Washington Digest: Congress completes Medicare payment overhaul
WASHINGTON — Congress completed work last week on a bill that overhauls the way Medicare pays doctors, ending a long practice of short-term fixes that was threatening medical services to seniors.
Senators voted 92-8 for the unusually bipartisan legislation which was sent to President Barack Obama for his signature. The House acted last month.
The bill repealed a payment system called the “sustainable growth rate formula” that in practice called for automatic cuts in doctor reimbursements. Since 2003, Congress had passed 17 periodic patches to avert the cuts before finally agreeing on a new payment system that enjoyed broad support among physicians.
Final passage immediately lifted the threat of an automatic 21 percent cut in Medicare fees to doctors. Continual threats to reimbursements had prompted some doctors to scale back seeing Medicare patients.
The new law allows reimbursements to increase 0.5 percent annually over four years. It also calls for modest incentives that would reward doctors whose patients get healthier.
To help offset the cost of the new system, the bill would require wealthier seniors to pay more for Medicare prescription drugs starting in 2018.
Critics however noted the cost of the bill was not entirely offset with savings elsewhere, meaning it would add $141 billion to the deficit over the next 10 years.
Sens. Harry Reid, D-Nev., and Dean Heller, R-Nev., voted for the bill.
HOUSE VOTES TO REPEAL ‘DEATH TAX’
On the week when most Americans were filing their federal tax returns, Republican leaders in the House scheduled a series of votes to amend the tax code.
Lawmakers voted 240-179 to kill the federal estate tax.
Sponsoring Rep. Kevin Brady, R-Texas, argued the so-called death tax “is the No. 1 reason family-owned businesses and farms aren’t passed down to the next generations.
“It is at its heart an immoral tax, and it is an attack on the American Dream, especially more so for our newest startups in America — women- and minority-owned businesses that are building wealth for the first time,” Brady said.
Democrats protested that the GOP was holding votes on “message” bills that hold little chance of final passage as Congress in recent years has tried to tackle tax reform through broader bills rather than individual ones.
“This proposed repeal of the estate tax is nothing more than a massive, unfunded tax break for a small sliver of America’s wealthiest families,” said Rep. Jim McDermott, D-Wash.
Rep. Mike Thompson, D-Calif., said “full repeal is not the answer.” He said better-targeted exemptions for family farms and small businesses would help families preserve inheritable assets while not helping people “who don’t need the government’s help.”
Reps. Cresent Hardy, Joe Heck and Mark Amodei, all R-Nev., voted for the bill. Rep. Dina Titus, D-Nev., voted against it.
HOUSE BACKS SALES TAX DEDUCTION
The House voted 272-152 to make permanent the IRS deduction for state and local sales taxes, a benefit targeted to the half-dozen states that lack an income tax.
Taxpayers under current law can choose to deduct either the state income tax they pay or their sales taxes. The choice is easy in states that have no state income tax, such as Nevada, Wyoming, South Dakota, Washington, Texas, Florida and Tennessee.
The sales tax deduction has been temporary and needed to be renewed every year or two. “We should be fair and say, if the income tax deduction is permanent, the sales tax deduction is permanent as well,” said Rep. Steve Stivers, R-Ohio.
The White House said President Barack Obama would veto the bill because it was not offset with savings elsewhere and would add $42 billion to the deficit over 10 years.
Heck, Hardy, Amodei and Titus voted for the bill.
TAX-DELINQUENCY BILL REJECTED
Lawmakers failed to gain enough votes for a bill that says people “seriously delinquent” on their taxes are ineligible to work for the federal government.
The vote was 266-160, but the bill was debated under a fast-track procedure that required a two-thirds margin for passage.
“The bill demonstrates a simple principle: individuals collecting federal salaries funded by taxpayers have to follow the rules and pay their taxes,” said Rep. Jason Chaffetz, R-Utah.
Chaffetz said the bill contained due process safeguards for workers paying off tax debt or who are contesting their taxes.
Rep. Elijah Cummings, D-Md., said the bill “seeks to resolve a problem of tax compliance that simply does not exist — a fact confirmed by the Internal Revenue Service. This measure is based on ideology rather than on facts, and it will perpetuate a negative image of federal workers.”
Hardy, Heck and Amodei voted for the bill. Titus voted against it.
Contact Review-Journal Washington Bureau Chief Steve Tetreault at stetreault@reviewjournal.com or 202-783-1760. Find him on Twitter: @STetreaultDC.
