“NO” on American Health Care Act (H.R. 1628)

At some point, the House is expected to vote on the American Health Care Act (H.R. 1628), which would partially repeal and replace various components of Obamacare. The proposed legislation repeals a number of Obamacare provisions and contains several notable policy reforms, but the most important part of the AHCA is what it fails to include: a repeal of the regulatory architecture of Obamacare that is responsible for the rising cost of health care.

Title I of the Patient Protection and Affordable Care Act (i.e., Obamacare) lays out a number of health insurance mandates and regulations that make up the regulatory architecture of Obamacare including guaranteed issue, community rating, essential health benefits, and actuarial value, among others. While the AHCA does repeal actuarial value and partially addresses community rating by moving the age rating ratio that Obamacare imposes from 3:1 to 5:1, the bill falls far short of comprehensively addressing the overall regulatory framework of Obamacare.

Obamacare’s creators designed this regulatory framework with the intent to take control of private health insurance plans and convert them into a highly regulated, quasi-public utility. As one of the law’s supporters explained back in 2010, Obamacare’s design “transforms health insurance into a public accommodation,” and turns private health insurance into “a regulated industry … that, in its restructured form, will therefore take on certain characteristics of a public utility.” It strains credibility to characterize this bill as repealing Obamacare when the mechanisms for the federal government’s takeover of health care remain firmly in place.   

Taken together, these mandates and regulations restrict consumer choice and drive up the cost of health care premiums by a national average of 44.5 to 68 percent.  As Heritage Foundation Senior Policy Analyst in Simulations Drew Gonshorowski writes:

“Overall, accounting for gender, age, and the relative proportions of all those groups, Americans are paying 44.5-68 percent more in premiums owing just to Title I regulations. That number is even higher when factoring all the other adverse effects of Obamacare. Obamacare’s Title I regulations bid up the price of premiums drastically for many Americans. While the current House bill begins to repeal Obamacare, it does not go far enough, as many of the most damaging regulations are left in place. Alleviating this pain should be strongly considered at every step of the process.”

The AHCA would also subsidize that regulatory framework through new refundable tax credits aimed to help individuals buy their own health care plans – plans that will remain highly regulated and overly expensive. There has already been political pressure to increase those credits, and that pressure will increase so long as premiums remain high.

As Heritage Foundation Senior Research Fellow in Health Policy Studies Edmund F. Haislmaier describes:

“The key problem with the draft House health care bill is that it fails to correct the features of Obamacare that drove up health insurance costs. Instead, it mainly tweaks Obamacare’s financing and subsidy structure. Basically, the bill focuses on protecting those who gained subsidized coverage through the law’s exchange subsidies and Medicaid expansion, while failing to correct Obamacare’s misguided insurance regulations that drove up premiums for Americans buying coverage without government subsidies.”

Yuval Levin, editor of National Affairs, explains that the AHCA is “fundamentally different” from previous Republican health care proposals, including the bill introduced by now-Secretary Tom Price, “because it functions within the core insurance rules established by Obamacare, which means it can’t really achieve most of the key aims of the conservative reforms it is modeled on.”

Lawmakers cannot preserve Obamacare’s regulatory structure and claim to have repealed the law. Without including the repeal of these regulations in the AHCA, congressional Republicans will have failed to keep their seven-year old promise to fully repeal Obamacare and health insurance costs will likely continue to increase leading up to the 2018 elections.

House Republican Leadership claims the AHCA is only phase one of a three-part plan to repeal and replace Obamacare. In phase two, Human Health and Services (HHS) Secretary Tom Price will take action to address the Obamacare insurance mandates and regulations. In phase three, Republicans will pass any additional reforms they failed to achieve in phase one and two. Unfortunately it isn’t that simple. All executive action in phase two is limited, temporary, and will likely face serious legal challenges. All legislative action in phase three will require 60 votes in the Senate, including eight Democrat votes, a nearly insurmountable obstacle for Republicans to overcome.

