The War Over Obamacare May Never End Even if the GOP gives up on repeal and replace. Filed under Health Care

The latest version of Obamacare repeal seems dead or on life support, with Arizona Sen. John McCain declaring on Friday that he will not support the Graham-Cassidy legislation. Maine’s Susan Collins, Alaska’s Lisa Murkowski and Kentucky’s Rand Paul are also leaning against voting for the bill, which would put the Republicans two votes shy of passage, so it’s not clear whether Graham-Cassidy will even be taken up for a vote next week.

But I don’t think the Obamacare wars are over — or even close to over. We tend to think there are only two possible futures for the Affordable Care Act: It remains in place or Republicans in Congress repeal it. But there are really four paths:

Repeal and replace succeeds. Republicans in Congress find a way to repeal or partially repeal Obamacare. Sen. Orrin Hatch of Utah has already floated the idea of adopting a reconciliation bill for 2018 that includes tax reform and an Obamacare repeal. This would allow Republicans to attempt to accomplish both major GOP goals using a single bill that would require only 50 votes to pass. It would be hard to pull off, but the fac that Hatch is floating the idea suggests that Republicans may not give up trying to pass an Obamacare repeal with 50 votes, even if they can’t use the 2017 reconciliation process, which expires after Sept 30. Executive branch undermines Obamacare. President Trump’s administration could do a number of things — such as cutting the advertising budget for the Obamacare marketplaces (which has already happened) or refusing to pay insurers for cost-sharing subsidies (which Trump has not yet done) — that don’t outright repeal the law, but that severely weaken its effect and over four years might add up to a partial repeal. Bipartisanship. A bipartisan congressional effort to fix the law — along the lines of the bill Republican Sen. Lamar Alexander of Tennessee and Democratic Sen. Patty Murray of Washington were working on until GOP leaders decided this week to focus on Graham-Cassidy — could still gain traction. Trump implements Obamacare. In this scenario, the Trump administration and Republican governors decide to give up on repeal and instead implement Obamacare. This would mean Trump’s team would need to encourage insurers to remain in the program and some of the 19 states that have not yet expanded Medicaid under Obamacare, nearly all of which are led by Republicans, would likely opt to do so.

Congressional Republicans and the Trump administration, in trying to pass an Obamacare repeal for much of the year, have essentially been vacillating between these four approaches. The White House has taken steps, like paying out the cost-sharing subsidies owed to insurers under the law, that move in the direction of approach No 4. But cutting the Obamacare ad funding is more like No. 2, a kind of Obamacare sabotage. And the Trump administration didn’t formally oppose Alexander’s bipartisan approach until this week, when it seemed like Graham-Cassidy could pass.

It’s hard to say which path Republicans will take, even next week. And this is not because party leaders are stupid or confused about their goals, but because each of these paths is fraught for Republicans.

Repeal and replace succeeds: It’s not an accident that Republicans keep coming up a handful of votes short. The party’s ideology keeps pushing it toward approaches that would cut Medicaid and leave millions more people uninsured. But those ideas are unpopular with the public, and the Obamacare provision that ensures people with pre-existing conditions can get affordable coverage has become a kind of political red line that can’t be crossed,

So Republicans keep trying to advance bills that cut Obamacare’s regulations, rules and costs without leaving more people uninsured or pricing out people with pre-existing conditions. These bills annoy more moderate GOP members (Collins) and also more conservative members (the House Freedom Caucus and Paul) by trying to split the difference between divergent views of health care. The goals (keep the good parts of Obamacare while repealing Obamacare) also fall apart under scrutiny from policy analysts like the Congressional Budget Office, creating some incentive for rushed, opaque processes that annoy more institutionalist Republicans (McCain, Murkowski).

Obviously, this option goes away if Democrats win control of the House or Senate in 2018 or if Republicans no longer occupy the Oval Office.

Executive branch undermines Obamacare: Millions of Americans are already buying insurance through Obamacare exchanges or living in states that have expanded Medicaid. Cutting off the advertising budget for Obamacare is most likely to affect potential beneficiaries of the law, that is, people who have not yet signed up. So I would argue Trump is on safer political ground there.

But any steps that take health care away from people who already have it are more politically complicated. Arkansas, West Virginia and Kentucky all expanded Medicaid under Democratic governors but now have GOP chief executives. All those states could withdraw themselves from the Medicaid expansion. None of them have, because those governors know such a move would be politically perilous.

If Trump’s team used the executive branch to take steps that would gut protections for people already getting coverage through Obamacare, they would face similar political challenges.

Bipartisanship: Even if Senate Republicans drop their Obamacare repeal effort and never come back to it again, I’m skeptical that a bipartisan Obamacare “fix” can pass Congress. Republican members of the House and Senate have spent almost a decade attacking this law. They have told party activists it is terrible. Key groups within the party, like Americans for Prosperity, are deeply committed to ending Obamacare. Would House Speaker Paul Ryan want to bring some kind of “Obamacare stabilization” legislation to the floor and watch it pass even as the majority of Republican House members vote against it? I doubt it.

Trump implements Obamacare: To me, this is the easiest path — or at least the one with the fewest land mines. Team Trump would ratchet down the Obamacare wars, stop criticizing the law and take some steps to implement the ACA, but in a conservative way. (This might include measures like having the 19 states that have not currently expanded Medicaid opt in to the expanded program, but require recipients to have jobs or be in college or a training program, plus pay some small premiums.) Some of Trump’s remarks about Obamacare (he seems open to signing a bill that doesn’t really repeal the law as long as he can claim he fixed it) suggest that the president would not be opposed to such a path. And if he can flip-flop on DACA even though it involves one of his signature issues (tough immigration policies), surely he can flip on health care. Trump could then say that he fixed American health care.

But Trump’s Health and Human Services Department is run by Tom Price, who has been a consistent and fervent opponent of Obamacare. I doubt Price would favor such an approach. In fact, I think Trump’s HHS staff would slow-walk a pro-Obamacare strategy (think of how Trump’s national security staff seems to be trying to stop him from withdrawing the U.S. from the Iran nuclear deal) if the president called for one.

The news of this week suggests that Republicans won’t pass an Obamacare repeal by Sept. 30, although that could change if Collins, Murkowski or Paul suddenly switch positions. But Republicans, I would argue, only have hard choices on Obamacare. And that’s why the last seven months in Washington have felt like Groundhog Day.