Obstacles ahead as GOP begins ObamaCare repeal

Republicans who have vowed for years to repeal and replace ObamaCare are now seeking to turn their campaign pledge into reality, with markups of legislation potentially beginning this week. 

With narrow majorities in the House and Senate, Republicans won’t be able to pass healthcare legislation unless they remain united.

That could prove difficult, as there are several knotty issues raised by the repeal effort that threaten to push lawmakers into opposing camps.

{mosads}Here are the four biggest issues that Republicans will have to resolve before an ObamaCare repeal bill can reach President Trump’s desk. 

Tax credits

One of the biggest sticking points for Republicans is how to provide tax credits to help people pay for health insurance.

While there is broad support in the GOP for providing assistance through the tax code, they are at odds over the details. 

House Republican leaders are pushing for a refundable, advanceable tax credit — something conservatives have denounced as a new government entitlement. 

“I think there is still a significant divide within the conference on how you deal with refundable tax credits,” said Rep. Mark Sanford (R-S.C.), a member of the conservative House Freedom Caucus.

“I think the refundable tax credit in its present form represents a new entitlement,” he said, adding that he would have “very, very strong reservations” about supporting a bill that included them. 

Sen. Rand Paul (R-Ky.) has compared the refundable tax credits to the subsidies some people get under ObamaCare.

“The problem that I have with a new refundable tax credit is it’s essentially a subsidy by another name,” he said last month.

“ObamaCare had subsidies. If we call them refundable tax credits, have we really done anything other than change the name? So I think that’s a problem.” 

Sanford sponsored a replacement bill in the House, and Paul in the Senate, that would instead offer a tax credit of up to $5,000 to help people fund health savings accounts.

Other Republicans have suggested the tax help should come in the form of a deduction, rather than a tax credit. 

But a tax deduction would do little to help low-income people who often pay no federal income taxes. While a refundable tax credit can push a person’s tax liability below zero, resulting in a refund, a deduction cannot. 

“The deduction doesn’t help if you don’t make enough income,” said Rep. Tom Cole (R-Okla.), a member of the House’s appropriations and budget committees.

“If you’re trying to make it applicable to everybody, in my view, you’d need to have a refundable tax credit of some sort. … It seems to me this is much more empowering and a much more fairer way to proceed.” 

Medicaid expansion

Republicans are also at odds over what to do about ObamaCare’s expansion of Medicaid, the government insurance program for the poor. 

Some Republicans who hail from states that took the Medicaid expansion have indicated they want to keep it and prevent people from losing coverage. Under the expansion, roughly 11 million people in 31 states gained Medicaid coverage.

But drafts of the House GOP’s repeal bill aim to eliminate the Medicaid expansion by 2020 — and that could be tough for several Republican senators to swallow. 

Sen. Shelley Moore Capito (R-W.Va.), for example, “absolutely” wants to keep the expansion in her state, and she’s not alone. 

“I want to keep those people in the system, covered in some way,” she told The Hill last month. 

“That’s something I’m looking over watchfully. It’s very important to me.”

But some Republicans argue that states that did not expand Medicaid should not have to subsidize the states that did.

“Is it fair for the people of North Carolina and the hardworking taxpayers of North Carolina to fund Medicaid expansion when they didn’t expand it in their state?” said Rep. Mark Meadows (R-N.C.), chairman of the House Freedom Caucus.

“Ultimately it’s going to require a state involvement as we deal with Medicaid, and how we properly and fairly apply that from state to state.” 

How to pay for it

House Republican leaders have to figure out how to pay for their ObamaCare replacement.

Because leadership wants to repeal all of ObamaCare’s taxes, including the “Cadillac tax” on high-cost health coverage, they’re looking for other funding options to pay for things like refundable tax credits to help people buy insurance.

One option is capping the tax exemption for employer-sponsored healthcare coverage. The end result would be a new tax on the most generous employer-funded healthcare plans. 

The Congressional Budget Office estimates the tax exclusion costs the federal government about $250 billion in lost tax revenue in 2013.

But some Republicans would rather keep some of ObamaCare’s taxes rather than creating new ones. 

“I’m not for financing a new healthcare system by putting taxes on health insurance plans,” Cole said.  

“I think I’d rather keep whatever you need of the current taxes and let some go, obviously, but not vote new taxes on top of it.” 

The Affordable Care Act created several new taxes, including an excise tax on medical devices, a surtax on some investment income and a tax on health insurers. 

But Sen. Orrin Hatch (R-Utah), the chairman of the powerful Senate Finance Committee, has vowed that all of the ObamaCare taxes must be repealed.

“My view is this: After spending seven years talking about the harm being caused by these taxes, it’s difficult to switch gears now and decide that they’re fine so long as they’re being used to pay for our healthcare bill,” Hatch said.

“All of the ObamaCare taxes need to go as part of the repeal process.” 

Planned Parenthood

Speaker Paul Ryan (R-Wis.) has said Planned Parenthood will be defunded through the ObamaCare repeal bill, an idea long pushed by conservatives opposed to abortion.          

But the idea faces opposition from centrist Senate Republicans, some of whom are from states where Planned Parenthood clinics have become key healthcare providers. 

“I, for one, do not believe that Planned Parenthood has any place in our deliberations on the Affordable Care Act,” Sen. Lisa Murkowski (R-Alaska) told her state’s legislature earlier this month. 

“Taxpayer dollars should not be used to pay for abortions, but I will not vote to deny Alaskans access to the health services that Planned Parenthood provides.” 

Another moderate GOP senator, Susan Collins (R-Maine), has expressed reservations about voting for a repeal bill that also contains the Planned Parenthood language.

“If the House Republicans want to bring it up, it should be in a separate bill. I would oppose that bill, but it further complicates the negotiations to have it included in this bill,” she said. 

A draft of the ObamaCare repeal that leaked last week shows that Republicans may use the same language they did in the 2015 bill, which would block Medicaid reimbursements to Planned Parenthood and other abortion providers for a year.

Collins voted against that bill, while Murkowski supported it.

Because Republicans are repealing ObamaCare through reconciliation, they only need 50 of their 52 members in the Senate to vote for it. 

Murkowski and Collins offered an amendment in 2015 to try to protect the organization’s funding, but it was shot down. Collins’s office would not say if she planned to offer a similar amendment this year.  

Tags Lisa Murkowski Orrin Hatch Paul Ryan Rand Paul Shelley Moore Capito Susan Collins
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