AHCA Now in Senate Republicans’ (Fragile?) Hands

With the American Healthcare Reform Act finally out of the House, the political momentum ball is now firmly in the hands of Senate Republicans. Can they handle it? Or more specifically, are Ted Cruz and Rand Paul as brainless as the House Freedom Caucus?

Whether by design or accident, the Trump Democrats have put “big league” pressure on Senate Republicans by outlining one of the largest tax reform frameworks in modern American history concurrent with AHCA deliberations. The “savings” generated by the AHCA and the political momentum afforded by a buttoned-up passage would carry the GOP into tax reform negotiations. Stymie the bill, and tax reform becomes a months-long slog.

I have hammered the House Freedom Caucus ever since they killed the initial version of the AHCA, as it obliterated all political momentum. But I must retract my anger: By 110% accident the HFC in effect forced the Trump Administration to pursue a policy construction strategy from the inside-out, led by the highly pragmatic and transactional Trump Democrats – Trump, Cohn, Mnuchin and Kushner. The “inside-out” framework boxes in the Democrat Party from a policy perspective – recall, the Democrats have nothing in the way of a coherent economic policy agenda – since the Trump policy agenda is driven by Democrats.

So while the Trump Administration is likely forced to pursue a seemingly partisan legislative path, the GOP will largely pass bipartisan legislation…since the “inside-out” framework effectively neuters the HFC. This puts the GOP in strong position for the 2018 Midterms.

This is not even remotely to say the AHCA in current form is a major win for the American healthcare consumer. There are many puts and takes that will play out over the span of years. But by far the biggest win is deregulation of the ACA python working its way thru the system. So in my “let the federal government fund it and the free market run it” framework, the AHCA – in full three-stage form – goes a long way toward letting the free market (the states in this case) run it.

Plus, as Ben Shapiro likes to cynically quip, it is highly unlikely that Medicaid is ultimately rolled back in any material way, as the federal government has historically almost never touched an entitlement program. So if generating phantom “savings” is what it takes to pass large-scale tax reform, I will take it…as I believe the federal government could and should fund both tax reform, as currently proposed, and a $280 billion Medicaid expansion to cover the remaining 25 million uninsured.

[5/7/17 edit: 28.4 million uninsured, not 25 (was going off the top of my head from my previous write-up).]

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