The Senate is on the brink of passing their sweeping tax bill. Many analyses exist showing how the tax cuts flow predominantly to the wealthiest among us, the diversity of impact among middle class families, and the economic consequences overall, including significant increases in the deficit and decreases in revenue.

We must acknowledge the negative health effects that this tax bill could have collectively. However, for now, let’s focus more specifically on some of the health-related issues at stake. For example, there is growing concern that the massive reductions in revenue as a result of these changes to the tax code will lead to significant cuts in social programs such as Medicare, Medicaid, and Social Security. The Congressional Budget Office (CBO) has estimated that due to pay-as-you-go rules, these tax cuts will automatically trigger a $25 billion cut to Medicare next year.

If the Senate passes this bill, they still need to reconcile differences with the House version. Related to health, the House bill does not include repealing the individual mandate, while the Senate scraps it. On the other hand, the House eliminates the medical expense deduction, while the current Senate version keeps it in.


What is the impact of eliminating the medical expense deduction? In 2015, 8.8 million filers claimed this deduction, most with incomes under $100,000. Not surprisingly, eliminating this deduction disproportionately affects those with significant medical needs, and therefore high medical costs. Often, individuals with high costs associated with long-term services and supports rely on this deduction to avoid spending down their assets and enrolling in Medicaid—which could mean that eliminating this deduction could actually increase Medicaid spending.


Collins Ties Her Vote to Health Care

According to reports, while Senator Collins (R-ME) is not happy with the repeal of the individual mandate being included in the tax bill, she may be willing to vote in favor, with the understanding that two health care bills will also be passed. The first bipartisan bill was introduced by Senator Collins and Senator Bill Nelson (D-FL) to provide funding for states to use Section 1332 waiver authority to create high risk pools or reinsurance programs to stabilize their marketplaces.

The second bill is the bipartisan health reform effort proposed by Senators Lamar Alexander (R-TN) and Patty Murray (D-WA). The Alexander-Murray bill, also known as the Bipartisan Health Care Stabilization Act of 2017, would fund Cost-Sharing Reduction (CSR) payments through 2019, partly restore the outreach and enrollment budget for the ACA, and expand flexibility of 1332 waivers. This bill was in part created in response to President Trump’s late night proclamation in October that his Administration was stopping CSR payments to insurance companies, and the negative ripple effects this is expected to have.

Passing these Health Care Bills is Not Enough

Senator Collins is looking for assurances that these two health care bills will pass, to help ease her concerns about including the elimination of the individual mandate as part of the tax bill. However, the CBO suggests that the Alexander-Murray bill will only have a marginal effect on premiums and insurance coverage. Instead, the impact of the elimination of the individual mandate will remain as previously estimated: decreasing the number of people with health insurance by 4 million in 2019, and 13 million by 2027, with premium increases of 10 percent in most years in between.

Both Nelson and Murray, the lead Democratic co-sponsors of these bills, oppose the use of their health care bills as a strategy for moving the tax bill ahead. To help address Collins’ concerns, Senator Alexander has proposed attaching these health care bills to the end of the year spending bill. However, Conservative Republicans in the House suggest they will not vote for the continuing resolution if these health care bills are attached to it. Thus, the likelihood of passing these health care stabilization bills remains up in the air.

Bringing Key Republican Votes Over the Finish Line

The process that is underway—including my favorite step in lawmaking, “vote-a-rama”—must end with 50 Senate votes for passage (with Vice President Mike Pence as the tiebreaker). That means three Republican ‘Nay’ votes are needed to kill the bill. If it makes it through the Senate, the bill can either be passed as is by the House, or go to conference committee to reconcile the differences between the final House and Senate bills.

Despite hope from some that Senator John McCain (R-AZ) might help to sink the tax bill, he announced Thursday that he is on board, citing his support for lowering the corporate tax rate and repealing the individual mandate.

That left deficit hawks Senator Bob Corker (R-TN) and Senator Jeff Flake (R-AZ) as the key hold-outs (with Collins as the potential third ‘Nay’ vote). The final vote was pushed to today after the Joint Committee on Taxation reported that the bill would increase the deficit by $1 trillion dollars over a decade, even after accounting for economic growth. Corker was ready to support the bill after advocating for a trigger provision. The purpose of the trigger was to ensure that if the  hallmark promise of economic growth (i.e., this tax bill will ‘pay for itself’) did not pan out, then taxes would go up. However, Thursday the Senate parliamentarian, who sets the rules for what is allowable in the Senate, said the trigger provision is a no-go. This sent Republicans back to the drawing board.

However, at this very moment, debate continues on the floor of the Senate, Republican leaders claim they have the votes for passage, and Senator Flake has announced he is a yes. Even if Corker and Collins vote No, this bill can pass.