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The Health 202: Here's another huge obstacle to repealing Obamacare in the Senate

Analysis by
Deputy newsletter editor
May 11, 2017 at 8:15 a.m. EDT
Senate Majority Leader Mitch McConnell's hands may be tied on health care after the CBO releases its new report the week of May 22. REUTERS/Aaron P. Bernstein

THE PROGNOSIS

The Senate is filling in a blueprint for its own Obamacare replacement, but the outer perimeters are already in permanent ink.

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Speculation abounds over how the Senate will craft a bill chiseling away big pieces from the Affordable Care Act, and how it will differ from the measure the House passed last week. Senators could propose a bill with larger subsidies, for example, or fewer cutbacks to Medicaid, in order to ensure it deprives fewer people of health coverage.

Policy-wise, there’s a relatively wide range of possible outcomes for whatever the Senate ends up introducing. But here’s the catch: The Senate bill must achieve the same overall level of savings as the House bill if Republicans want it to have any chance of passing. No Democrats will support the measure, so Republicans moved early on to use arcane budget rules known as "reconciliation" that would allow the health overhaul to pass with a simple majority rather than the 60 votes typically necessary in the Senate. Using reconciliation was a political necessity for Republicans, but it's also going to cost them -- quite literally. 

The requirement that the same overall savings be achieved actually puts some pretty defined boundaries around what senators can ultimately do.

It’s kind of like shopping for a house, one Hill staffer explained to me. Say you’ve already decided that $500,000 is the maximum you can spend (which sadly, in D.C., might get you a somewhat shabby duplex). You must determine your priorities within that budget. So you might buy a house with several bedrooms but a tiny living area. Or maybe you’d purchase a home with a massive kitchen but outdated bathrooms.

--Translating the analogy to health care: If the Senate wants to provide more government assistance for people to buy coverage than the House bill allowed, it would have to do so in such a way that the final price tag doesn’t exceed that of the House bill.

This reality is why we’re anxiously awaiting a final, final estimate of how much the House’s health care bill would save and how many people it would cover, which the Congressional Budget Office says it will release the week after next.

The CBO has already said the House bill will reduce federal deficits by $150 billion over a decade. But this newest score will reflect three amendments Republicans tacked onto their legislation before finally passing it, which are likely to somewhat reduce its savings. That final number from the CBO will provide the minimum level of savings Senate Republicans must achieve. 

All of this is important to keep in mind as the Senate’s 13-member working group meets for a fourth time today (this time to discuss how to handle the Affordable Care Act’s insurer regulations). Everyone’s been focused on which policies affect federal spending enough to qualify under reconciliation, and for good reason, as the Senate parliamentarian could very well rule that none of Obamacare’s insurance regulations can be ditched through this process.

--But the rules around the topline savings in a Senate health-care bill could be just as confounding. “VERY complicating,” one GOP health-care lobbyist wrote me.

Consider the moderate senators who want to reverse the dramatic Medicaid cuts in the House bill. West Virginia Sen. Shelley Moore Capito (R) has insisted a health-care bill must retain Obamacare’s Medicaid expansion, which her state accepted. But if the Senate goes that route, and reinstates Medicaid spending the House bill chopped, the chamber could be forced to keep some of the law’s taxes, for example, in place to pay for it all.

A GOP aide to the Senate Budget Committee confirmed the strict rules around deficit reduction in a budget reconciliation bill, which is what the American Health Care Act technically is.

“Whatever deficit savings the Congressional Budget Office finds in the House bill is the floor for savings in the Senate measure,” the staffer said. “Additional spending in the revised legislation would have to be offset by cuts elsewhere or by revenue increases.”

If you don’t understand how this all works, you might think the CBO score of the final House bill is merely a political pressure point for the Senate to try to preserve coverage for more people. But it's a lot more than that.

The truth is there's not a lot of wiggle room for senators, moderate or conservative. The week of May 22 will influence the direction of the health-care debate, whether they like it or not. For more on the anticipated CBO score, read my colleague Amy Goldstein.

AHH, OOF and OUCH
Reporter Dan Heyman tried to ask Health and Human Services Secretary Tom Price a question about the Republican health-care bill on May 9. He was arrested. (Video: Valerie Woody/West Virginia Citizen Action Group)

AHH: "That gentleman was not in a press conference." That's what Health and Human Services Secretary Tom Price said about the journalist in West Virginia who tried to get some answers about the GOP health-care bill. "Daniel Ralph Heyman, a reporter for the independent Public News Service, was arrested and charged with willful disruption of governmental processes, a misdemeanor, after police in West Virginia’s Capitol building said he was 'aggressively' trying to get past Secret Service agents while yelling questions at Price," reports STAT. Video is above in case you missed it yesterday.

The secretary and Trump adviser Kellyanne Conway were in West Virginia to talk about the opioid crisis and Price said after the incident that police “did what they felt was appropriate.” When asked whether the arrest should have been made, he told STAT: "That's not my decision to make." Heyman said he was just doing his job when he asked Price whether domestic violence would be considered a preexisting condition in the House health-care measure. He was released on $5,000 bond.

