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Health Law Mandate Repeal Not a Shoo-In Under Reconciliation

By Melissa Attias, CQ Roll Call

August 19, 2015 -- Republican efforts to use reconciliation to repeal parts of the health care law may be limited by requirements built into the budgetary maneuver that could block scrapping such high-profile targets as the law's requirement that most individuals buy health coverage or pay a penalty.

The so-called Byrd rule—named for the late Sen. Robert C. Byrd, D-W.Va.—will largely determine whether or not a health law provision can be repealed through reconciliation with a simple majority. If any senator raises a point of order that a provision violates its complex requirements, it would take 60 votes to overcome the objection. 

The rule not only generally limits the use of reconciliation to those provisions that change spending or revenues but stipulates that lawmakers cannot use those changes as justification to target policies and regulations that have marginal budgetary effects. That aspect, which former Senate Parliamentarian Alan Frumin said is subjective and the most difficult for parliamentarians and congressional staff to apply, could complicate GOP efforts to undermine the Affordable Care Act.

Frumin said repealing the individual mandate and a similar requirement that employers provide coverage or pay penalties, as well as the law's requirements for the insurance markets, do not belong in a reconciliation bill. At the same time, he noted that all of those provisions have some budgetary effects and were addressed through reconciliation when the health care law was enacted, which could leave room for maneuvering.

"I'm skeptical about flat-out repeals of the substantive structure of these aspects of the law, but the reconciliation door is most likely open to some extent to weaken the budgetary muscle of these aspects of 'Obamacare,'" Frumin said in an email.

Rather than a clear green light for repealing those provisions, "perhaps there's a light here with some shade of green," he suggested.

Elizabeth MacDonough, who succeeded Frumin in 2012 and became the first woman to hold the Senate parliamentarian's post, will play a crucial role determining which provisions are suitable for reconciliation after reviewing cost estimates from the Congressional Budget Office and materials presented by congressional staff in closed-door sessions.

Senate Majority Leader Mitch McConnell of Kentucky said earlier this month that Republicans think they can repeal much, but not all, of the overhaul through reconciliation based on discussions with MacDonough. While repeal legislation would be largely a messaging exercise as long as President Barack Obama is in office and capable of wielding a veto pen, it could set precedents for reconciliation maneuvers if Republicans win the White House in 2016 and retain their congressional majorities.

Budget Factor

Frumin said he repeatedly heard "strong arguments" in 2009 and 2010 that most of the components of what would become the health care law, including the individual mandate, did not belong in a reconciliation bill. The reasoning was that all of the proposals were largely policy-driven—essentially aimed at providing health care for the masses—and had nothing to do with the government's coffers.

"I have no recollection of having heard any of those arguments from any Democrat," he said.

Frumin also said he recalls warning that insurance market provisions, such as covering people with preexisting conditions, could be vulnerable to a Byrd rule challenge.

In the end, Democrats in both chambers advanced the bulk of the health care overhaul in a 900-plus page bill and followed up with a 55-page reconciliation measure that made adjustments and included some education provisions.

Ed Lorenzen, who served as senior policy adviser for then-House Majority Leader Steny H. Hoyer of Maryland during the debate, said there were many changes that Democrats thought had enough of a budgetary effect to survive the Byrd rule but were dropped after meetings with the parliamentarian. That suggests there are a number of items Republicans assume can be repealed through reconciliation that would be tripped up by the Byrd rule, he said, noting that many precedents from the 2010 process would still apply.

Lorenzen–now a senior adviser at the Committee for a Responsible Federal Budget–said changing or repealing the penalty for not having individual coverage should be allowed because it has a direct budgetary effect. The mandate may not necessarily qualify for reconciliation, but he said its accompanying penalty for failure to comply could be removed.

Other budget experts think the mandates could be repealed but differ on whether the insurance market requirements could be undone through reconciliation. 

G. William Hoagland, a senior vice president at the Bipartisan Policy Center, said he thinks those provisions are a "close call" that will largely depend on the scoring of each provision. But Edwin Park, vice president for health policy at the left-leaning Center on Budget and Policy Priorities, said everything from a ban on health plans limiting the dollar amount of annual coverage to restrictions on charging more based on age would not survive the Byrd rule.

The law's subsides to help individuals purchase health coverage, meanwhile, are widely expected to be eligible for repeal through reconciliation.

Experts also pushed back against a proposal promoted by the conservative group Heritage Action for America that assumes a one-provision bill repealing the entire law, as opposed to striking individual provisions, could move through the reconciliation process. Frumin said he thinks the notion is a "nonstarter" and seems like it would fall on a Byrd rule point of order. 

Dan Holler, communications director for Heritage Action, defended the one-provision reconciliation bill, saying previous efforts to scrap the law were a "very simple straightforward approach." He added that Heritage Action has vetted its approach with its own authorities on the budget. The group circulated a memo in late July laying out its position.

Beyond finding a way to achieve deficit reduction in the 10-year budget window, Lorenzen pointed to the way the Byrd rule bars provisions from boosting the deficit beyond that timeframe. In the second decade, he said, repealing the law is expected to raise the deficit by $3 trillion to $4 trillion.

Lorenzen said maintaining the law's Medicare savings and other spending reductions could provide a way to solve the 10-year deficit problem. It could in the longer run, too, though it would create a political problem for Republicans who campaigned against the law's Medicare cuts.

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