Tag Archives: Donald Trump

Insurance Commissioners’ CSR Malpractice

Today, a Senate committee hearing will feature testimony from insurance commissioners about the status of Obamacare in their home states. It will undoubtedly feature pleas from those commissioners for billions of new dollars in federal funds to subsidize insurance markets. But before Congress spends a single dime, it should take a hard look at insurance commissioners’ compliance with their regulatory duties regarding Obamacare. On several counts, preliminary results do not look promising.

Of particular issue at today’s hearing, and in health insurance markets generally: Federal payments to insurers for cost-sharing reductions, discounts on co-payments, and deductibles provided to certain low-income individuals. Obamacare authorized those payments to insurers, but did not include an appropriation for them. Despite lacking an explicit appropriation, the Obama administration started making the payments anyway when the exchanges began operation in 2014.

Rightfully objecting to an intrusion on its constitutional “power of the purse,” the House of Representatives filed suit to block the payments in November 2014. In May 2016, a federal district court judge ruled the insurer payments unconstitutional, halting them unless and until Congress granted an explicit appropriation.

By the middle of 2016, it seemed clear that the cost-sharing reduction payments lay in significant jeopardy. While the federal district court allowed the payments to continue during the Obama administration’s appeal, a final court ruling could strike them down permanently. Moreover, a new administration would commence in January 2017, and could stop the payments immediately. And neither Hillary Clinton nor Donald Trump had publicly committed to maintaining the insurer payments upon taking office.

Let’s Let the Problem Fester to Put Trump in a Bind

How did insurance commissioners respond to this growing threat to the cost-sharing reduction payments? In at least some cases, they did nothing. For instance, in response to my public records request, the office of Dave Jones, California’s insurance commissioner, admitted that it had no documents examining the impact of last May’s court ruling on the 2017 plan bid year.

To call this lack of analysis regarding cost-sharing reductions malfeasance would put it mildly. A new president could easily have cut off those payments—payments totaling $7 billion this fiscal year—unilaterally on January 20. Yet the regulator of the state’s largest insurance market had not so much as a single e-mail considering this scenario, nor examining what his state would do in such an occurrence.

For Democrats such as Jones, last year’s silence on cost-sharing reductions represents a happy coincidence. Had insurance commissioners required insurers to price in a contingency margin for 2017—to reflect uncertainty over whether the federal payments would continue—those higher premiums would undoubtedly have hurt Clinton during last fall’s campaign. Instead, liberals like Jones who remained quiet last year have suddenly started shouting from the rooftops about “uncertainty” leading to higher premiums—because they believe Trump, not Clinton, will bear the political blame.

Break the Law to Fund Our Political War Against You

Indeed, insurance commissioners who remained silent last year about cost-sharing reduction payments have responded this year in alarming fashion. The commissioners’ trade association wrote to the Trump administration in May asking them “to continue full funding for the cost-sharing reduction payments for 2017 and make a commitment that such payments will continue.”

The insurance commissioners essentially demanded the Trump administration violate the Constitution. Article I, Section 9, Clause 7 of the Constitution grants Congress the sole power to appropriate funds, and the Supreme Court in a prior case (Train v. City of New York) ruled that the executive cannot thwart that will by declining to spend funds already appropriated. Under the Constitution, a president cannot spend money, or refuse to spend money, unilaterally—but that’s exactly what the insurance commissioners requested.

By implicitly conceding the unconstitutional actions by the Obama administration, and asking the Trump administration to continue those acts, the commissioners’ own letter exposes their dilemma. Why did commissioners ever assume the stability of a marketplace premised upon unconstitutional actions? And why did commissioners purportedly committed to the rule of law ask for those unconstitutional actions to continue?

Regardless of whether members of Congress wish to make the payments to insurers, they should first demand answers from insurance commissioners for their regulatory failure. Insurance commissioners’ collective ignorance that the unconstitutional cost-sharing reduction payments could disappear closely mimics banks’ flawed assumptions in the years leading up to the subprime mortgage collapse. Unless Congress relishes the thought of passing another TARP program, they would be wise to exercise their oversight authority before they even think about getting out the taxpayers’ checkbook.

This post was originally published at The Federalist.

Obamacare, the Constitution, and “Sabotage”

An inside look at an Oval Office meeting between President Trump and Democratic leaders…

 

Donald Trump:           Nancy, Chuck, so good to see you. I wanted to bring you some good news: We’re starting construction on the border wall tomorrow.

Nancy Pelosi and Chuck Schumer:             What? Congress hasn’t appropriated money for the wall. And Congress has the “power of the purse,” not you. How can you say you’ll build the wall when we haven’t signed off on the funding?

Trump:            Because Barack Obama did it for years. What about his actions on Obamacare?

Pelosi:              What do you mean, what about Obamacare? It’s the law of the land—and you should stop sabotaging it!

Trump:            By “sabotaging Obamacare,” you mean failing to spend money on the cost-sharing subsidies to lower deductibles and co-payments…

Pelosi and Schumer: Right!

Trump:            …even though the text of Obamacare itself nowhere includes an appropriation for those subsidies…?

Pelosi and Schumer: Ummm…

Trump:            Let me get this straight: You’re accusing ME of sabotage, because YOU “forgot” to include an appropriation in Obamacare for more than $10 billion per year in spending?

Pelosi:              But “everyone understood” the law provided an appropriation…

Trump:            Even though you couldn’t be bothered to write it down?

Pelosi and Schumer: Ummm…

Trump:            Did either one of you—or for that matter, any Democrat—actually read the bill before voting for it?

