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May 19, 2017

The House could be forced to re-vote on the AHCA. Here's the $1B reason why.

Daily Briefing

This story has been updated.

It's been just over two weeks since the House voted to pass the American Health Care Act (AHCA), but House Republicans have yet to send their bill to the Senate—and industry experts say the looming Congressional Budget Office (CBO) score may force a re-vote.

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AshLee Strong, a spokesperson for House Speaker Paul Ryan (R-Wis.), confirmed House leaders are holding the bill "until CBO issues its final score."

CBO last scored the AHCA before House leaders made several changes to the bill to secure ample support for its passage. CBO on March 23 projected that an earlier version of the AHCA would increase the number of U.S. residents without insurance by 24 million by 2026 while reducing federal budget deficits by $150 billion over a 10-year period. But the office has yet to score the final version of the bill, which the House narrowly approved on May 4. A new CBO score is expected on Wednesday.

According to Bloomberg's Billy House, if CBO determines that the House-approved AHCA does not reduce federal spending by at least $2 billion, then the bill would not be able to pass in the Senate through the budget reconciliation process. That process allows certain bills to pass the Senate by a simple majority, without being subject to a filibuster.

According to Vox's Dylan Scott, separate Senate committees—the Senate Finance Committee and one by the Senate Education, Health, Labor, and Pensions Committee—would consider the bill in two distinct parts. Under Senate rules, each section of the bill must independently reduce the deficit by at least $1 billion over 10 years.

Therefore, if CBO estimates that either of the two parts does not sufficiently reduce the deficit, the House might have to re-vote to allow the Senate to use the reconciliation process.

Potential budget projections

Several industry experts say it is likely that the latest version will meet the deficit reduction threshold, as CBO's score for the prior version of the bill means lawmakers had a generous cushion to work with as they changed the legislation, Vox reports.

But, according to Vox, new amendments in the bill, which have yet to be scored, could increase spending enough to endanger passage via reconciliation. For instance, one added amendment would allow states to waive certain provisions of the ACA that experts say make health insurance more comprehensive but also more costly. If many states requested those waivers, Vox reports that the number of individuals who opt to purchase coverage could actually increase, which would result in more consumers receiving federal tax credits. The Committee for a Responsible Federal Budget (CRFB) has estimated that if an additional 6.5 million people were to sign up for such coverage, the bill would no longer reduce the deficit.

Ed Lorenzen, a budget expert as CRFB, explained that many of the AHCA's latest changes could appear before the health committee—including new funding for the AHCA's stabilization fund. The result could be that the health committee's half of the bill fails to sufficiently reduce deficits.

Brookings Institution Fellow Matthew Fiedler told the Daily Briefing that his "best guess" is that CBO will find the bill sufficiently reduces the deficit, but that there "is meaningful uncertainty" given that estimating how many states would request waivers "is inherently a judgement call."

Republicans optimistic about CBO score

Despite the last-minute changes to the bill, House Republicans appear confident that the bill would meet the needed savings to pass under reconciliation.

A House GOP leadership source told Politico, "Based on the previous two scores, we believe we'll hit our target deficit reduction number." He added that Republicans decided to hold the bill "out of an abundance of caution" (House, Bloomberg, 5/18; Scott, Vox, 5/18; Cheney/Haberkorn, Politico, 5/18; Sullivan, The Hill, 5/18).

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