Frequently Asked Questions on Budget Reconciliation and the American Health Care Act

March 28, 2017
Blog Post

Throughout the last two weeks, there has been a lot of talk about why the House of Representatives could not just vote on repealing Obamacare and then work on replacement at another time. But a repeal and replace of the legislation is a complicated process. The following are some frequently asked questions about the process of budget reconciliation and the American Health Care Act.

Q: Why did the House not just vote to repeal Obamacare?
The simple answer is 60. That is the number of votes required in the Senate to repeal Obamacare outright because of a process called cloture. At the present time, there are only 52 Republicans in the Senate, meaning eight Democrats or Democratic-leaning independents would have to join Republicans in a vote to repeal Obamacare. It would be difficult to get one Democrat to vote for repeal, meaning eight Democrats voting to repeal Obamacare will probably not happen.

Q: What about the nuclear option?
The nuclear option is a change to the Senate cloture rule that would allow votes to pass with a simple majority. Senate Majority Leader Mitch McConnell has not shown a willingness to invoke the nuclear option at this time.

Q: What is budget reconciliation and why did the House try to use this process to repeal and replace Obamacare?
A: Budget reconciliation, created by the Budget Control Act of 1974, is a procedure that allows certain items to pass both Houses of Congress on simple majority votes (meaning there is no 60 vote cloture rule to worry about in the Senate). By including the American Health Care Act  in budget reconciliation, we could take important pieces of Obamacare away through a simple majority (including the Obamacare taxes, the individual mandate, and more). But in order to use budget reconciliation, any of the items voted on must have budgetary connection. Therefore certain items conservatives, myself included, wanted in an Obamacare repeal and replace bill like the purchase of insurance across state lines would not have met the standard since it did not have a direct connection to the budget passed by Congress.

Q: Why not try and get everything into reconciliation? Shouldn’t anything having to do with Obamacare be connected to the budget?
If the House were to include items in the legislation that did not meet the standards of budget reconciliation, the Senate parliamentarian could throw out the entire bill. If that were to happen, we would be back to the drawing board. That is why using budget reconciliation is both strategic and frustrating.

Q: With such stringent rules, could we have ended up with a more conservative bill or something that could have passed both Houses?
A: I think we could have passed the AHCA in the House and Senate if we could have made everyone – from Members of Congress to constituents to the media – understand the budget reconciliation process. Once the bill got to the Senate, its Members would have had more flexibility in trying to get amendments added to the bill without having the entire bill struck down by the parliamentarian. If we had tried the same item in the House, it could have killed the bill entirely based upon Senate rules. As it stood Friday, we could not get all Members to understand why we needed to move forward with the bill and how the Senate could have made improvements.

Q: What would the AHCA accomplish in its current form?
A: Using budget reconciliation, the AHCA would provide for the largest combined tax cut and entitlement reduction ever passed by Congress. Working with my colleagues in the House, as well as the White House, we were also able to include block grants and work requirements for working-age, able-bodied adults who receive Medicaid benefits and move the definition of essential health benefits back to the states.