Market Shakes As Republicans Accept Defeat On Healthcare Bill

Acting on orders from President Donald Trump, Speaker of the House Paul Ryan led Republicans to pull the proposed healthcare bill from the House docket Friday.

“We just didn’t quite get consensus today,” Ryan said at a press conference. “We came very close, but we could not get a consensus, which is why I thought the wisest thing to do was pull the vote.”

Earlier in the day, Ryan visited the White House to warn that the measure wasn’t expected to earn the required 216 votes to pass.

This is the second time the party has stalled efforts to advance its own measure.

In February, Trump and the House Republicans had sought a delay in the healthcare ruling because, as Height Securities suggested, they were afraid they’d win. At the time, the Administration had no plan to replace the existing Affordable Care Act.

"We're going to be living with Obamacare for the foreseeable future," Ryan said.

So What Now?

Republican lawmakers are planning to adjust their approach.

“We will try to help [the ACA] along and prop it up, but it is so fundamentally flawed I don’t think that’s possible,” Ryan said.

He added that the Republicans had been doing the architects of Obamacare a favor by amending the law. “I’m sure they may be pleased right now, but when they see how bad this thing gets...I don’t think they’re going to like that either,” he said.

“Yes, this makes tax reform more difficult, but it does not make it impossible,” he said. “We will continue with tax reform...That just means Obamacare taxes stay with Obamacare. We’re going to go fix the rest of the tax code.”

Market Reacts

Investors responded to the latest news with mixed reactions.

SPDR S&P 500 ETF Trust SPY and iShares Russell 2000 Index (ETF) IWM spiked up 0.4 percent.

SPDR Gold Trust (ETF) GLD dropped 0.3 percent, SPDR S&P 500 VIX Short Term Futures TM ETN VXX fell 4.5 percent and ProShares Trust Ultra VIX Short Term Futures ETF UVXY plunger 7.6 percent.

Health insurance shares, which had steadily fallen leading up to the scheduled vote, got a boost from the announced cancellation.

Molina Healthcare, Inc. MOH popped 2 percent, Aetna Inc AET 0.7 percent, Humana Inc HUM 0.9 percent, Anthem Inc ANTM 0.8 percent and CIGNA Corporation CI 0.8 percent. Each had tapered off in the minutes following.