Schumer:         I meant to, I swear! But Max Baucus said he hired the best experts, so we didn’t think we needed to.

Trump:            Didn’t those experts read the bill?

Schumer:         They spent all their time cutting deals to get the bill passed. Those Cornhusker Kickbacks don’t write themselves, y’know!

Trump:            Well, your loss is my gain. I’ve read some of the documents in the lawsuit over the cost-sharing subsidies. Do you know that the Obama Administration argued that the structure of the bill implied an appropriation, even though one doesn’t exist…?

Pelosi and Schumer: Yes…

Trump:            And Nancy, you remember the amicus brief you filed in the case right before my election, which said that the courts are “certainly not” the venue for litigating cases when the executive invents an appropriation, as it did with the cost-sharing subsidies…?

Pelosi:              But…but…but…

Trump:            That means I can argue that there’s an appropriation behind any law Congress has passed—like the bill you voted for, Chuck, authorizing construction of the border fence…

Schumer:         What?

Trump:            …And you can’t go to court to stop me!

Pelosi and Schumer: But you requested funding from Congress—and we refused to grant it!

Trump:            You mean, like Congress refused to appropriate funds for the Obamacare cost-sharing reductions, after President Obama requested them…?

Pelosi and Schumer: Ummm…

Trump:            The Obama Administration testified before Congress that it had the authority to spend money on the cost-sharing reductions because Congress didn’t explicitly stop them from spending it, correct?

Schumer:         Yes…

Trump:            And Nancy, your brief said the same thing: That unless Congress explicitly prohibits a President from spending money, the President has free rein to do so…

Pelosi:              But I was trying to protect Obamacare from sabotage!

Trump:            Did you take an oath to support and defend the Constitution, or to support and defend Obamacare?

Pelosi and Schumer: There’s a difference?

Trump:            Yes—and here it is. Thanks to President Obama’s precedent, I can make up whatever appropriations I want—and by your own admission, you can’t go to court to stop me. You could in theory enact a bill prohibiting me from spending money on these phantom appropriations. But because I have a veto pen, you’ll need a 2/3rds majority in each chamber to override me. You don’t have a 2/3rds majority, do you?

Pelosi and Schumer: No, Mr. President.

Trump:            Didn’t think so. So I’ll get my funding for the border wall—and increased defense funding to boot. And maybe I’ll find some other appropriations too. I think the structure of Michelle Obama’s school lunch program implies an appropriation for a new chef at Mar-A-Lago…

Pelosi:              You know, Mr. President, maybe we need to re-think our position on these phantom appropriations. I signed that legal brief the week before the election, not knowing who the next President would be. I thought that power would be safe in her hands…

Trump:            WRONG!

Pelosi:              But executive power has its limits—and Congress should jealously guard its “power of the purse,” regardless of which party holds power at the other end of Pennsylvania Avenue. Otherwise, we could see all sorts of unintended consequences from legislation…

Trump:            You mean, we had to pass the bill so that you could find out what is in it…?

Pelosi:              Well played, Mr. President.

How Donald Trump Created the Worst of All Possible Health Care Worlds

Following last week’s developments in the ongoing saga over Obamacare’s cost-sharing reduction (CSR) payments, two things seem clear. First, President Trump won’t stop making these payments to insurers, designed to reimburse them for providing reduced deductibles and copayments to low-income individuals. If Trump’s administration continued to pay CSRs to insurers mere weeks after the Obamacare “repeal-and-replace” effort collapsed on the Senate floor, it should be fairly obvious that this president won’t cut off the payments.

Second, notwithstanding the above, Trump won’t stop threatening to halt these payments any time soon. Seeing himself as a negotiator, Trump won’t cede any leverage by committing to make future payments, trying to keep insurance companies and Democrats in suspense and extract concessions from each. He has received no concessions from Democrats, and he likely has no intentions of ever stopping the payments, but will continue the yo-yo approach for as long as he thinks it effective—in other words, until the policy community fully sees it as the empty threat that it is.

The combination of these occurrences has created the worst of all possible worlds for the president, his administration, and Republicans. Conservatives can, and should, criticize Trump for continuing to violate the Constitution in making the payments. But liberals will also criticize Trump for violating the Constitution only on a piecemeal, month-by-month basis, claiming that the threat to cut off the unconstitutional payments “sabotages” Obamacare.

President Trump Is Savaging the Constitution

From a constitutional perspective, Trump’s approach to CSRs undermines the rule of law. The president referred to the payments in a May interview with The Economist, stating that “If I ever stop wanting to pay the subsidies, which I will [sic].”

But as any conservative will explain (and this space previously outlined), the president cannot stop making any payments unilaterally. The Supreme Court ruled unanimously in Train v. City of New York that if a law makes a constitutional appropriation, the president cannot refuse to spend the money. He must make the appropriation. Conversely, if the law lacks an appropriation, the president cannot spend money—that prerogative lies with Congress, as per Article I, Section 9, Clause 7 of the Constitution.

Judge Rosemary Collyer ruled last May that Obamacare lacks an appropriation for the cost-sharing reduction payments. If the president agrees, he should stop the payments immediately. If the president disagrees, he should continue the Obama administration’s appeal of that ruling, and commit to making payments unless and until the Supreme Court orders him to stop. Instead, the president has treated the payments—and thus the Constitution—as his personal plaything, which he can obey or disregard on his whim.

This Policy ‘Uncertainty’ Has Consequences

From a policy perspective, the president’s dithering—and the continued threats that he has yet to carry through on (and likely never will)—are having an impact. For years, insurers—wrongly—ignored the threat that CSR payments could disappear, even as some individuals publicly warned them of the risk.

