Mixed signals sent on fate of tax bill’s health provision

Republicans cannot afford to lose more than two senators on the final vote, which would allow Vice-President Mike Pence to cast a tie-breaking 51st vote in his capacity as president of the Senate. (Photo: Kathy Swendiman/ Flickr)

WASHINGTON— Two of President Donald Trump’s leading economic advisers sent mixed signals Sunday on the fate of a health care provision in the Senate version of a $1.5 trillion measure to overhaul business and personal income taxes that is expected to be voted on after Thanksgiving.

The provision to repeal a requirement that everyone in the U.S. have insurance has emerged as a major sticking point for Republican Sen. Susan Collins of Maine, who has said that issue should be dealt with separately from the push by Trump and fellow Republicans to overhaul the tax code.

Collins’ vote is crucial in a chamber where Republicans hold a slim 52-48 edge.

Sen. Ron Johnson, R-Wis., has already declared his opposition to the bill, saying last week that it doesn’t cut business taxes enough for partnerships and corporations. GOP Sens. Bob Corker of Tennessee, John McCain and Jeff Flake of Arizona, and Rand Paul of Kentucky also have concerns about the bill.

Republicans cannot afford to lose more than two senators on the final vote, which would allow Vice-President Mike Pence to cast a tie-breaking 51st vote in his capacity as president of the Senate. Democrats are not expected to support the bill, as was the case when the House passed its version last week.

Asked whether the health care provision will be removed to keep Republicans on board, Treasury Secretary Steven Mnuchin indicated that the current plan is to keep the provision in the bill. The provision is not in the House version of the legislation.

“The president thinks we should get rid of it. I think we should get rid of it,” Mnuchin said. “It’s an unfair tax on poor people. To think that you put a penalty on people who can’t afford to buy medical policies, it’s just fundamentally unfair.”

He added: “But we’re going to work with the Senate as we go through this.”

Budget director Mick Mulvaney said the White House is open to scrapping the provision, which would repeal a key component of the Affordable Care Act health care law enacted by President Barack Obama. Trump has pressed for the provision to be added to the bill, partly to show progress on undoing the health care law. Congress fell short during previous attempts earlier this year to repeal the overall health care law.

“I don’t think anybody doubts where the White House is on repealing and replacing Obamacare. We absolutely want to do it,” Mulvaney said. “If we can repeal part of Obamacare as part of a tax bill and have a tax bill that is still a good tax bill that can pass, that’s great.

“If it becomes an impediment to getting the best tax bill we can, then we’re OK with taking it out,” Mulvaney added.

Legislative director Marc Short said the White House “is very comfortable with the House bill,” which does not include what’s known as the “individual mandate.” But Short said the White House views the individual mandate as a tax and “we like the fact that the Senate has included it in its bill.”

At issue is a provision to repeal the requirement that everyone in the U.S. have health insurance. Eliminating the so-called individual mandate under “Obamacare” would add an estimated $338 billion in revenue over 10 years that the Senate tax-writers used for additional tax cuts.

Collins said Sunday that the tax advantage that some middle-income consumers would get under the broader bill could end up being cancelled out by repealing the mandate. They would face higher insurance premiums coupled with the loss of federal subsidies to help them afford the cost of insurance, she said.

“The fact is that if you do pull this piece of the Affordable Care Act out, for some middle-income families, the increased premium is going to cancel out the tax cut that they would get,” Collins said.

Collins said she hasn’t decided how to vote on the bill because it will be amended before the final vote.

Mnuchin, meanwhile, said he’s had “very good discussions” with Collins, Corker and Johnson about the bill. He said he wants to make sure their views are heard and incorporated before the final vote.

Mnuchin spoke on “Fox News Sunday.” Mulvaney and Collins were interviewed on CNN’s “State of the Union.” Collins also appeared on ABC’s “This Week.”