Daines, Tester split on repealing health care mandate in tax reform bill
Sen. Steve Daines this week deepened his support for a Republican push to repeal the Affordable Care Act’s individual mandate as part of the proposed tax bill, though Sen. Jon Tester voiced concern.
Daines has labeled the mandate as a “poverty tax,” one that systematically taxes those making less than $50,000. Tester fears the repeal will force rural hospitals out of business as the ranks of uninsured grow, along with those who fail to pay for health care.
“The IRS pick-pocketed over $3 billion from over 6.5 million Americans in 2015 alone – a majority of whom make less than $50,000,” Daines said in a floor speech delivered Tuesday. “This is a tax targeted at those in poverty.”
The individual mandate directs most Americans to either purchase health insurance or pay a fine. By repealing it, Republicans hope to save more than $300 billion in government funding and use it to finance their proposed tax reform plan.
The savings would come from reduced government spending to subsidize health care. As many as 13 million Americans would be left without health insurance if the mandate is repealed, according to the Congressional Budget Office.
That could have consequences for rural hospitals across Montana.
“If you don’t have insurance and you can’t pay your bills, the effect on all hospitals, especially those rural hospitals, it’ll put them out of business,” Tester said Wednesday. “Those aren’t my words. Those are their words.”
Those fears were expressed by health care leaders in Montana last month during a statewide hospital summit held in Missoula.
There, Bob Olsen, vice president of the Montana Hospital Association, warned that repealing portions of the ACA would transfer the financial risk to patients and rural hospitals, many of which could close as a result.
Tester heard similar concerns during nearly a dozen town hall meetings held on the issue earlier this year.
“I’m going to take the president at his word when he campaigned, saying you’ll have better health care, everyone’s going to have it and it’ll be cheaper,” Tester said. “Frankly, I haven’t seen one thing in the last 10 months that would indicate that that’s the direction we’re going here.”
Projections by the CBO suggest that repealing the individual mandate would leave 13 million people without health insurance. The results could drive up the cost of insurance premiums by 10 percent or more for those who remain in the system.
Still, Daines believes that doing nothing would result in a “poverty tax” increase on low- and middle-class Americans. It’s a position he has repeated several times over the past few months.
“It’s unthinkable that we would leave such a provision in law when we have the opportunity to repeal it,” Daines said. “By repealing it, we would, according to the CBO, save $338 billion over ten years. That’s over $300 billion we can put towards additional tax relief for small businesses and families.”
Tester questioned that talking point, saying the CBO projected that nearly 13 million middle-class Americans would actually see a tax increase under the Republican tax proposal.
Tester agreed with Daines in that tax reform is essential, though he criticized the current process as a partisan effort that bypassed the system to score a quick political victory. Republicans hope to have a tax plan signed into law by Christmas.
“I’m concerned this was drafted by a select few, that it didn’t go through the committee process, didn’t take public input, and there was no effort to get bipartisan support,” Tester said. “We’re going to be voting on a bill the week after Thanksgiving that I haven’t even seen. It’s been very much rushed and I believe it’s rushed because some people don’t want others to know what’s in it.”