Congress’s 2017 Tax Reform Agenda Starts with Repeal of ACA

CCH Tax Day Report

Republican and Democrat lawmakers met separately on January 4 to discuss the future of the Patient Protection Affordable Care Act (ACA) (P.L. 111-148). President Obama met with House and Senate Democrats while Vice President-elect Pence had meetings with House and Senate Republicans. During the afternoon, the Senate, after a 51-to-48 vote largely along party lines, began debate on a 2017 budget resolution initiating the healthcare law repeal process.

Comment. It appears, at this time, that the GOP’s approach to repeal of the measure seems to go beyond repeal of the individual and employer mandates. Repeal efforts will likely encompass repeal of ACA -related taxes, such as the excise tax on high-dollar health plans, known as the so-called “”Cadillac tax,” and the medical device excise tax, as well as repeal of related incentives, including the Code Sec. 45R small employer health insurance tax credit.

President-elect Trump’s first order of business will be to repeal and replace the ACA , Pence told reporters. According to Pence, the incoming Trump administration is currently working on a “series of executive orders that will enable orderly transition to take place as Congress debates alternatives to replacement of ACA.” He added, “We are working very closely with Senate leadership on a budget resolution that will begin the process of repealing the ACA.”

House Speaker Paul Ryan, R-Wis., emphasized the need and desire for an “orderly, stable transition” once the law is repealed. “We want every American to have access to quality, affordable health coverage,” Ryan said.

House Minority Leader Nancy Pelosi, D-Calif., criticized the GOP for having no replacement for the law. “Healthcare in our country is a right, not a privilege. They have no replacement plan,” Pelosi told reporters on January 4. However, Rep. Walter Jones, R-N.C., said that, after Trump is sworn in, there will be movement to present some ideas as to how we need to fix the problems in the ACA.

Senate Minority Leader Charles E. Schumer’s, D-N.Y., predicted that repealing the ACA would cause health insurance premiums to “skyrocket.” Schumer noted that the ACA is a “delicate balance,” adding, “Republicans will soon learn that you can’t keep the good parts of the ACA and remove the rest of the law and still have it work.”

According to White House Press Secretary Josh Earnest, repeal of the healthcare law would have a negative impact on the federal budget. “Repeal is going to rip a hole in the deficit, in the federal budget, and the deficit will go up if the ACA is repealed,” Earnest said.

By Jessica Jeane, Wolters Kluwer News Staff

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