The New GOP Health Care Bill Shows Republicans Have Given Up on Fully Repealing Obamacare

Moderates want to keep Obamacare's essential structure in place.



Republicans in Congress have given up on fully repealing Obamacare.

Instead, they have decided they want to leave pieces of it in place, along with a system of tweaks and opt-outs that require federal permission and may never be used. And even that may be too much for some GOP moderates.

Last month, House Republicans made a failed attempt to pass the American Health Care Act, a bill that would have partially repealed and replaced Obamacare, putting in place a new system of tax credits while leaving many of the health law's key insurance regulations in place. Since then, factions representing House conservatives and House moderates have continued to work on bill that they hoped might garner more support.

The vehicle they settled on to manage their differences was a system of state-based opt-outs, in which states could apply for permission from the federal government to escape some of the regulations put in place under Obamacare, and left in place by the AHCA, under certain conditions, after winning federal approval.

This limited and restricted system of opt-outs is at the core of a new amendment to the bill.

The amendment, which was reported last night by Politico, would allow states to apply to opt out of some of Obamacare's community rating provisions starting in 2018, to override the federally mandated essential health benefits rules and set their own starting in 2020, and to charge individuals based on health status, provided a high risk pool or some facsimile to cover the sickest patients.

But Obamacare's major insurance regulations would remain on the books at the federal level, as the default national option, which would mean that federal policymaking under either Republican or Democratic administrations would revolve around those rules.

Nor is it clear that the opt-outs would actually be used. The majority of states are currently governed by Republicans—yet as health policy analyst Chris Jacobs notes, not one has even hinted at interest in applying for a waiver. And although the new amendment appears for a speedier and more straightforward application process than states have seen in the past with other types of federal health policy waivers, it still leaves significant room for a future administration to deny states their requests, should they submit them.

The new amendment, in other words, calls for state flexibility that might turn out to be entirely symbolic.

But even that might be too much for Republican moderates. Although the new amendment looks like to increase support amongst the more conservative members of the House Freedom Caucus, their moderate GOP counterparts in the Tuesday Group may not be on board. And it's far from clear what it would it would actually take to bring them on board–even to the group's leadership.

In an interview with Philip Klein of The Washington Examiner yesterday, Tuesday Group leader Rep. Charlie Dent (R-Pennsylvania) said he was still not on board with the bill. Dent cited the AHCA's treatment of Obamacare's Medicaid expansion–which the new amendment does not address–as one reason for his opposition, and seemed to indicate that he opposed overturning Obamacare's preexisting conditions rules for insurance companies. What would Dent prefer instead? Klein asked, and here's how Dent responded:

Conservatives have cited the need to reduce premiums as a reason for supporting stripping out Obamacare regulations, such as mandated health benefits and limits on how much insurers can charge based on health status.

When asked how he would prefer to reduce premiums without removing Obamacare's regulations, Dent said, "That's the $64,000 question."

When pressed further on whether there were any ideas for reducing premiums that have been proposed that he would support, he said he didn't want to get into a negotiation with a reporter in an interview…

GOP moderates now appear to hold the votes to either send the AHCA on to the Senate or keep it stuck in the House. But if Dent is any indication—and there are signs he is—aside from simply leaving Obamacare in place and making slight tweaks to its structure, it's not at all clear what would satisfy them. And it's not clear that most GOP moderates really know either.

Update: The House Freedom Caucus has officially endorsed the AHCA with the new amendment.

Update 2: Heritage Action, an influential conservative activist group that key voted opposition to the initial draft of the AHCA, has backed off its position, with caveats. "To be clear," Heritage Action CEO Michael Needham said in a statement, "this is not full repeal and it is not what Republicans campaigned on or outlined in the Better Way agenda. The amendment does, however, represent important progress in what has been a disastrous process. Given the extreme divides in the Republican Party, allowing Texas and South Carolina to make different decisions on health insurance regulations than New York and New Jersey may be the only way forward."