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Republican unified budget plan would ease PPACA changes

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(Bloomberg) — House and Senate Republicans agreed on a unified budget plan Wednesday that would allow them to bypass Democrats and send President Barack Obama legislation to repeal or revise the Patient Protection and Affordable Care Act of 2010 (PPACA).

The budget proposal spells out the Republican Party’s priorities by calling for $5.3 trillion in spending cuts to reach balance in nine years. Of this, $4.1 trillion in reductions would come from programs including entitlements like Medicare.

Discretionary spending in 2016 would be limited to $1.016 trillion, while war funding would total $96 billion, far above Obama’s request. The plan allows total spending of $3.9 trillion in 2016, with a $400 billion deficit.

The measure, to be set for votes in the House and Senate, is a non-binding framework for spending bills to be passed later.

“People might say this isn’t real,” Sen. Jeff Sessions of Alabama said this week, “but it does require you to lay out how you are going to manage the people’s money if you were given the power to do so.”

A key aspect of the measure would give Republicans a vehicle to go after PPACA, which his administration said has extended coverage to 16.4 million previously uninsured Americans.

Rep. Chris Van Hollen of Maryland, top Democrat on the House Budget Committee, said the plan relies on “gimmicky accounting tricks to falsely claim balance.” He said it represents an attempt to pave the way for additional tax breaks for the wealthy.

Spending limits

House Appropriations Committee Chairman Hal Rogers, a Republican from Kentucky, said the budget’s mandated spending limits will continue to complicate the passage of the 12 annual appropriations bills, as it has in the past several years.

“It’s going to be tough to pass some of these bills,” he told reporters. “The numbers we are dealing with this year, overall, don’t even meet inflation so the squeeze is even further” than in previous years.

Senate Budget Committee Chairman Mike Enzi, a Wyoming Republican, expressed a more favorable view.

“This will change the way we do business here in Washington to make the government live within its means — just like hard-working families,” Enzi said.

Regarding PPACA, the U.S. Supreme Court plans to rule by the end of June on a lawsuit that could throw out most of the tax credits that are an underpinning of the law. If the justices do so, the entire law might crumble.

Reconciliation process

The budget agreement would let Republicans use a process called reconciliation to send revisions in PPACA to the president without needing votes from Democrats.

A policy statement contained in the deal says the health care law “is unaffordable, intrusive, overreaching, destructive and unworkable” and “should be fully repealed.”

“I like that it created a situation in reconciliation, so depending on how King vs. Burwell goes you can make some changes in Obamacare,” said Sen. Charles Grassley, an Iowa Republican, referring to the case before the Supreme Court.

The budget conference deal came together after Sen. Bob Corker, a Tennessee Republican, said Wednesday he was dropping his opposition. He had contended that a spending-cut provision didn’t go far enough.

See also: Senate budget sets up clash with U.S. House on Defense, Medicare

“There is no question this budget is far from perfect, but it is some progress,” Corker said in a statement. A day earlier he told reporters he was withholding support, which was needed to release the plan.

Two versions

Both chambers adopted their own versions of the budget plan last month and conferees worked out the differences.

The unified budget, S.Con.Res. 11, uses emergency war funds to evade a limit on defense spending while keeping in place caps on domestic programs. The House is working this week to pass the first set of 2016 spending bills based on the plan.

Obama has said he wants a deal that raises both defense and non-defense limits.

A budget document is typically little more than an aspirational framework for spending. The most recent unified budget plan was enacted for fiscal 2010 when Democrats controlled both chambers.

The appropriations bills due at the Oct. 1 start of each fiscal year set the actual spending details for agencies and government functions.

This budget resolution is taking on larger ramifications because of the ability to use reconciliation procedures to keep Democrats from using the filibuster to block policy changes.

‘One bullet’

“This is a budget that’s disconnected from reality and it’s not a budget they intend to implement,” said Ed Lorenzen, a former budget aide for House Democrats.

“They’ll have the one bullet they have and fire it in the air to repeal Obamacare, then not do anything to actually move towards a balanced budget,” Lorenzen said. He is now a senior adviser at the nonprofit Committee for a Responsible Federal Budget.

The House version of the budget, adopted in March, contained more expansive reconciliation instructions that could have been used for an array of spending cuts, tax-law changes or revisions in entitlement programs such as Medicare.

The Senate’s plan, also adopted in March, avoided the House’s proposal to partially privatize Medicare. Senate Republicans, who are defending 24 seats in the 2016 election, succeeded in removing partial privatization of Medicare from the unified budget.

—With assistance from James Rowley, Heidi Przybyla and Kathleen Hunter in Washington.

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