Does The GOP Really Have A Strategy On Health Care Anymore?

Donald Trump and Paul Ryan seem to be unable to let go of the failure of Trumpcare and keep on throwing out proposals that they hope will somehow, some way, find enough supporters to actually pass. But one has to wonder what exactly their strategy really is or if there really is one.

Before they left for the Easter recess, Ryan's latest proposal was to move older and sicker people into high-risk pools that would be run by the states. It also included the provision that would allow the insurance companies to charge older and sicker people who would remain in the private market significantly higher premiums and offer skimpier policies that provide far less coverage than the ACA currently requires. Of course, it provided insignificant subsidies to the states to cover these high risk pools and actually phased these insufficient subsidies out entirely in under ten years. The idea behind this plan is that it would reduce premiums for the majority of those who remained in the private insurance market, while markedly hiking rates for a smaller subset of people.

For Ryan, passing something on health care may be a matter of self-preservation, as there are already rumblings within his own caucus that he should be removed as Speaker. At a town hall meeting, House Freedom Caucus member Justin Amash said, "We need either a change in direction from this speaker, or we need a new speaker." In addition, the massive tax cuts the Ryan so desperately wants and on which the entirety of his "Better Way" agenda is based on, relies on the $1.2 billion in tax cuts that repealing the ACA would bring. For Ryan, passing something on health care may be existential.

Trump, on the other hand, just seems to be unable to accept defeat because, I guess, he's a "winner". Trump also realizes that repealing the ACA is the real path to the tax cuts he, the GOP, and their corporate and wealthy overlords are counting on. Tax reform just won't do it. Says Trump, "we get hundreds of millions of dollars in savings that goes into the taxes" if they can pass a health care bill that replaces the ACA, mostly through the repeal of around a 5% tax increase on the rich that undergirds Obamacare. In addition, the idea was to force through the ACA repeal under the 2017 budget reconciliation rules and then do tax reform under the 2018 budget reconciliation, as both would only need 50 votes for passage in the Senate. That would allow them to complete both actions without breaking the rule to increase the deficit over a 10 year period. Combining them into one budget resolution package will break that 10 year rule.

Trump's line of attack now seems to try to get Democrats on board with some kind of bipartisan change in the health law. Trump's initial attempt to do this came when he floated the idea of combining an infrastructure package with either a health care bill or tax reform. That plan didn't last too long as someone probably convinced Trump that tackling any of one these issues individually is a nightmare, but to do two of them at once is virtually impossible. In addition, Democrats made it clear that there was no deal like that to be made.

The current line of attack is threatening to destroy the ACA and then blaming Democrats. This strategy is based on an ongoing court case that Congress brought against the executive branch when Obama was President. The case revolves around subsidies paid directly to insurers so that they could reduce premiums and out-of-pocket costs for enrollees. Congress claims that those subsidies were not authorized in the ACA bill and are therefore illegal and they received an initial ruling on the case in their favor. The Obama administration appealed that decision and it is now up to the Trump administration whether to continue with that appeal or let the initial ruling stand.  Last week, HHS indicated that it would continue the appeal but Trump apparently reversed that decision and claims that no decision has been reached, in an apparent attempt to use these subsidies as a bargaining chip.

Interestingly, a joint statement by groups representing health insurers, doctors, hospitals, and more importantly the US Chamber of Commerce urged the administration to continue these subsidies. The letter points out that insurers need to make decisions about 2018 plans by the end of this month so a decision on this issue is critical. The appearance of the Chamber of Commerce on this letter add some real pressure from a solidly Republican and important lobbying group to not destroy the ACA this way. But that is the threat Trump is using.

Further complicating the issue is the upcoming debt ceiling vote and the looming budget reconciliation for 2017. Trump and the GOP may demand try to attach tax reform or health care to raising the debt ceiling vote and dare Democrats to say no. According to another Freedom Caucus member, Dave Brat, "So I think that debt ceiling piece will be tied to -- and in my view it has to be tied to -- tax reform being in stone." On the other hand, while Democrats are currently demanding a "clean bill", if the GOP links other issues to the debt ceiling vote, Democrats may have their own demands, possibly setting the stage for another standoff as the US heads for default on its obligations. It takes an enormous faith in the bully pulpit and the right wing echo chamber to believe that Democrats could be successfully blamed for a government shutdown and possible default of US Treasury obligations when the GOP controls both houses of Congress and the presidency, but that power should not be underestimated.

In any case, it is hard to see how Trump's strategy will work. At this point, having tried to screw around with the ACA, Trump and the Republicans will own what happens in 2018. If premiums and deductibles increase again like they did in 2017, any low-information voters will assume that Republicans have changed the law somehow. If Trump does not defend the insurer's subsidies, most high-information voters will understand he sabotaged the law. And others will wonder, having talked about the issue for most of 2017 and having full control of government, why Republicans allowed the increases to happen. Again, it takes an enormous faith in the bully pulpit and the right wing echo chamber to believe that Democrats could be successfully blamed.

More importantly, the preoccupation with a health care plan that seems doomed to failure simply gives the GOP less time to move on the tax reform and the budget, both of which have the potential to split the Republican caucus in the same way as health care. Remember, Republicans were unable to craft a budget in 2016, despite controlling the House and the Senate. The continuing budget resolution passed in December expires April 28th, and Democrats may use the leverage on that vote to insist that these insurer subsidies be continued.

Lastly, the Republican health care plan has been a total PR debacle and members going back to their districts over the Easter break have been absolutely pummeled on the issue. Many Americans have already made up their minds about the GOP health care plan and it is overwhelmingly negative. Keeping the issue front and center merely keeps the inability of Republicans to govern front and center. I'm sure for most members of Congress, the preference would be to simply move on to something else, despite Ryan's and Trump's wishes. And perhaps this was all a gambit to force the Democrats to use the insurer subsidies as a bargaining chip in the budget debate. If health care disappears from the agenda after April 28th, we will know why. But it really seems that Ryan and Trump want to pass something for real and the discussions will still continue. At this point for Democrats, the longer the GOP spends on health care, the better.