THE PROGNOSIS

Their grand gamble to repeal the Affordable Care Act now lost, Republicans have devolved into bickering over whether to leverage extra Obamacare subsidies as a final bargaining chip toward getting something done on health care. Trump has threatened to withold the subsidies for low-income Americans, but Republicans' relationship with the president has deteriorated so sharply in recent days that some lawmakers are openly defying his directives, laying bare the party's deep schisms on health care.

Two GOP camps have emerged. One group of Republicans insists the Trump administration keep reimbursing insurers for mandatory cost-sharing discounts, to save the ACA marketplaces from a potentially fatal spiral of premium spikes and insurer exits. Most prominent in this group: Senate Health, Education, Labor and Pensions Chairman Lamar Alexander (R-Tenn.), who yesterday announced his plans for hearings in September on how to stabilize the marketplaces. Alexander asked Trump to fund the cost-sharing reductions (known as CSRs) until then.

"I have...urged the president to temporarily continue the cost-sharing reduction payments through September so that Congress can work on a short- term solution for stabilizing the individual market in 2018," Alexander said in a statement.

Republican Sen. Susan Collins of Maine also called for the payments to be made, per HuffPost's Matt Fuller:

But Republicans in the second camp -- and this includes Trump -- want to withhold the payments as a way of pressuring lawmakers, including perhaps Democrats, to keep trying for elements of ACA repeal. Finance Committee Chairman Orrin G. Hatch (R-Utah) appears to be closer to this group, telling us yesterday that CSR payments should only go out with "significant reforms" alongside them.

"As we work through these challenges, one thing is certain: There should be no Obamacare bailouts without significant reforms," Hatch said in a statement provided to The Health 202.

Senate Majority Leader Mitch McConnell (R-Ky.) has expressed a similar unwillingness to fund the CSRs without a chance to also rewrite some of the ACA. Many of the conservative groups who  have been furiously pressuring the GOP to repeal-and-replace Obamacare are also in this crowd. Both the Heritage Foundation and the Koch-backed Americans for Prosperity are terming the subsidies a "bailout" and view funding them as a concession to President Obama's health-care law (even though it's now clear Republicans can't repeal it anyway).

Heritage's Bob Moffit wrote that Trump “should light a fire under both Republicans and Democrats in Congress by simply canceling the illegal taxpayer insurance subsidies for congressional health coverage."

"Our view is the CSR’s are evidence of a failing system," AFP spokesman Levi Russell said. "They represent a taxpayer-funded bailout of insurance companies that do nothing to address the underlying structural problems of Obamacare...So we feel that the only way to actually address the cost and access of healthcare is to repeal Obamacare fully."

Trump has also repeatedly used the word "bailout" to describe the payments, which the federal government pays to insurers to help cover the costs for extra discounts they're required to offer marketplace customers. These discounts are applied to a plan's out-of-pocket costs -- like its deductibles or co-payments -- and are available only to people earning up to 250 percent of the poverty level.

The president sent a flurry of tweets over the past few days threatening to withhold the August payment unless Congress tries yet again for a repeal bill. No. 2 Senate Republican John Cornyn (Texas) appeared to push back against that idea yesterday, several reporters noted:

HuffPost's Jennifer Bendery: 

AP's Erica Werner:

Rumors were circulating yesterday that Trump has made a final decision. From Andy Slavitt, former acting administrator of the Centers for Medicare and Medicaid Services under Obama:

The White House didn't confirm or deny the claim. "The president is working with his staff and his cabinet to consider the issues raised by the CSR payments," is all a White House spokesperson told The Health 202.

The administration has already delivered the July payment, so it is the August payment that is jeopardized. But even if Trump funds the subsidies through September -- as Sen. Alexander has requested -- Republicans still don't have much time to figure out their response to counties with a shortage of insurers. Alexander will commence HELP hearings the week of Sept. 4. Just three weeks later, on Sept. 27, insurers must make their final decisions about whether to sell marketplace plans in 2018.

And so far, Alexander is the only Republican holding health-care hearings. The other three congressional panels that deal with the issue all said yesterday they don't have any such plans, at least none they're revealing right now. Lauren Aronson, spokeswoman for the House Ways and Means panel, pointed to the health-care bill the House already passed in May and noted that Congress has held more than 200 health-care-related hearings since the ACA was passed back in 2010. Senate Finance and the House Energy and Commerce  Committee likewise said they have no health-care hearings to announce.

