Here’s how Republicans could get another shot at health care and taxes – MarketWatch

House Speaker Paul Ryan is trying to push health-care reform and a tax overhaul through Congress.

So, say the Republicans effort to pass their Obamacare repeal-and-replace bill blows up on Thursday, or in the next few weeks. Can that effort and a separate push for tax reform recover?

Technically, the answer is yes, thanks to whats known as reconciliation. Politically, it could be a far different story.

Heres the latest: A vote on the American Health Care Act is still planned for Thursday but no time was set as of the early afternoon, as there were signs negotiations were ongoing. Members of the House Freedom Caucus conservatives who say the bill wont lower premiums, among other criticisms met with President Donald Trump and said theres no deal yet.

Were trying to get to yes, said Freedom Caucus Chairman Mark Meadows of North Carolina.

Also read: Republican health-care bill disapproved by 56%-to-17% margin: poll.

The House Republican health-care bill includes the biggest structural overhaul of Medicaid in its 52-year history including work requirements for certain recipients. Why the change? WSJs Jason Bellini has #TheShortAnswer. Photo: Fox

Republicans are trying to move both their health and tax bills through Congress using the procedure known as reconciliation. The advantage of that process, which is limited to budget-related legislation, is it requires just a simple majority in the Senate. Republicans control 52 seats there, so bills they all agree on would be foolproof.

The complicating factor here is that there are two separate attempts at using reconciliation: one for health care and another for a tax overhaul. The plan was to use the fiscal 2017 process for health care and the fiscal 2018 process for the tax code. The health-care course has been set, with lawmakers approving a budget resolution in January that contained repeal-and-replace instructions.

But Congress hasnt passed a separate resolution with instructions for a tax rewrite using reconciliation.

So a new resolution could be the Republicans ticket to a fresh crack at health care and tax reform. As Ed Lorenzen of the Committee for a Responsible Federal Budget explains, such resolutions are supposed to pass in the spring before a fiscal year begins. That means now, since fiscal 2018 begins Oct. 1.

The window is closing, in that they cant really even start the process on tax reform until they pass a new budget resolution, Lorenzen said.

Citi analysts wrote in a note on Thursday that Republicans could include their health bill in the fiscal 2018 reconciliation bill, together with tax reform. But they say the strategy is risky given lawmakers limited bandwidth to address the two issues at the same time.

Lorenzen agrees, saying youre combining two sets of potentially controversial issues and its harder to get votes.

Citis analysts, meanwhile, think the health bill will stall and lawmakers will turn their focus to tax reform.

Our base-case is that the AHCA passes the House, with a likely thin majority, but is ultimately voted down by the Senate and/or placed on the back burner by the Republican leadership in order to focus upon tax reform, the analysts wrote.

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Here's how Republicans could get another shot at health care and taxes - MarketWatch