Senator’s Shaky Obamacare Deal Poses Challenge for Tax Plan

  • Collins says she’s ‘confident,’ others say ‘she got rolled’
  • GOP’s three key issues center on Maine’s moderate Republican
Bloomberg’s Sahil Kapur reports on Sen. Susan Colllins’ health care deal in the tax overhaul bill.

The three biggest stories in Washington -- a broad overhaul of the U.S. tax structure, a health-care makeover and a spending bill that would avert a government shutdown -- all depend, more or less, on one moderate Republican senator who says she’s got a deal that could deliver them all.

The only trouble is, Senator Susan Collins’s deal could unravel fast, putting the Maine lawmaker and her party in a tight spot as GOP leaders seek a major policy win in 2017.

Collins joined 50 of her GOP Senate colleagues Saturday in voting for tax legislation -- but only after securing what she’s called a promise that Congress would pass two other bills before year’s end. Both measures are aimed at shoring up insurance marketplaces that experts say would be ravaged by one part of the Senate tax bill: a repeal of the “individual mandate” imposed by the 2010 Obamacare law.

But Collins’s promise came from Senate Majority Mitch McConnell -- who can’t always deliver a vote in his own chamber, let alone the one across the capitol. It’s by no means clear that either of the health care bills Collins bargained for will get anywhere in the House, where conservatives regard at least one of the measures with disdain.

“I wasn’t part of those conversations,” House Speaker Paul Ryan told reporters Thursday, when asked about Collins’s bargain with McConnell. “I’m not deeply familiar with those conversations.”

Ryan -- who wants to repeal Obamacare’s mandate that individuals buy insurance or pay a federal penalty -- said Collins has “put some very productive, constructive solutions on the table” that will “invite a new conversation about how we fix health care.”

But of course, she didn’t ask for a conversation.

One-Vote Margin

Uncertainty over the House’s intentions poses a dilemma for Collins, who says additional laws are needed to mitigate health-insurance premium hikes that would “almost certainly” result from the individual mandate’s repeal. But it’s also a challenge for Senate GOP leaders -- who are currently trying to hammer out a compromise tax bill with their House counterparts:

Losing Collins would cut their one-vote margin on the tax bill to zero, putting the prospects of final passage in a more precarious state.

The two Senate bills that Collins is seeking include one proposed by Republican Lamar Alexander of Tennessee and Democrat Patty Murray of Washington; it would make “cost sharing” payments to insurers who take on sicker patients. The other, sponsored by Collins and Democrat Bill Nelson of Florida, would boost reinsurance funding. Collins says both would help hold down anticipated premium hikes from axing Obamacare’s individual mandate.

‘White Flag’

The nonpartisan Congressional Budget Office estimates that zeroing out the mandate penalty would lead to 13 million people dropping their coverage and to premiums rising by 10 percent in most years of the ensuing decade. It would put more pressure on an already unsteady Obamacare market as it could lead to an exodus of healthy people and cause insurers to raise prices to cover the cost.

The Alexander-Murray bill has legs in the Senate, but it’s toxic to many House conservatives, who decry it as a taxpayer “bailout” of insurance companies.

“I do not believe there are the votes on the floor of the House to pass Alexander-Murray,” said Representative Matt Gaetz of Florida, who said the bill is “not consistent” with GOP promises to voters. “Alexander-Murray is the legislative embodiment of the white flag being waved on the repeal of Obamacare.”

Conservative advocates could make it politically painful for Ryan to even bring the bill to a vote. “We think it’s a bad idea,” said Rachael Slobodien, a spokeswoman for the conservative Club For Growth. “Alexander-Murray is so unpopular, why would they want to sully tax reform with that?”

‘Making Progress’

Collins wouldn’t say Thursday whether she’ll support the final tax package in the absence of guaranteed passage of the health-care bills.

“I remain confident that it is going to happen,” she said. “We’re making progress.”

Her critics wonder what she’s thinking.

“She got rolled,” said Jim Manley, a Democratic lobbyist who worked for former Senate Majority Leader Harry Reid. “Despite the fact that she’s a veteran legislator, as far as I’m concerned she got rolled here. The promises she extracted from the Senate leadership aren’t worth the piece of paper they’re written on. The House is continuing to raise questions about why they’re bound by a deal in the Senate.”

Collins is in the unfortunate position of having already voted for the Senate tax bill, meaning she’ll get hit from both its opponents and its supporters if she reverses course now, Manley speculated.

Boost from Trump?

GOP Senator Mike Rounds of South Dakota said it’ll be a “pretty easy lift” for Senate Republicans to get behind Alexander-Murray, but he acknowledged that it’ll be difficult in the House. He suggested that President Donald Trump could help.

“That’s where the challenge is, and I think that’s where the president really can come in to help us with it,” Rounds said.

He voiced hope that once skeptical House conservatives “find out that the president is supportive” of the legislation -- and that it’s not a bailout, but a risk-adjustment mechanism, “we’ll be able to come around the get the votes we need.”

The White House didn’t commit to supporting either bill Collins wants Thursday.

“The President supports the repeal of the individual mandate,” said Hogan Gidley, deputy White House press secretary. “We have also had productive discussions with Congress about how to temporarily provide stability in the marketplace. However, we’re not going to get ahead of any negotiations until a bill is presented to us.”

The issue looms large over government-funding negotiations as well -- after Congress approved a stopgap measure to push the shutdown deadline from Dec. 8 to Dec. 22. That measure coming up in two weeks may be the most -- if not the only -- viable vehicle for the Alexander-Murray and Collins-Nelson bills to pass before lawmakers break for the holidays.

Senator John Cornyn of Texas, the chamber’s No. 2 Republican, said he thinks many of the House Republicans who are questioning Alexander-Murray will change their minds in coming weeks.

“I think it’s going to pass and I think it should pass,” he said.

— With assistance by Laura Litvan, Anna Edgerton, Zachary Tracer, and Alexander Ruoff

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