The marketplaces have overwhelmingly attracted lower-income Americans under 200 percent of the poverty level, who are eligible for these CSRs. America's Health Insurance Plans has a handy map showing where people would be most affected by a cessation of the payments:

And don't forget, there's a legal side to this. If the Trump administration doesn't decide within a few weeks to appeal a previous court ruling saying Congress must appropriate the CSR money (in a case first filed by House Republicans against the Obama administration), it can't keep making the payments anyway. Then, the burden would be on Republicans on Capitol Hill.

It may have just gotten harder for both the Trump administration and Republicans to abandon the payments without a legal fight, after the U.S. Court of Appeals for the District of Columbia Circuit ruled yesterday that a coalition of 16 state attorneys general, all of whom want to preserve the subsidies, may intervene in the appeal, The Post's Amy Goldstein reports.

Health policy student Adrianna McIntyre:

AHH, OOF and OUCH

AHH: Last month, with no public hearings, the House voted to approve a medical malpractice measure placing strict limits on damages for some plaintiffs and lower fees for their attorneys. It isn’t unusual for industry stakeholders to draft legislation, but in this case, lobbyists were able to rapidly shepherd their bill to House passage with minimal input from the public or even members of Congress -- and then bragged about it, reports The Post's Kimberly Kindy.

"Lobbyists crowed about the achievement, boasting that the House-passed measure was nearly identical to one they provided to the House Judiciary Committee," Kimberly writes. "With Republicans in full control of Washington for the first time in 10 years, lobbyists for business and conservative causes are pushing aggressively for changes in laws and regulations long resisted by Democrats....After just six months, they have scored dozens of victories.

"In February, Trump signed a measure, championed by the National Rifle Association, that rolled back Obama-era rules making it harder for people with mental illnesses to buy guns. In April, Trump signed a bill, backed by large Internet providers, that killed rules blocking the companies from selling consumers’ browsing histories to third parties."

"Leaders of a coalition of doctors and their insurers say their odds of overhauling the nation’s medical malpractice laws have also greatly improved," Kimberly continues. "Trump’s health secretary, Tom Price, is a former congressman and orthopedic surgeon who has long complained that frivolous lawsuits are driving up the cost of health care. And GOP leaders in both the House and Senate have cast medical malpractice reform as a key part of their strategy for making health care more affordable."

OOF: California's marketplace announced some not-so-great news yesterday. Premiums for its plans will surge by an average of 12.5 percent next year -- a second consecutive year of double-digit increases -- and major insurer Anthem Blue Cross will significantly roll back its participation, the AP reports

At the same time, the state will avoid the massive market upheaval that has left some states with just one insurer or none at all, with all 11 existing insurers continuing to provide coverage next year. Anthem Blue Cross will continue offering plans only in Santa Clara County and rural parts of Northern California and the Central Valley, forcing about 10 percent of people insured through Covered California to find a new health plan.

OUCH: Some House Republicans agreed to vote for the chamber's version of Obamacare overhaul -- the American Health Care Act -- under the belief the Senate would make it better. But then the Senate failed to pass anything, leaving vulnerable Republicans in a position of defending their vote for the AHCA. One of these members is Florida Rep. Carlos Curbelo, Roll Call reports. “I received strong assurances that major improvements would be made in the Senate," Curbelo wrote in a May Miami Herald op-ed explaining his vote. 

The Senate's failure to pass a bill "leaves those House Republicans who justified their politically risky 'yes' votes last May by saying the Senate would improve the legislation without much cover," writes Simone Pathe. "House members who voted for their own version of repeal were upset about the Senate vote Friday morning, but few expressed concern about their own political fates. Mostly, they denied that they’re thinking about politics at all....But as they head home for a month-long recess, House Republicans in targeted districts are likely to continue to face tough questions about a deeply unpopular piece of legislation."

TRUMP TEMPERATURE

--Besides threatening to withhold CSRs, President Trump has also threatened something else: To block members of Congress and their staff from getting employer contributions (in this case, from the federal government) to their insurance plans. The threat is rooted in a change in congressional health coverage that was ordered during the initial consideration of the ACA in 2010, Kaiser Health News's Julie Rovner reports.

In an effort to embarrass Democrats — then in the majority — Republicans successfully pushed an amendment to the ACA bill that required lawmakers and some staffers to buy their insurance through the measure’s marketplaces. They currently get coverage through the D.C. marketplace. But this is where things get messy, because they're still able to get the employer contribution to their plans.