Having under-estimated their risk before this year, many insurers have over-estimated their risk now. Carriers have threatened higher premium increases, or reduction in service areas, because they finally recognize the inherent uncertainty around CSR payments lacking an explicit appropriation in statute.

Insurers’ cries of “uncertainty” have joined chorus with liberals’ claims of “sabotage” against the Trump administration. The same liberal groups and advocates who failed to recognize the uncertainty last year—because higher premiums for 2017 would have hurt Hillary Clinton and Democrats during last fall’s elections—now almost gleefully embrace the concept, believing it can benefit them politically.

Therein lies the full scope of the political danger for Trump and Republicans. It seems obvious that Trump will continue to make the payments to insurers. But it seems equally obvious that Trump enjoys keeping insurers on the proverbial short leash, and won’t give them the “certainty” over the payments that they desire. The end result: An administration that receives political blame from the Right for making unconstitutional payments, and from the Left for “uncertainty”-related premium increases, because Trump has not confirmed those unconstitutional payments will continue.

Rule of Law, Not of Men

In many respects, Trump has provided a perfect illustration of the problems inherent in creating a government based on men and not laws. When President Obama decided to violate the Constitution by making CSR payments without an appropriation, he created a scenario whereby any future president could do exactly what Trump appears to relish: Hold the flow of funds as a political cudgel in an attempt to bend people to his desires.

But in an ironic twist, the political benefit from creating this unilateral policy could accrue to Democrats, if Republicans receive fallout from higher premiums in 2018. Perhaps that outcome could persuade both parties to abandon the executive unilateralism that has become far too common in recent administrations. Restoring the rule of law seems like such a simple, yet novel, concept that some enterprising politicians in Washington might want to try it.

This post was originally published at The Federalist.

CBO Report Shows Bogus Nature of Obamacare “Sabotage” Charges

If you need any additional evidence as to the trumped-up (pardon the pun) charges of Obamacare “sabotage” leveled against the current president, look no further than the Congressional Budget Office (CBO) report about cost-sharing subsides released yesterday. In the report, CBO concluded that ending subsidy payments—which the law never appropriated to begin with—would keep premiums roughly constant for most individuals, increase spending on insurance subsidies, and increase the number of insured Americans modestly.

Which one of those outcomes do Democrats oppose? Exactly none. Which illustrates why all the self-righteous indignation about President Trump “sabotaging” Obamacare is as much about the individual inhabiting the Oval Office as it is about health care policy.

Check the Cost-Sharing Analysis

The CBO report, as with other prior analyses, assumed that eliminating the cost-sharing reductions—used to reimburse insurers for providing discounted deductibles and co-payments to certain low-income households—would lead insurers to raise premiums, but only for certain plans. Because the law requires insurers to lower cost-sharing regardless of whether the federal government provides separate reimbursement payments for that, insurers would “load” those reductions on to silver insurance plans—but only on insurance exchanges. This change would exempt plans sold off the exchanges, where individuals do not qualify for subsidies, from the higher premium effects.

The higher premiums for silver plans on exchanges would lead to higher spending on insurance subsidies, which Obamacare links to the second-lowest silver premium. And those richer subsidies would attract some more individuals to insurance markets, reducing the number of uninsured by about one million.

Democrats may seize upon CBO’s finding that this scenario would increase the deficit as reason to oppose it. But if Democrats cared about protecting taxpayers, they would have objected to the Obama administration’s actions—actions that the Government Accountability Office concluded last year violated the statute—placing insurance companies ahead of ordinary taxpayers in receiving reinsurance payments. They didn’t object on behalf of taxpayers then, so why object in this case? Is it really about policy, or is it just crass politics?

Liberal Hypocrisy on the Individual Mandate

Likewise, liberals charge that the president could refuse to enforce Obamacare’s individual mandate, encouraging healthy people to drop coverage and causing insurance markets to deteriorate further. In reality though, his room for maneuver is more limited. If the president decided to issue blanket exemptions to the mandate, or not enforce it, insurers likely would sue the administration for failing to execute its constitutional duties—and they could, and should, win. Under our Constitution, the president can, should, and must enforce all the laws, including the mandate, not just the ones he agrees with.

Given their own party’s history with the mandate, liberals’ sudden insistence on its “enforcement” sounds more than a bit rich. Democrats were the ones who, when faced with the fact that non-compliance with the mandate could lead to jail time, expressly wrote the law to prevent the use of such enforcement mechanisms. And the last administration was, if anything, far too liberal with hardship exemptions to the mandate, giving them to individuals who received a notice from a utility threatening to shut off service, or those who had a close family member die in the past three years.

So is the issue with President Trump’s supposed non-enforcement of the mandate, or the fact that he’s the one making decisions on exactly how the mandate will be enforced?

Pester People into Enrolling

The Trump administration could certainly influence insurance markets through outreach efforts. Liberal groups have spent weeks complaining that the Department of Health and Human Services has not solicited them for this fall’s open enrollment season.

But put things into perspective. A Politico story in January noted that the Trump administration reduced television advertising by about $800,000 per day for the last four days of open enrollment—a few million dollars. If Obamacare—entering its fifth open enrollment period this fall—is so fragile that losing a few million dollars of advertising will tank insurance markets, what does that say about the stability, let alone the wisdom, of the law in the first place?

The federal government shouldn’t need to spend millions of dollars every year pestering people into enrolling in coverage, not least because insurance companies can and should do that themselves. President Trump should enforce the law as it’s written—a novel task compared to his predecessor, who seemingly relished in re-writing it unilaterally—but sabotage? Democrats sabotaged the law themselves when they passed it seven years ago, and no amount of opportunistic (and disingenuous) rhetoric can change that fact.