Thankfully, Republicans in Congress have the legislative tool necessary – budget reconciliation – to fully repeal Obamacare’s regulations and avoid the political and policy complications contained within phase two and three. Some Republicans have argued Congress cannot repeal Obamacare’s insurance mandates and regulations contained in Title I through budget reconciliation because it does not have a clear budgetary impact. This is somewhat surprising considering the AHCA includes some regulatory changes while leaving others out. Regardless, this argument ignores the reality that Obamacare’s regulatory architecture imposes significant costs on taxpayers and is inseparable from the rest of the law. A January 2017 Congressional Budget Office (CBO) report left little doubt that Obamacare’s regulatory regime has budget implications.

As one former Senate staffer wrote:

“To argue that their budgetary impact is merely incidental to the rest of the law is absurd on its face. Even the Obama administration made this very argument before the Supreme Court in King v. Burwell, arguing forcefully that the regulations are inseparable from the rest of the law. Predicated on that alone, Congress has a case that full repeal through budget reconciliation is viable.”

The Wall Street Journal editorial board describes the two managers’ amendments released  Monday night as “mostly modest,” which is true because they do nothing to repeal the regulatory architecture of Obamacare.     

Republicans promised to fully repeal Obamacare, campaigned on full repeal since 2010, and voted more than 60 times to repeal parts or all of the disastrous health care law. The American people rewarded Republicans for their promise to repeal Obamacare by giving them a united government for the first time in more than a decade. An unwillingness to pursue repeal of Obamacare’s Title I insurance regulations through reconciliation based on a narrow interpretation of budget rules is not acceptable.

Unless repeal of Obamacare’s regulatory regime is included in the AHCA, the bill deserves to be defeated because it would leave the architecture of Obamacare in place and ensure health insurance premiums remain far too high.

Then-Representative Mike Pence’s description of his 2003 vote against the Bush-era prescription drug program resonates still today: “House conservatives faced a difficult choice: oppose the president we love, or support the expansion of the big government we hate.” Voting against a leadership-crafted bill was “not a sign of disloyalty, but of true loyalty to principle,” Pence explained at the time. That same principle remains true today.

Heritage Action opposes H.R. 1628 and will include it as a key vote on our legislative scorecard.        

Related:
Heritage Action Statement Opposing the AHCA
Daily Signal: Misleading Rhetoric Can’t Mask Failings of GOP Health Care Bill
Daily Signal: Capitol Hill’s Misleading Claims on Tax Credits for Health Care
Full Repeal Means Regulatory Repeal: Why Obamacare’s Regulatory Mandates Must Be Undone Permanently
Daily Signal: House Republican Health Care Bill Misses the Mark by Heritage Health Care Expert Ed Haislmaier
Daily Signal: As Republicans Debate Health Bill, Let’s Remember Why Americans Want Obamacare Repeal by Heritage Health Care Expert Ed Haislmaier
Daily Signal: Pro-Life Groups Sound Caution on Obamacare Replacement Bill
The Hill Op-ed: Voters won’t forgive Republicans if they fail to repeal ObamaCare
Op-ed: Holding Obamacare Repeal Hostage for Replace Guarantees Its Defeat by James Wallner
Op-ed: Why Obamacare’s “20 Million” Number if Fake
Daily Signal: How Tom Price Can Begin to Unravel Obamacare From Inside the Agency That Implemented It

Key Vote: “YES” on Disapproval of the HHS Rule requiring Title X funds to go to Planned Parenthood

This week the House of Representatives is expected to vote on H.J.Res. 43, sponsored by Rep. Diane Black (R-TN), a disapproval resolution of the final rule submitted by Obama’s Secretary of Health and Human Services (HHS) relating to compliance with Title X requirements by project recipients in selecting sub-recipients. Title X of the Public Health Service Act provides federal funds to states for family planning grants.  Once states receive the funds, they have the ability to prioritize sub-recipients, directing funds to organizations like community health centers and family health clinics. While federal law prohibits government funding for abortion, it does allows certain public dollars, like the Title X grants, to support abortion providers if the funds are directed to non-abortion related health services.  Under this exception, Planned Parenthood has been eligible to receive Title X funds, per the states’ discretion.

