Congressional GOP Gets to Work Reconciling Tax Bill With Healthcare Implications

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Republican leaders begin work Monday reconciling the differences in the Senate and House tax legislation, hoping to send a final bill to President Trump before Christmas. Senate Republicans passed the bill by 51-49 just before 2 am on Saturday.

Called the Tax Cuts and Jobs Act, the bill has major implications for healthcare. The Senate version would drop the Affordable Care Act (ACA) mandate that people purchase individual health insurance or pay a penalty. The Congressional Budget Office has predicted that this change would cause health insurance premiums to rise by about 10% a year and prompt 4 million people to drop insurance by 2019 and 13 million to drop it by 2027.

The House version of the legislation, passed 2 weeks ago, does not mention the ACA mandate, but it does repeal individual tax deductions for medical expenses.

The tax bill would also cause deep cuts to Medicare, triggered by a 2010 law Congress passed to keep the deficit from growing larger. Various models predict that the tax bill would add $1.63 trillion to $1.78 trillion to the deficit.

Some physician and health groups said the tax bill would prove harmful to US health.

In a statement earlier Friday, the president of the American Society of Clinical Oncology (ASCO) said he was “deeply concerned” about the automatic cuts the tax bill would trigger. "We fear that the current proposal will harm patients with cancer by reducing access to care, a situation that could adversely impact treatment needed to extend and save patients' lives,” said Bruce E. Johnson, MD, FASCO. "The tax reform legislation under consideration will almost certainly trigger cuts to Medicare, projected to be a $25 billion reduction in 2018. Sixty percent of cancer patients are Medicare beneficiaries. A cut of this magnitude will cause increased instability in an already fragile cancer care delivery system and threaten access for patients with cancer.

The American Public Health Association (APHA) said in a statement over the weekend it was opposed to dropping the insurance mandate and feared the effects of automatic spending cuts on programs like Medicare.

“This legislation will have immediate consequences for Americans’ health. It not only fails to deliver on the promise of increasing prosperity for the lower and middle classes, but will ruin their health in the process,” said Georges Benjamin, MD, executive director of APHA. “It will leave Americans sicker, poorer and with a government unprepared and unequipped to respond to urgent threats to public health as soon as next year.”

After the Senate passed its version of the tax reform bill, Senate Majority Leader Mitch McConnell, R-Kentucky, and House Speaker Paul Ryan, R-Wisconsin, released a joint statement addressing concerns that the legislation would lead to cits in vital programs.

“Critics of tax reform are claiming the legislation would lead to massive, across-the-board spending cuts in vital programs—including a 4% reduction in Medicare—due to the Pay-Go law enacted in 2010. This will not happen," McConnell and Ryan said. "Congress has readily available methods to waive this law, which has never been enforced since its enactment. There is no reason to believe that Congress would not act again to prevent a sequester, and we will work to ensure these spending cuts are prevented.”

The American Academy of Pediatrics has also criticized the legislation for its effect on the Children's Health Insurance Program (CHIP), which funds healhcare for children from low-income families. Many states have begun sending out warning letters that without funding extensions children will lose their healthcare coverage.

CHIP provides coverage for 8.9 million children, and 11 states have estimated that they will run out of funding for the program by the end of the year. A total of 32 states will have exhausted funds by the end of March 2018, Kaiser Family Foundation reported.

A bill to refinance CHIP, which ran out of funding at the end of September, passed the House of Representatives by a vote of 242-174, largely along party lines. The House bill also continues funding for community health centers for 2 years and includes money for Medicaid programs in Puerto Rico and the Virgin Islands. However, the bill calls for paying for the funding by taking money from a public health fund created under the ACA. The public health fund helps to combat things like the opioid epidemic, Reuters reported.

Meanwhile, the Washington Post reported Saturday that there is a deal in the works to support cost-sharing reduction payments for 2 years in order to cover the expense of discounts that the ACA mandates for insurers in order to cover low-income people who enroll in Marketplace plans. The Post attributed the quote to Senator Susan Collins (R-Maine), who voted to support the Senate tax bill. Sen. Collins said McConnell had “committed to support” 2 separate measures by the end of the year. Trump ended CSR payments in October. One is a bipartisan plan that would restore CSR payments to cover the expense of discounts that the ACA compels insurers to give lower-income customers on deductibles and other out-of-pocket costs.