Even though the Republicans had majorities in the House and Senate during the first two years of Donald Trump’s presidency, they failed to repeal the Affordable Care Act (ACA), better known as Obamacare, or to “repeal and replace” it with something better.
President Trump recently announced that he is backing off plans to introduce a Republican replacement for Obamacare after Senate Majority Leader Mitch McConnell “privately warned him that the Senate would not revisit health care in a comprehensive way before the November 2020 elections.”
Trump then issued three tweets about it:
The Republicans are developing a really great HealthCare Plan with far lower premiums (cost) & deductibles than ObamaCare.
In other words it will be far less expensive & much more usable than ObamaCare.
Vote will be taken right after the Election when Republicans hold the Senate & win back the House.
The Republicans’ last attempt to replace Obamacare was in 2017. After the American Health Care Act of 2017 (AHCA) passed the House, Senate Republicans released the first draft of their version called the Better Care Reconciliation Act of 2017 (BCRA). After a second draft was introduced, it failed to pass, as did bills to repeal Obamacare in whole or in part.
Even though Democrats regained control of the House in the 2018 election, Republicans were ecstatic that Obamacare might yet still be repealed after a federal judge in Texas, a George W. Bush appointee, ruled that “the individual mandate is unconstitutional” and therefore the remaining provisions of Obamacare are invalid because “the individual mandate is inseverable from the entire A.C.A.” Trump afterward tweeted, “As I predicted all along, Obamacare has been struck down as an UNCONSTITUTIONAL disaster! Now Congress must pass a STRONG law that provides GREAT healthcare and protects pre-existing conditions.”
However, with the Democrats in control of the House and the Republicans in control of the Senate, no such law has any chance of passing, hence Trump’s announcement that the introduction of a replacement for Obamacare will be delayed until after the election (assuming, of course, that he wins reelection and Republicans regain control of the House).
The most interesting comment about the Republican attempts to “repeal and replace” Obamacare, comes not from the current president but the former one. After the Republicans’ last attempt to repeal Obamacare, former president Barack Obama made this comment on Facebook about it:
The Senate bill, unveiled today, is not a health care bill. It’s a massive transfer of wealth from middle-class and poor families to the richest people in America. It hands enormous tax cuts to the rich and to the drug and insurance industries, paid for by cutting health care for everybody else. Those with private insurance will experience higher premiums and higher deductibles, with lower tax credits to help working families cover the costs, even as their plans might no longer cover pregnancy, mental health care, or expensive prescriptions. Discrimination based on pre-existing conditions could become the norm again. Millions of families will lose coverage entirely.
Simply put, if there’s a chance you might get sick, get old, or start a family— this bill will do you harm. And small tweaks over the course of the next couple weeks, under the guise of making these bills easier to stomach, cannot change the fundamental meanness at the core of this legislation.
That’s right, Barack Obama is objecting to something because it is, so he claims, a transfer of wealth. Not just any transfer of wealth, mind you. He has no objection to wealth transfers from “the rich” to “the poor,” and did all he could to maintain and expand them during his eight years as president.
Governments have no money of their own. Every penny in the federal treasury used to subsidize some American’s health insurance was first taken from the paychecks, pockets, and purses of some other American.
According to Obamacare Facts, “85 percent of the 8 million Americans who purchased insurance through the exchanges will receive a tax subsidy.” This is done with a refundable premium tax credit based on income that is available to those making between 100 and 400 percent of the Federal Poverty Level (FPL). For coverage in 2019, that equals an amount between $12,140 and $48,560 for an individual, between $16,460 and $65,840 for a family of two, and between $25,100 and $100,400 for a family of four.
The IRS explains how it all works:
The premium tax credit is a refundable tax credit designed to help eligible individuals and families with low or moderate income afford health insurance purchased through the Health Insurance Marketplace, also known as the Exchange. The size of your premium tax credit is based on a sliding scale. Those who have a lower income get a larger credit to help cover the cost of their insurance. When you enroll in Marketplace insurance, you can choose to have the Marketplace compute an estimated credit that is paid to your insurance company to lower what you pay for your monthly premiums (advance payments of the premium tax credit, or APTC). Or, you can choose to get all of the benefit of the credit when you file your tax return for the year. If you choose to have advance payments of the premium tax credit made on your behalf, you will reconcile the amount paid in advance with the actual credit you compute when you file your tax return. Either way, you will complete Form 8962, Premium Tax Credit (PTC) and attach it to your tax return for the year.
The credit is “refundable” because, if the amount of the credit is more than the amount of your tax liability, you will receive the difference as a refund. If you owe no tax, you can get the full amount of the credit as a refund. However, if advance credit payments were made to your insurance company and your actual allowable credit on your return is less than your advance credit payments, the difference, subject to certain repayment caps, will be subtracted from your refund or added to your balance due.
There are two kinds of tax credits.
A regular tax credit is a dollar-for-dollar reduction of the amount of income tax owed. Like tax deductions and exemptions, one will pay less in taxes the greater the number, and the greater the amount, of tax credits that one qualifies for. Tax credits may reduce the tax owed to zero, but if there is no taxable income to begin with, then no credit can be taken. Tax credits — like their cousins tax deductions, tax exemptions, and tax loopholes — are always a good thing because they allow Americans to keep more of their money in their pockets and bank accounts and out of the hands of Uncle Sam.
A refundable tax credit is treated as a payment to the government from the taxpayer, such as federal income tax withheld or estimated tax payments. If the tax credit “payment” is more than the tax owed after regular tax credits are applied, then the taxpayer becomes a tax receiver. He receives a refund of the money he never actually paid in. The money is simply taken from real taxpayers and transferred to him. Refundable tax credits are the ultimate form of welfare because they are payments made in cash, just like the Temporary Assistance to Needy Families (TANF) and Supplemental Security Income (SSI) programs. And not only are they are paid in cash, the cash received is not counted as income when determining eligibility for other welfare benefits, or the amount of such benefits, from any federal welfare program or any state or local program financed in whole or in part with federal funds.
The PTC is a transfer of wealth just like the refundable portions of the American Opportunity Tax Credit (AOTC), the Child Tax Credit (CTC), and the Earned Income Tax Credit (EITC).
Besides being a collection of tax increases masquerading as health-care reform, Obamacare is a massive transfer of wealth. Just don’t expect Barack Obama to label it as such.