Center on Budget and Policy Priorities: Senate Bill Still Cuts Tax Credits, Increases Premiums and Deductibles for Marketplace Consumers

This analysis of the Senate’s Better Care Reconciliation Act from the Center on Budget and Policy Priorities highlights the bill’s impact on individuals that will continue to use the federal health insurance marketplace to obtain their health insurance. Under the Senate bill, deductibles could increase to an average of $6,300, more than double the current average. Older Americans would be faced with dramatic increases in their premiums because the Senate bill allows health plans to charge seniors up to five times the amount of premiums charged to other adults. The lowest income Americans would lose cost-sharing tax credits that currently help them pay their health insurance premiums, deductibles, and other co-payments. The Senate bill also eliminates any tax credits to assist with the payment of premiums for individuals and families with incomes between 350% and 400% percent of the federal poverty level. All this means that millions of working individuals and families would not be able to afford health insurance.

The policy brief also has useful graphs that shows the impact in specific states: for example, a 60-year old in Alaska with an income of 350% of the federal poverty level would face a health insurance premium increase of $8,650 AND lose $22,380 in tax credits in 2020.

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Congressional Budget Office: Senate’s Better Care Reconciliation Act Would Still Result in Additional 22 Million Uninsured Americans

The Congressional Budget Office (CBO) has released its analysis of the impact of the Senate’s Better Care Reconciliation Act to repeal and replace the Affordable Care Act, concluding that the Senate bill would still result in an additional 22 million Americans becoming uninsured by 2026. If enacted, that impact would be immediate, with 18 million newly uninsured under the bill next year, in 2018. Ten years from now, a total of 49 million, or 17.5% of the U.S. population, would be uninsured.

The CBO analysis estimates that the average cost of health insurance premiums would continue to rise through 2020, only stabilizing after that. Again, the impact of those higher costs would be immediate, with premiums estimated to increase 20% next year, the first year after enactment. At the same time, deductibles would also continue to increase and the “actuarial value” while amount of health care services actually covered by health insurance would decrease. All this means higher costs for less health care.

The CBO does estimate that the ten-year savings from the bill would be $321 billion, greater than the savings projected under H.R. 1628 passed by the House of Representatives in May. There would be $541 billion in tax reductions to the wealthiest Americans, health insurance plans, pharmaceutical and medical device companies. Meanwhile, there would be $772 billion in cuts to the Medicaid program and $408 billion less in tax credits for low-income and middle-income Americans to help them pay for health insurance. The cuts to the Medicaid program would be a cost shift to states, health care providers, and low-income and older Americans who rely on Medicaid for health insurance coverage, including most of the costs of long-term care for older Americans.

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Senate Introduces Better Care Reconciliation Act

Here is the text of the Senate version of the Republican efforts to “repeal and replace” the Affordable Care Act, to be titled the Better Care Reconciliation Act. The draft bill has quite a number of differences with H.R. 1628, the American Health Care Act, which was passed by the House on May 4, 2017.

The bill still does not have a number nor analysis by the Congressional Budget Office. It is expected to be considered by the full Senate, without any committee hearings, as early as this week (before the July 4 recess).

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International Rescue Committee v. Trump: U.S. Supreme Court Grants Partial Stay Against Injunctions and Grants Review

The U.S. Supreme Court has granted review of both the 4th Circuit and 9th Circuit injunctions against President Donald Trump’s revised executive order banning the travel and entry of individuals from six Muslim-majority countries (Iraq, Libya, Somalia, Sudan, Syria, and Yemen) and suspending all refugee admissions. And in a highly unusual action, the Court also granted a partial stay of those injunctions, allowing a partial implementation of the executive order during the Court’s review of the lower court decisions. While the executive order will continue to be enjoined for any individuals from the six countries “who have a credible claim of a bona fide relationship with a person or entity in the United States” (for example, family members, students, other temporary nonimmigrants coming for a business reason, etc.) but may be implemented against any other individuals from the six named countries. In an unnecessary aside, the Court also states that “a nonprofit group devoted to immigration issues may not contact foreign nationals from the designated countries, add them to client lists, and then secure their entry by claiming injury from their exclusion.” Even more confusing, the Court also applies this “relationship” test to refugee admissions, continuing to permit entry for refugees who can establish such relationships to individuals or entities in the U.S., but allowing the implementation of the executive order temporarily suspending admission for refugees who cannot.

The action is unusual because rather than granting President Trump’s requests to stay both injunctions pending review (which would have been the action that Justices Thomas, Alito, and Gorsuch would have taken, as they outline in their concurring and dissenting opinion), the Court reaches into the merits of the injunctions and the lower court decisions to separate out which sections of the executive order remain enjoined and which sections can be implemented.  For a court dominated by justices with conservative judicial philosophies of not making or re-writing laws, this action reflects extreme judicial activism, essentially re-writing the executive order for the President (which incidentally, all the lower courts declined to do, citing the flaws in drafting as part of the rationale for the injunctions).

