By Alexander Bolton - 09/01/09 10:38 AM EDT
Gregg (N.H.), the senior Republican on the Budget Committee, told The Hill in a recent interview that Republicans will wage a vicious fight if Democrats try to circumvent Senate rules and use a budget maneuver to pass a trillion-dollar healthcare plan with a simple majority.
The maneuver was originally intended to help reduce the federal deficit by allowing spending cuts and tax increases to pass by majority vote, but it has since been used to fast-track wider-scope legislation, such as former President George W. Bush’s 2001 tax cuts.
Republicans, however, warn that if Democrats attempt the maneuver, their healthcare bill will end up looking like Swiss cheese.
Gregg said that Republicans could file “hundreds” of points-of-order objections to the bill, each one requiring 60 votes to waive.
“We are very much engaged in taking a hard look at our rights under reconciliation,” Gregg said. “It would be very contentious.”
Gregg’s opposition is particularly notable given that seven months ago, President Barack Obama tapped him to serve as Commerce secretary. Gregg first accepted the Cabinet appointment, but later withdrew before being confirmed over policy differences.
Gregg is also taking exception to comments made by Senate Majority Leader Harry Reid (D-Nev.), who said it would be possible to create a broad government-run health insurance program under budgetary reconciliation.
Gregg said the only way for the so-called public option to have the necessary budgetary impact to warrant procedural protection would be if the program were “very aggressive in setting rates, price controls and rationing,” an option that might cause conservative Blue Dog Democrats in the House to bolt.
Budget experts say it is too soon to tell whether Gregg will be able to carve up the Democrats’ healthcare plan.
William Hoagland, a longtime senior aide to Senate Republican leaders on budget issues, said it will depend on how Democrats draft their final bill and how the Congressional Budget Office (CBO) scores it.
“At the end of the day it comes down to green-eyeshade examinations of the bill and ultimately to the Senate parliamentarian,” said Hoagland, who now works for CIGNA, a global health-services company. “There are a lot of gray areas, right up until the end.”
Hoagland said, however, that he did not see how a plan to set up membership-run healthcare co-ops could survive a Republican objection.
“On the co-op plan, those particular proposals as currently drafted, it’s an authorization for start-up and capitalizing the co-ops,” he said, drawing a distinction between an authorization to spend and an actual allocation of funds, arguing that as a result the proposal “has no budgetary consequences. It doesn’t spend money or save money.”
If Senate Parliamentarian Alan Frumin rules the budgetary impact of a provision is negligible next to its larger purpose, he would likely uphold an objection that it violates the so-called Byrd rule, a section of the 1974 Budget Act named after Sen. Robert Byrd (D-W.Va.). Democrats would need 60 votes to set aside such a point of order.
The CBO, which has disappointed Democrats several times this year with its cost estimates, and the Joint Committee on Taxation would assess the budgetary impact of various measures.
Co-ops have emerged as the leading Democratic alternative to a government-run health insurance option as a way to pressure private insurance companies to lower their rates. Sens. Max Baucus (Mont.) and Kent Conrad (N.D.) are among Democrats who favor co-ops.
Hoagland said that barring insurance companies from discriminating on the basis of pre-existing conditions and setting regulations governing insurance for individuals and small-business employees would likely be found to have no budgetary impact and thus require 60 votes to be approved by the Senate.
But Hoagland said that “smart staff” may find ways to draft the public option or co-ops in a way that enables them to pass under reconciliation.
The procedural obstacles that Democrats would find in the way of many elements of their healthcare reform agenda would require them to pass two bills if they used reconciliation. Proposals that fell to Gregg’s procedural objections would need to pass in a “sidecar” bill that must win the support of 60 senators.
Democrats argue that provisions such as banning discrimination on the basis of pre-existing conditions and promoting healthier habits could win broad approval. But some Republicans say that ramming major elements of reform through the chamber with a simple majority would create enough animosity to kill the accompanying bill.
Senate Minority Whip Jon Kyl (R-Ariz.) said in a recent television interview that liberals are “going to insist that the Democrat leadership divide the legislation and give them the part that they want and then give Republicans a chance to vote on another piece of it."
Kyl predicted that Republicans would not abet that plan by voting for a second bill: “Of course that will be no deal because you’ll have the government-run insurance and the other liberal parts, including the tax increases in the part that the Democrats would plan to pass with just a bare majority of votes.”
Hoagland agreed with Kyl: “I think it will poison the water and I think the sidecar will have difficulty getting through the United States Senate.”