Tax bill may kill Obamacare mandate
WASHINGTON — Republican Sen. Rob Portman will support scrapping an Obamacare requirement that Americans buy health insurance, a move that’s been added to the Senate GOP tax overhaul. Ending the requirement would help finance the proposal, but it could cause as many as 13 million people to drop their federally subsidized individual insurance policies.
In a conference call with Ohio reporters Tuesday, Portman said there is “broad support” among Senate Republicans to kill the so-called individual mandate, which imposed fines on those who do not buy insurance policies through marketplaces established by the 2010 Affordable Care Act.
Portman and other Republicans on the Senate Finance Committee are expected to end the mandate as part of their broader effort to overhaul the federal tax code, eliminating a number of deductions and reducing corporate and individual tax rates.
By killing the mandate, Republicans would save $338 billion during the next decade as fewer Americans receive federal subsidies to buy their individual policies. But the GOP move provoked outrage among Democrats, who say the Republicans are trying to undercut Obamacare after congressional Republicans failed earlier this year to scrap the entire law.
The nonpartisan Congressional Budget Office this month concluded that ending the mandate would lead to 13 million people dropping their insurance coverage by 2027 while raising premiums for those buying individual policies by an average of 10 percent.
The CBO report concluded that without the mandate to buy insurance, “healthier people would be less likely to obtain insurance,” adding that “the resulting increases in premiums would cause more people to not purchase insurance.”
Obamacare extended health insurance to millions of those without coverage by expanding Medicaid — a joint federal and state program that covers health costs for low-income people — and providing financial help to middle-income people to buy individual policies through the marketplaces set up by the law. The law forced people to buy those policies or face a fine.
“Tax reform should be about cutting taxes for working families, not raising the cost of their health insurance,” said Sen. Sherrod Brown, D-Ohio, a member of the finance committee.
Rep. Tim Ryan, D-Niles, called the Republican decision “a disgrace,” tweeting that “the GOP’s tax scheme continues to find new ways to harm the most vulnerable.”
But Republican senators are hampered by rules that their tax bill cannot add more than $1.5 trillion to the nation’s publicly held debt during the next decade. By killing the mandate, they can use the savings to finance more-robust tax cuts.
In a related development, Ohio State University President Dr. Michael V. Drake warned lawmakers that increasing the standard deduction to $24,000 for a married couple could cost universities millions of dollars in donations.
In a letter to the Ohio congressional delegation, Drake said increasing the standard deduction would reduce the number of taxpayers who itemize, “significantly lowering the value of the charitable deduction.”