Post-Summit Health Politics – Why Large Scale Reforms Almost Certainly Cannot Pass

eytan
Print Friendly
Share on LinkedIn0Tweet about this on Twitter0Share on Facebook0

Richard Evans

212.531.6101

richard@sector-sovereign.com

February 2, 2010

Post-Summit Health Politics – Why Large Scale Reforms Almost Certainly Cannot Pass

  • Despite yesterday’s focus on cross-party conflicts, the rate-limit to passage of major health reforms remains intra-party Democratic conflicts
  • Presidents systematically fail to shift public opinion, but Congresses rather reliably follow public opinion. On net, voters continue to oppose reforms
  • Of 18 Senate Democrats up for re-election in 2010, only 7 appear relatively secure. 39 House Dems that supported the original House bill are in districts that President Obama carried by 10 percent or less. For scale, consider that the President carried Massachusetts by 26 percent. These susceptibilities, and the proximity to November’s election, argue that moderate v. liberal / progressive tensions continue building within the Democratic party
  • Abortion and immigration also are potent intra-party wedges; Stupak has at least 10 reliable pro-life votes; the Congressional Hispanic Caucus of 20 votes will not support a bill that prevents un-registered immigrants from purchasing coverage with their own money. Recall that under much more permissive political circumstances, the original House bill passed by just 5 votes
  • With only 59 Democratic Senate seats, and with reconciliation an unsuitable path for very complex legislation, this Senate cannot pass large scale de novo reforms – large scale reforms only pass this Congress if the House passes the Senate bill
  • The Senate bill is opposed by Democrats on both sides of the abortion issue, by the CHC, by House progressives, and by a growing number of at-risk moderates. The House will only pass the Senate bill if the Senate promises to modify the bill post passage – which it can only do via reconciliation; and, many of the necessary modifications (e.g. abortion, immigration) do not meet the rules for reconciliation. This means further non-reconciliation – i.e. 60 vote – Senate provisions would have to pass, to modify the bill to House Democrats’ liking. For good reason many House Democrats believe the Senate is incapable of passing the required modifications
  • We conclude that large scale reforms are almost certainly dead. If we’re wrong, we expect to be wrong very quickly – Democrats cannot lose time on jobs, and cannot allow voter frustration to 1) grow further and 2) run up against the November elections. We conclude that House Democrats (procedurally, the House will have to go first) either vote on the Senate bill right away (even then, we don’t think it would pass), or refuse. Refusal effectively kills large scale reform, opening the floor to smaller, less substantive symbolic (e.g. insurers’ anti-trust exemption) actions

In the wake of yesterday’s White House sponsored Health Care Summit, we retain our conviction that large-scale reforms are unlikely to become law in the current political cycle.

Yesterday’s meeting focused on cross-party differences, but we would emphasize that the immediate political rate-limits to health reform exist within, rather than across, party lines. Until and unless Democrats have a unified bloc, Republicans’ optimal political strategy is to be unified in opposition, as this raises their odds of achieving their political priority – dealing a popular President and his Congressional majorities a major legislative failure, and exploiting this failure at the polls.

Democratic unity on healthcare remains elusive, for reasons both systematic and idiosyncratic. Systematically, even very popular presidents have surprisingly limited ability to move public opinion. The empiric evidence[1] shows that presidential advocacy of an issue tends to raise the public’s level of focus on that issue, but also shows that the underlying public opinion tends to remain essentially unchanged. Congress, reacting to public opinion – amplified by the president having raised focus on an issue – follows the public’s wants rather reliably. For healthcare this means that: 1) the summit is no more likely to have shifted public opinion than any of the preceding presidential events on healthcare; and, 2) that Congress is likely to react to the public’s opinion of the issue – either by passing nothing, or by passing very limited reforms.

On net, the public continues to oppose health reform, at least as embodied in the separate House and Senate-passed bills (Exhibit 1). The pull of public opinion on Congress arguably is greater than normal, given the tangible impact of public opinion in Virginia, New Jersey, and Massachusetts elections; and, given the number of Democrats whose political careers are very much at risk. Of the 18 Senate Democrats up for re-election this November, only 7 are in races that both The Cook Political Report and CQ Politics give them a solid chance of winning (Exhibit 2). In the House, 39 of the ‘yea’ votes on that chamber’s health bill came from Democrats in districts that President Obama either carried by less than 10 percent or lost. Of these 39 ‘yea’ votes, 21 face elections which are rated competitive by either Cook or CQ this year[2] (Exhibit 3) – and keep in mind that the President won Massachusetts by 26 points, only to see an anti-health reform Republican take a pro-health reform Democrat’s seat by a commanding margin. Voters’ opposition to reforms very much pulls the Democratic caucus in two directions – at-risk Democrats tend to be in more conservative districts and so tend to (need to) act more conservatively; this conflicts with the party’s more traditional liberal / progressive base.

