Trump, GOP Race to Avoid Government Shutdown as They Juggle Health-Care Revamp

Democrats say White House demands to fund border wall, immigration enforcement are nonstarters

Louise Radnofsky, Siobhan Hughes and Kristina Petrson
The Wall Street Journal

WASHINGTON—The White House has thrust a new set of proposals into talks to avoid shutdown of the government next week, while also seeking to revive a health-care overhaul that had collapsed last month.

With less than a week to pass legislation funding the government for the rest of the fiscal year, negotiations are beginning to take shape. Democrats are demanding that the legislation include money for insurance companies, without which fragile insurance markets could implode, while the White House in return wants additional money for defense, the border wall and border enforcement.

Failure to extend the funding would trigger a partial government shutdown on April 29, the 100th day of Donald Trump’s presidency.

Republican leaders will need Democratic votes in the Senate, and likely in the House, to pass a spending bill, giving the minority party unusual leverage in negotiations. Discussions now hinge on Democratic demands that the government continue payments that help support Affordable Care Act insurance plans. The money, known as “cost-sharing” payments, helps insurers lower costs for low-income consumers.

On Thursday, White House budget director Mick Mulvaney said the administration was proposing, in return, increased defense spending, money to expand a border wall and funding to hire more immigration officers. Mr. Mulvaney said the White House was willing to give Democrats a commitment to continue payments to health insurers, provided that the Democrats agree to some White House conditions.

“We want more money for defense, we want to build a border wall, and we want more money for immigration enforcement, law enforcement,” Mr. Mulvaney said Thursday at an Institute of International Finance conference. “We’re willing to have that discussion if they want to have it.”

The White House request put a set of controversial elements into the negotiations.

Democrats have said that money for a wall on the Mexican border or for increased immigration enforcement were nonstarters. The White House framed the request as reasonable in exchange for acceding to Democratic demands that the Trump administration continue “cost-sharing” payments.

“Everything had been moving smoothly until the administration moved in with a heavy hand,” said Matt House, a spokesman for Senate Minority Leader Chuck Schumer (D., N.Y.), who is a principal negotiator. “Not only are Democrats opposed to the wall, there is significant Republican opposition as well.”

Mr. Trump said Thursday that he was eager to push ahead with the health-care measure, in hopes of reversing what has been seen as one of his most prominent failures. He said a deal among Republicans could come together as soon as next week, though there was no clear sign from GOP lawmakers that divisions that sank the bill last month had been bridged.

Mr. Trump, at a joint news conference with Italian Prime Minister Paolo Gentiloni, said he was committed to passing new funding for the federal government and suggested that his ambitions for reviving the health bill could slip as a result.

“I believe we will get it, and whether it’s next week or shortly thereafter,’’ Mr. Trump said of the health bill. “As far as keeping the government open, I think we want to keep the government open, don’t you agree?”

The number of moving parts in the spending negotiations put Republicans on a bumpy path just as Mr. Trump heads toward his 100th day in office. The milestone creates pressure for Mr. Trump to show he is able to rack up legislative wins, but also coincides with the potential for a government shutdown at a time when Republicans control all the levers of power.

Congressional Republicans are hoping to stave off that worst-case scenario, which would reflect on their abilities to run the government, and are searching for a way forward that minimizes tensions.

“The broad consensus is we need to avoid a government shutdown—we’re sent here to keep the government open,” said Rep. Luke Messer of Indiana, a member of House GOP leadership. “This in a lot of ways for the new Republican governing coalition is our first opportunity to show we can govern.”

The “cost-sharing” payments to insurers are the subject of litigation initiated in 2014 by the Republican-led House of Representatives against the government. The House argues that the then-Obama administration was making the payments without authorization, a position that has been backed by a federal judge.

The Trump administration hasn’t blocked the payments to date, but in an interview with The Wall Street Journal last week, Mr. Trump raised the prospect of doing so in the future.

An abrupt withdrawal of the payments would pose an immediate threat to the already-fragile insurance markets, potentially triggering the collapse of health plans midyear. Health plans have said that uncertainty over the payments’ future is also a factor as they mull whether to sell coverage in 2018, a decision which they have only a few more weeks to finalize.

A centrist GOP lawmaker, Rep. Tom MacArthur of New Jersey, had reignited the simmering debate over Republicans’ health-care ambitions Thursday with a proposal seeking to unite at-odds conservative and centrist lawmakers after GOP leaders were forced to pull a health-care bill from the floor at the 11th hour last month because it lacked enough Republican votes to pass.

Mr. MacArthur’s proposal would allow states to waive some insurance requirements established by the 2010 health law, popularly known as Obamacare, if the states could argue that it would enable them to lower the cost of premiums or insure more people. States could relax requirements that set which benefits health plans must cover, as well as allow insurers to charge higher premiums to people with riskier medical records.

He said he had been discussing his idea with Vice President Mike Pence, White House chief of staff Reince Priebus and other top administration officials, and that legislative text of his measure would be available by week’s end.

“This is just my effort to try to bridge this divide and I think it’s getting some traction,” Mr. MacArthur said in an interview Thursday. “We’ll gain some [votes], we may lose a few, but I think on balance it gets us over the threshold and allows the bill to move forward,” he said.

But GOP leadership aides said that with lawmakers scattered around the country as the two-week congressional recess draws to a close, it was impossible to tell whether the MacArthur proposal moved them any closer to drawing the 216 House votes needed to pass the legislation.

Aides to lawmakers in the Tuesday Group, a faction of centrist House Republicans that includes Mr. MacArthur, said Thursday that Mr. MacArthur’s proposal didn’t reflect a consensus of the group.

“I have very serious concerns,” about the amendment, said Rep. Charlie Dent (R., Pa.), a co-chairman of the group, who is opposed to the bill. “This amendment does nothing to change my position on the bill.”

One White House official said Thursday that party leaders would call a roll quickly when they were confident they had the votes, but that there was no fixed date in mind. Another White House official also said little had changed, and that there was no timetable for a vote ahead.

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