Senate Republicans on Thursday released a health-care bill that would curtail federal Medicaid funding, repeal taxes on the wealthy and eliminate funding for Planned Parenthood as part of an effort to fulfill a years-long promise to undo Barack Obama’s signature health-care law.
The bill is an attempt to strike a compromise between existing law and a bill passed by the House in May as Republicans struggle to advance their vision for the country’s health-care system even though they now control both chambers of Congress and the White House.
The Senate proposal largely mirrors the House measure with significant differences, according to a discussion draft circulating Wednesday among aides and lobbyists. While the House legislation would peg federal insurance subsidies to age, the Senate bill would link them to income, as the Affordable Care Act does.
The Senate measure would cut off expanded Medicaid funding for states more gradually than the House bill but would enact deeper long-term cuts to the health-care program for low-income Americans. It also would eliminate House language aimed at prohibiting federally subsidized health plans from covering abortions, a provision that may run afoul of complex Senate budget rules.
Like the House bill, the Senate measure is expected to make big changes to Medicaid, the program that insures about 74 million elderly and lower-income Americans and was expanded in most states under the ACA. In effect, the revisions would reduce federal spending on the program.
The Senate measure would transform Medicaid from an open-ended entitlement to one in which federal funding would be distributed to states on a per capita basis. The Senate measure would also seek to phase out the program’s expansion – although at a more gradual rate than the House version.
Yet the Senate bill is expected to go further than the House version in its approach to cutting Medicaid funding in the future. In 2025, the measure would tie federal spending on the program to an even slower growth index than the one used in the House bill. That move could prompt states to reduce the size of their Medicaid programs.
In a move that will please the health-care industry, the draft also proposes repealing all the ACA taxes except for its ‘‘Cadillac tax’’ on high-cost health plans in language similar to the House version. Senators had previously toyed with the idea of keeping some of the ACA’s taxes.
It would also eliminate Medicaid reimbursements for Planned Parenthood for one year. Federal law already prevents taxpayer funding to pay for abortions except to save the life of the woman or in the case of rape or incest. But some Republicans want to ban all federal funding for Planned Parenthood, which also provides health services such as birth control, because their clinics provide abortion services.
Like the House measure, the Senate bill would eliminate two central requirements of the current health-care law: that individuals provide proof of insurance when filing their annual tax returns and that companies with 50 or more employees provide health coverage for their workers.
In a move that is critical to insurers, the Senate measure would continue to fund for two years cost-sharing subsidies that help 7 million Americans with ACA plans. House Republicans have challenged the legality of the $7 billion in subsidies – which help cover consumers’ deductibles and copays – in court, and insurers have warned that they will have to increase premiums dramatically next year unless the federal government commits to continuing the payments.