On a more idiosyncratic level, the Democratic caucus is further torn by issues of abortion and immigration. Recall that Representative Stupak established a bloc that insisted on language prohibiting use of Federal dollars to subsidize purchase of plans that cover abortion, and that Progressives accepted the 11th-hour amendment to ensure passage of the House bill. At the core of Stupak’s anti-abortion bloc are 10 Democrats who have cast pro-life votes in all 15 right-to-life relevant bills over the last decade, with the exception of a single member on a single bill – a very tight coalition (Exhibit 4). It’s clear Stupak has at least these ten votes, and perhaps several more, that will insist that abortion restrictions remain in any bill the House passes. And, it’s equally clear that many House Progressives are unwilling to accept the Stupak language, particularly if they are asked to do so in exchange for a watered down bill – which, because of the related politics, almost any bill must be. Also, recall that the Congressional Hispanic Caucus (CHC) has refused to vote for a bill that does not allow un-registered immigrants to purchase health insurance with their own money; the House bill allows for this, the Senate bill does not. The CHC controls 20 votes, all of whom voted in favor of the original House bill.

Notably, the President’s proposal to raise the Cadillac tax threshold and postpone its implementation date has effectively killed the tax – and in so doing removed the issue of union opposition to reforms. This plays to Democratic unity, but further polarizes voters’ views on the reform initiative. The President’s proposal replaces the revenue[3] lost to the Cadillac tax by making unearned income subject to Medicare taxes; presumably voters opposed to this means of financing are more often Republican than Democrat.

Democrats have two options in the Senate – very narrow reforms that either everyone can agree on or that Republicans cannot afford to oppose (e.g. revocation of insurers’ federal anti-trust exemption, small health amendments to very popular non-health bills); or, reconciliation. Returning for a moment to voter opinion, we note that voter opposition to reconciliation is even more pronounced than opposition to the reforms themselves (Exhibit 5).

As we’ve previously shown[4] reconciliation is unsuitable for very large and/or very complex legislation. Rather, reconciliation can only be reliably used for smaller, less complex legislation whose provisions meet the requirement of being budget relevant. In effect, with Democrats down to 59 seats, this Senate can no longer pass de novo large scale reform packages – Congress has little choice but to work with the Senate passed bill.[5]

Thus the only way for Congress to pass large scale reforms is for the House to pass the Senate bill as is, on the promise that the resulting law will be suitably modified in subsequent legislation. This is where reconciliation may be useful; in theory Senate Democrats can use reconciliation procedures to pass a smaller bill modifying the law that would result from the House passing the already-passed Senate bill. In practice, we note that reconciliation procedures are restricted to budget – relevant provisions; and, that by extension Senate Democrats may be unable to modify through reconciliation some of the stickier issues (abortion, immigration) that plague the House. This leaves the alternative of passing non-budget-relevant modifications as amendments to other unrelated Senate bills – which is a very uncertain path.

If this sounds like the parliamentary equivalent of breathing through a straw, it is. And quite apart from parliamentary challenges in the Senate, Democratic representatives do not trust Democratic senators. This further complicates the matter of getting the House to act (and the House must act firs), as all members, especially susceptible ones, will be hesitant to pass an unattractive law on the promise that the Senate will act to suitably modify that law, as the Senate has so far in this Congress been much less legislatively productive than the House.

Summarizing – without Republicans, large scale reforms only happen in this Congress if Democrats in the House vote for the Senate-passed bill. In turn this requires a majority of Congress to act against mounting public opinion, for 39 at-risk Democrats in particularly to go against their districts’ conservative biases, for 20 CHC members to vote for a bill that bars un-registered immigrants from purchasing coverage with their own money, and for both sides of the abortion issue to support a bill with a provision they oppose[6]. And, House passage of the Senate-passed bill further requires the House to rely on the Senate agreeing to — and passing into law — suitable modifications, despite the political and parliamentary challenges to the Senate doing so.

As has been the case from the beginning, time remains a critical factor. The more time Congress spends on healthcare, the more likely healthcare remains a defining issue in November, the more likely Congress will not act effectively on voters’ immediate priorities (jobs) and the more likely at-risk Democrats are to lose their seats. Accordingly we expect the prospects of large scale reforms to become very clear, very soon. Either the House agrees to take up the Senate bill – which we don’t believe they can pass – or it becomes clear that House either cannot or will not do so.

In the wake of failing to pass major reforms, we fully expect one or more measures to pass that are relatively minor, or even symbolic – much along the lines of the House passing a bill to revoke insurers’ federal anti-trust exemption on Monday of this week.

 

  1. See in particular the work of Brandice Canes-Wrone from Princeton’s Woodrow Wilson School, especially: “Who Leads Whom?: Presidents, Policy and the Public” Univ. of Chicago Press, 2006.
  2. Including 4 announced retirements and the death of John Murtha, there are seats from an additional 5 districts (26 total out of 39) from this group which are competitive in 2010.
  3. We’re speaking loosely here; CBO has not scored the President’s proposal. It’s not at all clear whether the Medicare tax is as large as the Cadillac tax, nor is it clear whether the proposal raises as much incremental revenue as it gives out in incremental benefits.
  4. “Health Reform Legislation is Unlikely to be Either Very Large or Very Complex …” Sector & Sovereign, Sept. 8, 2009
  5. This explains the parliamentary logic behind Republicans’ call for starting from a blank page.
  6. Recall that the Senate bill contains the Nelson language, which requires enrollees to write a separate check for that portion of the health premium that covers abortion. The pro-life position is that this does not prevent Federal funding of abortion; the pro-choice position is that no plans will cover abortion under these circumstances. Thus both sides oppose the Nelson language.
Print Friendly