GOP senators mull scrapping high-earner tax cuts, allowing no-frills plans in health-care revamp

Sen. Mitch McConnell and Sen. John Cornyn.
(Image credit: Nicholas Kamm/AFP/Getty Images)

Senators left Washington on Thursday night for a 10-day break without voting on the Senate Republican health-care bill, and after a day of meetings and negotiations and new Congressional Budget Office numbers, Senate Republicans still did not have the pieces in place for a plan that could get 50 of their 52 votes, according to all accounts. Senate Majority Leader Mitch McConnell (R-Ky.), who wrote most of the bill behind closed doors, and the White House have already agreed to increase the bill's funding for the U.S. opioid addiction problem, to $45 billion from $2 billion, to win the votes of senators from hard-hit states, but Senate Republicans are seriously considering at least two other ideas, one to mollify conservatives and the other to win over more moderate holdouts.

To win over moderates like Sen. Susan Collins (R-Maine) and Sen. Bob Corker (R-Tenn.), Republicans are talking about keeping some of the Affordable Care Act's tax increases for some wealthier Americans, most notably the 3.8 percent tax on capital gains and other investment income for households making more than $250,000 a year, and putting that retained revenue toward helping poorer Americans afford insurance or reduce the federal deficit. According to the CBO, repealing that tax, as McConnell's draft bill does, would cost $172 billion over 10 years.

"It's not equitable to have a situation where you're increasing the burden on lower-income citizens and lessening the burden on wealthy citizens," Corker explained. Some more conservative senators said that, despite the bad optics, the idea should be off the table.

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GOP senators were also discussing a proposal by Sen. Ted Cruz (R-Texas) to allow insurers to sell stripped-down health plans as long as they also offered at least one plan that met the essential-benefits standards required under ObamaCare. Several Republicans found that idea promising, though health-care experts warned it would likely lead to sharply higher prices for sicker and older people, and some senators said it might not be allowed under the Senate rules McConnell is using so his bill requires only 51 votes. A senior GOP aide told Axios that 20 to 30 Republicans would balk at the idea: "If Cruz succeeds in putting it in the bill, the bill dies. Period. End of sentence end of paragraph end of story."

McConnell had wanted a vote on the bill before the July 4 break, but now GOP leaders said they are shooting for mid-July, with a hard deadline of the August recess.

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