However, after the Center for Medical Progress released videos suggesting that Planned Parenthood Federation of America affiliates are harvesting and selling the body parts of aborted unborn children, many states, including Alabama, Arkansas, Arizona, Florida, Louisiana, Kansas, Missouri, Ohio, Oklahoma, and Wisconsin, took steps to ensure that Title X funds were flowing to real health care clinics – – and not the abortion industry.  But, as Melanie Israel at The Heritage Foundation explains in her article Obama’s Last Gift to Planned Parenthood, the Obama Administration’s HHS stepped in to protect Planned Parenthood’s federal funding stream:

“President Barack Obama has given Planned Parenthood a parting gift in the final weeks of his administration….the Department of Health and Human Services proposed a rule that would prohibit states from blocking Planned Parenthood from receiving Title X family planning services grant money for reasons “unrelated” to its ability to provide family planning services….The rule was proposed in response to several states’ attempt to defund Planned Parenthood after the nation’s largest abortion provider was featured in a series of undercover videos released by the Center for Medical Progress last year.”

Despite this parting gift, Israel goes on to explain that the new Congress, and President Trump, have a unique opportunity to overturn this rule by using the Congressional Review Act:

“According to the Congressional Review Act, Congress and a new president can overturn rules issued in the waning days of a previous administration…The Congressional Research Service has estimated that anything submitted to Congress after the end of May 2016 can be undone in this manner, meaning there are many rules and regulations that the incoming Congress could and should vote to rescind….Incoming members should put Planned Parenthood’s parting gift on the list of items to address using the Congressional Review Act when Congress returns in the new year.”

Overturning this rule is the appropriate step for Congress to take, to both protect life and reassert that the states have Tenth Amendment rights to allocate Title X family planning grants in such a manner as to prioritize community health clinics and true family planning over the industrial abortion industry represented by Planned Parenthood.  The HHS rule is a classic example of excessive federal rulemaking and executive overreach for partisan political gain, making it a perfect target for nullification under the CRA.

Heritage Action supports H.J.Res. 43 and will include it as a key vote on our legislative scorecard.

Related:
Obama’s Last Gift to Planned Parenthood
Pro-Life Groups Fight Obama Administration’s ‘Parting Gift’ to Planned Parenthood

 

“YES” on Disapproving the Stream Protection Rule (H.J.Res. 38)

On Wednesday, the House of Representatives will vote on H.J.Res. 38, a resolution disapproving of the rule submitted by the Department of the Interior’s Office of Surface Mining (OSM) known as the Stream Protection Rule (SPR).  Offered by Representatives Bill Johnson (R-OH), Evan Jenkins (R-WV) and David McKinley (R-WV), this resolution would ensure that final SPR has no force or effect, and that OSM cannot issue a rule that is substantially the same without subsequent authorization from Congress.

While initially proposed in 2008, the rule wasn’t finalized until December 19, 2016.  During the intervening time, The Heritage Foundation wrote extensively about the profoundly negative impact this rule would have on the coal mining industry. In his paper The Assault on Coal and American Consumers, Heritage Foundation scholar Nick Loris writes:

“According to the OSM’s own projections, the proposed rule could eliminate 10,749 jobs in Appalachia. The new rule would impose additional permitting and reporting requirements and restrict various mining activities. The rewritten rule also has several serious problems. It only vaguely defines permit requirements, monitoring, and stream classifications, which it applies to both surface and underground mining.It removes flexibility in how companies reclaim mine sites, for instance by requiring reforestation even though wildlife organizations are working with the coal industry to provide grassland habitats for a wide range of species. Furthermore, it ignores regional differences and the efficient state regulatory work that manages those differences.”

