Hatch: Cut health law's subsidies in tax debate

Subsidies under President Obama's healthcare law should be on the table as the Senate looks for tax breaks to eliminate, Sen. Orrin Hatch (R-Utah) said Wednesday.

Hatch, the top Republican on the Senate Finance Committee, accused Democrats of "cherry-picking" tax subsidies as they look for new revenues to help reduce the deficit. The health law's insurance subsidies should be on the table as Congress looks at tax breaks, Hatch said.

"The reality is that the vast majority of these tax preferences aren’t going to corporate jets or our energy sector, as Democrats would have you believe, they are increasingly flowing to government paid for healthcare," Hatch said in a statement.

Senate Budget Committee Chairwoman Patty Murray (D-Wash.) will release her budget outline Wednesday. It's expected to call for more than $1 trillion in new revenue from eliminating tax breaks, but will preserve funding for the Affordable Care Act.

The health law's insurance subsidies — administered as refundable tax credits — will begin to flow next year. But by 2017, they'll be the second-biggest healthcare tax expenditure at $96 billion, Hatch said.

The ACA provides subsidies on a sliding scale, based on income, to help pay for private health insurance. The subsidies are only available to people who purchase coverage through a new insurance exchange and do not get their coverage through an employer.

The tax exclusion for employer-based healthcare benefits is the biggest expenditure in the tax code.

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