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Cut 'ObamaCare' subsidies? Congress has been there, done that

  • Blog Post by:
  • June 4, 2012 - 5:38 PM
As House Republicans propose cutting insurance subsidies under “ObamaCare” to cover the repeal of a controversial tax on medical device makers, life has suddenly become more interesting for Minnesota’s two Democratic senators.
 
To be sure, Sens. Amy Klobuchar and Al Franken support President Obama’s health care overhaul. But like many state pols in both parties, they oppose the $29 billion-10-year excise tax on medical technology companies that comprise an important part of the state’s economy.
 
The repeal bill, sponsored in the House by Minnesota Republican Erik Paulsen, had no “pay for” until Friday, rendering its chances of passage practically nil in the Senate. Simply put, Democrats weren’t going to blow a $29 billion hole in President Obama’s signature health care overhaul, which is supposed to provide coverage to some 33 million uninsured people.
 
But now Republicans say they can save $43.9 billion by making low- and middle-income people fully reimburse any excess tax credits they receive to buy health coverage on new government-sponsored insurance exchanges. As the law stands today, there are caps on taxpayer liability for overpayments.
 
While Democrats in the House Ways and Means Committee have balked at the idea of erasing the caps, there is some precedent for Democrats, including Klobuchar and Franken, dipping into the health care law's premium support subsidy.
 
Once was in December, 2010, when the Senate voted by unanimous consent to raise the caps by a net $19.2 billion to stave off scheduled cuts in Medicare rates for doctors, a perennial ritual called the “doc fix.”
 
Another time was in April, 2011, when the Senate voted 87-12 to trim subsidies further to cover the $25 billion repeal an unpopular Form 1099 purchasing reporting requirement for businesses.
 
Third time’s a charm, right? Not necessarily. Klobuchar and Franken have stayed mum so far. But Democratic aides say there’s a big difference between raising the caps on taxpayer repayments and lifting them altogether, which they say could devastate families living on the economic fringes.  

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