Senate GOP warms to larger insurance subsidies for older and low-income people

Senate GOP warms to larger insurance subsidies for older and low-income people
© Keren Carrion

 

Senate Republicans are coalescing around the idea of giving more generous subsidies to lower-income and older people than what’s laid out in the House-passed GOP healthcare reform bill.

Many Republicans in the upper chamber generally agree that the skimpier subsidies contained in the House bill need to be beefed up for groups that need more help buying insurance.

ADVERTISEMENT
“What I want to ensure is that the subsidies or tax credits are enough so that lower-income, middle-income people have the ability to actually purchase healthcare,” Sen. Bob CorkerBob CorkerSunday shows: Homeland Security chief hits the circuit after Manchester attack A retreat from the Paris climate pact would imperil U.S. interests Cohn: US ‘probably looking to get tougher’ on Russia MORE (R-Tenn.) said.

“The way the subsidies were in the House bill, it really wasn’t enough to help people who were on the lower end of the economic spectrum to be able to actually purchase it.”

Under the House-passed healthcare plan, tax credits range from $2,000 to $4,000 and would be based on age, not income. Younger people would get smaller credits and older people, who generally use more health services, would get larger ones.

The credits phase out for individuals earning more than $75,000 and end completely for those making $95,000 or more. That number goes up to $115,000 for people 60 years or older.

A proposal being worked out by Sen. John ThuneJohn ThuneCongress must address student loan debt crisis, a national economic drag Republicans go to battle over pre-existing conditions GOP frustrated by slow pace of Trump staffing MORE (R-S.D.) and others would cut off eligibility sooner and make the credits larger, tying them to income while also giving older people more support.

“We clearly want to drive more of the benefit of the tax credit to people on the lower-income part of the scale and the elderly,” Thune said.

“Frankly, I don’t think we could pass anything in the Senate unless we figure out a way to improve upon what the House did in respect to the tax credit.”

Since the House passed its healthcare bill earlier this month, focus has moved to the Senate, where there is wide agreement that changes must be made to get the bill off the floor.

Even as consensus appears to emerge on the subsidies question, the conference remains divided on many other issues, such as how and when to end the Medicaid expansion and what to do with ObamaCare regulations.

Thune, who has been working on the tax credit issue since March, said there is “a lot of support” for it, but he is waiting for a score from the Congressional Budget Office (CBO) on the House healthcare bill to finalize it.

That’s expected next week. 

The CBO’s initial score of the American Health Care Act (AHCA) showed that older Americans would face higher premiums, an unacceptable fact for many senators.

For example, a 64-year-old making $26,500 a year would pay $1,700 in premiums under the Affordable Care Act but $14,600 under the AHCA.

“The tax credits are not adjusted for income or geographic region,” Sen. Susan CollinsSusan CollinsSenate takes lead on Trump’s infrastructure proposal Navy leaders defend Trump's lackluster ship budget Overnight Healthcare: CBO fallout | GOP senators distance themselves from House bill | Trump budget chief blasts score | Schumer says House bill belongs 'in the trash' MORE (R-Maine) said on ABC’s “This Week” earlier this month.

“That really hurts a state like Maine, where we have an older population living in largely more expensive, rural areas, as far as healthcare is concerned.”

The House bill put in placeholder language to give the Senate money to work with for the credits — about $85 billion over 10 years.

It’s unclear if the Senate plans to spend more than that on the credits, but Thune said, “I would hope that would be enough.”

Sen. John HoevenJohn HoevenRepublicans go to battle over pre-existing conditions Overnight Healthcare: Divisions emerge in Senate over preexisting conditions GOP senators meet with insurer for input on ObamaCare repeal MORE (R-N.D.) said he’s working with Thune on the credits, hinting the amounts could be double what the House proposed.

While the House sketched out credits of between $2,000 and $4,000, the Senate credits could range from $4,000 to $8,000 and would phase out sooner, Hoeven said.

“I think that the refundable tax credit has to be based on income, as well as age, in order to work,” he said.

“More help for lower-income and older [people] because your premiums go up as you get older, and lower-income [people] need more help.”

Credits that are tied to age and income sound similar to ObamaCare subsidies, something pointed out by many healthcare experts. Some GOP senators have also pushed for the credits to vary by geography, another feature of ObamaCare.

But Thune batted down the comparison, noting that the credits the Senate is working on aren’t tied to premium costs like ObamaCare’s.

“We think that’s a better way of addressing it. Creating a competitive marketplace where the market actually can help drive prices down.”

It’s unclear if Senate conservatives such as Ted CruzTed CruzFranken explains why he made an exception to diss Cruz in his book FEC faults Cruz on Goldman Sachs loans in rare unanimous vote CBO score underlines GOP tensions on ObamaCare repeal MORE (R-Texas) and Rand PaulRand PaulSenate gears up for fight on Trump's 0B Saudi Arabia arms sale Paul: 0B Saudi arms deal ‘a travesty’ Senate feels pressure for summer healthcare vote MORE (R-Ky.) would support the changes.

Paul has suggested he could support keeping the structure of the ObamaCare subsidies if they were scaled down.

Cruz, who has called the credits a “new entitlement program” and helped form the Senate’s healthcare working group, would not tell The Hill if he could support the changes.