If Republicans can't come together on legislation to repeal and replace the Affordable Care Act, President Donald Trump should "take a time-out" and allow the system to collapse, Sen. Lindsey Graham said Wednesday.

"Here's what I would tell the president: If you can't get a better deal and if you can't protect that 62-year-old worker in Greenville from having dramatic premium increases because Democrats won't work with you and you can't get the Republican Party on board, stop, take a time-out, let it collapse," Graham told MSNBC's "Morning Joe," after using an example from his South Carolina district to discuss premium increases.

"Then, turn to the Democrats and say this was the system you created," said Graham. "It has collapsed, now help me replace it. That's what I would do."

House leadership and the White House both back the American Health Care Act, the repeal and replace legislation introduced last week. However, conservative lawmakers say they oppose the bill, calling it "Obamacare light" because it keeps some provisions of the Affordable Care Act. Others are calling for a clean repeal.

Graham said Trump is "really working hard" to support the bill, including offering to hold a bowling and pizza party with the Freedom Caucus.

"That shows you how much he wants a bill," said Graham. "I don't think I could have done that."

House Speaker Paul Ryan has said that the bill is the "last, best chance" to repeal Obamacare, but Graham said he does not quite agree.

"This is the last, best chance for Republicans to do it by ourselves, and maybe screw it up," Graham said. "So if you can't get the product you want, Mr. President, don't buy it because Republicans tell you, you have to."

Medicaid expansion, Graham said is the big problem. His own state rejected expansion, but "Medicaid is broken."

"You're going to have every governor throughout the nation enrolling millions of people in Medicaid and it's already structurally broken," said Graham. "You would lose me if that is coming over. I'm not going to punish South Carolina, and I'm not going to take a broken program and add millions to it before we can reform it."

Graham said he would like to broaden the number of insurance companies that can be chosen from, as competition lowers prices.

"Obamacare is collapsing in South Carolina.," said Graham. "We had five plans on the exchange and four dropped out and it's down to Blue Cross/Blue Shield. They are about to go out of the market. Obamacare is about to collapse."