House to prohibit IRS from implementing healthcare law

The House as early as next week will pass legislation prohibiting the IRS from receiving any money from the Department of Health and Human Services (HHS) to implement the 2010 healthcare reform law.

Passage of the financial services spending bill is especially timely in light of last week's Supreme Court ruling that penalties the government can impose under the law against people who refuse to buy health insurance can be seen as a tax, because it is enforced like a tax. 

That finding allowed the individual mandate to stand, and Republicans have already started reorienting their attacks against the law based on the knowledge that it only remains in place because it is an allowable tax.

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The bill would have to get through the Senate and be signed by President Obama to become law. 

The House will take up the Financial Services and General Government Appropriations Act sometime in July, and possibly next week when it returns from the July 4 recess. (The rule governing debate on the bill was already approved last week.) While the Obama administration requested another $1 billion so the IRS can implement the healthcare law, the bill, H.R. 6020, does not give any new money to the IRS.

Additionally, it "prohibits the IRS from receiving transfers from the Department of Health and Human Services to implement the Patient Protection and Affordable Care Act," according to report language accompanying the bill from the House Appropriations Committee.

The report notes that in 2010, HHS allocated $20 million to the IRS for enforcing the healthcare law "without the Committee's knowledge." It also notes that the IRS received $168 million from HHS to implement the law in 2011, and plans to get another $322 million from HHS in 2012.

"The Committee prohibits further such transfers during fiscal year 2013 in section 106 of this Act," the report states.

The bill would spend a total of $21.5 billion on the IRS, Treasury Department and other related agencies, about 1.7 percent less than the current funding level. The bill increases funding in some areas, such as Small Business Administration business and disaster loans, public safety and education in Washington D.C., and the Treasury Department's anti-terrorism financing programs.

To make up for these increases, the bill makes cuts in several areas, including the executive office of the president.

"The committee is disappointed that the administration's request did not propose additional reductions for the EOP salaries and expenses accounts," the bill report says. "The committee believes that the chief executive of any organization experiencing a fiscal crisis should share in the funding sacrifice along with the rest of the organization.

"Therefore, the committee has reduced the salaries and expenses appropriation for each organization under this heading," it adds.

Specifically, the bill would fund salaries in the executive office of the president at $650 million, down $9 million from the current level. White House salaries and expenses would be cut $2.8 million, and funding for costs related to keeping up the White House would be cut $671,000.

Other executive branch agencies would receive token cuts as well, while the Office of Management and Budget would see funding drop nearly $9 million, to $80.5 million.

The bill would also take a swing at the General Services Administration (GSA), which faced harsh criticism this year for a lavish, 2010 conference in which more than $800,000 was spent. Under the bill, the GSA would face more oversight related to its travel budget, and would be banned from holding conferences that don't comply with relevant laws and regulations.

The GSA would also have to submit quarterly spending reports to Congress, and face restrictions in monetary awards it gives to employees.