OOF: In Alaska, a Republican state lawmaker said that women try to get pregnant “so that they can get a free trip to the city.” Alaska Rep. David Eastman believes that the use of state funds, including travel costs to other states for second-trimester abortions, is a problem: “We have folks who try to get pregnant in this state so that they can get a free trip to the city, and we have folks who want to carry their baby past the point of being able to have an abortion in this state so that they can have a free trip to Seattle,” Eastman said. He later told Alaska Public Media: “You have individuals who are in villages and are glad to be pregnant, so that they can have an abortion because there’s a free trip to Anchorage involved.” The Alaska House voted yesterday to censure Eastman for his comments.

OUCH: Remember Rep. Tom MacArthur (R-N.J.), the leader of House moderates who at first wouldn't support the health-care bill but then did? Last night, MacArthur's constituents reminded him in a marathon town hall meeting of why his vote was a politically scary one. My colleague, Dave Weigel, was there to capture the fireworks, writing that "the mood was toxic from the start."

--"For more than five hours, MacArthur presented himself as an empathetic, pragmatic legislator who had to represent 'one of the few real swing seats,'" Dave writes. "But he rarely got a break. He opened with a story that, in other settings, would have been a gut punch — the decision to raise a daughter with special needs and to take her off life support when, at 11 years old, she passed away. He could hardly get the story out, as angry constituents accused him of diverting the discussion from his health-care bill …“We know about your daughter,” yelled one constituent … From that point, MacArthur was on defense, assuring constituents that he was saving the health-care system from itself and challenging the hecklers who questioned his motives."

Here's how the scene played out on social media:

At one point, MacArthur insisted that the health-care bill he voted for wouldn't cut Medicaid benefits. Strictly speaking, the bill doesn't explicitly enact changes to benefits, but it does roll back the ACA's Medicaid expansion and would result in fewer federal dollars overall to the states.

One attendee predicted MacArthur will lose his seat next year.

Here's a video of some the protesters outside:

Protesters demonstrated outside of a town hall hosted by Rep. Tom MacArthur (R-N.J.) on May 10 after he voted to pass the GOP health-care bill. (Video: Twitter/@brianbaumley)

Some people even lay on the ground and pretended to be dead:

But MacArthur didn't end things early. Instead he talked. And talked. And talked:

HEALTH ON THE HILL

We've already mentioned that keeping some of the Affordable Care Act's taxes could be one way of paying for expanded financial assistance for people to buy health coverage, if that's what the Senate decides to do. Sen. Susan Collins (R) of Maine suggested as much this week. "I don't see how you can repeal all of the pay-fors...and still meet the goal of providing health insurance coverage for people who truly need assistance," she said. 

--The Wall Street Journal delves deeper into this question: "One path for the Senate could be a repeal of the taxes but a delay in the effective dates. Compared with immediate repeal, that approach generates money within the 10-year budget scoring window without changing the ultimate policy," writes Richard Rubin.

Much has been written in the last few days about the exclusion of GOP women from the 13-member Senate working group on health care. Majority Leader Mitch McConnell (R-Ky.), who led its formation, said "nobody is being excluded because of gender," NYT's Jennifer Steinhauer reports.

--In McConnell's defense: None of the Senate's five Republican women are on the powerful Finance Committee, which has wide jurisdiction over health care. Six of the working group's members are on that panel. It makes sense that McConnell would choose members with more experience in health care policy.

--But on the flip side: Two Republican women sit on the second most powerful health care committee -- Senate Health, Education, Labor and Pensions. They are Collins of and Lisa Murkowski of Alaska, both moderates who generally oppose cutting Medicaid and defunding Planned Parenthood. It's highly unlikely that McConnell's decision to leave them off the working group was an oversight. And the absence of women is indicative of a much bigger problem within the GOP of cultivating female leadership.

BRAIN WAVES

Get smart: Here's a new Brookings study on how states could be affected by the Medicaid revamp envisioned in the health-care bill the House passed last week.

What they studied: How switching Medicaid to a per-capita payment system would have reduced federal funding to states back in the 2000s, to get a sense of its effects if implemented today.

What does per capita mean, anyway? Right now, the federal government pays states a set percentage of their Medicaid costs, without limiting the total dollar amount. Republicans who are concerned this unduly strains the federal budget want to instead base the payments on the number of enrollees, thus "per capita." That's what the American Health Care Act proposes.

What researchers found:

1. Making Medicaid "per capita" during the 2000s would have required states to increase their own Medicaid spending by 11 percent on average to avoid cuts.

2. No states would have received more funding under a per-capita cap than under current law.

3. More than 85 percent of the federal cuts would have affected states that spend the least per enrollee on their Medicaid programs.

INDUSTRY RX

Aetna exiting all ACA insurance marketplaces in 2018 (Amy Goldstein)

New research sheds light on what patients want at the end of life, and who is or isn’t getting it. (New York Times)

Four things Americans should know about Dr. Scott Gottlieb, the new head of the FDA (Los Angeles Times)

STATE SCAN

Vape Shops Want to Do Good, but Fear F.D.A. Won’t Let Them Do Well (New York Times)

Illinois Senate approves state funding for abortions (Associated Press)

SUGAR RUSH
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