The House's hard-core conservatives have gotten used to losing at the end of a long legislative fight. But for the first time in the 114th Congress, Speaker John Boehner is cutting them loose from the get go.
Boehner and his top chairmen will pitch a permanent "doc-fix" deal to Republicans Tuesday morning that would have been unheard of in the GOP-led House of the last few years: an entitlement change that adds tens of billions of dollars to the 10-year deficit and that they know fiscal hawks will vote against. What's more, Boehner and his team negotiated the deal with House Minority Leader Nancy Pelosi and her Democrats first.
That is a noted strategy shift for Boehner, who on several recent occasions—including last month's Homeland Security Department funding standoff—has only gone to Pelosi as a last resort and, instead, relied on 218 Republicans to pass right-leaning bills. Now he is not bothering to try to appease the most vocal hard-liners in his party, members who—Boehner's allies have argued—were never going to come around to his side anyway.
Perhaps even more interestingly, the proposal—which could reach the floor as soon as this week—is coming in part from Ways and Means Chairman Paul Ryan, who so insisted on offsetting all spending when he chaired the Budget Committee that he might have voted against this very deal a few years ago.
"This is a hard run to the middle," said a former GOP aide who has worked on fiscal issues. "It's nothing more than a 100-plus billion-dollar hole in the deficit, if you're at all worried about a primary from the fiscal conservative side, which is still dominating the Republican Party."
"The interesting thing is how Paul argues this. His first big move from the committee is to allow 100-plus billion dollars in entitlement spending to go unpaid for?" the source continued.
In fact, Boehner, Ryan, and other leaders will argue that, if you look beyond the standard 10-year budget window, the deal is a win for Republicans. Only about a third of the up to $200 billion price tag will be paid for within 10 years—half of that by reforms to Medicare long sought by Republicans and the other half through costs imposed on hospitals and other Medicare service providers. But those Medicare reforms, leaders will argue, will save money in the long term.
The deal also removes a perennial sword of Damocles hanging over doctors who treat Medicare patients, as it repeals a policy that would raise their costs by more than 20 percent if it is allowed to lapse at the end of the month.
"We are working to develop a bipartisan framework that finally resolves the never-ending doc-fix problem while putting in place responsible reforms that would strengthen the Medicare program for seniors," Boehner spokesman Kevin Smith said.
Meanwhile, House Democrats have agreed to the policy without insisting on tax increases in return. What they get instead is a two-year reauthorization of the Children's Health Insurance Program at levels agreed to in the Affordable Care Act. And even that is a relief for GOP leaders; CHIP not only splits the Republican Party, but it expires in September, just as government spending is set to run out. Amid another potential shutdown jam, GOP leaders would also likely have to deal with Democrats to get it passed then or concoct their own policy and suffer attacks from Democrats accusing them of endangering or making draconian cuts to children's health care programs.
All that is enough, aides said, for Boehner to make the decision to deal with Democrats up front. Not to mention, the last doc-fix patch was so controversial, GOP leaders sneakily voice-voted it without giving dissenters a chance to object, surprising even Ryan. That has left residual hard feelings, and Boehner does not want to replicate that move.
"Boehner's biggest priority these days is just to get the place working again," said a House GOP aide familiar with leaders' thinking. "I think Boehner's been through so many of these things and knows how much they disrupt getting anything you want to do done. He wants to resolve it once and for all."
To be sure, the strategy comes with its risks. Until leaders brief their members, they will not know how many Republicans they can count on to support the measure. And they are already getting preemptive pushback from Heritage Action and other outside groups (although Americans for Tax Reform and The Wall Street Journal editorial board favor the deal). The number will be important to determine how many Democrats Pelosi must bring to the table, especially since some progressives could balk at a deal that includes changes to the sacred cow of Medicare.
"A permanent solution to [the sustainable growth rate] is something that members would be very supportive of, and obviously getting CHIP for two years at ACA levels is a very big accomplishment," said a Democratic leadership aide. "It's just wait-and-see right now, and the next crucial point is [Tuesday's] Republican conference meeting."
The doc-fix deal is well-trodden ground. The contours of the deal largely resemble a deal then-Ways and Means Chairman Dave Camp and then-Finance Chairman Max Baucus negotiated last year. That deal was scuttled, however, because leaders were unwilling to go ahead with a deal that was not fully offset.
The Medicare changes are not new, either, as both were considered as potential pay-fors in a grand deficit bargain that never materialized. The deal would expend means testing for Medicare patients for doctors visits and prescriptions, meaning those with higher incomes would pay higher premiums. It would also impose a $250 out-of-pocket copayment for doctors visits on patients who supplement their Medicare coverage with so-called private Medigap coverage.
Yet it remains to be seen whether the Senate can accept the deal. Senate Minority Leader Harry Reid has been aware of the discussions, but he has not indicated support, aides said. And with the Senate schedule packed with budget and confirmation votes, it is not clear they have the time to make it through debate on this issue before the deadline.
Alex Brown contributed to this article
Daniel Newhauser is a staff correspondent for National Journal, where he primarily covers the House of Representatives. He was formerly a House leadership reporter for Roll Call, where he started as an intern in 2010 and quickly earned a slot as a beat reporter.
A native of San Antonio, Texas, Newhauser traveled further West to study journalism at Arizona State University's Walter Cronkite School of Journalism and Mass Communication and write for newspapers including the East Valley Tribune and the Green Valley News & Sun.