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GOP plans to repeal Obamacare mandate for health coverage

The Senate tax bill is becoming a health care bill, as Republican leaders announced Tuesday they plan to repeal the Affordable Care Act’s individual mandate.
Image: Republican Presidential Candidate Rand Paul Campaigns In Iowa
Republican presidential candidate Sen. Rand Paul (R-KY) speaks at a campaign event at Drake University on Jan. 28, 2016 in Des Moines, Iowa.Brendan Hoffman / Getty Images file

WASHINGTON — To help pay for the GOP tax bill, Republican Senate leaders announced Tuesday that they plan to repeal the Affordable Care Act's requirement that Americans maintain health coverage.

The announcement comes one day after President Donald Trump urged Senators to eliminate the Obamacare mandate and use the savings to reduce the top income tax rate to 35 percent, a move that would exclusively benefit individuals earning over $500,000 and couples earning over $1,000,000 under the current Senate bill.

"We're optimistic that inserting the individual mandate repeal (into the tax bill) would be helpful," Senate Majority Leader Mitch McConnell, R-Ky., told reporters after a caucus meeting.

It was not immediately clear what Senate Republicans planned to do with the savings, although a Senate GOP aide said they would be used to "provide more relief for middle-class families."

Senator Rand Paul, R-Ky., suggested earlier in the day that Republicans should use the money to help taxpayers who would be affected by the loss of the state and local tax deduction, which the Senate bill currently eliminates.

The Congressional Budget Office estimates repealing the mandate penalty would save $338 billion over the next 10 years, which would help Republicans pay for their $1.5 trillion tax bill. But ending the mandate would only save money because the CBO projects 13 million fewer people would have health insurance by 2027, meaning the government would spend less money subsidizing coverage through private insurance or Medicaid.

Premiums on the individual insurance market would also go up 10 percent as a result.

In a joint letter, the top industry groups representing insurers, hospitals and doctors came out strongly against repealing the mandate, arguing it was necessary to attract enough healthy patients to offset the cost of insuring Americans with pre-existing conditions.

"There will be serious consequences if Congress simply repeals the mandate while leaving the insurance reforms in place: millions more will be uninsured or face higher premiums, challenging their ability to access the care they need," the letter read, which was signed by America's Health Insurance Plans, the American Hospital Association, the American Medical Association, the Blue Cross-Blue Shield Association, the American Academy of Family Physicians and the Federation of American Hospitals.

Senate Minority Leader Chuck Schumer, D-N.Y., said in a statement that Republicans were "so determined to provide tax giveaways to the rich that they’re willing to raise premiums on millions of middle-class Americans and kick 13 million people off their health care."

Democrats in the Senate Finance Committee marking up the Senate bill were livid at the news, especially after the chairman, Sen. Orrin Hatch, R-Utah, said it was premature to discuss the changes until they were made official.

"We’re talking about a whole new subject, a subject that, as I’ve indicated, can raise health insurance premiums on millions of people," Sen. Ron Wyden, D-Ore., said.

Senate Republicans tried to pass a narrow "skinny repeal" bill that would have repealed the individual mandate earlier this year, but it failed after three of them — Susan Collins of Maine, Lisa Murkowski of Alaska and John McCain of Arizona — voted it down. It was not immediately clear whether they would support including a similar measure in the tax bill.

Sen. John Kennedy, R-La., told reporters that some members on Tuesday indicated they were unsure about returning to the health care debate, but that they had not signaled they were a hard "no" if the measures were included.

"There are some people who are concerned about including the mandate in the tax legislation, but my gut tells me we will reach a consensus on doing that," he said. "It makes too much sense."

House Republicans are planning to vote soon on their own tax bill, which so far does not include a repeal of the individual mandate, despite a push from House conservatives to add the measure. Republican leaders in both chambers are hoping to complete a final bill before the end of the year.