"Federal workers, like most people who work for large employers, get a substantial portion of their insurance premium paid as part of their overall compensation — about 72 percent under Federal Employee Health Benefits Program," Julie explains. "Taking this employer contribution away from Hill staffers would be tantamount to a pay cut of thousands of dollars. Members of Congress from both parties feared it would result in a “brain drain” because making employees pay the full cost of insurance would make Capitol Hill a less desirable place to work."

HEALTH ON THE HILL

--Burn: In a moment of brutal honesty yesterday, McConnell acknowledged that Republicans themselves are ultimately to blame for last week's dramatic failure of a "skinny repeal" bill. Republicans had used the budget reconciliation process so they could bypass Senate Democrats and ram through an Obamacare overhaul with just 50 votes. But in the end, they could only get 49 votes.  (Trump has raised the issue in recent days with a tweetstorm over the weekend saying that Republicans should change the Senate's filibuster rules so they could pass better legislation).

Per Julie Rovner:

--Meanwhile, Sen. Bernie Sanders (I-Vt.) is ramping up his campaign for single-payer health care, starting with digital ads that ask voters to endorse his planned “Medicare for All” legislation ahead of August recess, my colleague Dave Weigel reports.

"The six-figure buy, paid for by Sanders’s 2018 Senate reelection campaign, will direct readers to his website, where they can sign on to his bill," Dave writes. "That will tee up legislation that Sanders has promised, then delayed, since March — a version of single-payer health care that, he hopes, will avoid some of the pitfalls that have made previous bills politically untenable."

“We’re tweaking the final points of the bill, and we’re figuring out how we can mount a national campaign to bring people together,” Sanders said this past weekend on CNN’s “State of the Union.”

REPRODUCTIVE WARS

--Planned Parenthood dodged a bullet when the Senate health-care bill died last week, as it would have blocked Medicaid reimbursements to the women's health and abortion provider. But abortion foes are deeply disappointed, as defunding Planned Parenthood has been one of their longtime goals.

Today the research wing of antiabortion group Susan B. Anthony List will release a look at the market share of abortions Planned Parenthood provides versus other kinds of medical care -- trying to undermine the group's efforts to downplay its abortion services and highlight other reasons women visit its clinics. The report says that Planned Parenthood provides 35.4 percent of abortions in the United States but less than 1 percent of the nation’s HIV and pap tests. In the last five years, service-to-client ratios for breast exams and pap tests have declined by 37 percent, the report says.

The findings demonstrate that except for abortion, Planned Parenthood doesn't provide any medical services not easily available from other providers, according to Chuck Donovan, president of SBA List's Charlotte Lozier Institute.

“Planned Parenthood’s commitment to abortion on-demand is clearly more than ideological," Donovan said in a statement. "Their market domination would make such giants in their respective industries as General Motors and Samsung envious – but cornering the abortion market is nothing to celebrate."

A few more reads from the Post and beyond:

For a long time Dean Heller looked likely to thwart his party’s drive for health-care legislation. Then he flipped back, but the GOP failed anyway.
New York Magazine
SECOND OPINION
There’s plenty of flexibility to change the Affordable Care Act without repealing it.
Lanhee J. Chen and Tevi Troy
INDUSTRY RX
The lone insurer offering policies on Alaska’s individual health insurance market has filed for an average rate decrease of about 22 percent next year.
Becky Bohrer | AP
STATE SCAN
At the meeting, the head of the state’s health exchange praised the drop in uninsured under the ACA but warns of declining insurer participation.
Fenit Nirappil
DAYBOOK

Today

  • Brookings Institution is holding an event on "procedure and politics in the 115th Congress."

Coming Up

  • The Senate Finance Committee considers Matthew Bassett, a nominee to be the Assistant Secretary of Health and Human Services on Thursday
SUGAR RUSH

Watch Sen. Cory Booker (D-N.J.) discuss his bill to legalize marijuana nationally:

On the Late Show with Stephen Colbert, Sen. Al Franken (D-Minn.) recalls Sen. John McCain's (R-Ariz.) vote against the GOP health-care bill: 

From Stephen Colbert, "The Purge: White House Edition":

Jimmy Fallon with an idea for a LinkedIn for anyone kicked out of the Trump administration: