TRP’s Shea McCarthy Comments on the Republican Study Committee’s Role in Healthcare Reform Talks for Inside Health Policy

In an Inside Health Policy article published yesterday, Thorn Run Partner’s Senior Vice President Shea McCarthy offered his take on the role of conservatives in the House — namely the Republican Study Committee (RSC) and the House Freedom Caucus — in looming negotiations between the two chambers as lawmakers continue to digest the Senate’s healthcare reform bill. McCarthy noted that while it was expected that the Senate’s version was always expected to be more centrist than the House’s American Health Care Act (AHCA), key questions remain as to whether or not Senate conservatives — such as Senators Ted Cruz (R-TX) and Mike Lee (R-UT) — will support a more moderate package. “Cruz in particular still carries a lot of weight with the RSC and the Freedom Caucus,” said McCarthy in the interview prior to the Senators’ opposition of the current bill. “Assuming Cruz and Lee ultimately sign off on the Senate’s version, signaling that the bill goes ‘far enough,’ it’s hard to envision enough conservative House members casting votes to sink the package.”

McCarthy astutely noted that drawing a line in the sand is not uncommon for the RSC, noting that the committee may be signaling that watering down the House bill won’t be taken well in the House. “By drawing a hard line in the sand now, the RSC is sending a signal to moderate Republican senators that watering the bill down any further won’t be taken well on the House side,” said McCarthy. “But if Speaker Ryan were to bring the Better Care Reconciliation Act to the floor in an act of political expediency — which seems very realistic — there would be a ton of political gravity pulling Members towards the party line.”

The article in its entirety can be read below.

 

RSC Members Warn Four Components Of AHCA Crucial To House Passage

 

June 22, 2017

House Republican Study Committee members warned Senate Majority Leader Mitch McConnell (R-KY) that four components of the House-passed American Health Care Act are crucial to getting a final health reform bill to the White House — the so-called MacArthur amendment, phasing out enhanced Medicaid expansion by 2020, repealing Affordable Care Act taxes, and preventing federal payments to Planned Parenthood while also keeping subsidies from being used to purchase plans that cover abortion — and raised concerns the Senate is moving in a direction that could cause the upper chamber's bill to stall in the House. The Senate draft bill does not include the MacArthur amendment and includes a longer phase out of Medicaid expansion funding compared to the House bill.

“We write to express our serious concerns regarding recent reports suggesting that the Senate's efforts to produce a reconciliation bill repealing the Affordable Care Act are headed in a direction that may jeopardize final passage in the House of Representatives,” 30 members of the RSC wrote just prior to the Senate's draft becoming public.

Julius Hobson, senior adviser at Polsinelli, said the letter is an indication that the House will likely have to vote on what the Senate passes without working out differences between the two chambers’ versions.

A spokesperson for the RSC says the group is reviewing the draft bill, which the Senate released Thursday (June 22). Separately, House Freedom Caucus members are “not rushing to judgment,” according to Freedom Caucus Chair Mark Meadows (R-NC) (see related story).

Prior to the bill’s release, House RSC members listed four components of the House-passed AHCA that are “particularly crucial to its ability to continue to garner a passing majority in the House.” The first of these is the House bill's prohibition on new states receiving the enhanced federal match rate for expanding Medicaid and the phaseout of higher federal funding for newly eligible beneficiaries in expansion states. However, under the draft Senate bill, Medicaid expansion would remain for three years, followed by a three-year phase down of the enhanced federal match rate.

Meadows said he seeks fair treatment of both states that expanded and those that did not, “so we've tried to take a more pragmatic approach, principled but pragmatic.”

The House bill also included the so-called MacArthur amendment, introduced by Rep. Tom MacArthur (R-NJ), that would allow states to choose to waive essential health benefits. However, the draft Senate bill would get around that controversial amendment by allowing states to use 1332 waivers to redesign their insurance markets.

Two of the other components to the House bill deemed crucial by the RSC members were included in the bill — repealing taxes that were used to pay for the Affordable Care Act and “living up to an important conservative commitment to promote life and protect the unborn.” The draft includes a provision to ban federal funding for Planned Parenthood for a year and to keep tax credits from being used to purchase plans that cover abortions.

However, Hobson said that it's likely both provisions could be removed before a vote as, based on prior rulings, the Senate parliamentarian could say that the provisions don't meet the requirements of a reconciliation bill under the Byrd rule.

“As the Senate continues its deliberative process, we urge you to carefully evaluate the American Health Care Act and consider the important role these specific policies played in building consensus in the House,” the letter says.

Shea McCarthy, vice president at Thorn Run Partners, said it was always expected that the Senate's bill would be slightly more centrist than the House's bill.

“The key question in the Senate — which remains to be answered — is whether Sens. Ted Cruz and Mike Lee, who have been integral in negotiating the bill, will support a package that leans more moderate than the House version. Cruz in particular still carries a lot of weight with the RSC and the Freedom Caucus. Assuming Cruz and Lee ultimately sign off on the Senate’s version, signaling that the bill goes ‘far enough,’ it’s hard to envision enough conservative House members casting votes to sink the package,” McCarthy told Inside Health Policy shortly before Cruz (R-TX) and Lee (R-UT) came out against the current version of the bill, but said they were open to negotiation.

“Currently, for a variety of reasons, we are not ready to vote for this bill, but we are open to negotiation and obtaining more information before it is brought to the floor. There are provisions in this draft that represent an improvement to our current health care system, but it does not appear this draft as written will accomplish the most important promise that we made to Americans: to repeal Obamacare and lower their health care costs,” Sen. Rand Paul (R-KY), Lee, Cruz and Sen. Ron Johnson (R-WI) said in a statement.

Still, McCarthy said this wouldn't be the first time the RSC has drawn a hard line in the sand, and it may be working to signal to the Senate that watering the bill down won't be taken well in the House.

“This wouldn’t be the first time that the Republican Study Committee set an aggressive marker for how conservative the healthcare bill has to be before eventually coalescing around the as-good-as-we’re-gonna-get version of the bill. By drawing a hard line in the sand now, the RSC is sending a signal to moderate Republican senators that watering the bill down any further won’t be taken well on the House side,” McCarthy said. “But if Speaker Ryan were to bring the Better Care Reconciliation Act to the floor in an act of political expediency — which seems very realistic — there would be a ton of political gravity pulling Members towards the party line.”