The Obamacare Taxes Dividing Republicans

Republicans have coalesced around a strategy for repealing Obamacare using a budget tool called reconciliation.

But a divide has emerged among some Republican senators who, splitting from their conservative colleagues, believe they should delay a repeal of Obamacare’s taxes until a replacement plan is implemented.

On one side of the debate are Republican Sens. Bob Corker of Tennessee, Bill Cassidy of Louisiana, and Susan Collins of Maine who would like to leave in place the taxes—levied on insurers, medical device companies, employers, and individuals—included in Obamacare.

The revenue streams pay for Obamacare’s subsidies, which extend to Americans purchasing coverage on the federal and state-run exchanges, and the senators say the taxes are necessary to fund the subsidies further during a two- or three-year transition period after repealing Obamacare.

“Right now, the track we’re on, the repeal process is going to repeal all the revenues, but keep in place the subsidies for three years,” Corker said last week at a breakfast hosted by the Christian Science Monitor.

The Republican senators aren’t ruling out replacing the taxes altogether, but are advocating doing so later this year when Congress moves to reform the tax code using reconciliation.

“If we don’t like ‘em, we can replace them,” Cassidy told Bloomberg. “But we can do it in a way where you overall are lowering tax rates and making the tax code more efficient. There will be enough there for people to win.”

The senators’ push to keep Obamacare’s taxes in place temporarily puts them at odds with conservatives like Reps. Jim Jordan of Ohio and Mark Meadows of North Carolina, who believe their repeal should be done immediately and through the reconciliation bill that will roll back key aspects of the law.

“To look at any repeal of the Affordable Care Act without repealing the taxes would be something that would generally come out of a more liberal think tank than it would be from a conservative member of Congress,” Meadows told The Daily Signal. “Without a doubt, the taxes should be repealed.”

On the issue of the taxes, Meadows has a powerful ally in House Ways and Means Committee Chairman Kevin Brady, who said in an interview on Bloomberg TV on Tuesday that all of the taxes would be included in a repeal bill.

“Those taxes are causing real damage to families, to our small businesses, to the economy as well, along with the key mandates that drive up the expense of Obamacare,” he said. “All those need to be repealed immediately because look, Obamacare is getting worse.”

Meadows, chairman of the House Freedom Caucus, pushed back on his colleagues’ argument that the revenue streams are needed to fund a replacement for the Affordable Care Act.

Rather than fit a new proposal around the money raised by Obamacare’s taxes, the North Carolina Republican said he preferred a plan that involved crafting a replacement first, and then finding the revenue streams to support it.

“It’s a backward argument to suggest you put a pot of money out there and figure out a replacement to fit it,” Meadows said. “It would be more prudent to come up with a replacement, and then figure out the taxes that are needed to support it.”

But for some lawmakers, especially those who signed pledges not to raise taxes, it may be politically difficult to find ways to increase revenue for a replacement plan.

Meadows, though, said it’s a risk he’s willing to take.

“That strategy will always make you be a lot more conservative in the amount of taxes that you’re asking for from hard-working American taxpayers instead of just assuming you have a certain budget and spend all of that and then some,” he said.

Conservatives in the House and Senate have for years been pushing for Obamacare’s full repeal, and most say they believe that any reconciliation bill that leaves the taxes in place would fall short of their promise to the American people to roll back the law.

“Repeal it. Get rid of it, every single bit of it. Don’t keep any of it,” Jordan told Bloomberg TV earlier this week. “That’s all the taxes, all the mandates, all the things that are in this thing that the American people don’t like and that I think have driven up the cost of medicine, hurt economic growth. I think we’ve got to do what we told voters we were going to do.”

Plus, Senate GOP leadership can’t stand to lose the support of three senators, since a reconciliation bill needs 51 votes in the upper chamber to pass.

Republicans currently hold 52 seats in the Senate.

Already, Sens. Ted Cruz of Texas, Mike Lee of Utah, and Marco Rubio of Florida have sent Senate leaders a letter telling them they support a strategy to repeal Obamacare using reconciliation.

But the senators urged Senate Majority Leader Mitch McConnell, Majority Whip John Cornyn, and Budget Committee Chairman Mike Enzi to use a reconciliation bill passed by the last Congress as a floor for future reconciliation legislation.

That bill repealed all of Obamacare’s taxes and eliminated the individual and employer mandates, and Medicaid expansion. It also stripped the government of its authority to run the federal and state-run exchanges, and decreased the fine for failing to comply with the individual and employer mandates to $0.

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The Obamacare Executive Orders Trump Could Issue on Day One

President-elect Donald Trump may be following President Barack Obama’s lead come Jan. 20, using executive orders to roll back parts of the outgoing president’s signature health care law.

During a meeting with Republicans on Capitol Hill Wednesday, Vice President-elect Mike Pence said the president-elect plans to kick off his administration by signing executive orders to begin dismantling Obamacare.

“We’re working now on a series of executive orders that will enable that orderly transition to take place even as Congress appropriately debates alternatives to and replacements for Obamacare,” Pence told reporters after the meeting.

