After months of rumors and anticipation, the Senate finally unveiled on June 22, 2017 its ACA repeal bill; named the “Better Care Reconciliation Act of 2017” (BCRA). The Senate bill is similar, but not identical, to the House bill that was recently passed.
As you may recall, we last left off with Congress as the House had just passed legislation to repeal and replace the “Affordable Care Act” (ACA). The “American Health Care Act of 2017” (AHCA; H.R. 1628) passed the House by a narrow vote in early May. The focus then shifted to the Senate. Senate leaders have been working behind the scenes to come up with their version of health care legislation to repeal and replace the ACA.
The Senate has now unveiled its repeal bill and rather than go through the normal committee process, the bill will move directly to the Senate floor where debate will soon be scheduled to take place - likely next week. Some amendments might be made to the bill, and the Senate leadership hopes to have the bill voted on by the end of next week (before the Fourth of July recess). If the bill passes the Senate, it would then move to a House-Senate Conference.
As in the House, the Republicans hold a narrow margin in the Senate, so they can only afford to lose two senators (assuming no Democrats support the bill) in trying to pass this bill. Several Republicans have already indicated they won’t support this bill, so some changes or amendments may be needed to the bill to secure their votes. Thus, there will be more political drama to be played out with this legislation, and perhaps sparks will fly (some early fireworks) in the Capitol.
Tax Provisions in the Proposed Bill
This Senate bill is a complex and detailed piece of legislation, but here are a few of the tax highlights from the bill, along with some comparisons to the House bill:
- ACA Mandates. The individual mandate and the business mandate are both repealed retroactively for the 2016 year. This is similar to the provisions in the House bill.
- 3.8% Surtax on Investment Income. The 3.8% Medicare surtax on unearned income would be repealed effective for 2017. This is similar to this provision in the House bill.
- 0.9% Surtax on Earned Income. The 0.9% Medicare surtax on income for higher earners would also be repealed beginning in 2023. This is similar to this provision in the House bill.
- Premium Tax Credits. The Senate bill proposes tax credits to help individuals buy health insurance based on an individual’s income level, rather than on an individual’s age, as was contained in the House bill. This income level provision for a premium credit was part of the ACA. The Senate bill would allow for anyone earning up to 350% of the poverty level to be eligible for these premium credits (compared to less than the 400% under ACA).
- Please click here to view a copy of the full text of the Senate proposed legislation.
Look for another close vote in the Senate. We will see what happens, and provide updates as needed. Stay Tuned . . .