between $600 million and $2 billion in federal funding by 2026 if the legislation passes.

As tensions mounted this week with Senate Republicans renewing a health-care debate thought to be laid to rest, Heller publicly touted the “flexibility” the measure would create by dividing up the federal dollars currently spent on the Affordable Care Act among the states in the form of a block grant. Where Sandoval only gently rebuffed Heller on Tuesday, saying he appreciated the “intended flexibility” of the bill, the careful, deliberative Sandoval — not one to rush to the presses with a strongly worded statement — didn’t mince words on Thursday.

“Flexibility with reduced funding is a false choice,” Sandoval said in the statement. “I will not pit seniors, children, families, the mentally ill, the critically ill, hospitals, care providers, or any other Nevadan against each other because of cuts to Nevada’s health-care delivery system proposed by the Graham-Cassidy amendment.”

Sandoval’s statement stands in sharp relief against one issued just two days earlier, in which the even-keeled governor attempted to soften the blow to Heller after authoring a letter with a group of nine other bipartisan governors urging Senate leadership not to consider the proposal. In the earlier statement, Sandoval said that Heller is “working in the best interest of the state” while gently, but firmly reiterating that he favors a bipartisan fix to the nation’s health-care system.

The recent rift between the two Republicans is also a sharp turn of events from June, when Sandoval and Heller stood side by side to harshly condemn Senate Republicans’ last repeal-and-replace plan, saying that it would strip health care away from millions of Americans and hundreds of thousands of Nevadans. Sandoval remained mum for weeks on the measure, initially drafted by South Carolina Sen. Lindsey Graham and Louisiana Sen. Bill Cassidy and signed onto by Heller amid a week of heated health-care negotiations in the Senate in July.

Heller publicly touted that “Nevada wins” under the measure, which would divvy up the block grant annually based on states’ numbers of poor or near-poor residents as well as create a per capita cap on the half-century old Medicaid program. The Republican senator, who is up for re-election in 2018, has had to walk a fine line amid discussions in the Senate over the past couple of months about repealing and replacing the Affordable Care Act, facing a challenge from the more conservative Danny Tarkanian.

Nevada would receive about $1.96 billion from the block grant in 2026, about 34.5 percent more dollars than it would when the block grant begins in 2020, according to calculations from the bill’s sponsors. The bill sponsors portray that as block grant “growth” and tout the flexibility states will have to spend that money to help high-risk patients purchase health coverage, stabilize premiums in the individual market and reduce deductibles or other out-of-pocket costs for individuals, among other approved uses.

But the state analysis of the legislation obtained by The Nevada Independent notes that the measure only bundles funding previously approved for Medicaid expansion, cost-sharing reductions and advance premium tax credits into the block grant. Because only 31 states (Nevada included) and the District of Columbia have opted into Medicaid expansion, their funds will be redistributed among the 19 other states currently receiving no federal dollars for Medicaid expansion.

The analysis notes that, while the bill sponsors compare the amount of money Nevada will receive in 2026 under Graham-Cassidy when the block grant ends to how much it will receive in 2020 when the block grant begins, the correct analysis would be to compare the projected funding Nevada will receive in 2026 under the Affordable Care Act under the status quo compared to what it would receive in 2026 under Graham-Cassidy. When that comparison is done, Nevada loses between $600 million to $2 billion by most organizations’ calculations, the state analysis says.

Over months of discussions about repealing the Affordable Care Act, Sandoval has repeatedly argued against touching the extra dollars the federal health-care law made available to states that chose to opt in to an expansion of Medicaid, a point he reiterated in the Thursday statement. Sandoval was the first Republican governor to opt in to Medicaid expansion, and the state has since entirely restructured the way it provides services, such as mental health care, to rely on those new federal Medicaid dollars.

