Republican Senators at Odds Over Medicaid in Obamacare Reform Push

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The Republicans may still manage to find a way to deliver one of the big promises to voters, that of Obamacare reform. We had been skeptical, simply because the House Freedom Caucus has succeeded in getting a tough enough version of the bill passed, and there would not be enough Senators who would be willing to risk their political futures by taking such a hard core position.

However, an additional possible point of failure has emerged: the difficulty in reaching agreement even among Senators. The issue is that some Republican Senators are from states that embraced Obamacare’s Medicaid expansion. Those Senators are understandably loath to vote for cutting health care benefits, since it would make for easy fodder for a challenger.

As the Wall Street Journal explains:

States that expanded Medicaid under the law are anxious not to see people lose health coverage or state budgets squeezed. States that didn’t expand Medicaid are reluctant to see other states benefit financially for making a choice they considered irresponsible.

There are about an equal numbers of red states in each camp.

Ugh, from the dealmakers’ perspective.

A couple of Republican insiders had opined that Obamacare reform needed to be settled by July at the latest, since it was perceived as critical to have it put to bed early and well before 2018 campaign dynamics slowed the legislative calendar. The Journal confirms that view. It reports that the intent is for the Senate to resolve its impasse before the July 4 recess so that both chambers can hash out differences before the end of July.

Both sides are trying to find a way to square the circle, such as by stealth cuts, such as increases that lag the inflation rate, or by allowing Medicaid expansion states to wind back their programs on an attenuated timetable:

Some conservative strategists said the best course for a deal on Medicaid is to restrict federal funding to a set amount for each person enrolled but allow states to retain more generous eligibility rules for a longer period. Such a proposal could represent a net win for states that opted not to expand the program, while allowing states that did to figure out how to offer coverage for people who qualify according the standards they want to set.

Another concept being discussed is cutting off federal Medicaid funding for people with incomes above the poverty level, and moving those people into subsidized private-insurance plans, people familiar with the conversations said. That idea is being promoted by Mr. Kasich, although it is unlikely to appease the more stringent advocates of cutting federal spending on Medicaid.

As we know from Obamacare, if you have a low income, even a subsidized insurance policy can break your household budget. The CBO scoring of whatever plan the Senate settles upon, assuming they can get to an agreement, will also have a big impact on the reconciliation talks. Any “end Obamacare” bill has to reduce the number of people covered. If the press blowback is strong, that may stiffen the Senate negotiators’ position relative to their House counterpart, which would increase the odds of a stalemate.

Either way, the Republicans intend to either get a bill signed relatively soon or move on. They need to be able to claim some accomplishments by election time 2018, and if Obamacare is too tough a nut to crack, they will move on to tax “reform”.

The Obamacare gridlock demonstrates how what appeared to be a winning strategy for attaining power has hobbled the Republicans, and to some degree, the Democrats too. While the Republicans are regularly accused of successful gerrymandering, professor Tom Ferguson, who has kept meticulous databases of national voting results since 1982, says the impact on party results in Congress is much lower than the Democratic complaints would have you believe. But the impact on political dynamic may be much greater.

Some Democratic party interest groups, in particular La Raza, were keen to create “minority majority” districts to increase the number of minority representatives in Congress. Needless to say, their biggest allies were the Republicans. But the flip side of carving out “minority majority” districts was that even more Republican districts were lily-white, or close to that, than you would have gotten through normal gerrymandering.

While I can’t prove it, the politically-savvy people I’ve consulted with concur with the thesis that the resulting more homogeneous districts were a big part of the rise of the Tea Party and other hard-core right wing elements in the former stodgy pro-business Republican party. Recall that in solid red districts, the primary campaigns are where the real battles take place, and they are often races to see who can present himself as the more diehard conservative.

And it’s the rise of this hard core radical wing that has now made it very hard for Republicans to get anything done legislatively. Trump does understand that his job is to sign Republican bills, so as rocky as his presidency has been for the party, the probable failure of Obamacare reform can’t be laid at his feet.

And while the “minority majority” strategy may have been useful for the Democrats too, that approach has been pushed well beyond its point of maximum advantage, as demonstrated by how the Democrats have focused unduly on identity politics and assumed that waving that flag would lead voters to forgive them for presiding over the damage done to the poor and middle class in the Clinton and Obama Administrations.

In other words, politics is all about compromise, but both parties have evolved in ways that make that harder than before, and have managed to lose credibility with voters in the process. Not exactly a responsible posture for a wanna-be governing elite.

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  1. Jer Bear

    “While the Republicans are regularly accused of successful gerrymandering, professor Tom Ferguson, who has kept meticulous databases of national voting results since 1982, says the impact on party results in Congress is much lower than the Democratic complaints would have you believe.”

    In 2016, 49.1% of voters went for a Republican representative vs 48.0% for a Democrat. However, the makeup of the House is 241 Republicans vs 194 Democrats. That is a significant impact.

