Health

Senate Republicans Still Split Over AHCA's Tax Credits

| by Oren Peleg

As the GOP works to deliver on the party pledge to repeal and replace the Affordable Care Act, commonly called "Obamacare," the details of that reality are proving hard to reconcile. Following the debut of the proposed American Health Care Act, several GOP senators are working to increase tax credits for lower-income Americans.

The AHCA replaces government subsidies on insurance premiums with tax credits.

"Under the proposed bill, tax credits would start at $2,000 a year for individuals under age 30, rising to $4,000 for those over 60," notes NPR.

According to Forbes, the Congressional Budget Office reports that the AHCA will result in "An $883 billion tax cut, $274 billion of it going to the richest 2%. $880 billion stripped from Medicaid. And 24 million fewer insured individuals over the next ten years."

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"The bottom line is that while everyone gets a tax cut, they are more favorable to the rich than those at the bottom," Robert Williams, of the Tax Policy Center, said, according to CNBC.

“I do think there are things we can do to tailor the tax credit in a way that it makes more attractive to people and more helpful to people on the lower end and with a phaseout that is a little less steep than what the House has,” Republican Sen. John Thune of South Dakota, said on March 14, reports The Hill. “It would be nice to add it to the House bill but if necessary, it could be in the Senate.”

However, Republican Rep. Kevin Brady of Texas, Chairman of the House Ways and Means Committee, defended the AHCA's tax structure, notes NPR.

"Our legislation transfers power from Washington back to the states," Brady wrote in a statement. "We dismantle Obamacare's damaging taxes and mandates so states can deliver quality affordable options."

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“I think there's some things we can do to improve it, including enlarging the stabilization fund for people with complex problems,” said Republican Sen. Lamar Alexander of Tennessee, who supports Thune's tax proposal, reports The Hill. “Sen. Thune's working on amendment that would make the tax credit richer for lower-income people. I think both those things would be helpful.”

Republican Sen. Roy Blunt of Missouri also supports Thune's proposal. “We need to look at some things like people who are going to be least well-served in a new marketplace, is there a way to shift some of the opportunity of assistance toward them."

Sources: The Hill, Forbes, NPR, CNBC / Photo Credit: The Hill

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