McCarthy on ObamaCare repeal: 'We have to do three different phases'

Fox's Sean Hannity pressed House Majority Leader Kevin McCarthy (R-Calif.) to explain why GOP leaders didn’t secure support from conservative groups such as Freedom Works and the Heritage Foundation before releasing their healthcare legislation to the public. 

"We did work it out before," McCarthy responded in the interview, which aired Thursday.

"If you listen to the Freedom Caucus in the very beginning of January, they asked us to make sure that we will not repeal without replacing at the same time. If you look at the conservative bill that we have before you, much of that element was Tom Price's bill when it was inside the House.  And you had members of Freedom Caucus cosponsor that."

Price served in the House before becoming Health and Human Services Secretary last month.

Several conservative groups are publicly opposed to the healthcare legislation, denouncing it as failing to live up to the GOP’s promise to fully repeal ObamaCare. The critics include Americans for Prosperity, which is backed by the influential conservative donors Charles and David Koch. 

McCarthy stressed that Republicans have to work within a special budgetary process known as reconciliation that allows them to bypass a Democratic filibuster in the Senate. The rules of that process limit what parts of the bill can be repealed. 

GOP leaders say repeal-and-replace will happen in three stages, with the legislation being considered now just the initial step.

"Because we don't have 60 votes, and that's what puts the fear in me is the challenge of the structure to go about doing. We have to do three different phases," McCarthy said.  

"One in reconciliation, repeal and replace.  But because of the Senate rules, we can't do everything we want. Those things administratively the power gives to Tom Price. And then those bills that take 60 votes, we'll move those along at the same time and right afterwards. At the end we end up the exact same place. This is the most conservative bill. It repeals all the taxes."

Hannity, a staunch supporter of President Trump, echoed the sentiment of Republicans and conservative pundits who argue the GOP cannot allow Trump's first legislative initiative to fail. 

"Listen, this has to work. There's no option here," said Hannity. "This is the first legislative agenda item that the president is now passing here. So at some point in the Freedom Caucus, those senators I mentioned, those groups, you're going to need them."  

The host asked if there was a "communication problem" that has led to intraparty squabbling in the press. 

"Is it a communication problem that they don't [understand the] three-step process, or are their criticisms valid that it's not a complete repeal, that there still some taxes from ObamaCare that exist, and not everything is free-market, that there is even a new entitlement, which is the main argument I hear they're making every hour of every day now on television? 

"Sean, we repeal every single tax in ObamaCare that was put in during ObamaCare," responded McCarthy. "If all you did was repeal, everything else would collapse, and then we would own that."

The GOP’s legislation repeals most of the taxes that pay for ObamaCare with the exception of a “Cadillac” tax on generous plans that would take effect in 2025.