    1. Yves Smith Post author

      You need to do much more granular analysis to reach any conclusions, which is the sort of thing that Ferguson is famous for. I can get him to respond more specifically. He didn’t say gerrymandering wasn’t a factor, he said it wasn’t as big a factor as widely depicted. And your data isn’t correct either. Republicans got 49.9% v. 47.3% for Dems.

      Even The Nation says “Gerrymandering is only part of the story”:

    2. Elizabeth Burton

      Gerrymandering is based on the dominant party’s voter registrations. One of the ways to combat it is to sign up unregistered voters and actively court independents. Neither of which the Democrats do. Instead, as Prof. Ferguson said, they throw up their hands, whine “gerrymandering,” and go looking for places they can run GOP-Lite corporatists.

      1. Darn

        I know a guy who is friends with the Gerry family and it’s pronounced with a hard g as in golf.

        1. KGC

          My grandparents, who knew Andrew Carnegie (who helped fund some of my great-grandfather’s projects), always said the name was pronounced car-NEG-ee. Woe to grandchildren who didn’t know better.

          On the other hand, in New York (and I’m sure many, many other places, but I’ve been a New Yorker these many years) it’s pronounced CAR-neg-ee. And woe to any who don’t know better.

    3. Vatch

      A little over a week ago, I posted a link to an article that attempts to specify the how much of the election results in recent years were attributable to gerrymandering. Of course, one can disagree with their conclusions, and I don’t know how close they are to Thomas Ferguson’s conclusions; he is definitely one of the real experts on this sort of thing.

      Here’s part of what I said:

      According to page 879 of this article in the Univ. of Chicago Law Review, there are no states in which there are more than 2 extra Democratic Representatives as a result of gerrymandering, despite some weirdly shaped districts in Illinois and Maryland. These states have an excess of 3 or more Republican Representatives dues to gerrymandering:

      North Carolina
      New Jersey

      There is a similar advantage for Republicans in state legislatures (page 882). The Koch brothers spent their money very effectively following the Citizens United decision in 2010.

  2. Darn

    Interesting stuff about gerrymandering dynamic, hope you will return to this in future. If switching people from Medicaid to subsidised private policies happens can they do it in a revenue-neutral way to pass the Senate?

    1. Benedict@Large

      The problem is not revenue neutrality, but rather benefits neutrality. What good does it do if the budget numbers stay the same if the amount of healthcare rendered goes down, while private sector profit gouging continues its upward track?

      1. Darn

        Don’t mean harm from the policy — I mean the likelihood of passage. If Dems can filibuster it then they need to nuke the filibuster or use reconciliation. And still need GOP to act together to get a majority. Reconciliation needs it to be revenue neutral iirc.

        (There is no chance of them changing the bill to make it a net positive for the American population.)

  3. Larry

    Unfortunately, compromise is is often quickly agreed upon. War? No problem Mr. President. Bailout Wall Street? You betcha. Undermine local control of education while crapifying the experience for all but the affluent? Where do we sign? There are some issues clearly where politics don’t align and where hard core conservatives dig their heels in to dramatically punch down on their constituents. But when it comes to enriching the ruling classes, it’s all hands on deck.

    1. Yves Smith Post author

      Bailing out Wall Street was not a life or death issue for many voters. Healthcare is. Voters have ripped some Republicans new orifices in town halls. And the resulting very bad video clips have a long afterlife. Some have said they are afraid for their safety. That is gonna make some of them think twice about compromise.

  4. Carolinian

    Not just La Raza. The strategy of concentrating African American voters into safe Black Dem districts while the white districts become more white has been cited as a reason for Republican dominance in the south. States like mine used to be at least somewhat competitive because the large black population (30 percent in SC) could help middle of the road or blue dog Dems to be elected. Now people like Lindsey Graham run practically unopposed.

    1. George Phillies

      Well, no. Lindsay Graham is a Senator. He is elected by the entire state. District gerrymandering can have no direct effect on his election. What does matter is that just as African-American voters are massively Democratic, say 90-10 or the like, white voters have become massively Republican. The has been true in Mississippi for some time now, but the trend has now reached along Appalachia into West Virginia and central Pennsylvania. If that trend percolates further, the Democrats will for a while be locked out of power.

      1. Carolinian

        Yes of course Lindsey is a senator but the Dems have no real bench or sufficient state presence to mount a challenge. In the not so distant past we have had a Dem governor and the Dem Senator Hollings paired with Republican Thurmond. Black/white percentages then were the same. There are other reasons for the shift but my understanding–not my theory btw–is that shifting most black voters into odd shaape districts is a more recent, and deliberate, strategy of Republican dominated state legislatures.

  5. Tim

    I’ve invested enough personal time in Congress on my issues to see that both parties goal with gerrymandering is to solidify their districts, and the effects are most pronounced in policy, because what happens is the more extreme candidates win the primaries, and are still able to win the general.

    So what you end up with fewer moderates an more extremists making compromise impossible even within their own party.

    The logic is quite straightforward, and we have been seeing it in action ever since Obama was elected.

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