Month: December 2017

Health Policy Report

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The Week in Review

The House and Senate both adjourned for the year after passing a four-week stopgap spending bill that will keep the government open until Jan. 19 and prevent $136 billion in automatic under congressional PAYGO rules. The Senate overwhelmingly rejected a proposal from Sen. Rand Paul (R-KY) on PAYGO to strip the language avoiding a potential sequestration, which would have been triggered in 2019 if President Trump were to sign the tax bill in January. Just eight Senate Republicans voted to enforce the PAYGO cuts, while every Democrat agreed to waive the pending sequestration. Although Congress was able to avoid a government shutdown, they failed to complete work on an $81-billion disaster aid package to help California, Gulf Coast states and Puerto Rico recover from wildfires and hurricanes, as lawmakers scrambled Thursday to wrap up business before a Christmas break.

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TRP’s Shea McCarthy Forecasts Possible Entitlement Reforms in 2018

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In an Inside Health Policy article published December 15, Thorn Run Partners Senior Vice President Shea McCarthy discusses the possibility of entitlement reform next year. Speaker Paul Ryan (R-WI) has said that Republicans plan to pass entitlement reform through the reconcilation process next year. McCarthy astutely points out that GOP leadership has been reading from the same playbook with respect to their biggest policy priorities this year, and it stands to reason they will plan to do so going forward. However, McCarthy noted that major cuts to Medicare and Medicaid would be a tough undertaking for the GOP-led Congress. "Major cuts to Medicare or Medicaid will be even more difficult to move through Congress than ACA repeal — and without all the sweeteners that come along with tax reform," said McCarthy. "And with a shrinking margin in the Senate, Republicans should be realistic about whether they’re writing their election year messaging platform, or a bill that can actually become law.” 

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Today on the Hill: Congress Poised to Approve Tax Reform in Votes Today

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The conference report for the GOP-backed Tax Cuts and Jobs Act (TCJA) is expected to reach the floor of both chambers today, as Republicans in Congress are poised to deliver on their promise to overhaul the nation’s tax regime for both individuals and businesses. In the Senate — where the bill will likely be passed on a razor-thin margin — theoretical holdouts Sens. Susan Collins (R-ME), Bob Corker (R-TN), and Marco Rubio (R-FL) have already committed to voting in favor of the bill, which should make the vote relatively free of the drama that defined the effort to repeal and replace the Affordable Care Act (ACA) earlier this year. On timing, the House vote will almost assuredly be completed later this morning, which then triggers a 10-hour procedural clock before the upper chamber can hold their vote on final passage. Majority Leader Mitch McConnell (R-KY) has indicated that he intends to hold that final vote tonight, which would result in a final vote on the bill at some point late this evening.  President Trump is expected to take a victory lap with Republicans and sign the bill later this week.

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Financial Services Report

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Looking Ahead

Near Term

  • The House and Senate are poised to approve the tax reform bill and if everything goes according to plan, it will be on the President’s desk by mid-week.
  • Funding for the government expires on Friday.  A continuing resolution to punt the hard choices of what to include in a long-term spending bill until mid-January has been teed up and is expected to pass the Senate on Friday.  How late on Friday remains to be determined. 
  • The House will also take up a bill (H.R. 3312) that would revise the authorities of the Financial Stability Oversight Council (FSOC) in their designation of certain financial services firms as “systemically important” by replacing the Dodd-Frank threshold of $50 billion in assets, and instead requiring the regulators to come up with an activities-based approach.
  • The House is also expected to take up the “Corporate Governance Reform and Transparency Act of 2017 (H.R. 4015).  This legislation would require firms that give investors proxy voting advice to register with the SEC and would also increase the disclose of these firm’s methods and potential conflicts of interest.
  • The Senate Banking Committee is scheduled to hold votes on a slate of nominees to fill vacancies at the Ex-Im board on Tuesday.  This includes the nominee to be President of the Bank, Scott Garrett. However, his nomination has faced bipartisan opposition and may not be approved.  

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Health Policy Report

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The Week in Review

The twin battles over government funding and tax reform both took steps forward last week. On the funding track, a proposed continuing resolution (CR) backed by House Republicans would provide defense spending for a year and domestic spending for five weeks — an approach viewed as a non-starter in the Senate, where Democrats have demanded “parity” in increases to defense and domestic spending. Lawmakers will likely be looking to strike a limited agreement this week that will kick the larger funding fight into January.

