An updated Senate healthcare bill that’s expected to be released the week of July 10 could include tweaks to tax language to allow health savings account dollars to pay for health insurance premiums or to retain the 3.8 percent net investment income tax on high-income earners.
The updated version of the previously released Better Care Reconciliation Act of 2017(BCRA) could be released by the end of the week, Senate Finance Committee member John Thune, R-S.D., told reporters July 10. A Congressional Budget Office report on the updated bill could come the week of July 17, followed by a Senate vote by the end of that week.
“There are attempts being made to try and make some changes . . . [including] some tweaks to the tax credit,” Thune said, referring to the bill’s proposed premium tax credits. Politicoreported July 9 that the changes would boost the value of the credit for low-income families, but Thune wouldn’t confirm that report, saying only that “nothing is final.”
The changes to the tax credit and other provisions have been included in the bill sent to the CBO, whose analysis may determine whether those changes are enough to garner support for the BCRA from Republican holdouts, Thune added.
Before leaving for the weeklong Independence Day recess, Senate Majority Leader Mitch McConnell, R-Ky., delayed a vote on the BCRA, citing differences within his conference. While some Republican senators have suggested solutions for bridging those differences, Sen. John McCain, R-Ariz., told CBS’s Face the Nation on July 9 that he considers the BCRA dead.
Sen. Ted Cruz, R-Texas, said on ABC News’s This Week With George Stephanopoulos July 9 that Republican leadership will include language in the updated bill that would allow HSAs to be used to pay for health insurance premiums.
“Now, how do we lower premiums? . . . We allow people to pay premiums from health savings accounts so you can pay from pretax dollars. That's a 20 percent to 30 percent decrease for many taxpayers in premiums immediately,” Cruz said. “That's a proposal I introduced and has been incorporated in the Senate bill. That’s a big deal.”
A spokesperson for Cruz confirmed that he was talking about the updated legislation that has been sent to the CBO. Under the current version of the BCRA, HSAs would be expanded to allow greater annual contributions, allow spouses to contribute to a single account, and allow them to be used to pay for more goods and services such as over-the-counter medication.
According to the July 9 Politico report, another provision that Republican leadership sent to the CBO to be analyzed is preservation of the net investment income tax — which would be retroactively repealed to the beginning of 2017 under the BCRA.
A spokesperson for McConnell told Tax Analysts that there are “no announcements yet on the ongoing discussions with CBO.”
Sen. Ron Johnson, R-Wis., told reporters he would have approached the healthcare reform exercise differently, either scrapping the Affordable Care Act altogether to start fresh with a Republican alternative or working with Democrats to fix the law they passed when they held the majority. He added that if Republicans are looking to keep most of the premium tax credit structure under current law, it should be paid for.
“The reality of the situation is, if we’re maintaining $443 billion of Obamacare subsidies, we ought to maintain the funding mechanisms for at least a portion of that, and I would focus priority-wise on repealing the taxes that actually drive up the costs of premiums. That’s where I would start in terms of repeal,” Johnson said.
Marc Short, White House director of legislative affairs, said July 10 that President Trump is confident that healthcare legislation will pass before the upcoming monthlong August recess. Trump weighed in earlier in the day, posting to Twitter, “I cannot imagine that Congress would dare to leave Washington without a beautiful new HealthCare bill fully approved and ready to go!”
Asha Glover and David van den Berg contributed to this article.
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