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White House keen to resuscitate healthcare bill

The White House has not abandoned hope that Congress could make another effort to pass healthcare legislation that Trump administration officials believe would ease resistance to enacting tax reform.

President Donald Trump signalled last week that he would switch focus after Republican leaders in the House cancelled a vote to replace the Obamacare law because of disagreements inside their party. But the White House is making another run at the bill as Republicans try to find a compromise.

One White House official said “lots of work” was being done on Capitol Hill aimed at changing the bill — pulled from the House floor last Friday in a huge defeat for Mr Trump — as part of an effort to appease hard-line conservatives. They were unhappy with some aspects while some moderate Republicans also had concerns.

Mr Trump sparked speculation about revisiting the issue at a Tuesday dinner when he joked that tackling healthcare was an easy issue that would “happen very quickly”. Sean Spicer, White House spokesman, stressed that Mr Trump had been having “a little bit of fun” with the remarks, but said there was a “renewed sense” that a way forward could be found to bridge divides.

“There is a renewed sense because . . . [of] comments and the calls that the president has gotten,” he said, referring to talks with lawmakers who have floated ideas. “It’s a conversation and we’re not trying to jam that down anyone’s throat right now.”

Republicans have made repeal of Obamacare a top priority since Barack Obama signed the Affordable Care Act into law in 2010. But their first real attempt to do so failed last week after most members of the Freedom Caucus, a few dozen hardline conservatives, said the bill did not go far enough towards removing government from provision of healthcare. A handful of moderate Republicans also balked over estimates that the bill would leave 24m Americans without healthcare coverage.

A Republican congressional staffer downplayed suggestions about a vote next week, but said lawmakers continued to negotiate and the GOP was “not folding our tents on this thing”. Another Republican aide said lawmakers on the three House committees that put the initial bill together had resumed discussions, but stressed that introduction of a revised bill had no clear timeline.

One question is whether Mr Trump might try to convince some Democrats to support the bill. This would be a reversal given that the White House and Republicans made little effort to generate bipartisan support the first time. Democrats are also sceptical that Republicans will reach a compromise among themselves.

“I’ve heard people say they really believe they need a win on healthcare,” said John Yarmuth, the ranking Democrat on the House budget committee. “But no one knows what a win would look like.”

For advocates of the sweeping tax reforms being championed by Paul Ryan, Republican House Speaker, success on healthcare would reinvigorate the chances of progress on that issue. It is a bigger priority for Mr Trump who argues that it would spur economic growth and create jobs.

Grover Norquist, president of Americans for Tax Reform, said reforming Obamacare would produce $1tn of tax reductions over 10 years that, coupled with related spending cuts, would make it easier to lower taxes. “There is less work to do, less distance to travel from where you are the moment you pass healthcare reform.”

Mr Norquist said Republicans wanted to see a permanent tax cut rather than reductions that only lasted 10 years, and argued that tax reform plans were in “reasonably good shape”. He believes that a less desirable outcome would be a re-run of the tax cuts under George W Bush in the early 2000s. These had so-called sunset provisions after 10 years because they added to the deficit.

One GOP aide said party members had “some remorse” about the failure of the healthcare reforms, and that rank-and-file lawmakers in the House were eager to put healthcare back on track. “There are a lot of folks talking about how to move forward,” he said.

But the idea that healthcare tax cuts are a pre-requisite for tax reform plans is questioned by some. Kyle Pomerleau of the Tax Foundation said there was no direct interaction between the tax reforms in the healthcare bill and those in the tax reform package backed by Mr Ryan and Kevin Brady, head of the House ways and means committee which overseas tax. “I don’t see that tax reform gets any easier or harder if the ACA is repealed or not repealed,” he said.

Mr Pomerleau added, however, that legislative success on healthcare might be seen politically to breed a greater chance of success on taxes. “If they are able to come back to the table and have something pass that would unite the Republicans a little more . . . that makes tax reform a little easier.”

Follow Demetri Sevastopulo on Twitter: @dimi

Via FT