Trump and Speaker of the House Paul Ryan said they had the votes, when in reality they had nowhere near enough. Trump got rolled, plain and simple (Maureen Dowd's "Donald, This I Will Tell You" makes this point well). The Freedom Caucus, backed by the Koch's constellation of Birchite pressure groups, demanded "poison pill" rewrites of Trumpcare; and when they got those, they demanded more. Trump was exposed not as a consummate artist of the deal, but as a clown, a buffoon huckster.
The silver lining here is that knives are being sharpened in the West Wing. Bannon and company wanted to hold the vote and then start taking the scalps of those Republicans who strayed off the reservation. Ryan carried the day here with his counsel that the fractured caucus needed cover in order to pass Trump's tax reform plan. So no vote on Trumpcare was held.
All this does is kick the can down the road and place the GOP under even more pressure. Revising the tax code is no easy thing. Failure here will deliver an enormous blow not just to Trump but to the GOP and the political system at large. How can a party control all three branches of government and be paralyzed?
Democrats will try to take credit for their defense of Obamacare, but they had little to do with it. It was the Tea Party, the paranoid, Bircher reboot of the Republican Party made possible by the Affordable Care Act, that saved Obamacare and prevented the gutting of Medicaid. What an irony.
Trump is right about one thing though. Obamacare is still in plenty of trouble, and Trump is at the control switch. As Margot Sanger-Katz outlined on Friday in "Trump’s Choice on Obamacare: Sabotage or Co-opt?":
Mr. Trump will need to decide, quickly, whether his goal is to knock over the still-functioning markets, or help prop them up. [Is that even in question? He has publicly stated his strategy going forward: He is waiting for Obamacare to collapse to get another chance to "make a deal."] If he decides to topple them, next year could be very messy.
Insurers are making their decisions right now about whether to enter the markets for next year and about how much to charge their customers. Signals from the administration in the next few weeks about whether he will help or hurt them will almost certainly guide insurers’ choices.
Fight a court case on subsidies?
The biggest immediate decision concerns a court dispute between the House and the administration over subsidies to help low-income insurance buyers pay their deductibles and co-payments. The House has argued that the money for those subsidies was not properly authorized. The Obama White House fought the case. It is not clear whether Mr. Trump’s lawyers will do the same. The availability of those subsidies, used by a majority of Obamacare customers, is critical for insurers in the markets.
Without the subsidies, all the insurers will lose some money, and many smaller carriers will face bankruptcy. If Mr. Trump does not fight the court case, the Obamacare markets in most states will unravel quickly, leaving millions without insurance options on his watch. Many of the beneficiaries are Trump voters.
Encourage insurance companies in wobbly markets?
There are smaller decisions ahead, too, about how to administer programs, whether to enforce the law’s individual mandate, and whether to recruit insurers to participate in markets where competition is thin.
So far, Mr. Trump’s secretary for health and human services, Tom Price, has taken every opportunity to gloat about the health law’s setbacks, even as he is administering its programs.
Mr. Price, perhaps more than Mr. Trump, has long been committed to the Affordable Care Act’s demise. But now he will have to manage the law’s many programs. Obama administration officials called insurers, cajoling and reassuring them. If Mr. Trump wants the markets to be vigorous, he could use his self-described deal-making skills to woo insurance companies into the stabilizing markets.
Make the system more conservative?
If Mr. Trump and Mr. Price can make peace with the health law, there are opportunities to steer it in a more conservative direction. The law gives broad authority to the executive branch to shape health care policy. So far, the health law has been driven by Obama administration priorities, but that could change.
A few early regulatory changes have begun that process. The Trump administration plans to make it harder for people to sign up for plans midyear. It has given insurers more wiggle room to raise their deductibles. It may be able to make alterations that loosen up benefit requirements — though it won’t be able to completely eliminate them, as Republicans sought to do at the last minute in the failed bill.
Offer states maximum flexibility?
The administration will also have enormous power to allow states to reshape their Medicaid programs — and even their local insurance markets — through waivers to existing law. Seema Verma, the just-confirmed administrator of the Centers for Medicare and Medicaid Services, was a consultant who helped states write pathbreaking conservative proposals for their Medicaid programs. She is ideally positioned to approve many more such waivers from Republican-led states, allowing them to impose premiums, cost-sharing and even work requirements for Medicaid beneficiaries.
A new Obamacare waiver program has just gone into effect: It would allow states to overhaul their entire health insurance markets if they can show that their revised plans would cover as many people. That process could allow Ms. Verma and Mr. Price to approve state plans that hew more closely to the Republican vision for health care.
Change Medicare policy?
New powers granted under the Affordable Care Act allow the Department of Health and Human Services to make major changes to the Medicare program, through demonstration projects meant to lower costs and improve patient care. The Obama administration set a precedent of imposing “mandatory” projects on large portions of the country to test policy ideas. So far, Mr. Price has looked askance at such efforts. But the provision could give him power to reshape what Medicare pays for and how seniors receive their care.
Nicholas Bagley, a law professor at the University of Michigan, has criticized the Obama administration for stretching its legal authority with some of its Obamacare choices. But those choices have created a precedent for the Trump administration to stretch the health law in its own direction. “If you think Congress is done, and you don’t want to provoke a reaction anymore, then you own this,” he said. “You will be judged as an executive on the performance of Obamacare.”
For years, opposing Obamacare has been a rallying cry for Republicans. But if Republicans can’t repeal Obamacare, they could instead co-opt it. There are opportunities for Trumpcare yet.