A new U.S. Senate version of the Trumpcare bill largely hews to the structure of the healthcare reform bill that passed the House last month, reportedly handing a huge tax cut to the rich by slashing the government’s contribution to the Medicaid program for the poor.
The Senate bill would create a new tax credit for health insurance purchases and would allow states to drop Obamacare benefits such as maternity care, emergency services and mental health treatment, the New York Times reported. Although the Senate version would offer more financial help for the poor than its House counterpart, like that measure it would phase out federal subsidies to states to cover the Affordable Care Act’s Medicaid expansion and cap Medicaid’s budgets.
Significantly, the Senate bill would also eliminate Obamacare’s individual mandate requiring American’s to have health care or pay a penalty. It would also repeal the medical device tax as of Dec. 31, 2017, a day before the 2.3% levy is slated to go back into effect. The bill includes a repeal of the employer mandate requiring employers provide their employees with health insurance.
The draft bill proposes a repeal of the 3.8% net investment income tax on high earners retroactively to the start of 2017, and not at some point in the future as some analysts speculated. The bill would also cut the planned expansion of Medicaid for the poor and disabled over 3 years from 2021 to 2024, and enact deeper cuts in the program than the previously passed House version beginning in 2025, and would allow states to add work requirements for certain Medicaid enrollees.
With Republicans holding 52 seats, majority leader Sen. Mitch McConnell (R-Ky.) will have a hard time mustering the 50 votes needed to pass, even with the Republicans end-run around a Democratic filibuster. The proposal is too liberal for some conservative senators such as Sen. Rand Paul (R-Ky.) and does not do enough to address the growing opioid addiction crisis in key states like Ohio and West Virginia. And the governors of states that opted to expand Medicaid under Obamacare are pressuring their senate delegations to hold the line lest thousands of their poorest constituents lose their health insurance.
McConnell is said to be hoping for a vote before Congress breaks next week for the July 4 holiday. The Congressional Budget Office, which estimated that the House version would take health insurance away from 23 million Americans (the Center for Medicare & Medicaid Services puts that number at 13 million), has yet to score the Senate bill.
Hospital stocks have surged in response to the news, with HCA Healthcare up 3.8% and Tenet Healthcare Corp up 8.4%. Health insurers also rose, with Aetna and UnitedHealth Group up 1%, and Centene and Molina Healthcare up 3.4% and 2.6% respectively.
Material from Reuters was used in this report.