Washington's hottest club is ... the Senate health care working group

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The AHCA action has moved to the Senate, which has settled on a 13-member working group to draft a health care bill. Vox's Dylan Scott has a list of the members:

1. Senate Majority Leader Mitch McConnell (R-KY)
2. Senate Finance Committee Chair Orrin Hatch (R-UT)
3. Senate HELP Committee Chair Lamar Alexander (R-TN)
4. Sen. Mike Enzi (R-WY)
5. Sen. John Thune (R-SD)
6. Sen. Mike Lee (R-UT)
7. Sen. Ted Cruz (R-TX)
8. Sen. Tom Cotton (R-AR)
9. Sen. Cory Gardner (R-CO)
10. Sen. John Barrasso (R-WY)
11. Sen. John Cornyn (R-TX)
12. Sen. Robert Portman (R-OH)
13. Sen. Pat Toomey (R-PA)

The group is a cross section of the Republican Party in the Senate. It ranges from Sen. Portman — a moderate who is concerned about cutting the Medicaid expansion too heavily — to Sen. Lee, a conservative who would like to see Obamacare wiped off the books entirely. The idea is that if there is a health care bill that can fly with this group of legislators, it can probably survive the rest of the caucus too.

The working group notably does not include Sens. Bill Cassidy (R-LA) and Susan Collins (R-ME), who have spent this session working on a bill that would allow some states to keep the Affordable Care Act and others to opt out. That is a bill crafted for compromise with Democrats — which is something neither party seems to be in the mood for these days.

11 of the 217 Republicans who voted for the AHCA will hold town halls next week

Legislators who voted to pass the American Health Care Act sure don't appear eager to talk about that decision. According to data provided by the Town Hall Project, only nine Republicans who supported the bill currently have events scheduled during next week's recess. Those House members are:

1. Raúl Labrador (R-ID)
2. Tom Reed (R-NY)
3. Rod Blum (R-IA)
4. Roger Marshall (R-KS)
5. David Brat (R-VA)
6. Thomas Garrett (R-VA)
7. Tom MacArthur (R-NJ)
8. Chris Stewart (R-UT)
9. Don Bacon (R-NE)

The MacArthur event, which will happen next Wednesday evening, could be the most interesting to watch, given MacArthur's key role in drafting the AHCA — particularly adding the amendment that would allow states to waive Obamacare's requirements that insurers not discriminate against people based on their preexisting conditions.

Let's take a health policy field trip to Iowa

When Republicans explained Thursday why they needed to repeal Obamacare, they kept talking about the same thing: Iowa. A few examples from Thursday:

• House Speaker Paul Ryan: "Just this week, we learned of another state, Iowa, where the last remaining health care plan is pulling out of 94 of their 99 counties, leaving most of their citizens with no plans on the Obamacare market at all."
• House Majority Leader Kevin McCarthy: "How do you look in the faces of 94 counties in Iowa out of 99? Not that they won't have very many choices; they'll have no choice."

First things first: No, Iowa is not yet facing a situation where it has no insurers in 94 counties. But it's getting close. Health insurers have fled the Iowa marketplace quickly, in a way that is not happening elsewhere in the country.

For the past four years, Iowa had a relatively competitive marketplace. There were four insurers that sold in different areas of the state.

Things started to take a turn for the worse in April. Wellmark (Iowa's largest health plan) and Aetna announced in April that they would quit the marketplace.

This left one insurance plan, Medica, as the only insurer left in 94 of Iowa's 99 counties. It then released a statement this week saying it was considering leaving the marketplace — but hadn't made up its mind.

Why are insurers fleeing the Iowa marketplace? A lot of them are citing the uncertainty that the Trump administration has created.

Wellmark said it lost $90 million on the marketplace during its four years in business. It thought there was a way to fix this problem — to become profitable in the individual market — but the current administration didn't seem interested in going down that path.

"While there are many potential solutions, the timing and relative impact of those solutions is currently unclear," Wellmark chief executive John Forsyth said in a statement. "This makes it difficult to establish plans for 2018.”

Same story with Aetna, which said it was leaving as "a result of financial risk and an uncertain outlook for the marketplace."

Then comes Medica, with its statement this week. Medica too cited the uncertainty around the health law's future as making it skittish on sticking with the Obamacare marketplaces.

The marketplaces were not working perfectly under the Obama administration. But part of the reason insurers have soured on them, in Iowa and elsewhere, is the Trump administration has played coy about what it plans to do with Obamacare next year. Officials have been aggressively ambiguous, for example, about whether they plan to pay Obamacare's cost-sharing reduction subsidies.

