The rules surrounding the “reconciliation” process have proven a key obstacle to Republicans’ effort to repeal and replace Obamacare. Bills advanced under reconciliation can’t be filibustered — which is key when there are only 52 Senate Republicans — but under the “Byrd rule,” all provisions in them must directly relate to the budget. The Senate parliamentarian gets to decide what’s kosher and what’s not, and Republicans hoped she’d have a broad interpretation of the rules.
That hope has been dashed. News just broke that state waivers from Obamacare regulations — which Republicans had hoped to include even in the “skinny” version of repeal — do not pass muster. And this is just the latest provision to end up floating face-down in the “Byrd bath”; the other carcasses include provisions instating a six-month waiting period for people who fail to maintain continuous coverage, letting insurers charge older enrollees more relative to the young than is currently allowed, eliminating tax credits for plans that cover abortion, and defunding Planned Parenthood (which Republicans might try to bring back anyway).
These rulings don’t just take measures that Republicans want off the table; they also make it harder to make good policy. If Republicans get rid of the individual mandate, for instance, they will need to do something else to stop people from staying uninsured until they get sick and then signing up to stick everyone else with the bill — but a waiting period to sign up is now off the table. As James Capretta mentioned yesterday, the only option might be some kind of penalty that’s cycled through the federal budget, but that sounds a little bit like the mandate they’re trying to get rid of.
At this point the chances are rather large that the Republicans either will fail, or will pass something that’s incredibly risky on a policy level. (Many think the CBO overestimates when it says killing the mandate would increase the number of uninsured by 15 million, for example, but I don’t think anyone denies it would destabilize the market to some degree.) Or that they’ll start looking at more desperate options, such as overruling the parliamentarian or eliminating the filibuster for legislation. Whatever happens, we’re all in for a ride.