The spending bill featured a waiver to avoid Medicare cuts in 2018, before voters to go to the polls in the midterm elections.
President Donald Trump on Friday signed a massive tax bill that reshapes the nation’s revenue pie by $1.5 trillion while peeling away a fundamental piece of the Affordable Care Act (ACA).
The tax bill removes the individual mandate, the part of the ACA that requires Americans to have health coverage; it is designed to keep younger, healthier people in the risk pool and keep overall premium costs lower for everyone. Separately, Congress opted not to allocate funds for cost-sharing reductions (CSRs), which help insurers hold down premium costs as they meet requirements for low- and moderate-income households.
“I promised the American people a big, beautiful tax cut for Christmas,” Trump said. “With final passage of this legislation, that is exactly what they are getting.”
Late Thursday night, he also signed a stopgap spending bill to keep the government operating through January 19, 2018, and to provide $2.85 billion for the Children’s Health Insurance Program (CHIP) through March. CHIP, which has enjoyed bipartisan support since its creation in the 1990s, saw its appropriation deadline come and go September 30, 2017.
However, getting Trump’s signature on the tax bill took a maneuver to protect fellow Republicans for the 2018 election: Thursday night’s spending bill included a waiver of the “pay-go” rules governing how Congress has to pay for certain programs. This was needed to avoid triggering Medicare cuts in the tax bill before voters go to the polls next year. Without the waiver, Trump would have had to sign the bill in January to avoid Medicare cuts next year.
The end of the individual mandate has been projected to bring premium increases of 10% for those who buy coverage on the individual market. In addition, House Republicans refused to honor a commitment that Senate Majority Leader Mitch McConnell, R-Kentucky, made to Senator Susan Collins, R-Maine, to fund CSRs in the spending bill, which she wanted in exchange for her vote to support the tax bill.
Trump said this week, “Obamacare has been repealed in this bill.” However, officials at CMS announced that 8.8 million Americans had signed up for 2018 coverage through the HealthCare.gov exchanges, a figure not far below from last year’s 9.2 million, despite an enrollment period half as long with 90% less advertising.
Enrollment is ongoing in some states, but ended December 15, 2017, in the 39 states that use the federal platform.
Finally, the spending bill included short-term funding for CHIP, just as several states were sending out cut-off notices to families after going nearly 90 days with no word on funding. Alabama, Colorado, and Pennsylvania had started sending notices—women in Colorado who were pregnant and scheduled to deliver in February were told their benefits would be cut off. Before Congress acted, state lawmakers had voted to extend funding through mid-January.