Progressives, don't forget: The Freedom Caucus killed the AHCA

Defenders of the ACA are right to take some satisfaction and pride in the failure of Paul Ryan's repeal bill, the American Health Care Act.  All those packed Town Halls, jammed phone lines and floods of mail had their effect. Dozens of Republican reps and senators, moderate and not so moderate, expressed qualms about un-insuring tens or hundreds of thousands of their constituents -- and tens of millions of Americans.

As we consider next steps, though, it's important to take full measure of the rather mind-bending fact that it's the Freedom Caucus that really sank the bill. They reportedly killed it partly because Trump managed somehow to trivialize their concerns even as he caved to most of them -- but more fundamentally, because it left some ghost of the ACA tax credits and consumer protections intact for those seeking insurance in the individual market.

For these zealots (and their right-wing think tank backers), the AHCA wasn't harsh enough.  It didn't cut the taxes that fund Obamacare benefits fast enough. It didn't uninsure beneficiaries of the Medicaid expansion fast enough. It didn't kill the concept of subsidized private insurance dead enough. It didn't take us back to the future of medical underwriting and health "insurance" that would render unaffordable coverage for such incidentals as childbirth and mental health treatment.

As House leadership and Trump staggered toward their symbolic ACA-anniversary vote date, almost all the concessions were to this crew -- phasing out the Medicaid expansion at the end of 2017 instead of in 2020, repealing the ACA's taxes more quickly, repealing the Essential Health Benefits (EHBs) that the ACA required all insurers to include in qualified health plans.

Yes, the relative moderates expressed significant qualms, particularly about rolling back the Medicaid expansion. Their ranks included some dozen senators, mostly representing states that had expanded Medicaid. On March 16, Susan Collins of Maine said she couldn't support the bill "in its current form." Dean Heller of Nevada followed suit a couple of days later.  The bill could survive only three Senate defections. In the House, where Republicans could afford to lose 21 votes, the Times' final whip count before the bill was pulled showed ten moderates opposed,with another three expressing "concerns" and another 16 leaving their positions unclear. [Update: according to the NYT's post-mortem count, the bill was opposed by 10 moderates, 8 "other Republicans" -- and 15 hard-liners.]

If the right wing had gotten behind Ryan, however -- if they had been willing to take 90% of a loaf -- the bill almost certainly would have passed the House. The "manager's amendment," incorporating concessions to the Freedom Caucus, gave some moderates cover for voting no. Eviscerating Medicaid was ultimately palatable most of them (if troubling to some), but the late disfigurements to the individual market were a bridge too far. In a pivotal moment on Friday, March 24 (the day the bill was pulled in advance of a scheduled vote), Rep. Rodney Frelinghuysen of New Jersey, chair of the Appropriations Committee, justified his turn against the bill this way:

“Unfortunately, the legislation before the House today is currently unacceptable as it would place significant new costs and barriers to care on my constituents in New Jersey. In addition to the loss of Medicaid coverage for so many people in my Medicaid-dependent state, the denial of essential health benefits in the individual market raise serious coverage and cost issues.

“I remain hopeful that the American Health Care Act will be further modified. We need to get this right for all Americans.”

Earlier in the week, Frelinghuysen had promised in a tele-town hall that he would work to ensure that no one enrolled in Medicaid in New Jersey would lose their coverage. That logically meant voting no, although Frelinghuysen was counted as a yes until the moment of his defection (which was astonishing to his constituents). Yet the Medicaid expansion repeal is grammatically subordinated in his statement to the EHB repeal. The Caucus gave him cover.  (They also presented us with the mind-bending spectacle of Republicans* speaking in defense of the EHBs, which they had pilloried from the start for driving up the cost of insurance.)

In the Senate, where Republicans could afford only three defections, left-side Republican opposition to the original bill was squishy. Collins and Heller rejected the bill "in its current form," when it was already trending right. Heller took his cue from Nevada's Republican Governor Brian Sandoval, one of a quartet of Republican governors purporting to champion the ACA Medicaid expansion. Yet those governors, in their March 16 compromise proposal, left expansion states with a Catch-22: either accept per capita caps on the federal Medicaid contribution, or give up enhanced federal funding for the expansion’s beneficiaries.  Heller had earlier indicated that he was seeking to delay the expansion phase-out, not end it. 