This post was originally published at The Federalist.

Restoring the Rule of Law to Obamacare

Over the last several months, this space has highlighted that President Trump has an opportunity and a challenge: Restoring the constitutional rule of law his predecessor often ignored. Such a move would require ending the Obama administration’s ad hoc rewriting of Obamacare, implementing the law as written—no more, no less.

Into that debate stepped the Conservative Action Project on Friday, with a memo noting that the president can and should lead on Obamacare. The title suggests a continuation of Obama’s “pen and a phone” mentality, emphasizing executive unilateralism in the face of Congress’ inability to pass “repeal-and-replace” legislation regarding Obamacare.

So Far Trump Is Perpetuating Obama’s Law-Breaking

The document contains numerous important suggestions to undo President Obama’s illegal executive acts. For instance, it encourages Trump to “take action to end the illegal and unconstitutional cost-sharing subsidies to the insurance companies,” ending their disbursement. This development would be not only welcome, but far overdue.

For more than six months President Trump has continued his predecessor’s habit of violating the Constitution to disburse billions of unappropriated dollars to insurance companies. To both enforce the rule of law and end crony capitalist dealings between “Big Government” and “Big Insurance,” Trump should end the unconstitutional subsidies forthwith.

The CAP letter also rightly calls on Trump to “end the illegal diversion of money from the U.S. Treasury to insurance companies.” The Government Accountability Office ruled last September that the Obama administration had violated the text of Obamacare by prioritizing reinsurance payments to insurers over required payments to the Treasury. As with the cost-sharing subsidies, President Trump should put the rule of law—and taxpayers—ahead of insurance companies’ special interests.

The CAP document calls for President Trump to “continue to fight for repeal of the individual mandate,” but—thankfully—does not call for Trump to defang the mandate unilaterally. As I wrote back in January, when administration officials first suggested they may not enforce the mandate at all, “a Republican Administration should not be tempted to ‘use unilateral actions to achieve conservative ends.’ Such behavior represents a contradiction in terms.”

You Can’t Ignore the Law Because You Don’t Like It

In this same vein, CAP’s call for the Trump administration to “expand the exemption for so-called ‘grandmothered’ plans” represents an open invitation for the president to violate the Constitution, just as his predecessor did. These “grandmothered” plans should have been cancelled in January 2014, as they did not—and do not—comply with the new statutory requirements included in Obamacare.

In late 2013, President Obama faced political controversy for his “If you like your plan, you can keep it” broken promise, which became PolitiFact’s Lie of the Year. To stanch his political bleeding and solve the problem of millions of cancellation notices—along with a broken website preventing individuals with cancelled plans from buying new ones—Obama tried to pass the proverbial buck. He said his administration would allow states, if they chose, to let individuals keep their plans—temporarily. This purportedly “temporary” solution has been extended numerous times, and now is scheduled to expire at the end of 2018.

Unfortunately, as law professor (and Obamacare supporter) Nicholas Bagley has noted, Obama’s unilateral creation of these “grandmothered” health plans violated his constitutional duties as chief executive: “The Administration thus used the public pronouncements of its non-enforcement policies to encourage the regulated community to disregard provisions of [the law]. Prospectively licensing large groups of people to violate a congressional statute for policy reasons is inimical to the Take Care clause.”

To put it more bluntly, the president cannot decline to enforce the law because he finds himself in a political jam, whether due to a broken promise, a non-functioning website, or mere disagreement with the law in question. That principle applies as equally to President Trump as it does to President Obama. Trump’s extension of “grandmothered” plans violates the Constitution as much as President Obama’s did—and expanding those plans to include other forms of insurance would represent a further violation.

To be clear, as a matter of policy, I hate the idea of cancelling millions of insurance policies because they do not meet Obamacare’s myriad regulatory requirements. But as I noted recently, I believe President Trump should do just that—not because I support that outcome, or because President Trump supports it, but because the law requires it. He should have done that months ago—within days of taking office—to make clear that the cancellations stemmed from President Obama’s violation of his own health law, not any measure Trump himself wanted to implement.

Unfortunately, however, President Trump has yet to enforce the law, or the Constitution, when it comes to Obamacare, having undone none of his predecessor’s illegal and extralegal acts. For this conservative, hope springs eternal, as tomorrow always brings another opportunity to do the right thing. Here’s to this administration finally realizing that the rule of law by definition means enforcing the laws one disagrees with—for that critical principle exceeds the value of any particular law, no matter how onerous or obscure.

This post was originally published at The Federalist.

Inconvenient Truths over Obamacare’s Cost-Sharing Reductions

Leaders in both parties engaged in rhetorical bluster over the weekend regarding Obamacare’s cost-sharing reductions. Those payments to insurers for lowering deductibles and co-payments—ruled unconstitutional by a federal district court judge last May—remain in political limbo, and a subject of no small controversy.

But the rhetorical exchanges yielded inconvenient truths, both for Democratic leaders demanding the Trump administration continue the payments, and for the president himself, who has threatened to stop them.

Schumer: If the Payments Are Constitutional, Trump Can’t Withhold Them

Senate Majority Leader Schumer tweeted about what might happen “if @POTUS refuses to make CSR [cost-sharing reduction] payments.” There’s just one problem with his statement: If the payments are lawful, President Trump cannot refuse to make them. More than four decades ago, the Supreme Court held unanimously in Train v. City of New York that the Nixon administration could not spend smaller amounts than what Congress appropriated for a environment program.

Schumer therefore implicitly admitted—as elsewhere—that the payments are not only illegal, but unconstitutional. Obamacare lacks an explicit appropriation for the cost-sharing reduction payments. That’s the reason Judge Rosemary Collyer ruled the Obama administration’s actions in making said payments unconstitutional last year. (The ruling is currently stayed pending appeals.)

As one summary of the case noted, Train v. City of New York established the principle that “the President cannot frustrate the will of Congress by killing a program through impoundment.” Yet Schumer, in asking the Trump administration to continue making payments to a program that Congress never funded in the first place, wants the executive unilaterally—and unconstitutionally—to frustrate the expressed will of the legislative branch, thereby diminishing Schumer’s own authority as a lawmaker.

It’s highly likely Schumer, a lawyer who spent several years serving on both the House and Senate judiciary committees, knows full well the nature of unconstitutional actions, begun by the last administration, that he wants the current one to continue. But if he wants to have any credibility on the rule of law—whether criticizing the Trump administration’s other “abuses,” or standing up for the independence of the Russia investigation—he would be wise to 1) admit that the Obama administration violated the Constitution in making the payments to begin with and 2) hold the last administration just as accountable as he wants to hold the current president.

Trump: Upholding the Constitution Is a Choice

Conversely, the president seems to delight in dangling in front of Democrats the prospect of cancelling the CSR payments, as he did most recently on Twitter Saturday, one day after the Senate failed to approve a “skinny” health-care repeal.

But for the president, as for Schumer, the question of the cost-sharing reduction payments should come down to a binary choice: Does a lawful appropriation for CSRs exist, or not? If a lawful appropriation exists, then the president must make the payments, consistent with Train v. City of New York outlined above. If a lawful appropriation does not exist, then the president must not make the payments, consistent with both Article 1, Section 9, Clause 7 of the Constitution—“No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law”—his duty to “take Care that the laws be faithfully executed,” and his oath of office.

This conservative believes President Trump should have cancelled the CSR payments within days of taking office, not because it would have been popular—it likely would not have been—but because the rule of law demands it. Likewise, President Trump should have long since undone billions of dollars in reinsurance payments to insurers that the Government Accountability Office found illegal, and cancelled the “grandmothered” plans President Obama allowed some individuals to keep in 2014—violating his constitutional duty to “take Care that the laws be fully executed” in the process.

Making a clean break with the numerous legal and constitutional violations the Obama administration perpetrated to keep Obamacare afloat early in his administration would have demonstrated President Trump’s desire to escape the executive unilateralism of his predecessor.

Government of Laws, Or of Men?

In drafting the Constitution for the Commonwealth of Massachusetts, John Adams famously spoke of creating a government of laws, not of men. Yet both participants in the CSR drama this weekend seem insistent on creating an arbitrary government based on whim. In Schumer’s case, that whim stems from placing Obamacare on a higher pedestal than the Constitution, while the president’s whims seem most directed towards achieving a legislative victory on health care, no matter its form.

That Barack Obama, a constitutional law professor, bequeathed such legal gamesmanship and a culture of inherently arbitrary actions to both parties stands as one element of his legacy. As the debate this weekend demonstrated, that legacy has affected—and infected—our constitutional discourse, and not for the better.

This post was originally published at The Federalist.

What You Need to Know about the Senate’s Obamacare “Vote-A-Rama”

It’s not a carnival ride—although it might prove even more adventurous. The Senate’s consideration of health-care legislation will soon result in a grueling series of votes dubbed “vote-a-rama.”

After 20 hours of debate on the budget reconciliation measure, equally divided between the majority and minority parties, the Senate will complete consideration of all pending amendments, with the process’ conclusion typically determined when senators exhaust all the amendments they wish to offer—not to mention themselves.

Here’s what you need to know about “vote-a-rama.”

1. It’s Physically Demanding

The “vote-a-rama” process during consideration of the 2010 reconciliation bill that “fixed” Obamacare provides an example. On Wednesday, March 24, senators began voting on amendments at 5:32 PM. Nearly nine hours later, at 2:17 on the morning of Thursday, March 25, senators had completed votes on 29 amendments. The Senate then took a brief break, re-convened at 9:45 the same morning, and disposed of a further 12 amendments over an additional four-plus hours, with a vote on final passage at 2 PM on March 25.

For 20-something or 30-something staffers—let alone senators several times their age—this lengthy process can prove grueling, with long hours, late nights, lack of sleep, and little food (or bad food) the norm.

2. It’s Mentally Confusing

Between votes on amendments, senators usually allow for brief one-minute speeches by the amendment’s proponent and an opponent (generally the majority or minority floor manager of the bill). However, as Senate procedural expert James Wallner notes, that habit has derived from custom and unanimous consent, not any formal rule. If any senator objects to the brief “well speeches” as part of “vote-a-rama,” then the Senate will vote on amendments without any debate or a summary of what the amendment does.

Even with the brief summaries by amendment sponsors, it’s often difficult for senators—and particularly Senate staff—to understand exactly what’s going on down on the Senate floor. Amendment text can occasionally change at the last minute, as can the sequence of amendments offered. On occasion, senators may have to “fly blind” without clear guidance or recommendations from their staff on how to vote. Coupled with the long hours and lack of sleep (for members and staff alike), it’s a recipe for mistaken votes and confusion.

3. It’s Hard to Pass Amendments with a Simple Majority…

As Wallner noted in an article earlier this week, the Senate’s rules essentially give preferential treatment to the underlying reconciliation bill, making it difficult to craft amendments that can pass with a simple (i.e., 50-vote) majority. The amendment must be germane (i.e., relevant) to the underlying bill, and cannot increase the deficit.

Moreover, to pass with a simple majority, an amendment must also comply with the six-part “Byrd rule” test. For instance, an amendment may not have only an incidental fiscal impact, make programmatic changes to Title II of the Social Security Act, or exceed the jurisdiction of the committees who received the reconciliation instructions (in this case, the Senate Finance and Health, Education, Labor, and Pensions committees). Other than simple motions striking particular provisions, amendments will face a difficult time running the procedural gauntlet necessary to pass on a 50-vote threshold.

4. …But It’s Easy to Get Amendment Votes

Even if an amendment does not comply with the budget reconciliation rules, senators can still offer a motion to waive those rules. The motion to waive requires the approval of three-fifths of senators sworn (i.e., 60 votes), which often does not materialize, but the motion to waive provides a way to get senators on the record on a specific issue. Many votes in a “vote-a-rama” series consist of a “motion to waive all applicable budgetary discipline”—i.e., the “Byrd rule” and other restrictions that make passing an amendment with a simple majority difficult.

5. It Will Result in Messaging Amendments

Perhaps the classic example comes from the Obamacare “vote-a-rama” in March 2010, when then-Sen. Tom Coburn (R-OK) offered an amendment that included the following language:

(b) Prohibiting Coverage of Certain Prescription Drugs—

(1) In general.–Health programs administered by the Federal Government and American Health Benefit Exchanges (as described in section 1311 of the Patient Protection and Affordable Care Act) shall not provide coverage or reimbursement for—

(A) prescription drugs to treat erectile dysfunction for individuals convicted of child molestation, rape, or other forms of sexual assault;

The “No Viagra for Sex Offenders” amendment drew no small amount of attention at the time, and led to political ads being run against the Democrats who voted against it (as some predicted prior to the amendment vote).

Democrats will almost certainly offer similar messaging amendments this year, including amendments unrelated to the bill, or even health care. They may offer amendments regarding the Russia investigation—those would likely be subject to a 60-vote threshold, as foreign policy is not germane to a budget reconciliation bill, but if Democrats wish to get Republicans on record, any vote will do.

Doubtless Democrats will offer amendments related to Donald Trump’s taxes—the reconciliation bill is in the jurisdiction of the Finance Committee, so these amendments could theoretically prove germane, but amendments specifically targeting the president (i.e., making policy, with only an incidental fiscal impact) could violate the “Byrd rule,” making them subject to a 60-vote threshold. For Democratic political consultants, the possibilities are virtually endless.

6. It May Lead to Chicanery—and ‘Strategery’

Senate Republican Leader Mitch McConnell (R-KY) has generally opposed allowing reimportation of prescription drugs from Canada or other countries, with one noteworthy exception. In December 2009, McConnell, along with several other Republicans, supported one of two reimportation amendments offered on the Senate floor.

While opposing reimportation on the merits, some Republicans supported these particular amendments because they wanted to break up the “rock-solid deal” between Democrats and Big Pharma—whereby pharma agreed to support Obamacare in exchange for a promise from Democrats not to support reimportation of prescription drugs.

As it happened, Democrats spent an entire week—from December 8 through December 15, 2009—without floor votes on amendments to Obamacare. The delay—effectively, Democrats filibustering their own bill—came in part because party leaders could not persuade fellow Democrats to vote against the reimportation amendment—and could not afford to allow the amendment to pass.

One can expect similar gamesmanship by the Democratic minority this time around, as evidenced by their tactical decision to abstain from voting on Tuesday’s motion to proceed to the bill until Republican senators mustered a majority solely from within their own ranks. If only three Republicans defect on an amendment, Democrats could have the power to play a decisive role in that amendment’s outcome. It’s an open question how they will do so.

For instance, will some or all of the 12 Democrats who voted against reimportation earlier this year—during January’s “vote-a-rama,” when the Senate passed the budget enabling the current reconciliation process—switch their votes so the amendment will pass, causing Republicans heartburn with the pharmaceutical lobby? When and how will Democrats use other tactical voting to gum up the process for Republicans? The answers range from possible to likely, but it remains to be seen exactly how the process will play out.

7. It Will Inflict Political Pain

Consider for instance a flashpoint in the reconciliation bill: Whether to defund Planned Parenthood. Two Republican senators, Susan Collins and Lisa Murkowski, have already stated they oppose defunding the organization. If one more Republican defects, Democrats would likely have the votes to strip the defunding provision. (While Democratic Sen. Joe Manchin previously supported defunding Planned Parenthood two years ago, in the immediate aftermath of sting videos featuring organization leaders, he has since reversed his position, and will presumably vote with all Democrats to strip the provision.)

To put it another way: Sen. Dean Heller (R-NV) may not just have to be the 50th vote supporting the underlying bill, he may also have to provide the 50th vote to keep the Planned Parenthood defunding provision in the legislation. Will Heller vote to defund the nation’s largest abortion provider—and what will happen to the bill if he, and the Senate as a whole, votes to strip the provision out? Senate leaders will face several of these white-knuckle amendment dramas during “vote-a-rama,” any one of which could jeopardize the entire legislation.

8. It Could Unravel the Entire Bill

Ultimately, with no agreement among Republicans to preserve the underlying bill text, and no clear roadmap on how to proceed, “vote-a-rama” could resemble pulling on the proverbial thread—one good tug and the whole thing unravels. What if Heller ends up helping to strip out Planned Parenthood defunding—and conservatives respond by blocking more funding for Medicaid expansion states? What if moderates vote to strip the “consumer freedom” amendment offered by Sen. Ted Cruz (T-TX), and conservatives retaliate by taking out the “side deals” included to assuage moderates’ concerns?

At the end of “vote-a-rama,” senators could be left with an incoherent policy mess, legislation that no one would readily support. It’s the big potential downside of the freewheeling amendment strategy—but a chance that McConnell apparently feels he has no other choice but to take.

9. It’s Why Senate Leadership Is Talking about a Conference with the House

In recent days, Senate Majority Whip John Cornyn (R-TX) and others have floated the idea that, rather than having the House pass the Senate’s bill whole, sending it straight to the White House, members may instead want to have a House-Senate conference to resolve differences between the two chambers. Some have gone so far as to propose the Senate passing a “skinny” bill—repeal of the individual and employer mandates, along with the medical device tax—as a placeholder to get the reconciliation measure to a conference committee.

This strategy would have one beneficial outcome for the Senate’s Republican leadership: By allowing congressional leaders to re-write the bill in conference, it would save them from having to abide by the results of “vote-a-rama.” If, for instance, senators vote to strip out Planned Parenthood defunding, or to add in reimportation language, congressional leaders could re-write the bill in conference to negate the effects of those votes—presenting a new measure to both chambers with a binary choice to approve the bill or not. (In other words, rather than a “wrap-around bait-and-switch” on the Senate floor, senators could instead face a bait-and-switch in conference.)

That leadership has mooted a conference committee speaks to the nature of the “vote-a-rama” ahead. Despite the complaints on both ends of Pennsylvania Avenue about the lengthy nature of the health-care process, Senate leaders are now looking to extend the process further via a House-Senate conference—because they may need to regain control of the legislation after a wild and unpredictable debate on the Senate floor.

This post was originally published at The Federalist.

A Status Update on the Senate Health Care Bill

The past week’s debate on health care has seen more twists and turns than a dime-store movie novel. “Repeal-and-replace” is dead—then alive again. President Trump calls for outright repeal, then letting the law fail, then “repeal-and-replace” again.

As Vince Lombardi might ask, “What the h— is going on out here???”

Never fear. Three simple facts will put the debate in context.

Leadership Is Buying Moderates for ‘Repeal-and-Replace’

Whether in the form of “candy,” “making it rain,” or old-fashioned carve-outs that help states with reluctant senators, Senate leaders are trying to figure out the amount and type of money and incentives that will win enough moderate votes to pass a “repeal-and-replace” bill. Details remain sketchy, but the broader outline is clear: senators don’t want to vote for provisions they approved 18 months ago—when they knew President Obama would veto a repeal measure. And Senate leadership hopes to “solve” this problem essentially by throwing money at it—through new funding for Medicaid expansion states, opioid funding, bailout funds for insurers, programmatic carve-outs for some states, or all of the above (likely all of the above).

Leadership Isn’t Serious about Repeal-Only

Some observers (not to mention some senators) are confused about whether the Senate will vote on a repeal-only measure, or a “repeal-and-replace” bill. But Senate Majority Whip John Cornyn (R-TX) explained leadership’s strategy to Bloomberg Wednesday: “There’s more optimism that we could vote on a repeal-and-replace bill, rather than just a repeal bill….But if there’s no agreement then we’ll still vote on the motion to proceed” to a repeal-only measure” (emphasis mine).

Translation: Senate leadership will only move to a vote on the 2015 repeal bill—which some conservative groups have argued for—if it knows it will fail. In fact, some observers have gone so far as to suggest Majority Leader Mitch McConnell’s Monday announcement that the Senate would vote on a repeal-only bill amounted to an attempt to bait-and-switch conservatives—convincing them to support starting debate on the bill by dangling repeal-only in front of them, only to pivot back to “repeal-and-replace” once the debate began.

Regardless of McConnell’s intentions earlier in the week, Cornyn’s comments make clear the extent to which Senate leaders take a repeal-only bill seriously: They don’t.

McCain May Make It Moot

It may sound impolitic or callous to translate a war hero’s struggle against cancer into crass political terms, but if the recent cancer diagnosis of Sen. John McCain (R-AZ) means the senator will be unable to travel to Washington, Republican leaders’ desperate attempts to cobble together a legislative compromise may ultimately prove moot. At least two conservative senators oppose the current bill from the Right; adding more money to appease moderates won’t reduce those numbers, and may increase them. And at least two moderate senators oppose the current bill from the Left, hence the effort to increase funding.

If McCain is unable to vote on the legislation, Republican leaders will be able to withstand only one defection before putting the bill’s passage in jeopardy—yet at least two senators on either side of the Republican Conference oppose the current bill. That math just doesn’t add up, which means that barring some unforeseen development, the hue and cry of the past several days may ultimately amount to very little.

This post was originally published in The Federalist.

Trump Administration Continues Obamacare’s Illegal Corporate Welfare

Just over a week ago, on a Friday before the Independence Day holiday, the Trump administration quietly released a report on Obamacare’s reinsurance program. The new administration could have used the opportunity to cut off insurers from billions of dollars in corporate welfare payments, upholding the text of the law and repaying funds to the Treasury in the process.

Except the administration did nothing of the sort, which raises obvious questions: With “friends” like these, do conservatives really need enemies? And did a Republican president who pledged to repeal Obamacare get elected to office in November—or not?

Spreading the Wealth Around

A primer on the issues at work: Section 1341 of Obamacare created a reinsurance pool designed to stabilize the insurance exchanges in their first three years. The law funded the reinsurance program through “assessments”—taxes—on employer-provided health plans. In other words, the federal government raised premiums on employer plans to subsidize health insurers offering exchange plans on the individual market. Or, as President Obama might say, they were “spreading the wealth around.”

