Congress is poised to approve a spending deal that would raise the purchasing age for tobacco and e-cigarettes to 21, repeal major Obamacare taxes and forbid President Trump from deploying “nuclear options” that would kneecap the Democrats’ prized health law.
The bipartisan package released Monday also includes $25 million to fund gun-violence research at the Centers for Disease Control and Prevention, a longstanding priority for Democrats.
It provides $425 million in election-security grants to states, amid ongoing concern about Russian meddling, and nearly $1.4 billion for President Trump’s border wall. It invests in child care programs, increases funding at the National Institutes of Health for the fifth year in a row and safeguards coal miners’ pensions and health benefits.
Appropriators introduced their plans in a pair of legislative vehicles that, taken together, cover all dozen fiscal 2020 spending bills. Absent the agreement, the federal government would have shut down when federal funding expires Friday.
House leaders are expected to schedule votes on the spending package for Tuesday, clearing the way for Senate action and President Trump’s signature later in the week.
“I’m pleased that we have reached a bipartisan agreement that will keep government open, provide the certainty of full-year funding, and make strong investments in key priorities for American communities,” said House Appropriations Committee Chairwoman Nita Lowey, New York Democrat. “With higher spending levels in line with the bipartisan budget agreement, we are scaling up funding for priorities that will make our country safer and stronger and help hardworking families get ahead.”
The decision to raise the tobacco age to 21 is a key win for Senate Majority Leader Mitch McConnell, who had pushed to raise the age from 18 alongside Sen. Tim Kaine, Virginia Democrat. The change would apply to e-cigarettes and vaping products, according to Mr. McConnell.
While the package does not tackle prescription drug pricing or surprise medical bills, it sets up a May 22 deadline to address those issues in must-pass legislation that will be needed to renew prized health programs, according to a senior House Democratic aide familiar with talks.
Industry players will be toasting lawmakers’ decision to repeal the Affordable Care Act’s 2.3% excise tax on medical devices, its “Cadillac tax” on generous employer-sponsored health plans and its health insurance tax, or “HIT.”
The levies were included in the 2010 health law to pay for the program’s goodies but have caused heartburn for key industries and lawmakers for years, prompting a series of implementation delays.
The decision to ax the taxes would be huge news in normal times — Capitol Hill is consumed by impeachment — because it comes with a hefty price tag. Repealing the taxes would add nearly $400 billion to deficits over the next 10 years, according to the Congressional Budget Office.
Combined with other tax provisions, the package would tack $470 billion onto the debt, according to the Committee for a Responsible Federal Budget.
“The past few years have been an insult to budgeting,” CRFB President Maya MacGuineas said. “First, lawmakers passed an addition of nearly $2 trillion to the debt with the tax cuts in 2017, then they added another almost $2 trillion to projected debt levels through two massive spending deals, and now they’re back pushing for another $470 billion of debt with even more tax cuts. All this at the time when the deficit is the worst it has even been when the economy was this strong.”
Also Monday, Democrats said they secured anti-“sabotage” provisions that would prevent Mr. Trump from following through on whispered threats to end Obamacare auto-enrollment, in which existing customers are slotted into coverage for the new year if they don’t actively cancel coverage or shop for a different plan.
The deal also bars Mr. Trump from using regulations to end “silver-loading,” a tactic in which states lump premium increases onto midtier “benchmark” plans pegged to taxpayer-funded subsidies for customers. The subsidies rise with benchmark rates.
Regulators started silver-loading after Mr. Trump stop making Obamacare’s “cost-sharing” payments to insurers, citing the lack of congressional authority to dole out the money. Health plans responded by demanding higher premiums, though many customers were pleasantly surprised to find supersized subsidies and better deals from the silver-loading tactic.
Plans to shield Obamacare from Mr. Trump, who loathes the program, came the same day his administration said consumers would have until early Wednesday to sign up for 2020 coverage on the federal Healthcare.gov website after glitches over the weekend made it hard for some to beat the Sunday deadline.
In the meantime, medical device companies will be cheering the demise of the law’s 2.3% tax on their sales — especially in states such as Minnesota, Indiana and Massachusetts, where lawmakers said the levy was killing jobs in a key economic sector.
Health insurers lobbied hard to kill off the HIT tax, saying it forced them to raise premiums, and labor unions have long sought to kill off the 40% Cadillac tax on generous health coverage.
The Obama White House and its economists prized the tax on the cost of health coverage above $10,200 for an individual and roughly $30,000 for family coverage, saying the high-value plans end up paying for more care than needed, driving up health costs for everyone.
They also hoped that paring back generous health benefits would translate into wage increases.
Yet labor unions that initially backed the administration and its health law cried foul, arguing the tax would unfairly punish workers who negotiated generous health coverage in place of higher wages.
The tax would have taken effect in 2022. It was indexed for inflation in later years and would have affected more and more employers.
⦁ Stephen Dinan contributed to this report.
Copyright © 2020 The Washington Times, LLC.