This week, the White House and Republican leaders in the House of Representatives are once again pushing for a vote on their health reform bill with extreme haste. That’s even though the artificial deadline of President Trump’s 100th day in office has passed, even though the Congressional Budget Office has not released a score of their changes to the bill, and even though the bill is tremendously unpopular and the recent changes to preexisting conditions policy seem likely to make it even more so.
This behavior might come off as odd. The original Obamacare bill, after all, took more than a year to pass, but it did pass in the end. So why not take it slow, legislate, build support, and make compromises over the following months in a process like the one Democrats used, rather than continuing on this mad dash?
Republicans do have a rationale. Months ago, they agreed on a legislative strategy designed to game Senate rules so they could pass two major bills — Obamacare repeal and tax reform — with just 51 votes, ensuring that the filibuster would be bypassed and Democratic support wouldn’t be necessary. Furthermore, the GOP agreed to put health care first, which would have the happy side benefit of allowing them to pass a bigger total permanent tax cut, for other complex Senate rules–related reasons.
Their problem is that as those rules are currently being interpreted by congressional bigwigs, Republicans think they effectively can’t move on to a new budget resolution, which would allow a 51-vote tax reform bill, without either passing or deciding to permanently abandon their 51-vote health bill.
That is: If Republicans pass a new budget, as they intend to do, they think the existing “reconciliation instructions” setting up health reform on a 51-vote track would expire.
An important caveat here is that Senate rules are complicated and that a sufficiently determined majority may be able to find ways to circumvent, bend, or break them. But this is the current prevailing thinking about what the rules mean. I wrote about this at length in my analysis of why the GOP’s March attempt at health reform failed, but here’s a recap of Republicans’ strategic thinking here.
Republicans wanted to use budget reconciliation twice — and they decided to put health care first
When the dust settled after Donald Trump’s shocking victory on November 8, Republicans in Congress quickly saw that despite grand ambitions for what they could do with their newfound control of Washington, they had one major problem: the filibuster.
That is, with only 52 Republican senators, the party was far short of the 60 votes necessary to overcome a Democratic filibuster. Picking off eight Democratic votes would be a very tall order indeed. Furthermore, in the weeks after the election, several Republican senators affirmed they wanted to keep the legislative filibuster in place, thus forestalling any chance at a “nuclear option” rules change like the one used for Senate nominations.
So the best chance of passing sweeping new legislation, Republican leaders on the Hill concluded, was to use the Senate’s special budget reconciliation process. That allows certain bills that abide by certain rules to bypass the filibuster and advance through the Senate with a simple majority — just 51 votes rather than 60.
However, rather than setting one top priority for Trump’s first year, Republican leaders decided they’d have two: Obamacare repeal and comprehensive tax reform. And to ensure they wouldn’t have to win over any Democrats, they decided they wanted to use budget reconciliation for both.
But by Senate rules, you can’t move two separate budget reconciliation bills affecting spending and revenues at the same time. One would have to go first. And Republicans decided that would be Obamacare repeal, for a few reasons.
First, they thought it could be passed quickly. They had already passed it in December 2015, after all. It was vetoed by President Obama, but they thought they’d have sufficient support to do it again.
Second, they thought it would be legislatively easier to write an Obamacare repeal bill than tax reform, because they intended to put off the hard work of creating an actual replacement for Obamacare until later. This was the “repeal and delay” strategy — pass a quick repeal, set it to go into effect in a few years, and write the replacement in the meantime.
Third, Republicans thought repealing Obamacare first would actually make tax reform itself much easier. That’s because, per Senate rules, anything passed through budget reconciliation isn’t allowed to increase deficits in the long run (generally interpreted as more than a decade).
So by splitting their preferred tax cuts between both reconciliation bills, one of which (Obamacare repeal) would include large spending cuts to offset lost tax revenue, Republicans would give themselves the ability to cut taxes even further than they would have with a single reconciliation bill, and to make those cuts permanent. This was an extremely important priority for them.
But this strategy meant Republicans had to move on health care fast
To actually put this strategy into action, though, Republicans would have to jump through some procedural hoops.
