GOP Congress ponders Obamacare mandate repeal in tax plan
Tax calculator illustration

GOP Congress ponders Obamacare mandate repeal in tax plan

Posted November 14, 2017 04:53 PM by Nate Madden Tax calculator illustration
narak0rn | Shutterstock
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Millions of Americans might be freed from paying a tax penalty for not buying over-regulated, unaffordable health insurance, if liberal Republicans don’t get in the way again.

The GOP may have failed to repeal even minor parts of Obamacare multiple times this year, but an effort to do away with one of its most unpopular aspects — the individual mandate — is gaining steam on Capitol Hill.

Following the announcement from Sen. Rand Paul, R-Ky., Tuesday that he would introduce an amendment that would do away with the mandate – which requires everyone to either buy health insurance or face a steep tax penalty – Republican senators confirmed that the provision would be included in the Senate Finance Committee’s version of the bill.

The idea was first suggested by Senator Tom Cotton, R-Ark., last month, who praised the move Tuesday afternoon.

Including an individual mandate repeal in the tax package is also supported by President Trump.

As with previous health care bills, there is a natural concern that Sens. John McCain, R-Ariz., Lisa Murkowski, R-Ark., and Susan Collins, R-Maine, could stymie the effort, but the three of them at least appear to be withholding judgment, for now.

According to estimates from the Congressional Budget Office, repealing the individual mandate would save the federal government around $330 billion over the next decade, which would give congressional Republicans more wiggle room to offer bigger tax cuts.

However, since the Alexander-Murray “stabilization” (i.e. bailout) bill is also being floated as a compromise to accompany the mandate repeal, there are a couple of added dimensions here. If Alexander-Murray passes, some of that saved money will be handed over in crony payouts to insurance corporations.

Another point to keep in mind here is that repealing the individual mandate alone would simply allow taxpayers to voluntarily leave a broken health insurance system without government penalty. This means that the overly burdensome regulations that have driven costs through the roof in recent years would still be in place and would continue to make health insurance unaffordable for many.

The compromise is also starting to pick up steam on the other side of Capitol Hill, as the Republican Study Committee – which boasts over 150 GOP House members – officially came out in support of the amended tax reform plan within hours of the announcement.

“Adding the repeal of the individual mandate to tax reform could be the most consequential step this Congress takes to date in fulfilling our promises to the American people to both reform the tax code and repeal Obamacare,” reads a statement from the RSC’s steering committee. “It appears the Senate is keeping its promises. The House should do the same.”

However, if any such amendment is to make it into the House version of the bill, it would have to be introduced at to the House Rules Committee Tuesday night, before the bill goes to the floor on Wednesday.


 

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Nate Madden is CRTV’s congressional correspondent. Follow him @NateMaddenCRTV or send tips to nmadden@crtv.com.