Congress sent the White House its first rollback of last year’s health care law, a bipartisan repeal of a burdensome tax reporting requirements found in health care reform’s 1099 provisions. The measure passed the senate with an overwhelmingly bipartisan vote of 87-12. President Obama is expected to sign it despite concern about how to replace the money the provision would have raised.
The bill also repeals a second new 1099 requirement directed at landlords that helped pay for the small-business jobs act. In order to pay for these repeals, the House measure takes aim at subsidies that low- and middle-income people will receive to purchase health insurance under the new law. Those subsidies are tax credits paid in advance and based on income reported in prior years.”
The bill would cover the estimated $22 billion cost of eliminating the provision by forcing greater repayment of health insurance subsidies for families whose income unexpectedly exceeds certain thresholds. Some House Democrats had argued that the bill’s offset creates a $25 billion tax hike on the middle class because it could ensnare taxpayers who straddle the 400% income line, saying that a mere year-end bonus could push taxpayers ‘over the cliff’ and force them to repay the money.”
Before passing the bill, the Senate defeated 41-58 an amendment offered by Sen. Bob Menendez (D-N.J.) that would have made the 1099 repeal contingent on the Department of Health and Human Services certifying that it does not increase premiums or coverage costs for small businesses.