Senate GOP likely to miss Friday deadline on Obamacare repeal – Politico


Senate Majority Leader Mitch McConnell and Senate Majority Whip Sen. John Cornyn

Senate Majority Leader Mitch McConnell and Senate Majority Whip Sen. John Cornyn step out of the West Wing after meeting with President Donald Trump on Tuesday. | AP Photo

Senate Republicans are close to scrapping tax cuts in the bill, but some conservatives are likely to object.

Senate Republicans are increasingly unlikely to reach agreement on a new version of their Obamacare repeal measure by their self-imposed Friday deadline, as key senators engaged in a furious round of dealmaking.

GOP senators were close to a potential agreement to retain some of the taxes in Obamacare, including the so-called net investment income tax that levels a surcharge on some high-income earners. That would appeal to moderate holdouts, but likely would turn off conservatives who are pushing to dismantle as much of the 2010 law as possible, including its taxes.

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“There’s a significant amount of interest among, I would say, a good group of members for retaining that for some purpose,” South Dakota Sen. John Thune, the third-ranking Senate Republican, said in an interview. But on how many conservatives would be lost if that tax was kept, Thune added: “It’s not a big number, but it’s enough.”

Meanwhile, key Republicans have secured a new infusion of cash for the opioid crisis. But while McConnell’s team might be able to satisfy more centrist GOP senators with additional funding, conservatives remain a huge headache, according to senators and aides.

Sen. Ted Cruz (R-Texas) and his allies are still pushing to gut Obamacare’s regulatory structure, but Republican sources doubt that the Senate parliamentarian will allow it. That raises a key question: Can the party’s right flank support what’s going to amount to only a partial repeal of the law?

One Republican senator was “less optimistic” about meeting the Friday deadline, adding: “I’d be surprised if we get something done by Friday.”

As he entered the office of Senate Majority Leader Mitch McConnell (R-Ky.) — where key holdouts have been cycling through in recent days during the fast-paced negotiations — on Thursday morning, Sen. Bob Corker (R-Tenn.) confirmed the party is leaning toward maintaining Obamacare’s tax on wealthy individuals’ investments. The GOP would then reallocate that money to help more people from low-income households pay for insurance, although Thune said some Republicans want to use those funds for deficit-reduction purposes instead.

No final decision has been made, Republicans said, but the party is leaning strongly toward reshaping the bill to be less of a tax cut for the wealthy and more to supplying health insurance options to the working poor.

“We are going to figure out a way, I believe, before Friday comes, to greatly enhance the ability of lower-income Americans to buy health insurance on the exchanges that actually covers them. And my sense is the [investment tax] is going to go away,” Corker said. “It’s not an acceptable proposition to have a bill that increases the burden on lower-income citizens and lessens the burden on wealthy citizens.”

Killing or delaying the tax cuts will give the party significantly more money to play with and potentially change the optics of a bill portrayed by Democrats and some GOP critics as a tax cut for the rich at the expense of curtailing benefits for the poor.

The “net investment tax” imposes a 3.8 percent charge on some investments by people who make more than $250,000 a year, in addition to the capital gains tax. Centrist and dealmaking senators are ready to scrap it to take away critics’ ammunition.

Corker and Sen. Susan Collins (R-Maine) have both raised the issue in party lunches, Republicans said.

Republicans also are considering keeping a Medicare tax increase from Obamacare that their initial bill would cut. Combined, retaining the investment tax and Medicare tax could give the party more than $200 billion to invest in health care, on top of the $188 billion in savings the GOP has to spend from its initial Congressional Budget Office score this weekend.

“I am” open to keeping the net investment tax, said Sen. Marco Rubio (R-Fla.). “But only if it’s part of a plan that works, not just simply growing government for revenue purposes.”

Sen. Ron Johnson, a conservative holdout who has pushed for rolling back even more of Obamacare, signaled he would nevertheless be willing to consider keeping the investment tax around.

“If we’re retaining the benefit we ought to have the funding mechanisms,” he said in an interview.

But conservatives such as Sen. Pat Toomey of Pennsylvania and Rand Paul of Kentucky signaled that keeping the tax would be a potential deal breaker.

“I’m for repealing Obamacare, which includes all the taxes in Obamacare,” Paul told reporters.

“I expect that we’ll be repealing all of the taxes in Obamacare,” Toomey said.

McConnell met with a bevy of senators privately over the past two days, including conservatives like Cruz and moderates like Lisa Murkowski of Alaska.

“One of the things the working group said at the outset is that we will not set any artificial deadlines. We would keep working until we reached an agreement,” Cruz said after leaving McConnell’s office.

Movement on the party’s tax cuts follows a Wednesday evening offer among White House and congressional negotiators. That plan would deliver $45 billion to fight opioid addiction and establish health savings accounts that would allow people to pay for insurance premiums with pre-tax money, aimed at moderates and conservatives, respectively.

Still, it was unclear whether the opioid money would be enough to win over wavering senators from the center. When asked about the additional funds, Sen. Shelley Moore Capito (R-W.Va.) responded: “I’m not there yet. I know that.”

The frenzied atmosphere is a last-ditch attempt by McConnell and his lieutenants to salvage a bill that will no longer be considered this week, despite initial vows by leadership that a vote would occur regardless of the outcome.

Senate Majority Whip John Cornyn (R-Texas) said he hopes Republicans can reach an agreement by Friday. Part of the difficulty, Cornyn said, is receiving a new score from CBO which he said is using a “Ouija board … to predict the future.” The Senate cannot vote without a CBO score.

“We’re continuing to have conversations,” Cornyn said. “I know it’s aggravating to the press corps because there isn’t really anything to report.”

Jennifer Haberkorn and Adam Cancryn contributed to this report.

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