“As Governor, I made a commitment to use all the tools available to ensure Nevadans had access to affordable and quality health care. I made the decision to expand Medicaid to never before covered populations, including childless adults and pregnant women,” Sandoval said. “I made the decision to leverage all the federal funding possible through the Affordable Care Act (ACA), and to work to improve the health-care system for those with mental illness, addictions and disabilities.”

Before the state expanded Medicaid, the uninsurance rate was 20.7 percent, 27 percent for adults under 65 and 14.8 percent for children; after, the uninsured rate dropped by 9.3 percentage points, down to 11.4 percent in 2016. Between Medicaid expansion and the Silver State Health Insurance Exchange, nearly 400,000 Nevadans have gained access to health care, including more than 300,000 in Medicaid and nearly 90,000 on the exchange, Sandoval said.

According to the state’s analysis, more than 200,000 people currently receiving Medicaid will lose coverage when the block grant goes into effect on Jan. 1, 2020 and need to be moved to other coverage with unknown costs. An additional 90,000 Nevadans who purchase insurance on the exchange would also be left without access to subsidized coverage.

The per capita cap that Graham-Cassidy places on Medicaid funding, which organizations who have analyzed the bill do not believe will keep pace with the costs of providing health care, will “fundamentally” change the federal Medicaid program without analyzing the cost of long-term impacts to the state, the state analysis says.

The legislation will also reduce the ability for states to levy provider taxes from 6 percent to 4 percent over time, which will limit Nevada’s ability to help finance increased Medicaid payments to nursing homes. The reduction will result in a $10 million per year reduction in payments to nursing homes by 2025, according to the state’s analysis.

The state analysis says Graham-Cassidy will also reduce the $8 million in prevention and public health funding Nevada receives annually to pay for immunizations and conduct disease investigations to protect public health, as well as reduce Nevada’s hospitals from accessing Medicaid funds in retroactive months of eligibility in many cases, resulting in more uncompensated care and cost burdens being shifted to other parts of the health-care system.

“I have said many times before that I will not support legislation that may result in a cost shift to the State or result in Nevadans losing insurance coverage,” Sandoval said. “I cannot in good faith support the Graham-Cassidy amendment.”

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Read Sandoval’s full statement below:

“Flexibility with reduced funding is a false choice. I will not pit seniors, children, families, the mentally ill, the critically ill, hospitals, care providers, or any other Nevadan against each other because of cuts to Nevada’s health-care delivery system proposed by the Graham-Cassidy amendment.

Health-care reform is working in Nevada. Improvement is needed and planned but we are making great progress.

Recent information released by the U.S. Census Bureau shows the uninsured rate in Nevada for 2016 was 11.4 percent. This is a decline of 9.3 percentage points, the third-best decline in the uninsured ratings in the nation when compared to 2013 data. In three years, the state has nearly cut the uninsured rate in half and that number is expected to continue to decline.

This has been accomplished through the Medicaid expansion and the Silver State Health Insurance Exchange. Between these two programs nearly 400,000 Nevadans have gained access to health care with more than 300,000 enrolling in Medicaid and almost 90,000 gaining access through the Exchange since 2013.

As Governor, I made a commitment to use all the tools available to ensure Nevadans had access to affordable and quality health care. I made the decision to expand Medicaid to never before covered populations, including childless adults and pregnant women.  I made the decision to leverage all the federal funding possible through the Affordable Care Act (ACA), and to work to improve the health-care system for those with mental illness, addictions and disabilities.

I have worked to develop new and efficient health-care service delivery models. The newly eligible populations were mandated into Managed Care Programs so their care needs were managed and delivered in a cost effective manner. Improved provider reimbursement rates were negotiated with the federal government and care providers so the mentally ill did not have to wait for beds to open in State run hospitals. Care for this population has moved to private sector providers, and by leveraging federal funding, saved the State General Fund millions of dollars.

I have said many times before that I will not support legislation that may result in a cost shift to the State or result in Nevadans losing insurance coverage. I cannot in good faith support the Graham-Cassidy amendment.”