The Byzantine Rules for Dismantling Obamacare

Washington correspondent explains how budget reconciliation works

After capturing the White House and both houses of Congress, Republicans put repealing and replacing the Patient Protection and Affordable Care Act (PPACA) at the top of their to-do list. But to get around a Democratic filibuster, which could stop their campaign in its tracks, they plan to use an arcane legislative tool known as budget reconciliation.

In the Senate, it takes 60 votes to stop a filibuster. Although Republicans are in the majority, they have only 52 seats––and Democrats have said they won’t help their opponents dismantle the health act that Democrats voted to pass seven years ago. That’s why Republicans  have turned to budget reconciliation, which dates back to the Congressional Budget and Impoundment Control Act of 1974.

Several major health laws have been passed using reconciliation, including those guaranteeing the right to emergency room care, creating the Children’s Health Insurance Plan (CHIP), and allowing private plans as an alternative to traditional Medicare coverage.

In an online video, Julie Rovner, chief Washington correspondent for Kaiser Health News, explains how the reconciliation process works.

First, she said, Congress has to pass a budget resolution. That document must be approved by both the House and the Senate, but it doesn’t go to the president for his signature. Budget resolutions set spending targets for federal programs that Congress funds every year, Rovner said. They also instruct the congressional committees in charge of those programs to propose changes in the law that would “reconcile” how much the programs actually cost with the targets set by the budget. This is the process that Republicans plan to use to dismantle the PPACA.

Budget reconciliation bills, however, can change only things that directly affect the federal budget—either adding to or reducing federal spending. For the PPACA, that means Congress could use budget reconciliation to eliminate spending, such as the help people get to pay their premiums or funding to states to expand the Medicaid program for the poor, Rovner explained. A reconciliation bill can also repeal the taxes that help pay for those benefits, including the tax penalties for individuals who fail to buy insurance.

Thus, even with the reconciliation process, Republicans are limited with regard to how much of the PPACA they can repeal. For example, they can’t use reconciliation to change the act’s provisions requiring insurance companies to provide certain benefits or to sell coverage to people with pre-existing conditions, since those provisions don’t directly affect federal spending.

Source: Kaiser Health News; February 6, 2017.