The Beltway Buzz is a weekly update summarizing labor and employment news from inside the Beltway and clarifying how what's happening in Washington, D.C. could impact your business.
Tax Bill or Health Bill? It's Two Bills in One! Caught in a legislative black hole, the Affordable Care Act (ACA) cannot escape efforts to eradicate it—or at least large chunks of it. Late Thursday evening, the Senate Finance Committee passed by a 14 to 12 margin its current tax reform bill, which included—to much surprise—a controversial provision that would repeal the ACA's individual mandate. Although the Trump administration had been pushing to eliminate the individual mandate for over two weeks, the Senate had until now feared that the politically charged measure might jeopardize passage of the entire tax bill. Supporters of the Senate bill maintain that the more than $300 billion in estimated savings over 10 years will be used to enhance tax cuts to the middle class, while critics charge that the additional savings will instead be funneled into greater tax breaks for the wealthy. Critics also fear that repealing the individual mandate might cause health insurance premiums to rise sharply and overall coverage to drop as younger and healthier Americans decline to enroll. Interestingly, despite early contrary rumors, the bipartisan Alexander-Murray bill, which would retain federal cost-sharing reduction payments to insurers for two years, did not find its way into the current draft of the Senate bill. The full Senate is expected to vote on the bill sometime during the week after Thanksgiving.
Meanwhile, also on Thursday, the U.S. House of Representatives passed, 277–205, its latest tax reform proposal, which was unveiled last week and which differs in key respects from the Senate markup. (See last week's Beltway Buzz.) Notably, the House version does not include repeal of the ACA's individual mandate. Additionally, both the House and Senate versions have now eliminated most, but not all, of the provocative executive compensation provisions in each of these bills. Assuming the full Senate eventually passes its tax reform bill, the significant differences between the two will need to be ironed out in committee. It should be an interesting (although potentially dangerous) time to be in Washington once Congress attempts this reconciliation, which it hopes to do by Christmas. (Hat tip to Richard C. Libert, Stephanie A. Smithey, and Timothy G. Verrall.)