Pence did not elaborate on which parts of the law the president-elect would dismantle using his executive authority, and Trump’s transition team did not return The Daily Signal’s request for comment.

But health care experts believe there are several steps the president-elect can take on his first day in the White House that would deliver a blow to the health care law even before Congress acts legislatively.

“This is the problem with expansion of executive branch powers is that it cuts both ways,” Seth Chandler, a visiting scholar at George Mason University’s Mercatus Center and a professor at the University of Houston Law Center, told The Daily Signal. “I think a lot of liberals gave Obama a pass when he did it, and they’re now potentially going to have to face the consequences of permitting the executive to greatly expand its powers.”

Individual Mandate

Experts believe Trump could first decide not to enforce the individual mandate, which requires people to have health insurance and fines those who do not.

The provision was designed to balance out the population of consumers who enrolled in coverage under Obamacare and ensure healthier enrollees offset the higher costs associated with a sicker enrollment population.

But if the president-elect decided not to enforce the individual mandate, it “could make a real difference to the vitality of the exchanges going forward,” Nicholas Bagley, a professor at the University of Michigan Law School, told Kaiser Health News.

The president-elect also could announce his intention to seek hardship exemptions for all enrollees, effectively exempting everyone from the individual mandate, Chandler said.

“Obama expanded the hardship exemption for all sorts of reasons,” he said. “He has paved the way to a larger set of exemptions.”

The individual mandate is also likely to be the target of congressional Republicans in a reconciliation bill repealing parts of Obamacare.

Cost-Sharing Reductions

The president-elect can move to end the cost-sharing reductions or drop an appeal the Obama administration filed in response to the House’s lawsuit on the cost-sharing reductions in 2014.

Cost-sharing reductions are discounts offered to eligible consumers who purchase silver-level plans. The federal government then reimburses insurers for the reductions.

Last year, a federal judge ruled in favor of House Republicans, but the Obama administration filed an appeal to a higher court.

Dropping the appeal would allow U.S. District Court Judge Rosemary Collyer’s ruling to stand, and the payments to insurers would end.

If the payments ended, insurers would still be offering discounts to customers, but would no longer receive subsidies from the federal government to help with the cost.

As a result, insurance companies would likely begin to leave Obamacare’s exchanges, Chandler said.

“[Rep.] Tom Price voted to authorize a lawsuit to stop those payments because Congress never authorized them,” Chandler said of Trump’s pick for Health and Human Services secretary. “It becomes a little difficult for having said the payments are illegal to continue to keep taking them.”

Reinsurance Payments

In addition to the cost-sharing reductions, insurance companies received money from another program, the reinsurance program, under the Affordable Care Act.

Under the program, payments are made to insurers who enroll higher-risk populations.

But $5 billion was supposed to be returned to the Treasury before it was distributed to insurers. The Obama administration, however, has prioritized at least $3.5 billion to insurers over the Treasury.

Now, Republicans in Congress are pushing the Department of Health and Human Services to return the money paid to insurers under the reinsurance program to the Treasury.

Chandler said Trump could issue an executive order instructing the government to repay the Treasury.

Basic Health Program

Under the Affordable Care Act, states had the option to create a Basic Health Program, which was designed to offer public health insurance to low-income residents who did not qualify for Medicaid but were below 200 percent of the federal poverty line—$48,600 for a family of four in 2016.

Just two states implemented Basic Health Programs: New York and Minnesota.

Like the cost-sharing reductions, Trump could decide to no longer allocate money the states receive for Basic Health Programs, which would “throw the market in those two states in disarray,” Chandler said.

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Cruz, Lee, Rubio Call on Senate Leaders to Repeal ‘As Many Provisions of Obamacare As Possible’

Republican Sens. Ted Cruz of Texas, Mike Lee of Utah, and Marco Rubio of Florida are reaffirming their support for repealing Obamacare using reconciliation this year, but are calling on Senate leaders to craft a bill that goes further than previous legislation passed in 2015.

“The American people have given Republicans an historic opportunity to repeal Obamacare,” the trio of Republicans wrote in a letter sent Tuesday. “They have delivered majorities to both chambers of Congress and elected a Republican president who has promised to make this a priority from day one.”

In the letter to Senate Majority Leader Mitch McConnell, Majority Whip John Cornyn, and Budget Committee Chairman Mike Enzi, the three Republican senators expressed their support for a 2017 budget resolution that allows Congress to repeal Obamacare using a budget tool called reconciliation.

Under reconciliation, legislation needs just 51 votes to pass, and the GOP controls 52 seats in the 115th Congress.

Cruz, Lee, and Rubio said they expect the repeal bill to do away with, at a minimum, the components of Obamacare repealed through a reconciliation bill crafted in 2015.

That legislation eliminated Obamacare’s employer and individual mandates, Medicaid expansion, and Cadillac and medical device taxes. The bill, which President Barack Obama vetoed, also stripped the government of its authority to run the federal and state-run exchanges. It further decreased the fine for failing to comply with the employer and individual mandates to $0, a provision needed to comply with Senate rules.