Furthermore, Rep. Rob Bishop (R-UT), Chairman of the House Natural Resources Committee, said that:

“This rule is the perfect candidate for congressional repeal. It is an abuse of executive power and the unelected bureaucracy expurgated states from the rule-writing process before jamming it through in the eleventh hour. The sheer economic impact of this rewrite of over 400 regulations is devastating for coal communities and, if allowed to proceed, an utter disaster for existing regulatory processes.”

Under a law known as the Congressional Review Act (CRA), Congress has the power to review regulations issued by Executive Branch agencies, such as the OSM, and even revoke the regulations through a resolution of disapproval. Once the disapproval resolution is passed by both the House and Senate, and signed by the President, the regulation has no more effect and cannot be brought back by any future administration absent specific authorization by Congress.

Additionally, passage of CRAs in the Senate only requires a simple majority vote and is therefore not subject to the filibuster. This makes the CRA a perfect tool for overturning many of former President Obama’s burdensome regulations. As Daren Bakst and James L. Gattuso from The Heritage Foundation have written:

“Both Congress and the President will have an opportunity in 2017 to roll back costly new rules that have been and are continuing to be imposed on the American people by the outgoing Administration. One powerful tool they can use to accomplish this task is the Congressional Review Act. This long-neglected tool can provide Congress with the power to swiftly remove months of Obama Administration rules from the books and to help ensure that they do not come back. Congress should not hesitate to use the CRA extensively.”

Using the CRA to nullify the job-killing Stream Protection Rule is a good first step towards the extensive use that Congressional Republicans should make of this legislative tool — used successfully just one time since its creation in 1996 — to cancel excessive regulations.

Heritage Action supports H.J.Res. 38 and will include it as a key vote on our legislative scorecard.

Related:

WSJ: A GOP Regulatory Game Changer
The Assault on Coal and American Consumers
2017 House Interior and Environment Bill Makes Policy Strides, Still Spends Too Much
Stars Align for the Congressional Review Act

 

“YES” on No Taxpayer Funding for Abortion (H.R. 7)

This week the House will vote on the No Taxpayer Funding for Abortion and Abortion Insurance Full Disclosure Act of 2017 (H.R. 7). Sponsored by Rep. Christopher Smith (R-NJ), the bill would establish a permanent, government-wide prohibition on federal taxpayer funding of abortion and health benefits plans that include coverage of abortion, as well as prevent federal tax dollars from being entangled in abortion coverage under Obamacare.

The No Taxpayer Funding for Abortion Act is a good pro-life, pro-taxpayer bill that has earned Heritage Action’s support in the past. Regarding H.R. 7, The Heritage Foundation notes Congress failed to apply longstanding protections against federal funding of abortion or abortion coverage to the totality of Obamacare, potentially allowing large taxpayer subsidies to flow to health plans that cover elective abortion. They explain, “taxpayers will now foot the bill for federal subsidies for the purchase of health plans on the exchanges… and some of those plans could cover elective abortion.”

“YES” on Obamacare Repeal Budget Resolution (S. CON. RES. 3)

On Friday, the House will consider a concurrent resolution (S. CON. RES. 3). While the resolution will technically set the congressional budget for the United States Government for the remaining eight months of fiscal year 2017, its only functional purpose will be to produce reconciliation instructions that unlock fast track authority that Congress can then use to repeal Patient Protection and Affordable Care Act (PPACA). Separately, there is an expectation that the fiscal year 2018 budget resolution will reflect the longstanding conservative values embedded in previous GOP budgets. But to be absolutely clear, adopting S. CON. RES 3 is the only way to expedite the repeal of Obamacare.

In November, the Mercatus Center’s Brian Blase and The Heritage Foundation’s Paul Winfree, who was recently appointed Director of Budget Policy and Deputy Director of the Domestic Policy Council for The White House, laid out a “roadmap” on how to repeal Obamacare. The first step is to adopt the unpassed FY 17 budget that “include[s] instructions to the relevant committees in Congress” to repeal Obamacare. “This will set up the ability for Congress to pass a reconciliation bill repealing all the budgetary components of the ACA immediately after Trump is sworn into office,” Blase and Winfree continued.