In addition to paying insurers up to $20 billion—repeat, $20 billion—between 2014 and 2016, the law also required those assessments on employers to fund $5 billion in payments to the Treasury, offsetting the cost of another Obamacare program. For whatever reason, the employer assessments the past three years have not yielded the $25 billion needed to fund $20 billion in payments to insurers, plus the $5 billion in payments to the Treasury. In the event of such a circumstance, the law states that the Treasury should be paid before health insurers.

So what did the Obama administration do? You guessed it. They paid health insurers first, and gave the Treasury—taxpayers like you and me—the shaft.

For all of President Obama’s talk about Obamacare being the “law of the land,” his administration had quite a habit of forgetting exactly what the law of the land was when that was convenient. Both the non-partisan Congressional Research Service and the Government Accountability Office last year ruled that the Obama administration violated the law in giving insurers preferential treatment over taxpayers. The administration promptly ignored these rulings.

So, it seems, has the new administration. The report on reinsurance included not a word about making payments to the Treasury Department, reimbursing taxpayers the billions they are owed under the law. Nor did the report mention potential actions to sue health insurers to reclaim funds they received that are rightly owed to the U.S. Treasury.

Taxpayers Get the ‘Trump Discount’

During his business days, many of Donald Trump’s contractors complained about a “Trump discount”—the real estate mogul failing to pay the full sums he owed. It appears that the new administration has given taxpayers the “Trump discount”—choosing to continue prioritizing corporate welfare payments to insurers over repaying the U.S. Treasury.

That “Trump discount” insults hard-working taxpayers across the country. Also, by propping up a failing law by throwing more money at health insurers, it just might lead some to discount how much the Trump administration really wants to repeal Obamacare.

This post was originally published at The Federalist.

Why Theresa May Flopped in Last Night’s UK Election

Last November 8, Hillary Clinton lost the U.S. presidential election in an amazing upset by Donald Trump. She endured her shock defeat on a date prescribed by federal law. What if Hillary Clinton didn’t have to run a campaign last autumn, but called one anyway—then came up short?

That’s essentially what happened last night across the Atlantic, where British Prime Minister Theresa May gambled big—and lost. She called a surprise “snap election” earlier this spring hoping to expand her parliamentary majority, and gain additional leverage in her “Brexit” negotiations with the European Union. Instead, when the votes came in, her Conservative Party lost both votes and seats in Parliament. While the Conservatives remain the largest party in Parliament—albeit short of an outright majority—the election result cannot be viewed as anything other than a defeat.

The result looks that much more stunning when considering May’s foremost opponent: a Labour Party led by Jeremy Corbyn, a leftist who makes Sen. Bernie Sanders look moderate. Corbyn has opposed both military force and the use of nuclear weapons; more than 80 percent of his party’s own members of Parliament supported ousting him as leader, but the grassroots party returned him anyway. A university professor called Corbyn’s election as Labour leader “an act of stupidity unparalleled since Caligula appointed his horse to the Roman Senate.”

Losing This Big Took Some Effort

How could May, thought a shoo-in to win a landslide only a month ago, flop so resoundingly against an opponent so weak?

As with Hillary Clinton’s loss to Trump, it took some effort. May, like Clinton, played a safe campaign, in which she didn’t seem comfortable, while Corbyn relished interactions with voters and constituents. Her campaign manifesto prompted a U-turn from the prime minister mere days after its launch, angering traditional Conservative supporters and giving the party a bumbling appearance, at a time when May had promised to provide strong and stable leadership.

There were other factors, too. In the wake of last year’s referendum to exit the European Union, the UK Independence Party vote collapsed. It appears some working-class voters who voted UKIP at the last election shifted back to Labour instead of voting Conservative.

Turnout rose in newly won Labour areas, suggesting Corbyn’s brand of hardcore socialism and “pork-barrel politics”—including pledges to abolish tuition fees—motivated young people to turn out. And as Harold Macmillan famously warned, “Events, dear boy, events” may have conspired against the prime minister. The terror attacks in Manchester and London Bridge, coupled with Trump’s tweets against London Mayor Sadiq Khan, may have played a role in the campaign’s final days.

What Happens Next?

Although voters may have punished her for going to the country early, another plebiscite could be in the cards. In her speech early Friday morning, the prime minister promised a “period of stability,” suggesting a possible transition, followed by a third general election. With the Conservatives operating a minority government, it seems unlikely that government could last for the full five-year lifetime of a Parliament.

That said, May may not remain long enough to make those decisions herself. Early reports suggest a high likelihood that the prime minister could step down as Conservative leader, triggering the second leadership election for the party in as many years. (It is a demonstration of the election’s shock result that Corbyn could well outlast May as party leader—an outcome few previously would have thought possible.)

However, one election seems unlikely to occur any time soon: A second referendum on Scottish independence. Scotland provided one of the election’s many ironies when a weakening of Scottish National Party support led to a gain of 11 Conservative MPs, propping up the party after losses elsewhere. With Labour also benefitting from the SNP weakness, and Scottish voters seemingly taken a dim view of a “never-endum” debate on independence, the union of England and Scotland apparently remains secure—for the time being.

As to Britain’s “other” union—its impending divorce from the European Union—the nature of that relationship seems less clear. With the Conservatives having less room for maneuver in the coming Parliament, the next prime minister—whether May or someone else—could end up playing a weakened hand in negotiations with Brussels. That’s the exact opposite scenario of the one May envisioned six weeks ago—another surprising outcome from Thursday’s surprising election.

This post was originally published at The Federalist.