Congressional Republicans are hoping to pass a temporary funding bill that would keep the government open until mid-February, thus allowing negotiations to continue on immigration and other matters. To attract more support for the stop-gap bill, Republican leaders have proposed combining it with other unrelated and more popular provisions, including a two-year delay of the so-called “Cadillac tax.” Delaying the “Cadillac tax” again — it was already pushed back once — is a bad idea. It would set back the cause of market-driven health care rather than advance it.
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The House on Thursday night approved a stopgap measure to keep the government open less than 36 hours before a possible shutdown, shifting the drama to a Senate where Democrats are threatening to block the GOP bill.
The House measure includes a six-year extension of funding for the Children’s Health Insurance Program (CHIP), which expired at the end of September. States are at risk of running out of money to cover health care for children in low-income families.
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Because this exemption applies to employer-sponsored insurance but not individual coverage or out-of-pocket spending, it encourages group plans over consumer control. It should not be seen as sacred. However, the cap imposed by the Cadillac tax will become increasingly tight over time, which risks pushing Americans into public entitlements rather than empowering them as consumers. Policymakers should keep the Cadillac tax from biting too deeply — but a better way to end the tax bias toward employer-based plans would be to extend the tax exemption to health care that individuals purchase by themselves.
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The Trump Administration is on a mission to rescue health-care markets and consumers from ObamaCare’s shrinking choices and higher prices. Witness the Labor Department’s proposal to allow small businesses to band together to provide insurance on equal footing with corporations and unions.
The share of workers at small businesses with employer-sponsored health benefits has dropped by a quarter since 2010 as insurance costs have ballooned in part due to government mandates. About 11 million workers employed by small businesses are uninsured. Some businesses have dropped their workers onto state insurance exchanges where premiums are subsidized by taxpayers.
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State lawmakers in Maryland are looking to replace ObamaCare’s individual mandate, which was repealed by Republicans in Congress last month.
A proposal in Maryland would require people to pay a penalty for not having insurance. The money, though, could be used as a down payment for a health insurance plan.
People would also have the option to pay the penalty and get nothing in return.
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U.S. House Ways and Means Committee Chairman Kevin Brady said on Thursday getting rid of the so-called “Cadillac” tax on high-cost employer-provided health insurance could be part of the spending deal now under negotiation in Congress.
“We want to get rid of it,” Brady, a Republican, told reporters outside his office, adding that this could “possibly” be part of an agreement lawmakers are seeking to avoid a government shutdown on Jan. 19.
“Even Democrats who put that awful tax in place, believe it needs to be delayed. If we can find some common ground there that would be terrific,” Brady said.
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Seemingly lost in the news of last week’s big tax-cut victory for the GOP was the repeal of the individual mandate — the Obamacare provision that required Americans to have health coverage or else pay a penalty. This is, to borrow a phrase from Vice President Joe Biden, a “big f***ing deal.” It is a big victory for conservatives, who disdained the mandate as government coerciveness. But from a broader perspective, the rise and fall of the mandate is yet another example of how Congress struggles to regulate the national economy.
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Congressional Republicans’ move to scrap the Affordable Care Act’s individual mandate is likely to drive up sales of cheap, short-term health plans that do not have Obamacare’s consumer protections or benefits, health insurance experts say — a development that could further destabilize the Obamacare exchanges.
The GOP’s final tax legislation, which is now awaiting President Donald Trump’s signature, eliminates in 2019 the ACA’s mandate requiring most people to have health insurance or pay a penalty. For 2018, the penalty is set at $695 or 2.5 percent of household income, whichever is greater.
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The GOP’s new tax bill, which passed Congress on Wednesday afternoon after one last vote in the House of Representatives and will be signed by President Donald Trump, is also a health care bill. The tax bill does at least as much (if not more) to upend Obamacare, or the Affordable Care Act, than even all of the Trump administration’s thousand cuts to the health law over the past year by repealing the individual mandate. Which raises the question: Just what is the Obamacare individual mandate? And what does its repeal mean for Americans?
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The individual mandate repeal actually doesn’t take effect until 2019, Laszewski noted, “but I doubt many consumers knew that when they decided not to sign up during all of the news reports about the individual mandate being repealed.”
Thomas Miller, JD, resident fellow at the American Enterprise Institute, a right-leaning think tank here, sees the repeal as “more of a ‘mercy killing’ (putting it out of its chronically ineffective and unpopular misery),” he said in an email. As to whether more people will become uninsured if the mandate is repealed, “Self-serving claims by insurance sector interests and diehard ACA defenders that mandate repeal will trigger widespread disruption and despair in health care markets are vastly exaggerated, as long as other coverage subsidy dollars from taxpayers keep flowing. Good riddance to a half-hearted effort at trying to coerce some mostly less-affluent Americans into buying coverage they did not want, could not afford, or both.”
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