When Chief Justice John G. Roberts Jr. rescued Obamacare in 2012, he ruled it was legal to require Americans to hold health insurance under Congress’s taxing power — and said it was up to lawmakers to kill it, if they wanted.
Senate Republicans last week took him up on the invitation, using his exact argument.
After years of false starts and failure, the chamber cleared a bill to ax penalties tied to the so-called “individual mandate,” freeing millions of Americans who analysts said would prefer to forgo coverage, but who have been compelled to seek it out because of Chief Justice Roberts’ ruling.
“The Obamacare mandate was held by the Supreme Court to be tax. Whatever philosophical positions you may have had before that, that’s the law of the land,” said Sen. Tom Cotton, Arkansas Republican, who spearheaded efforts to undo it in the tax bill.
“It’s also the heart of Obamacare. And [repeal] allows us to pay for more tax cuts for working families and businesses that create jobs in this country, while at the same time avoiding a very punitive tax that falls squarely on working families and poor people,” he said.
Hopes for scrapping the mandate, after seven years of trying, now rest with the House GOP, which avoided the issue in their own tax bill and will negotiate a final package with the Senate in a conference committee.
House leaders say appetite for repealing the mandate is strong. Indeed, they avoided health care provisions only from fear this would hamper the effort in the Senate, where previous efforts to repeal and replace Obamacare died.
“The House GOP has consistently demonstrated numerous times over the last number of years its desire and ability to vote to repeal the individual mandate, including most recently with our passage of the Affordable Health Care Act to repeal and replace Obamacare,” said Lauren Fine, spokeswoman for House Majority Whip Steve Scalise.
Asked whether repeal of the mandate could pose a problem on the House side, Mr. Cotton said, “Never.”
The Senate passed its tax bill Friday, so unless other issues upend the tax effort in conference, Republicans and Mr. Trump should be able to pull the plug on the mandate by Christmas.
It’s a stark turnaround from late July, when a trio of Senate Republicans linked arms with Democrats to sink a slimmed-down repeal bill that would have sustained efforts to repeal and replace Obamacare and curtail spending on Medicaid. The “skinny” repeal would have scrapped the individual mandate and made other minor changes, though it’s effect on the markets largely mirrors that of the tax bill.
Even Republicans who voted for the skinny bill called it a “fraud” that should never become law, pointing to estimates that said repealing the individual mandate without replacing it would lead to sicker, more costly insurance markets.
But then, the conversation turned to taxes.
Mr. Trump and Republican allies saw a silver lining in Congressional Budget Office estimates saying 13 million Americans would opt to remain uninsured by 2027 if the mandate were repealed. Federal taxpayers would no longer subsidize those people through medicaid or Obamacare’s exchanges, freeing up $338 billion for deeper tax cuts and setting the table for another GOP crack at replacing President Obama’s health program with state block grants next year.
Republicans who sank last summer’s health effort started to fall in line. Sen. Lisa Murkowski of Alaska said with Medicaid and Planned Parenthood cuts no longer on the table, she could support killing a mandate she never liked, anyway, and Sen. John McCain of Arizona said the legislative process was thorough enough this time.
Sen. Susan Collins, Maine Republican, strongly objected to repealing the mandate as part of tax reform, though she was placated by leadership’s pledge to include Obamacare stabilization measures in a year-end spending deal.
House conservatives say they cannot support a deal that includes Obamacare “cost-sharing” payments for insurers, though the bill could pass if enough Democrats decide to chalk up a win and support it a broader package to keep the government open.
Democrats say repealing the mandate will still chase healthier people out of the markets, raising premiums, even if the cost-sharing payments return and Congress approves “reinsurance” money to blunt the cost of extra-pricey customers, as Ms. Collins wants. The CBO says repealing the mandate will cause premiums to rise by 10 percent in most year over the coming decade.
Republicans counter that the mandate hasn’t been very effective and consumers can still sign up for Obamacare, if they want, so repeal won’t have far-reaching consequences. They say it should be up to the states to take a pot of federal money and run their markets as they see fit.
Until they rally behind a bill, Obamacare will hobble along. The 2010 law includes a waiver program that allows states to reshape their markets, within tight boundaries, while blue states might be tempted to impose their own individual mandate if Congress zaps the federal version.
Massachusetts still has one on the books, a holdover from the “Romneycare” bill that paved the way for Mr. Obama’s national model.
“Nothing in the law would prevent state from establishing a mandate, either through their tax systems or through another mechanism,” such as a direct financial penalty, said Nicholas Bagley, a law professor at the University of Michigan.
Insurance officials and congressional Democrats said they want to see how the current debate plays out, before deciding what to do next.
“Ask me after the dust settles on this,” said Sen. Tim Kaine, Virginia Democrat.
Sen. Tom Carper, Delaware Democrat, said he isn’t completely wedded to the mandate, if Congress can come up with a better way to get people into the markets, but there needs to be some kind of spur.
“It’s foolish to repeal [the mandate] without replacing it with something that works as effectively, maybe even more so,” he said.
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