In addition to eliminating the provisions included in the 2015 reconciliation bill, Cruz, Lee, and Rubio called on Senate GOP leaders to use reconciliation to repeal additional parts of the health care law, specifically Obamacare’s insurance mandates.

These mandates include the essential health benefits requirement and the ban on limiting or denying coverage to consumers with pre-existing conditions.

The insurance mandates, the senators wrote, are “driving up health insurance costs for millions of Americans.”

However, some members are skeptical as to whether those provisions, in particular, would pass muster with the Senate parliamentarian, who has the authority to strike out parts of a reconciliation bill.

If the reconciliation bill crafted in the coming weeks repeals less of Obamacare than what was passed by Congress in 2015—which the trio of senators said sets the floor for this year’s legislation—than Senate leaders risk losing the support of Cruz, Lee, and Rubio.

GOP leaders began putting into motion a plan to repeal and replace Obamacare after Donald Trump won the White House in November. Republicans also maintained control of the House and the Senate.

Their proposal involves passing two budget resolutions—one for 2017 and one for 2018—which would allow them to use reconciliation twice.

Enzi released the text of the 2017 budget resolution Tuesday, and it instructed the four congressional committees with jurisdiction over Obamacare to begin crafting the reconciliation bill to repeal it.

McConnell said the GOP plans to use the second reconciliation bill to reform the tax code.

But in their letter to the majority leader, majority whip, and Budget Committee chairman, Cruz, Lee, and Rubio called on Senate leaders to pass a 2018 budget resolution that “sets out new, unified Republican federal government on a path to balance in 10 years without the use of budgetary gimmicks or tax increases.”

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Obamacare Repeal Must Be on Day One: Congress Has No Excuses

In less than three weeks’ time, when Donald Trump becomes our next president, he will take an oath to preserve, protect, and defend the Constitution of the United States.

It is fitting, then, that Trump has committed to repealing and replacing one of his predecessor’s most infamous unconstitutional policies, the Affordable Care Act or Obamacare. But he won’t be able to do it alone. Repealing Obamacare requires Congress to write legislation for the president to sign into law.

Congress can and should do this in January, before Inauguration Day. There is no excuse not to.

A lot has happened in the last eight years, since Nancy Pelosi first claimed “we have to pass the bill to find out what’s in it.” Obamacare architect Jonathan Gruber reveled in the “stupidity of the American voter” and “lack of transparency” that helped pass the bill, and President Barack Obama told Politifact’s Lie of the Year in 2013: “If you like your healthcare plan, you can keep it.” The so-called Affordable Care Act was a mandate when Congress needed to shove it through, and it was a tax when the Supreme Court decided to look the other way.

Many thousands of Americans have lost their insurance plans or their doctors, or seen their premiums hiked up to unbelievable levels. Seventeen of the original 23 Obamacare insurance co-ops have collapsed. The massive centralization of health insurance has hurt patients and providers alike. And, of course, there has always been the rotten, unconstitutional core of Obamacare: the federal government forcing citizens to buy a product.

Being forced to live under Obamacare has motivated millions of hardworking people across our country to get involved in politics.

That’s why conservatives have been fighting against Obamacare for years. That’s why, since they swept the elections in 2010, Congress has voted over 60 times to repeal all or part of it.

They just need to do it one more time.

To avoid a predictable Senate filibuster from the Left, Congress can employ the “reconciliation process”—a parliamentary procedure used to help the House and Senate pass budget bills. Obamacare repeal can be easily included in this legislation. We know, because Congress did just that to get a repeal of Obamacare on the president’s desk in 2015.

Then, Obama used a veto to protect his signature law. But in a few short weeks, Congress will be sending bills to a different president entirely.

Of course, this doesn’t mean we won’t see foot-dragging from some in Congress. When I was in the Senate, they would use every excuse to avoid fighting for conservative priorities. “Wait until we get the House.” Done. “Wait until we get the Senate.” Done. “Wait until we get the White House.” Done and done. There are simply no alternatives left but to repeal Obamacare and win the fight (a shocking prospect for some!)

Fortunately, Republicans can’t afford to throw conservatives under the bus on Obamacare repeal. Republicans have consistently campaigned on repealing Obamacare and won. It’s a promise that must be kept.

Many Americans care deeply about getting the government out of their healthcare decisions and finances. Being forced to live under Obamacare has motivated millions of hardworking people across our country to get involved in politics—abandoning them now would cause an electoral backlash to rival the one which put Trump in the White House.

Obama signed his namesake legislation seven years ago, and soon his successor will sign a bill to repeal it. But just as Congress made the original mistake of passing Obamacare, it must start working—now—to have that bill on President Trump’s desk on Inauguration Day. Once repeal legislation establishes a certain date when Obamacare will expire, Congress can begin a step-by-step approach to make health insurance more affordable and available for every American.

No excuses.

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