An uncertain marketplace is less attractive to health insurance plans. As industry consultant Robert Laszweski told me a few weeks ago, “The health plans I work with want to stay in, but the Trump administration is not making that easy.”

One wrinkle to this story that makes Iowa an outlier: Its marketplace has one very expensive patient. There is reportedly a patient in the Iowa marketplace who has about $1 million in monthly medical claims. This person enrolled on Wellmark in 2016, and because of their exceptionally high bills, the insurer had to raise premiums 40 percent in 2017. Insurers in Iowa are nervous about being the last one standing, because then they'd end up with this one person to cover. This is an anomaly in the Iowa marketplace that we so far haven't seen play out anywhere else.

Chart of the Day

Javier Zarracina/Vox

Remembering the economist who explained why health care costs rise so quickly. My colleague Tim Lee wrote an obituary for the famed economist William Baumol, whose cost disease theory explained why health care and education costs grow so much faster than other parts of the economy. Tim describes this graph as his favorite chart of the American economy.

Kliff’s Notes

Your daily top health care reads, with research help from Caitlin Davis

Today's top news

• "In Rare Unity, Hospitals, Doctors and Insurers Criticize Health Bill": “The prospect of millions of people unable to afford coverage led to an outcry from the health care industry as well as consumer groups. They found an uncommon ally in some insurers, who rely heavily on Medicaid and Medicare as mainstays of their business and hope the Senate will be more receptive to their concerns.” —Reed Abelson and Katie Thomas, New York Times
• "'I’ve never seen anything like this': progressives see huge donation spike after AHCA vote": "In about 24 hours, the political advocacy group Swing Left raised more than $800,000 for Democratic House candidates, with at least $100,000 going to challenge Rep. Darrell Issa (R-CA) alone. Daily Kos beat its single-day fundraising total by pulling in around $900,000 in just one day." —Jeff Stein, Vox
• "Even red states are wary of ditching Obamacare protections": “The House Republican repeal bill narrowly approved Thursday lets states opt out of much of Obamacare — but not a single governor has stepped up to say they want to take advantage of that leeway. Officials in a dozen states surveyed by POLITICO weren’t eager to embrace opt-outs that would let states skirt key insurance provisions, including safeguards for people with pre-existing conditions and a set of basic, required health benefits.” —Rachana Pradhan, Politico
• "Trump praises Australia’s universal health-care system: ‘You have better health care than we do'": “Seconds after praising his party's efforts to pass a new health-care bill that estimates said would leave millions uninsured, President Trump praised Australia's government-funded universal heath-care system. 'We have a failing health care — I shouldn't say this to our great gentleman and my friend from Australia, because you have better health care than we do,' a tuxedo-clad Trump said at a meeting with Australian Prime Minister Malcolm Turnbull in Manhattan on Thursday.” —Abby Phillip, Washington Post
• "Trump moving to slash budget for White House 'drug czar'": “The Trump administration is moving to gut the office of the White House 'drug czar' according to a preliminary budget document and an email message that its acting director has circulated to agency staff. The Office of National Drug Control Policy, or ONDCP, is the lead White House office shaping policy on the nation’s opioid crisis, among other responsibilities.” —Associated Press

Longer reads and analysis

• "How House Republicans learned to stop worrying about policy and pass the AHCA": "On Thursday, House Republicans gathered in that same basement room with the theme song from Rocky blaring through the speakers. House Majority Leader Kevin McCarthy took the podium with a picture of George Patton, the famed World War II general, projected behind him. The caucus was set to vote on a health care bill, and victory was at hand." —Tara Golshan and Dylan Scott, Vox
• "The House Republicans who could lose their jobs over Obamacare repeal": “Strategists in both parties already believed the House could be up for grabs in 2018, as it often is two years into a new presidency. But the Obamacare repeal vote was as emotionally charged as they come on Capitol Hill, and a handful of Republicans in districts won by Hillary Clinton may have very well written their political obituary by voting yes.” —Kevin Robillard, Politico
• "Death Spirals and Other Problems the Republican Health Plan Doesn't Solve": “The structure of the Republican tax credits, which are pegged to age rather than income and the price of insurance, seems if anything more likely to increase the 'adverse selection' problem, where sick people rush to buy insurance, healthy people dawdle, insurers are forced to raise premiums to the average cost of their fairly sick insurance pool, and more healthy people drop out of the market because the insurance is so darn expensive.” —Megan McArdle, Bloomberg

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