Software is produced and released on an incremental basis. That’s what earned Paul Ryan’s healthcare bill its Obamacare 2.0 moniker. Critics saw it as simply a newer version of the original legislation and they were right. Although, when that bill was sent to the Senate and became Mitch McConnell’s healthcare bill it wasn’t improved upon. In fact, Congressman Thomas Massie believes the Senate version is more like Obamacare 1.1 instead. The few improvements the House version of the bill had were stripped out and replaced with even more subsidies. Paul Ryan’s version took two steps forward and then Mitch McConnell took one step back.
There are major differences between the House and Senate versions that make the Senate version significantly worse and less likely to pass with Republican support. One of the key measures that was added after the original AHCA failed was the provision that allowed states to apply for special waivers. These passes would exempt states from key provisions regarding preexisting conditions. The Senate version stripped that out in its entirety. This addition was one of the major reasons that the House Freedom Caucus endorsed the bill and without it the legislation is unlikely to pass if ever sent back to the House.
The other significant change was what happened to the the massive Medicaid expansion. Under the House bill, expansion funding would immediately be cut and then taper off until ending altogether in 2020. Medicaid funding after 2020 would be block granted to the states. The Senate version doesn’t reduce Medicaid spending the first year, or the second year, or the third year. It keeps the original Obamacare funding through 2021 and might even increase it. While the Senate version still mandates block granting following 2021, the grants will be tied to inflation, which means the funding will still increase every year.
Finally, the most importance revision is that while the individual mandate has been removed, the provisions regarding preexisting coverage remain. In other words, insurance companies will still be required to cover sick people but healthy people will no longer be incentivized to purchase health insurance. Because companies will be forced to charge sick people the same prices as healthy people, prices will remain high, which will further decrease the incentive for healthy people to join the market. As Thomas Massie explains, this will only worsen the death spiral that Obamacare is in. Worst of all, if this bill ever passed, and Obamacare collapsed, Democrats would ensure that the media blamed Republicans.
All that said, Thomas Massie didn’t even bother to vote for Paul Ryan’s version of the healthcare bill when it squeaked through the House six weeks ago. If, and it’s an incredibly big if, this version of the Senate healthcare bill was passed and sent back to the House it’s would fail to earn Massie’s vote again. The same can also be said for other conservatives who decided to vote for the bill in the hopes that it would be improved by the Senate. Justin Amash won’t be voting for a worse version of Obamacare-lite that the one he reluctantly voted to send on to the Senate.
With that taken into account, the most likely outcome for Republican efforts to replace Obamacare is that this version of their bill will fail – as Paul Ryan’s first version of the AHCA did. It will then be brought back weeks later and the whole debate will start all over again. Rand Paul, Ted Cruz, and Mike Lee will band together to prevent that from passing and it will be back to square one if no concessions are made. Until the Republican establishment acquiesces to their conservative base, they’ll continue to fail to get anything passed into law.