Republicans shell-shocked by health defeat split on next steps

By Laura Litvan and Steven T. Dennis, Bloomberg

Republicans in Congress have been unable agree on a way to repeal and replace Obamacare — and now they’re divided on whether they should give up on their GOP-only approach.

Sen. John McCain urged fellow senators Friday to “start fresh” and seek a bipartisan plan, hours after he provided the decisive vote against his chamber’s latest Obamacare-repeal proposal. “We can do this,” the Arizona Republican said in a statement.

Other Republicans insist they got too close to a GOP-only agreement on demolishing Obamacare to turn back from that idea. The Senate fell one vote short of advancing a partial repeal of Obamacare early Friday, with opposition from McCain and two other Republicans. In May, the House passed its replacement plan on a razor-thin 217-213 vote.

House Freedom Caucus Chairman Mark Meadows said he has no intention of working with Democrats. “In the end, we will prevail,” the North Carolina Republican told reporters Friday. “I fully expect we’ll have something on the president’s desk in September.”

Senate Republican hardliner Ted Cruz of Texas also dismissed the idea of bipartisanship out of hand.

President Donald Trump’s impulse has been do nothing, let Obamacare implode and wait for Democrats to come to him to seek new legislation. There have been repeated hints that the president could stop making the health-care law’s cost-sharing payments for low-income people, which insurers and analysts have warned would cause a spike in premiums and perhaps even a pullout from more markets.

But that’s a risky strategy, with Republicans in charge of all of Washington and the president already facing historically low poll ratings heading into a midterm election year.

White House budget director Mick Mulvaney expressed disappointment in an interview with Bloomberg TV.

“We had hoped to clear the decks of health care last night so we could move our full attention to tax reform,” Mulvaney said. With the Senate scheduled to remain in session for two more weeks before taking an August recess, he added: “All I know is we still expect them to do something before they leave town.”

Earlier this week McCain made a dramatic return to the Senate following brain-cancer treatment to cast the 50th vote to start debate on the bill. But he gave the decisive thumbs-down during Friday’s vote on a bare-bones Obamacare replacement designed to jump-start bicameral talks on a final bill. The final tally was 49-51, with Republicans Susan Collins of Maine and Lisa Murkowski of Alaska also voting no.

The collapse was a blow to Majority Leader Mitch McConnell of Kentucky, who has previously said if Republicans failed they would need to cut a deal with Democrats to stabilize the markets. After the dramatic failure of his bill, the flush-faced leader declared he wasn’t interested in a “bailout” of insurance companies but wanted to hear what other ideas Democrats have.

In the Senate, half a dozen Republican and Democratic senators have discussed alternatives to the embattled GOP health-care bill. They mostly center on creating a reinsurance fund and authorizing cost-sharing payments for insurers on the Obamacare insurance exchanges so they don’t have to raise prices for covering a sicker pool of customers. Another Democratic idea would take a bite out of drug company payments and plow the savings into the system.

Senate Minority Leader Chuck Schumer of New York told reporters Friday he’s optimistic that members of both parties can work together to stabilize insurance markets and then “sit down and trade ideas” for the long run.

“Change it, improve it, but don’t just take a knife and try to destroy it and put nothing in its place,” Schumer said.

Sen. Lindsey Graham, a South Carolina Republican, met with Trump Friday to talk about his Obamacare replacement proposal with GOP Sen. Bill Cassidy of Louisiana, according to a Republican aide. The plan, which was never embraced by McConnell or Democrats, would redirect much of the federal funding for health insurance as block grants to states to use for health-care spending.

Senate Health Chairman Lamar Alexander of Tennessee, who voted against a broad repeal-and-delay bill this week, is focused on ensuring that people have at least some option for buying insurance. He has said his committee will hold hearings to explore options. Collins, a member of the panel, said in a statement Friday that’s a key part of restarting the health debate.

“We’re dealing with an issue that affects millions of Americans and one-sixth of our economy, and we need to approach reforms in a very careful way,” Collins said. “That means going through the regular process of committee hearings; receiving input from expert witnesses such as actuaries, governors, advocacy groups, and health care providers; and vetting proposals with our colleagues on both sides of the aisle.”

Sen. Tom Carper, a Delaware Democrat and former governor, has said he’s speaking with senators in both parties and governors of a number of states about a possible bipartisan plan.

“We need to do a fair amount more than shoring up the exchanges,” Carper said.

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