WASHINGTON -- Health policy experts contacted by ľֱ agreed that the Senate's repeal of the individual insurance mandate will be part of the ultimate compromise legislation on tax reform.
"It's hard to imagine that the individual mandate [repeal] wouldn't be in the final bill," said Tim Jost, JD, emeritus professor at the Washington and Lee University School of Law in Lexington, Virginia.
Repealing the individual mandate has the net effect of reducing the deficit, by no longer pushing individuals to buy government-subsidized policies.
Republicans "need that money, so that they can get the breaks that they want to give to corporations and wealthy taxpayers," argued Jost, a left-leaning policy expert.
However, Jost added that the Congressional Budget Office likely overestimated the number of people expected to lose coverage and the resulting savings.
"It's attractive politically, philosophically, and it happens to provide an important piece of revenue," said Gail Wilensky, PhD, a senior fellow at Project HOPE in Bethesda, Maryland, and former administrator of the Centers for Medicare & Medicaid Services under President George H.W. Bush.
The only reason the House didn't include the individual mandate in its own repeal bill was a faulty political calculus that it might cause the bill to tank in the Senate, said Chris Pope, PhD, a senior fellow at the New York-based Manhattan Institute.
"The Republican caucus is going to be delighted to see repeal of the mandate," he said.
If, as he and other policy experts predict, the mandate repeal is included, Jonathan Weiner, DrPH, professor, health policy and management at The Johns Hopkins Bloomberg School of Public Health in Baltimore, said the Obamacare exchanges will "become another branch of Medicaid."
Healthy, young people will stop buying insurance and only sick, older adults will enroll, Weiner said in a phone interview.
Medical Expense Deduction to Survive
But all of the scholars ľֱ interviewed said that the medical expense deduction from individuals' income taxes -- which the House sought to eliminate in its version of tax reform -- will be preserved.
The House provision would erase this tax deduction for people whose medical expenses exceed 10% of their income.
In the Senate version of the tax reform bill, an amendment from Sen. Susan Collins (R-Maine) not only restored the deduction but lowered the threshold for eligibility from 10% to 7.5% -- its pre-Affordable Care Act level -- expanding the number of people who stand to benefit.
Kavita Patel, MD, MPH, a nonresident fellow in economic studies at Brookings and a primary care internist at Johns Hopkins University, noted that eliminating the deduction was seen as a way to accrue savings for the House bill.
"What's come to light is how unpopular [repealing] it is," she said.
"They're going to have to try to work pretty hard to hold Collins' vote," said Jost, referring to the fact that Collins voted down previous Obamacare repeal bills. See companion story on ľֱ about Collins' efforts to influence the legislation.
Tom Miller, JD, a resident fellow at the American Enterprise Institute, agreed,"They need to keep her on board. So, they'll probably have to bend over a little further."
The medical expense deductions affect only about 6%-8% of taxpayers, said Jay Wolfson, DrPH, JD, associate vice president of USF Health in Tampa, Florida, who predicted it will be preserved with changes.
Fewer people will be filing the deductions anyway, because of other changes in the tax bill that will lead more people to file simplified returns, Wolfson said.
The deduction is "probably safe," said Pope, but he disagreed with Miller that the Republicans would need to appease Collins and expand it further.
On the other hand,"it's not out of the question that the Senate bill could be passed as is," Pope added.
Compared to the differences between the House's version of Obamacare repeal -- the American Health Care Act -- and the repeal bills the Senate aimed to pass this summer, "there's less disagreement to be ironed over. Both chambers are in pretty similar places," Pope said.
Medicare on the Block?
Most, though not all of the scholars, believe the bill has the potential to trigger cuts to Medicare.
In the long term, the bill is expected to raise huge deficits, and the only way the Republican majority will want to cut deficits is to cut spending, Jost said.
"In a year or three ... I think we're going to see some big cuts in Medicare and Medicaid and probably also another run at the Affordable Care Act," he continued.
Doug Badger, a senior fellow at the Galen Institute, noted that Speaker Paul Ryan (R-Wis.) and the Senate Majority Leader Mitch McConnell (R-Ky.) issued a saying that they would not allow a certain law known as Pay-G0 to kick in and force a 4% cut to Medicare -- an estimated $25 billion annually -- but many of the liberal scholars were dubious.
"Congress can tell you whatever they want," said Patel. At the end of the year it's the Office of Management and Budget that decides whether to apply sequestration to offset these new costs, she added.
The only way the government can stop this is by passing another law which would require 60 votes -- meaning Democrats would need to cross the aisle, Patel explained.
Senate Republicans passed their version of the tax reform bill just before 2 a.m. Saturday morning. House Republicans passed a different version two weeks earlier.