3 roadblocks for the Senate's last-ditch health care negotiations

Zoom in: Senators from both parties are cautiously optimistic that a bipartisan deal to extend the subsidies is possible. But there are significant political headwinds.

• Early bipartisan and bicameral negotiations have been ongoing over what to do with the expiring ACA tax credits, which were increased during the COVID-19 pandemic.
• The Senate Finance Committee will hold a key hearing on health care costs on Wednesday, setting the stage for a public debate that has largely been behind closed doors.

Yes, but: While the Senate could give bipartisanship a try, prospects for a deal are even dimmer in the House and the White House, where President Trump has been advocating his own proposal to send money directly to consumers.

• Democrats, whose starting position is a clean subsidy extension, feel they have a stronger political footing on health care amid concern about rising costs.

What to watch: Most Senate Republicans have been adamant that any deal to extend the tax credits will need to be short-term and require "reforms."

1. Income caps: Conservative Sen. Roger Marshall (R-Kansas) told Axios he could see himself supporting a deal if an income cap was placed back on the enhanced subsidies. Sen. Jeanne Shaheen (D-N.H.) has said such a change is reasonable.
2. Fraud prevention: Republicans have raised concerns about $0 premium plans, which they say allow fraudsters to sign people up without their knowledge, costing the government more money. One idea being floated is a low-cost premium, such as $10.
3. Hyde amendment: "We're not doing something without the Hyde amendment attached," Sen. Katie Britt (R-Ala.) told reporters last week, an argument many GOPers agree with. The hot topic of abortion has the potential to derail any bipartisan compromise.

Who to watch: In this new phase, the focus is shifting away from the small bipartisan gang that held talks on reopening the government.

• The Senate Finance Committee, led by Sen. Mike Crapo (R-Idaho), is expected to lead the negotiations — with Health, Education, Labor and Pensions Committee (HELP) members also closely involved, multiple sources familiar with early talks tell Axios.
• Sen. Ron Wyden (D-Ore.) — Finance's ranking member — is a key player on the Democratic side, along with Senate Minority Leader Chuck Schumer (D-N.Y.). A Schumer spokesperson said: "The bill Democrats bring to the floor will be a caucus product."
• Sen. Bill Cassidy (R-La.) chairs HELP but is also a member of Finance. He is passionate about health care issues, up for reelection next year and a trained physician. He is pushing a plan he says fulfills Trump's call to send the subsidy money to consumers directly, by filling flexible spending accounts.

• Other key voices to watch include Sens. Marshall, Ron Johnson (R-Wisc.), Jon Husted (R-Ohio) for Republicans and for Democrats Sens. Shaheen and Maria Cantwell (D-Wash.).

Between the lines: Even if the minimum 13 Senate Republicans help pass a deal, Speaker Mike Johnson (R-La.) will not guarantee a vote in the House. He can also use procedural moves to evade a discharge petition vote before the end of the year.

• Plus, Trump would need to sign off. His history on health care is full of contradictions, but his recent Truth Social posts have emphasized problems with the ACA — not a need to continue the expiring tax credits.
• If no bipartisan deal comes together in the Senate, Republicans are expected to put forward their own proposal to receive a vote and give their members something to support, to lessen pressure to back the Democratic plan.

What they're saying: Sen. Chuck Grassley (R-Iowa), leaving a meeting of Finance Committee Republicans on Monday, said no "consensus" exists on what to do on health care, but he thinks a deal is possible in the next month.

• Sen. Jim Justice (R-W.Va.) said he'll "be open-minded," adding, "Let's see how all this plays out."