The reconciliation option

Jacob Hacker dangles an intriguing legislative prospect in his New York Times op-ed promoting a public option as a cure to Obamacare’s woes.  Specifically, he suggests that Democrats could enact a public option with a bare-majority vote in Congress through the budgetary procedure of reconciliation:

This year, Senate Republicans, providing another lesson, passed legislation that repealed the Affordable Care Act through the budget process, which isn’t subject to a filibuster. (President Obama vetoed it.) If that’s possible under the budget rules, creating a public option should be, too — especially since it could reduce the deficit by tens of billions of dollars a year.

Reconciliation is a tool that allows for expedited consideration of budgetary legislation.  Importantly, it allows legislation to overcome the Senate filibuster and pass with simple majorities in each chamber of Congress.  The filibuster, of course, is the veto power invoked by 41 minority party senators to obstruct the legislative will of the majority.  It’s not part of the Constitution, and as wielded by Senate Republicans, the filibuster has created an unnecessary de facto super-majority requirement for virtually all congressional action.  Reconciliation is a safety valve to let lawmaking go forward in the face of obstructionist filibustering.

What can and cannot be achieved through the reconciliation process depends heavily on precedent and the whims of the Senate parliamentarian.  Most famously, Obamacare was originally heaved over the finish line through reconciliation after the Democrats abruptly and unexpectedly lost their Senate super-majority in 2010.  The main requirement for reconciliation is that it must be budgetary neutral, and may not add to the federal deficit.

During the past year, Paul Ryan and House Republicans have been steadily expanding the bounds of reconciliation.  Congressional Republicans have passed bills repealing Obamacare, including its insurance subsidies, Medicaid expansion, and individual and employer mandates.  They even used reconciliation to de-fund Planned Parenthood.

None of these bills made it past President Obama’s veto.  But they did pass muster as appropriate uses of reconciliation with the Senate parliamentarian.  This helped Ryan create precedent for 2017, when he hoped to have a Republican president to sign off on his bills instead of vetoing them.  Indeed, in early October, Ryan was openly talking about his plans to pass much of his agenda through budget reconciliation next year.

But the last month has turned the tables on Ryan’s reconciliation plan.  After a catastrophic month for Donald Trump, the presidency is Hillary Clinton’s to lose, Democrats have a good chance to retake the Senate, and may even have the House within reach if the agony of Trump sufficiently depresses Republican turnout in November.  Ryan’s hopes to push his “Better Way” agenda through reconciliation have been dashed, and now it’s the Democrats who are looking for creative ways to enact their legislative priorities.

So could a public option really be passed through reconciliation?  There’s good reason to think so.  According to the Center on Budget and Policy Priorities, a good deal of major legislation has relied on reconciliation, including welfare reform in 1996, and the 2001 and 2003 Bush tax cuts (which actually increased the deficit and debt).

Most relevant, Congress has used reconciliation to create major health insurance programs before.  In 1985, it used reconciliation to extend health coverage to workers who have lost their jobs (so-called “COBRA” insurance).  In 1997, it used reconciliation to create the Children’s Health Insurance Program, extending coverage to millions of low income children.  And also in 1997, it used reconciliation to create Medicare Advantage.

Not to mention that Obamacare itself (and repeated efforts to repeal it) relied on reconciliation.  If the original law fit the standards of reconciliation, then so too should  most efforts to tweak and improve it.  If balanced with new revenue sources, then Democrats could conceivably enhance insurance subsidies, lower the Medicare eligibility age, expand Medicaid, and enact a whole host of other health reforms all through reconciliation without regard for the hurdles posed by congressional Republicans.

If Democrats eke out only the slimmest majorities in Congress, it doesn’t have to be a recipe for gridlock and legislation stymied by Republicans relegated to minority status.  Much of the Democrats’ health reform 2.0 agenda could be passed through reconciliation.  For that, no small degree of thanks is owed to the precedent created by Paul Ryan and his fellow repealniks in the GOP congressional caucus.

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