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Senate GOP returns from break no closer to Obamacare deal

Sens. John Cornyn and Mitch McConnell are facing the party’s toughest legislative task since taking the majority in 2014. | AP Photo

Senate Republicans appear miles away from their long-sought repeal of Obamacare, returning to Washington on Monday with just a few weeks to put the pieces back together before they could be forced to abandon their partisan attempts at a healthcare overhaul altogether.

Over the July 4 recess, conservative demands hardened and surprising opposition to the Senate GOP’s first stab revealed itself in red states like North Dakota and Kansas. Republicans sniped over the merits of deregulating the health insurance industry and GOP senators began floating exit strategies in case they can’t agree on legislation, ranging from working with Democrats to amend Obamacare to simply repealing the law and figuring out how to replace it later.

Senate Majority Leader Mitch McConnell isn’t giving up yet, and his staff and allies toiled over the break to fashion a compromise that can get 50 of the Senate GOP’s 52 senators on board. The calculating Kentucky Republican could still find a deal that unites his fractious party. But McConnell and his whip, John Cornyn of Texas, are facing the party’s toughest legislative task since taking the majority in 2014.

At best, the repeal effort stayed stuck in neutral over the past nine days, several Republicans familiar with the ongoing negotiations said. At worst, the bill McConnell unveiled before the recess has little chance of being saved.

“My view is it’s probably going to be dead,” Sen. John McCain (R-Ariz.) said on “Face the Nation” on Sunday. “I fear that it’s going to fail.”

White House Chief of Staff Reince Priebus said on "Fox News Sunday" that such a result would be unacceptable. The rest of President Donald Trump’s agenda is already moving glacially through Congress. If the GOP’s six-month work on healthcare is scuttled ahead of the August recess, the party risks coming up empty-handed during what is typically the most fertile period of legislating in a president’s first term.

"The president expects them to get this done. The president expects the Senate to fulfill the promises it made to the American people," Priebus said.

This week, McConnell is expected to receive critical guidance from the Congressional Budget Office on whether a flurry of tweaks made in June will improve on initial estimates that the bill would result in 22 million fewer people with insurance. The nonpartisan office is also considering whether premiums can be reduced further.

McConnell’s initial proposal was broadly similar to a version that passed the House in May, and it would repeal most of the taxes created by the 2010 Obamacare law and scale back subsidies that help people buy insurance. It also would make major cuts to the Medicaid program that covers low-income families and people with disabilities and allow insurance companies to charge older people more for coverage.

After that bill failed to get enough support among Senate Republicans, the GOP asked the CBO to weigh proposals that would leave in place Obamacare’s taxes on Medicare and wealthy individuals, allocate more money for low-income people’s insurance, allow pre-tax money to pay for premiums and supply $45 billion to fight opioid funding, according to senators and aides.

Republicans will also learn the impact of a proposal from Sens. Mike Lee and Ted Cruz to drag the bill further to the right by eviscerating Obamacare’s insurance regulations.

On Monday, McConnell will gather with his leadership team to begin plotting ways to resuscitate the ailing legislation. On Tuesday, the full GOP caucus will meet for the first time in nearly two weeks, which aides predicted would be a rowdy gathering pitting hold-outs against McConnell allies. Republican senators will be pressured to choose between protecting Obamacare or supporting McConnell’s effort.

“Obamacare is failing. Whether or not we can come together, I don’t know. Mitch is trying,” said Sen. Lindsey Graham (R-S.C.) on “Meet the Press.” “My advice is, if it does fail, work together in a bipartisan fashion to replace it.”

Rather than boasting about their chances of success, Republicans have spent the last few days fixated on what happens if McConnell does not succeed. The leader himself has said that doing nothing is not an option and that, if their repeal effort fails, the GOP will have to work with Democrats to stabilize unsteady individual insurance markets. In June, McConnell told Trump directly that if Senate Republicans could not agree on how to replace Obamacare, the party would have to negotiate with Senate Minority Leader Chuck Schumer (D-N.Y.).

Conservatives would rather repeal Obamacare immediately and devise a replacement plan later if the party’s simultaneous efforts fail. Treasury Secretary Steven Mnuchin predicted Sunday that if the Senate bill fails, Trump will advocate for a straight-up repeal.

Yet other Republicans disagree with that approach, and it seems unlikely 50 senators would agree to repeal Obamacare without a replacement plan in hand.

“Non-starter. There will be uncertainty in the insurance markets. Premiums will rise,” Sen. Bill Cassidy (R-La.) said on “Fox News Sunday.” “I think it’s wrong; I think it betrays President Trump’s campaign pledges.”

Mnuchin also backed Cruz and Lee’s amendment despite opposition from moderates, amplifying the party’s internal discord.

“I’m very hopeful that his plan and his changes will get supported,” Mnuchin said of Cruz on ABC’s “This Week.”

Cruz and Lee, a Texan and Utahn, are an imminent problem for McConnell. They worked alongside leadership for months but now are demanding a more conservative approach than the GOP’s initial draft. Conservative groups and the Trump administration now support their addition, highlighting a clash among Republican senators with differing healthcare ideologies. The bill almost certainly would fail without Cruz and Lee’s support.

The duo spent the break advocating for their Consumer Freedom Act, which would allow the sale of cheap, deregulated healthcare plans alongside Obamacare-compliant plans with protections for pre-existing conditions and other minimum benefits. They argue that allowing more diversity in insurance plans would reduce premiums, but critics say the approach would shift sick people into one risk pool and healthy people into another, a recipe for a market meltdown.

Lee will vote against any bill that does not include their amendment or something similar that guts regulations, his office said.

"Sen. Lee has been flexible and consistent from day one. Americans need regulatory relief from Obamacare and he will not vote for something that does not provide that relief. [The Consumer Freedom Amendment] is that bare minimum relief,” said spokesman Conn Carroll.

But Republican senators like Bob Corker of Tennessee, Chuck Grassley of Iowa and Susan of Collins of Maine all argued against such an amendment over the recess. Grassley warned that it could be “subterfuge to get around pre-existing conditions.”

Cruz said on ABC’s “This Week” that Grassley was borrowing his talking points from Schumer, a serious charge in GOP circles.

“The Consumer Freedom option is the key to bringing Republicans together and getting this passed,” Cruz said. “What’s being repeated [by Grassley] is what Chuck Schumer said this week.”