Following Recess, GOP Health-Care Push Gets Trickier -- Update

By Stephanie Armour Features Dow Jones Newswires

Senate Republicans returning from a July 4 recess are so divided over a health-overhaul bill that they are increasingly talking about what to do if they fail to pass their legislation. So far, they are divided about that, too.

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Some conservative lawmakers say an implosion of the Republican legislation would open the door to a full repeal of the Affordable Care Act, putting off until later a decision about what system to put in its place. Others, including Senate Majority Leader Mitch McConnell (R., Ky.), are considering the possibility of legislation to shore up the law's marketplaces where individuals buy health coverage, action that would involve working with Democrats.

The focus on possible steps to take if Senate Republicans can't unite around a health bill is the strongest sign yet of the growing pessimism about the fate of the GOP legislation and the party's seven-year pledge to topple the ACA. Some Republicans now say a vote to pass a bill could stretch beyond August, if at all.

Sen. Bill Cassidy (R., La.) said Sunday on Fox that he has reservations about the bill. Mr. Cassidy, a physician, was one of three Republicans who held town hall-style meetings over the July 4 congressional recess. He gives the bill a 50-50 chance of passing this month.

The weeklong recess has only made Senate Republicans' path toward health legislation harder, with lawmakers returning to Washington facing at least one more defection and negotiations sputtering between conservatives and centrists. Sen. John Hoeven of North Dakota told a local newspaper that he doesn't support the current legislation, joining nine other members who had already come out against it.

In addition, Mr. McConnell's suggestion over the break that lawmakers would have to act to stabilize health-insurance markets if GOP senators can't agree on legislation drew sniping from within his own party.

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Negotiations over changes to the bill to bring more Republicans on board have reached an apparent standoff. Conservatives, like Mike Lee of Utah, are insisting on a provision that would let insurers sell cheaper, less-comprehensive plans. But centrists have signaled they would oppose such a measure, fearing it would erode protections for people with pre-existing health conditions.

The intraparty divide presents a tough obstacle for Mr. McConnell. Republicans initially aimed to get health legislation to President Donald Trump's desk by early April, according to a presentation by GOP leaders. Then a vote was planned for just before the recess, but Mr. McConnell, of Kentucky, was forced to postpone it.

Now a vote, if one occurs, would likely come in mid-to-late July, with Congress's August recess serving as the next deadline. If that fails, the legislative calendar would only get more difficult.

While the ACA funds expansions in health coverage with taxes on health industries and high-income households, the GOP bill does the reverse. It would repeal taxes and lower projected government spending toward Americans' health coverage while phasing out the ACA's Medicaid expansion and cutting Medicaid more broadly. It would reduce the ACA's tax credits for low-income consumers and would let states get waivers from some insurance regulations. It also would scale back ACA requirements imposed on employer-based health plans.

The most conservative senators say the bill doesn't go far enough toward repealing the ACA, while more centrist lawmakers such as Sen. Susan Collins of Maine worry that it guts too much of the current law and takes coverage from too many people.

The legislation would leave 22 million more people uninsured in a decade compared with the ACA, according to the nonpartisan Congressional Budget Office.

As Republicans struggled to unite behind a bill, Mr. Trump said in late June that if they can't, they should pass a bill repealing the ACA, sometimes called Obamacare, and then work on a replacement. Mr. McConnell has shown little enthusiasm for that idea, and some Capitol Hill aides say Mr. Trump's suggestion has complicated the ability to get legislation passed.

The majority leader, who presides over a narrow 52-48 majority, can only afford to lose two GOP votes and still pass the bill, with Vice President Mike Pence breaking a potential 50-50 tie.

Mr. McConnell hoped to assemble a revised bill over the recess, but publicly at least, Senate Republicans seem at least as polarized as before. Mr. Hoeven said he is concerned the bill doesn't do enough to help low-income people in his state and those with pre-existing conditions.

Still, he said he hopes health-care legislation, possibly composed of multiple bills instead of one, would pass.

"I think there's a number of ways to do it, but we're going to have to make sure that between Medicaid and the refundable tax credit that we have a good option for low-income individuals," he said in an interview last week.

Conservatives responded sharply to Mr. McConnell's suggestion that Republicans, presumably working with Democrats, would have to pass a measure to stabilize the insurance markets if they couldn't agree on their own health bill. Such efforts could include continuing billions of dollars in payments to insurers to offset their costs for providing subsidies that lower out-of-pocket costs for low-income consumers. Mr. Trump has threatened to stop those payments.

"If the Republican Party wants to work with Democrats to bail out Obamacare, the results will be catastrophic for the party," said Michael Needham, CEO of Heritage Action. "For seven years it has pledged it is the party of repeal, and now is the time to work toward that goal."

A recent proposal from Sen. Ted Cruz (R., Texas) has also provoked divisions. It would let insurers that sell plans complying with ACA regulations to also sell health policies that don't.

Health analysts say that would likely cut premiums for younger, healthier people, who would buy more limited policies, while causing premiums to rise for people with pre-existing conditions who would buy the more comprehensive plans that comply with the ACA.

Conservative groups are insisting the Cruz proposal be a part of the Senate legislation. Mr. Cruz's plan has been sent to CBO, which is expected to provide an analysis of its financial and coverage impact as early as this week, according to a person familiar with the talks.

Mr. Cruz has said that providing additional choices would lower premiums for many, and that sicker people would still have options. "Under this amendment, the protections for pre-existing conditions remain there," Mr. Cruz told a Dallas television station.

But Democrats said the plan would create a bifurcated system with insurance becoming increasingly expensive for older, less-healthy individuals. "This is nothing more than a two-track system for making Trumpcare even meaner," said Sen. Patty Murray (D., Wash.).

Write to Stephanie Armour at stephanie.armour@wsj.com

(END) Dow Jones Newswires

July 09, 2017 16:19 ET (20:19 GMT)