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McConnell Sets Vote on Healthcare, Brady Sets Tax Reform Timing

Posted on July 25, 2017 by Dylan F. Moroses

The Senate will hold a long-awaited vote July 25 to begin debate on legislation intended to repeal a majority of the Affordable Care Act, Majority Leader Mitch McConnell, R-Ky., announced during floor remarks July 24. 

“The only way we’ll have an opportunity to consider ideas is if senators are allowed to offer and debate them,” McConnell said. “That means voting to begin the open amendment process. That means voting to kick off a robust debate where senators from all parties can represent the views of their constituents.”

The initial vote will bring up for debate the House-passed bill, the American Health Care Act (AHCA, H.R. 1628), but what amendments may do to change the underlying legislation, and whether the legislation will pass remains unclear. Senate Republicans have considered voting on their own repeal-and-replace legislation or a repeal-only option as substitute amendments to the House-passed bill.

Senate Republicans already need to make several changes to the Better Care Reconciliation Act (BCRA), the Senate’s repeal-and-replace alternative to the AHCA, to meet reconciliation rules that allow a simple majority vote, according to a document obtained by Tax Analysts regarding the Senate parliamentarian’s determinations on the bill. The document lists several provisions that have been found to violate the rules and therefore require 60 votes for inclusion, including language to restrict premium tax credits from funding abortion services.

Other provisions subject to 60 votes include language to change how much money insurers can spend on health coverage compared to business expenses like marketing, the elimination of essential health benefits for the Medicaid program, and a provision that would require individuals to wait six months to purchase insurance if their health plan lapses, among others.

The document lists some language found to comply with reconciliation rules, including the overall repeal of the cost-sharing subsidy program beginning in 2020 and adding a work requirement for the Medicaid program. 

Two lobbyists told Tax Analysts that the parliamentarian’s ruling could complicate McConnell’s ability to get 51 Republican Senators to support the bill, but the additional money from retaining several ACA taxes may give him the resources to sway moderates by eliminating some of the Medicaid spending reductions.

Freedom Caucus Strategy 

Speaking at a National Press Club event, House Freedom Caucus Chair Mark Meadows, R-N.C., appeared confident that the Senate would vote to begin debate on the House-passed AHCA on July 25. He reiterated that his group is not opposed to keeping two ACA taxes on high-income earners: the 3.8 net investment income tax and the Medicare payroll tax increase.

Meadows said there is currently not enough support for or opposition against any tax reform proposal available to present an official Freedom Caucus position, although he did say it would take 80 percent of the caucus in agreement to do so, per the group’s bylaws. Several Freedom Caucus members have objected to including a border-adjustable tax in any tax reform proposal.

Meadows said caucus member H. Morgan Griffith, R-Va., would offer an amendment to an appropriations bill this week that would shrink the staff of the Congressional Budget Office by eliminating its budget analysis division, while mandating that its cost estimate reports be produced by aggregating several industry think tank scores. 

Tax Plan When Congress Gets Back

Also July 24, House Ways and Means Committee Chair Kevin Brady, R-Texas, promised that House Republicans will unveil their comprehensive tax reform plan when they return to Washington from their six-week August recess.

Brady said he plans to meet with White House officials and Senate lawmakers July 25 on a unified tax plan that will deliver tax relief to middle-class Americans, but he noted that work will continue away from Capitol Hill during the recess. 

On the same day that congressional Democrats unveiled a new “Better Deal” agenda, Brady noted Republicans’ desire to provide middle-income tax relief coupled with wage growth. He said the tax code is “more than progressive enough right now” and Republicans want to make it fair and simple. “In other words, the more special-interest provisions you leave behind so you can lower the rates for everybody, the better it is more middle-class taxpayers,” he said.

On the subject of allowing full expensing for businesses, Brady said the ability of firms of all sizes to write off business investment in buildings, equipment, software, and technology accounts for half of the growth in the GOP’s “A Better Way” tax reform blueprint

Stephen K. Cooper contributed to this article.

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