trending Market Intelligence /marketintelligence/en/news-insights/trending/jWzkT5p3yInFq1-EL42DnQ2 content esgSubNav
In This List

Senate chief: ACA repeal failure not Democrats' fault; bipartisan hearings set


Insight Weekly: M&A outlook; US community bank margins; green hydrogen players' EU expansion


Global M&A by the Numbers: Q2 2022


Insight Weekly: US bank M&A; low refinancing eases rates impact; Texas crypto mining booms


Infographic 2022 Top Tech Trends Shaping Corporations

Senate chief: ACA repeal failure not Democrats' fault; bipartisan hearings set

The Senate Republicans' failure to pass a bill to repeal and replace the Affordable Care Act, or ACA, was not the fault of the Democrats, the chamber's chief admitted Aug. 1.

"It's pretty obvious that our problem on healthcare was not the Democrats," Senate Majority Leader Mitch McConnell, R-Ky., told reporters. "We didn't have 50 Republicans."

Republicans hold 52 seats in the Senate, but McConnell fell short in getting enough members of his party on board to pass a healthcare bill using a 51-vote simple majority. He failed on three separate attempts: a comprehensive repeal and replace bill, the Better Care Reconciliation Act; the repeal-only legislation, the Obamacare Repeal Reconciliation Act; and the "skinny repeal" bill, the Health Care Freedom Act, which would have ended the ACA's requirements for eligible Americans to buy healthcare insurance or pay a tax penalty and put other temporary provisions in place.

But McConnell said the Senate was not ready to throw in the towel, noting there were other legislative proposals from Republican Sens. Ted Cruz of Texas, Rob Portman of Ohio and a combined effort from Lindsey Graham of South Carolina and Bill Cassidy of Louisiana awaiting cost estimates from the nonpartisan Congressional Budget Office.

In addition, there was still time for the Senate to take up the bill that passed the House in May, the American Health Care Act, under the upper chamber's reconciliation rules, which permits senators to pass legislation using the 51-vote simple majority.

"So there's still an opportunity to do that," McConnell said.

But for now, the Senate is focusing on completing other priorities during the short time it has left before the mid-August recess — a break that was supposed to start at the end of July but was pushed back two weeks by McConnell to give the senators time to concentrate on healthcare and wrap up other legislative business.

Those include confirming some of President Donald Trump's appointees, shoring up a Veterans Administration program and renewing the Food and Drug Administration's authority to collect user fees from industry.

Giving bipartisanship a chance

The Republican and Democratic leaders of the Senate Health, Education, Labor and Pensions, or HELP, Committee on Aug. 1 said they are now planning to lead a bipartisan approach to fixing some of the problems with the U.S. healthcare system, specifically stabilizing and strengthening the individual health insurance market.

Committee chairman Sen. Lamar Alexander, R-Tenn., said he plans to convene bipartisan hearings focused on the matter — following through on a pledge he made last month.

The first hearing in the series is set for Sept. 4. The committee had convened in February on the topic.

"We will hear from state insurance commissioners, patients, governors, healthcare experts and insurance companies," Alexander said.

"There are a number of issues with the American health care system, but if your house is on fire, you want to put out the fire, and the fire in this case is the individual health insurance market," Alexander said. "Both Republicans and Democrats agree on this."

HELP committee staff would begin working this week with all the panel members to prepare for the hearings and discussions, he said.

The individual market, which makes up only 6% of insured Americans, is small in comparison to the employer market, which covers 61% of insured Americans. Medicare, the U.S. government's program for the elderly and disabled, and Medicaid, the program for the poor, cover the rest.

Still, the individual market comprises 18 million Americans, 11 million of whom buy insurance on the ACA's exchanges, Alexander pointed out.

About 9 million of those 11 million Americans have ACA subsidies, "and unless we act, many of them may not have policies available to buy in 2018 because insurance companies will pull out of collapsing markets," Alexander said.

Congress must act by Sept. 27, the date by which insurers must sign contracts with the federal government to sell healthcare plans on the federal exchange next year, he said.

Cost-sharing payments

Alexander also urged Trump to continue making the cost-sharing reduction, or CSR, payments through September, at which point Congress could take over the appropriation of the funding for at least one year.

The payments help cover deductibles and copayments for about 7 million low-income Americans enrolled in ACA plans offered by private insurers through the government-run marketplace.

But Trump has threatened to withhold the payments — using them as leverage to get Congress to pass an ACA repeal bill.

Trump was expected to make a decision by early this week on whether he would make the payment, his counselor Kellyanne Conway said July 30. But the president has yet to reveal a verdict.

"The president is working with his staff and his cabinet to consider the issues raised by the CSR payments," a White House spokesman told S&P Global Market Intelligence.

"Without payment of these cost-sharing reductions, Americans will be hurt," Alexander said.

If Congress could work in a bipartisan way to pass a stabilization plan in September that includes making the cost-sharing payments mandatory for one year, "it is reasonable to expect that the insurance companies would then lower their rates," Alexander said.