Can Harry Reid keep Democrats like Al Franken from defecting?

Members of the House today voted 270-146 to pass H.R. 436, a health package that includes the text of H.R. 1004 — a bill that would eliminate a requirement that flexible spending account (FSA) holders forfeit any unused FSA balances at the end of the plan year.

The White House says senior advisors will tell President Obama to veto the bill if it reaches his desk, but 37 Democrats crossed party lines to vote for the bill.

The original version of H.R. 436 would have repealed a 2.3% excise tax on medical devices that’s set to be imposed by the Patient Protection and Affordable Care Act of 2010 (PPACA).

Republicans created the version of H.R. 436 that passed, the Health Care Cost Reduction Act package, by bundling the device tax repeal bill together with H.R. 1004, the FSA use-it-or-lose-it fix bill, and three other bills: 

  • H.R. 5858, a bill that would change health savings account (HSA) tax rules.
  • H.R. 5842, a bill that would repeal a PPACA provision that prohibits holders of FSAs and HSAs from using account assets to pay for over-the-counter (OTC) drugs unless the drugs are prescribed by a doctor.
  • A new bill that would require taxpayers to return 100% of any extra PPACA health insurance purchase tax credits they get. Current low would limit the amount of excess health insurance tax credit payments that the Internal Revenue (IRS) Service could claw back from low-income and middle-income taxpayers.

The PPACA health insurance tax subsidy clawback provision is getting attention because PPACA calls for the IRS to pay the credit to eligible taxpayers in advance, so that taxpayers can use the cash to buy health insurance.

Some taxpayers who do their best to obey the law will get extra credit payments simply because their income increases during the year or they get access to group health coverage, defenders of the current rules say.

Requiring all taxpayers to pay back all excess credits could keep some taxpayers from getting the help they need to pay for health coverage and increase the number of people who are uninsured, administration officials say.

Rep. Erik Paulsen, R-Minn., says the core excise tax repeal provision in H.R. 436 would help the United States keep its lead in medical technology innovation.

The bill now goes to the Senate, where some Democrats, including Sen. Ben Cardin, D-Md., have sponsored or cosponsored the Senate versions of bills now included in H.R. 436. Others, including Sens. Amy Klobuchar, D-Minn., and Al Franken, D-Minn., have expressed strong support for the idea of repealing the medical excise tax.

Senate Majority Leader Harry Reid, D-Nev., says the Senate has concluded legislative business for the week. Senate calendars for next week make no mention of H.R. 436.

Earlier in the day, Reid spoke on the Senate floor about his views on the congressional Republicans’ approach to legislation.

“Last Congress was one of the most productive – if not the most productive – in the history of the country,” Reid said. “But with a new Republican majority in the House, this Congress has been altogether different. Consistently, this Congress has taken weeks or months to pass even simple, common-sense proposals – proposals that would previously have passed in minutes.”

Reid said he had read in Politico that Republicans are saying serious efforts at legislating are done until after the election. 

“So, rather than work with Democrats to strengthen our economy or create jobs, congressional Republicans will put on a show designed to demonstrate the extreme, ideological direction in which they would lead the country,” Reid said. “It seems when congressional Republicans forget the world is watching, they say what they really mean – they’re more interested in putting on a partisan sideshow than in solving the very real problems facing this nation.”