Basically, to use budget reconciliation for a bill, you first have to pass a yearly budget resolution with “reconciliation instructions.” Once you do that, those reconciliation instructions can only be used for one bill that affects both spending and revenue (as Obamacare repeal does).
But Republicans in Congress conceived of a creative but complicated way they could use budget reconciliation twice in 2017. They had never bothered to pass a budget resolution for fiscal year 2017 (something that was supposed to be done in the 2016 calendar year).
So technically, it would be possible for them to ... stay with me here ... 1) pass a pro forma FY 2017 budget resolution purely to set up health care reconciliation, 2) pass Obamacare repeal through reconciliation, 3) pass a full FY 2018 budget resolution to set up tax reform reconciliation, and 4) pass tax reform through reconciliation.
The catch was that in this scenario, Obamacare repeal would have to move very quickly indeed. Republicans wanted to pass the new budget setting up tax reform for reconciliation (step 3) by this spring — and once they did so, they believed Senate rules required that the health care reconciliation instructions from the previous budget resolution would expire.
Reports that congressional GOP leaders were consolidating around this strategy began to trickle out in the press in mid-November. And on December 12, Mitch McConnell laid it out in a press conference. “We anticipate doing two budget resolutions,” he said. “The first will be the Obamacare repeal resolution. And then we will do one later in the spring, which will largely be dedicated to tax reform.”
But the plan quickly went awry when Republicans turned out to hate repeal and delay
When the 115th United States Congress was sworn in this January, step one of the Republican strategy unfolded as planned. That is, both houses of Congress swiftly passed a budget resolution that set up Obamacare repeal to pass through budget reconciliation.
But then GOP leaders encountered a problem. Their members, in both the House and the Senate, turned out to really hate the “repeal and delay” strategy, because it meant getting rid of Obamacare and its benefits without the “replacement” the party had long promised they’d offer being ready.
This came as a surprise to some, since practically every Republican in Congress had voted to pass Obamacare repeal without any replacement many times before. But it became clear that many of those votes were merely protest votes, used for messaging and taken with the comfort that President Obama’s veto would prevent them from actually going into effect.
Now that the GOP had unified control of Washington, the dynamic was different. The phrase “we’re shooting with live bullets now” became popular around the Hill. It suddenly seemed unacceptable for the governing party not to have a replacement plan.
And there was another big problem — if the “replace” bill was put off until later, it couldn’t advance through budget reconciliation. That means it would have to win over eight Democratic senators to beat a filibuster. Many Republicans feared this would never happen, and worried that after they started the countdown clock toward repeal, they’d be unable to pass a replacement and would get stuck with the blame.
So Republican leaders adjusted. The new strategy, they decided, was to do both repeal and as much of “replace” as possible in the budget reconciliation bill. (Publicly, they maintained they could pass other health reform measures through regular order later with Democratic support as part of a “three prongs” strategy, but nobody really believed them.)
This new approach had its own problems, though. For one, the Senate’s intricate rules about what kinds of provisions could pass through the budget reconciliation process meant Republicans couldn’t include some parts of a replacement they liked (such as allowing insurers to sell health plans across state lines).
Even more urgently, the crowded legislative calendar — with two budget resolutions and two reconciliation bills — meant the health bill had to happen fast, or it would hold up everything else.
This timeline made sense for repeal and delay, when many of the tough details of how to overhaul the health care system could be put off until later.
But now that they had to write a replacement, Republicans were stuck trying to completely overhaul the American health care system absurdly quickly. All the ordinary steps to winning broad support for a transformative piece of legislation — holding hearings, wooing over stakeholder groups, selling the bill in public, passing amendments — had to be short-circuited to stick to this timeline.
Rather than adjust their calendar or overall strategy, however, Republicans decided to forge onward. This resulted in the failure of their initial effort in March, and, it seemed, the derailment of their entire strategy. Paul Ryan proclaimed Obamacare was the law of the land, and the White House signaled it would simply drop the effort and move on to tax reform.
But in the following weeks, President Trump’s thinking seemed to change. He was upset at being deemed a failure on health reform, and he still wanted the bigger and permanent 51-vote tax cuts that the initial strategy would allow. So now he and the GOP are trying to make the initial plan work one more time.