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Today on the Hill: CR and Tax Package Progress as Congressional Leaders Plot Busy Week Before Holiday Break

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The twin battles over government funding and tax reform both took steps forward yesterday as House Republicans released the text of their preferred version of a continuing resolution (CR) and tax conferees reached an “agreement in principle” on the final form of a legislative package. On the former issue, the House Republican CR (text) would fund defense spending for a year and domestic spending for five weeks – an approach endorsed by conservatives in the House, but viewed as a non-starter in the Senate, where Democrats have demanded “parity” in increases to defense and domestic spending. House Republican leaders are reportedly facing pressure from the conservative side of their caucus to pass the bill and leave town in an attempt to force the Senate to accept their version. However, with 8 Democrat votes needed in the Senate for any funding measure, that approach is likely unpassable in the upper chamber and the brinksmanship approach would amount to a serious escalation of the threat of a government shutdown. Bipartisan and bicameral negotiations will continue behind the scenes ahead of next Friday’s deadline.

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TRP’s Shea McCarthy Discusses Possible Next Steps Following the End of the 2018 ACA Enrollment Period

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In an Inside Health Policy article published Monday, Thorn Run Partner’s Senior Vice President Shea McCarthy discusses possible next steps for CMS and the Trump administration following the end of the 2018 Affordable Care Act (ACA) enrollment period. The article notes that industry lobbysts expect CMS to take some sort of action following the end of the enrollment period, possibly shutting out "in-line" enrollees who are waiting as a result of expected healthcare.gov slowdowns.  McCarthy wisely pointed out that the end of the open enrollment period will represent "a key inflection point" for the Trump administration regarding their approach to ACA implementation moving forward. “It stands to reason that regulators will use the end of open enrollment as another opportunity to chip away at the ACA marketplaces," said McCarthy.

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Today on the Hill: Alabama Heads to the Polls in Special Election for Senate; Proposed Tax, CR Timelines Emerge

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Political observers will be waiting eagerly for the returns from today’s special election in Alabama to select Jeff Sessions’ replacement in the U.S. Senate. The unusually competitive race between Republican Roy Moore and Democrat Doug Jones has attracted national attention and resources, making today’s result another indicator for both parties as they plot their strategies for next year’s midterm elections. However, many commentators have been quick to point out the highly unusual circumstances surrounding the Alabama race: a special election held in December, in a deeply Republican state, but with a controversial Republican candidate that has disavowed the establishment and is fighting off accusations of inappropriate sexual conduct with minors.

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Financial Services Report

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Our Take

While not known as a prescient sage, back in 2006 John Mayer may have seen the future when wrote
 
"And when you trust your television
What you get is what you got
Cause when they own the information, oh
They can bend it all they want"
 
Much has been written about the Balkanization of how people receive their news and we all know of the biases that various sources have that "bend" what we each of us receives.   From my cozy perch inside the bubble of Washington, it still surprised me that last week a Pew Research poll was released that showed that a majority of President Trump's supporters (62%) can't think of anything Trump has done that they're unhappy with.   Perhaps this may have as much to do with the sense of team as a sense of ignorant bliss.  But either way speaks to the new world of tribal politics we may be entering in.  Speaking of which, for many liberals their view that this descent into tribal politics will be complete on Tuesday if, as the latest polls are correct and Alabama elects Roy Moore to the Senate.  It would be bittersweet irony if, similar to the Presidential campaign, the polling this race was also way off.

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This Week on the Hill: Washington to Focus on Tax Reform Conference and Alabama Special Election

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While government funding and tax reform remain at the forefront of lawmakers’ concerns, this week’s work is likely to focus on behind-the-scenes negotiations. On tax reform, the first public conference meeting is set for Wednesday and reports suggest that Republicans are making progress in working out the differences between the House and Senate tax bills. President Trump will continue his lobbying campaign for the tax bill with a speech at the Treasury Department on Wednesday. On the current timeline, Republican leaders are aiming to bring the tax bill to the floors both the House and Senate during the week of Dec. 18 and will try to send the bill to the president’s desk before Christmas.

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