Committee for a Responsible Federal Budget
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Amendments to the Senate Budget Resolution Regarding the ACA Would Promote Fiscal Responsibility

Jan 11, 2017 | Health Care

Last week, the Senate began consideration of the Fiscal Year (FY) 2017 budget resolution, which is primarily being used to create a legislative vehicle for repealing the Affordable Care Act (ACA). It also sets forth rules that would govern passage of a future replacement. As debate continues, senators will have the opportunity to vote for amendments to the FY 2017 budget resolution that will make the process for repealing and replacing the ACA more responsible. Below are a few amendments senators will consider to do just that. This blog will be updated with new amendments as they are filed.

Warner Medicare Solvency Amendment

Summary: Senator Mark Warner’s (D-VA) amendment would create a new hurdle for any bill that worsens the financial status of the Medicare Hospital Insurance (HI) trust fund, which funds Part A. It would create a 60-vote point of order1 against any legislation, including the reconciliation bill provided for in the budget resolution, that would reduce the trust fund balance or increase HI deficits over the next ten years or that reduces the trust fund's actuarial balance by more than 0.01 percent of payroll over 75 years.

Context: As we have previously noted, full or partial ACA repeal could significantly worsen the near-term and long-term financial condition of HI trust fund. The amendment would prohibit repeal of any of the savings to HI in the ACA from spending cuts or revenues unless they were offset with alternative savings.

Bottom line: Given the existing shortfalls facing the Medicare HI trust fund, Congress should not take actions to reverse the improvements that have been made in Medicare HI solvency.

Manchin Deficit Increase Prevention Amendment

Summary: Senator Joe Manchin’s (D-WV) amendment would prohibit a reconciliation bill under the budget resolution from increasing the deficit in any individual year in the ten-year budget window. This provision would be enforceable with a 60-vote point of order against such legislation.

Context:  The reconciliation bill repealing the Affordable Care Act that was passed by Congress and vetoed by the president last year would have increased the deficit in the first two years because it would have immediately repealed many of the savings in the ACA while delaying repeal of most of the spending for two years. Congressional leaders have indicated that the reconciliation bill under this budget would take a similar “repeal and delay” approach to the spending for coverage provisions and may leave it in place for more than two years. We have estimated that if repeal legislation were to repeal the mandates and tax increases immediately but delay repealing the Medicaid expansion and exchange subsidies for two years, it would add about $50 billion to deficits over the next two years. A four-year delay would add about $135 billion to deficits over four years. On the other hand, if all revenue and mandate provisions were retained for as long as the coverage provisions, the deficit impact would be negligible until any repeal went into effect. There have also been suggestions that reconciliation legislation repealing the ACA may include subsidies to encourage insurance companies to remain in the individual market during the transition period before a replacement policy is in place; that policy would further increase the near-term deficit.

Bottom line:  The Manchin amendment would require the savings in the ACA to only be repealed to the extent that the spending is also repealed. All of the ACA's offsets – including its taxes – should be retained for at least as long as its coverage provisions. Immediate repeal of the ACA's offsets but retention of its spending would have a negative fiscal impact. If repeal and delay is pursued, it should ensure that repeal of both the coverage provisions and offsets is delayed, not just the coverage provisions. 

Corker Reconciliation Reporting Date Amendment

Summary: Senator Bob Corker (R-TN) has filed an amendment with four other senators that would delay the reporting date for reconciliation legislation from January 27 to March 3.

Context: The budget resolution directs the committees with jurisdiction over the spending and revenue provisions of the ACA to report reconciliation legislation reducing the deficit by at least $1 billion by January 27. It is expected that the reconciliation legislation will repeal the spending and revenue provisions of the ACA. Reconciliation legislation could also provide tax credits and spending provisions for a replacement policy provided that the net effect complied with the deficit reduction target in the reconciliation instructions. The resolution also allows all but $2 billion in total of the net savings from reconciliation legislation to be used to offset the costs of subsequent replacement legislation.
 
Bottom line: Providing more time before committees are required to act on repeal legislation could be helpful if it allows policymakers to better assess the likely costs of replacement legislation and ensure that repeal legislation achieves enough savings to offset replacement legislation.

Amendment Prohibiting Repeal of ACA Revenues Until Replacement Legislation

Summary: An amendment may be offered to prohibit legislation repealing any of the revenue provisions of the ACA until the Senate acts on replacement legislation. This provision could be enforceable with a 60-vote point of order against such legislation.
 
Context: The budget resolution provides that the net savings from ACA repeal minus $2 billion for deficit reduction will be available to offset the costs of replacement legislation. Repeal of only the coverage provisions in the ACA would achieve $1.75 trillion in savings over ten years under dynamic scoring if they were repealed immediately, and $1.55 trillion under dynamic scoring if repeal were delayed for two years. However, repeal of the tax provisions included in the ACA would reduce revenues by approximately $800 billion, reducing net savings available to offset replacement legislation by roughly half.
 
Bottom line: Prohibiting repeal of the revenue provisions in the ACA until replacement legislation is considered could promote fiscal responsibility by delaying decisions about repealing the ACA's savings until lawmakers decide how much replacement legislation will cost.

Van Hollen Long-term Deficit Amendment

Summary: Senator Chris Van Hollen’s (D-MD) amendment would strike the budget resolution's exemption of ACA replacement legislation from the long-term deficit point of order.

Context: Current Senate rules include a point of order against legislation that would increase the deficit by more than $5 billion in any of the four decades after the ten-year window of the budget resolution. However, the budget resolution being considered by the Senate includes a provision exempting health care legislation replacing the ACA from this point of order. While the budget resolution limits the ten-year costs of replacement legislation to the net savings from repeal legislation minus $2 billion, there would be no limit on the costs beyond the ten-year budget window.

Bottom line: Growing health spending is one of the primary drivers of our unsustainable long-term debt. There should be no carve outs from budget discipline designed to prevent legislation from increasing long-term deficits.

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Each of these amendments could make important improvements to the budget resolution and provide for greater fiscal responsibility in consideration of legislation related to the ACA. We hope the Senate sides with fiscal discipline and adopts these amendments.


1. A point of order is a parliamentary tool to enforce rules in the Senate. Any senator can raise a point of order against legislation (or amendments to legislation) for violating a procedural rule. In the Senate, points of order generally can be waived with 60 votes. Some points of order apply to consideration of the entire bill, while surgical points of order apply to a specific provision in legislation that violates rules. If a point of order is sustained against legislation or an amendment, consideration of the legislation or amendment is blocked. If a surgical point of order is upheld, the specific provision in violation is struck from the text of the bill.