The GOP's High-Risk Move to Whack Obamacare in Its Tax Bill

Republican senators will scrap the Affordable Care Act’s individual insurance mandate as part of their proposal, jeopardizing delicate negotiations for the chance at a double legislative win.

J. Scott Applewhite / AP

Updated on November 14 at 5:09 p.m. ET

Republicans are taking another run at the Affordable Care Act as part of their overhaul of the tax code.

Bowing to pressure from President Trump, Senate leaders announced on Tuesday afternoon that they would add the repeal of Obamacare’s individual insurance mandate to the far-reaching tax bill they unveiled last week. It’s a high-risk, high-reward maneuver for the GOP, which has struck out in its previous attempts to dismantle the health law. If successful, the move could be a two-for-the-price-of-one policy victory for a party desperate to energize its voters heading into a difficult campaign year. But GOP leaders have previously warned that it could backfire, jeopardizing complicated negotiations over a tax bill and compounding what is already a heavy political lift.

Even as he confirmed the effort on Tuesday, Senate Majority Leader Mitch McConnell seemed less than assured it would succeed. “We’re optimistic that inserting the individual mandate repeal would be helpful,” he told reporters after Republicans senators discussed the issue over lunch.

The main argument for scrapping the insurance requirement as part of the tax bill is to solve a math problem. As currently written, the Senate bill costs the government too much money and couldn’t pass under the budget reconciliation rules Republicans are using to skirt a Democratic filibuster. While repealing the mandate technically reduces taxes on Americans who choose to pay a penalty rather than buy health insurance, the Congressional Budget Office has projected that zeroing out the penalty would actually boost federal revenues by $338 billion over a decade. That would help Republicans pay for their tax cuts—a point made by Trump in a tweet touting the move on Monday.

But the political risk to the GOP lies in the reason why repealing the mandate would save money: According to the CBO, 13 million fewer people would have health insurance as a result, including many who would have received government subsidies. And millions more could eventually face higher premiums, since removing the requirement that people buy coverage would shrink the insurance pool and force insurers to raise prices. Inserting that provision would put immense pressure on the three Republicans who torpedoed the party’s effort to pass a “skinny” repeal over the summer, Senators Susan Collins of Maine, Lisa Murkowski of Alaska, and John McCain of Arizona, along with others who opposed efforts to dismantle the health law without simultaneously replacing it.

“Make no mistake, repealing the individual mandate is tantamount to repealing the Affordable Care Act,” said Brad Woodhouse, campaign director for Protect Our Care, an advocacy group supportive of the ACA. “And as such it would be wise for those few Republicans in the House and Senate who said ‘no’ to previous efforts at repeal to say ‘hell no’ to this one.”

Republicans tried to get out in front of the criticism by characterizing the mandate repeal as part of their effort to reduce the tax burden on middle- and lower-income Americans. “We’re going to reduce the tax on poor Americans,” Senator John Cornyn of Texas said, omitting the fact that people under a certain income threshold are exempt from the Obamacare requirement.

The Senate Finance Committee is expected to add the mandate repeal to the tax bill later on Tuesday. But whether it makes it across the floor when the full Senate considers the bill during the week after Thanksgiving remains unclear. None of the Republicans in question sit on the committee, and conservative activists have raised doubts about whether the measure could get the necessary 50 votes. “I personally think that complicates tax reform to put the repeal of the individual mandate in there,” Collins told reporters on Tuesday. Still, she wouldn’t rule out supporting a tax bill that included repeal. “I am going to wait and see what the bill says,” she said.

In a bid to win over those members, GOP leaders are reportedly considering holding a separate vote on bipartisan legislation to stabilize the Obamacare market in the short term. Not surprisingly, that possibility is angering Democrats who do not want to see the measure paired with another attempt to roll back the law. “I’m really hopeful we don’t go down that path,” said Senator Patty Murray of Washington state, the Democratic co-author of the bipartisan bill. “That is the exact opposite of what we should be doing.”

The House would also have to agree to eliminate the mandate, and prospects in the lower chamber are also uncertain. Right now, GOP leaders are confident that their version of the tax bill—which does not touch Obamacare—will pass when it comes up for a vote on Thursday. But some lawmakers supportive of tax reform are balking at going after Obamacare at the same time, especially when the debate over the law had already shifted toward a bipartisan proposal shoring up its individual market.

While the mandate has never been popular, support for the broader law helped Democrats win the governor’s race in Virginia and make large gains in the state House of Delegates last week. A ballot measure expanding Medicaid under the ACA passed by a wide margin in Maine. “It would be an absolute wrong approach to take on tax reform,” Representative Charlie Dent of Pennsylvania told me last week when I asked him about adding a repeal of the individual mandate to tax reform. Dent had been supportive of the tax bill but voted against proposals to repeal Obamacare.

Republican leaders know they’re risking the success of one top legislative priority by pairing it with another. They could end up mobilizing Democratic activists who’ve had a tougher time ginning up the same level of grassroots opposition to the tax bill as rose up during the health-care debate. “If the American people weren’t already outraged by this bill, injecting health care into it will certainly do the trick,” warned Senator Charles Schumer of New York, the Democratic minority leader.

It’s possible they’ll have to drop the mandate repeal later in the legislative process. But for now, the possibility of achieving two major policy goals in a single bill is too enticing for Republicans to pass up.