Approps panel approves defunding of individual mandate

House appropriators on Thursday approved a $19.9 billion financial services spending bill for 2012 that prohibits the federal government from enforcing the healthcare reform law's requirement that individuals buy insurance.

The individual mandate does not take effect until 2014, but defunding the provision next year could have repercussions if it prevents the administration from hiring and training Internal Revenue Service agents. Over the long term, the Congressional Budget Office has said that defunding the mandate would reduce federal health insurance subsidies because fewer people would comply; at the same time, revenues would decrease because tax agents wouldn't be able to collect the penalty for noncompliance.

The bill cleared the subcommittee on financial services and general government appropriations. Markup by the full committee is scheduled for next week and the bill should hit the House floor the week of July 11.

The defunding provision "may get brought up at full committee," a House Democratic aide told The Hill, "but I think it will more likely become a conference issue."

-- Erik Wasson contributed to this report.