In short, in a sane party, the AHCA would have moderated, more or less significantly, and passed. Perhaps the coverage losses would have been reduced to 12 million in ten years rather than 24 million.  Most importantly, there is basically no one in the Republican party likely to stand out against imposing per capita caps on federal Medicaid spending, which would more or less slowly hobble the programs ability to serve its diverse beneficiary pools, which collectively include nearly a quarter of this nation's people.

And that's probably where the greatest threat to U.S. healthcare lies as long as Republicans retain control of both houses of Congress and the presidency. The short-term worries center around the ACA marketplace, which the Trump administration can sabotage to whatever extent it wishes. But Republicans are pretty united in wanting to sharply constrain medicaid -- the most cost-effective source of healthcare funding in the U.S.

So let's not get too hung up on the satisfying fact that the AHCA died a deserved death -- that it died because it was bad policy and rejected by a large majority of the American public. Everything in that statement is true -- except the "because." Harold Pollack, a fair-minded scholar always ready to credit those of opposed views with good faith, was uncharacteristically scathing in his criticism of Ryan on these grounds:

This was a failure of policy and legislative strategy—things that were supposed to be Ryan’s special sauce—not of tactics

Given the opportunity to reshape critical pieces of America’s health care safety-net, Ryan might have led an effort to craft a conservative, but incremental bill consistent with President Trump’s economic populist rhetoric. He might have proposed more modest cuts on the most needy, smaller tax breaks for the wealthiest Americans, and tried harder to accommodate the needs of Republican governors, interest groups and citizens who rely on the Affordable Care Act in their daily lives.

He didn’t. Instead, he and his allies crafted a poorly constructed and radical bill that would sharply cut support to low-income Americans and those with serious health conditions, while enacting big tax cuts for the wealthy. The payout to the top 400 families alone was estimated to exceed total ACA subsidies in 20 states and the District of Columbia. All of this was wildly out of step with American voters—only 17 percent of whom supported this bill.

Again, this is all true. But "a conservative, but incremental bill consistent with President Trump's economic populist rhetoric" wouldn't have passed it, either -- unless it was so populist (say, by expanding a Medicaid buy-in option to people with income up to three times the poverty level) that Democrats might have come aboard. That's not going to happen.

It's exhausting -- and frankly terrifying -- to work in opposition to a party whose legislative agenda is effectively controlled by the Freedom Caucus. This time, they did in their own. Next time, they may do in all of us.

Update:  Important point from Loren Adler of Brookings;

@charles_gaba @haroldpollack @xpostfactoid But progressives & moderates were responsible for stopping repeal & delay, which sealed the deal.

— Loren Adler (@LorenAdler) March 26, 2017

Repeal-and-delay was the earlier Republican plan to repeal the ACA marketplace subsidies and Medicaid expansion with a 2-4 year holding period,, then craft a "replacement" when the deed was done. The idea: once the repeal deed was done, various factions would have to come together for a replacement.  The underlying premise was that a replacement could not be passed via budget reconciliation, the only way to avoid a Democratic filibuster (other than voting to abolish the filibuster).

Update 2: Politico reporting, published this morning, indicates that a Freedom Caucus pact was the determining factor in the AHCA defeat:

...on March 7, just hours after Ryan unveiled a plan that confirmed its worst fears, the House Freedom Caucus rushed to devise a counterstrategy. The few dozen true believers knew that pressure from House leaders and President Donald Trump to fall in line would be immense and they were intent on not getting boxed in.

In a conference room in the Rayburn House Office Building, the group met that evening and made a secret pact. No member would commit his vote before consulting with the entire group — not even if Trump himself called to ask for an on-the-spot commitment. The idea, hatched by Freedom Caucus Vice Chairman Rep. Jim Jordan (R-Ohio), was to bind them together in negotiations and ensure the White House or House leaders could not peel them off one by one.

Twenty-eight of the group's roughly three dozen members took the plunge.

----

* Susan Collins also cited the EHBs in justifying her opposition to the bill

“The problem with that is while I would welcome some changes to improve the flexibility of plans that could be sold, we need to remember that the essential health benefits includes substance abuse and mental-health treatment, which are critical to retain for my state given the opioid crisis,” she told reporters. “Preventative care, vaccinations for children save money in addition to saving lives.”