The Court ordered hearing on the cases at its first week of October 2017 session but will not otherwise expedite its consideration of the cases.

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Center on Budget and Policy Priorities: House Health Bill – Tax Cuts for Wealthy, Insurers, and Drug Companies Paid for by Low- and Middle-Income Families

This policy brief from the Center on Budget and Policy Priorities describes the massive tax cuts for the wealthiest of Americans, health insurance plans, pharmaceutical companies, and medical device manufacturers included in the House Republican-enacted American Health Care Act (H.R. 1628). On the other hand, the bill reduces billions of dollars in tax credits for low- and middle-income Americans that now subsidize their health insurance premiums and costs such as co-payments and deductibles. Accordingly, the policy brief characterizes the legislations as one of the largest shifts in taxes in American history, with billions of dollars in cuts for the wealthiest and billions of dollars in increased tax burdens (from the loss of the tax credits) for low- and middle-income Americans.

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Congressional Budget Office: American Health Care Act Would Result in 23 Million Americans Uninsured

The Congressional Budget Office (CBO) has finally had the opportunity to analyze the final version of H.R. 1628, the American Health Care Act (AHCA), passed by the House of Representatives on May 4, 2017. It is highly unusual for a bill. especially a budget reconciliation bill with impacts on millions of Americans and hundreds of billions of dollars in the federal budget, to be acted upon by the House without a CBO analysis but the Republicans in the House pushed through the vote along party lines earlier this month.

The CBO concludes that the bill would result in 23 million Americans, or over 18 percent of the total population, without health insurance by 2020. This would mean that all the increases in health insurance coverage resulting from the Affordable Care Act (ACA), enacted in 2010, would be undone, returning our national uninsured rate to pre-ACA levels. About 14 million Americans currently insured through the expansions of Medicaid under the ACA would lose their health insurance by 2020.

In the private health insurance markets, the AHCA would only provide $375 million in tax credit subsidies to low- and middle-income Americans to help them pay their health insurance premiums and costs such as co-payments and deductibles.  This is compared to $671 million that is now available under the ACA, which means that low- and middle-income Americans would have to find a way to pay $296 million to keep their health insurance. Since many millions will not be able to afford their health insurance without these tax credit subsidies, they will be among the 23 million that will become uninsured.

The AHCA also cuts $834 billion from the Medicaid program, a significant reason that the legislation results in net tax savings (estimated at $119 billion over ten years, $32 billion lower than the prior version of the bill), even with hundreds of billions of dollars tax cuts for the highest income Americans (at least $231 billion), health plans ($144.7 billion), pharmaceutical companies ($28.5 billion), and medical device manufacturers ($19.6 billion). Another provision allows health plans to take additional business deductions for compensation paid to their highest paid executives, resulting in $500 million less tax revenues.

Buried in the tables accompanying the report is one stark example of how significant the impact the AHCA will have on many Americans. In 2026, ten years after enactment (and full implementation), a 64-year old with an annual income of $26,500 (175% of the federal poverty level) would go from paying $1,700 for health insurance under the ACA to having to pay $16,700 for the same coverage. That individual’s premiums would go up $5,700 while losing $8,700 in tax credits to help pay for those premiums.

The U.S. Senate has yet to take action on H.R. 1628 or any similar legislation.

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International Rescue Committee v. Trump: 4th Circuit Affirms Preliminary Injunction Against Revised Muslim Immigration, Refugee, and Travel Ban

In a 10-3 decision, the 4th Circuit Court of Appeals has affirmed a federal district court’s preliminary injunction against implementation of President Donald Trump’s second attempt to ban Muslim immigrants, refugees, and visitors from the U.S. (Executive Order 13780).  In an opinion by Chief Judge Roger Gregory (appointed to the Court by President George W. Bush), the Court writes:

“The question for this Court, distilled to its essential form, is whether the Constitution… remains ‘a law for rulers and people, equally in war and in peace.’ And if so, whether it protects Plaintiffs’ right to challenge an Executive Order that in text speaks with vague words of national security, but in context drips with religious intolerance, animus, and discrimination. Surely the Establishment Clause of the First Amendment yet stands as an untiring sentinel for the protection of one of our most cherished founding principles—that government shall not establish any religious orthodoxy, or favor or disfavor one religion over another. Congress granted the President broad power to deny entry to aliens, but that power is not absolute. It cannot go unchecked when, as here, the President wields it through an executive edict that stands to cause irreparable harm to individuals across this nation. Therefore, for the reasons that follow, we affirm in substantial part the district court’s issuance of a nationwide preliminary injunction as to Section 2(c) of the challenged Executive Order.”

The Court asserts its important role as the third branch of government:

“Although the Supreme Court has certainly encouraged deference in our review of immigration matters that implicate national security interests,…it has not countenanced judicial abdication, especially where constitutional rights, values, and principles are at stake. To the contrary, the Supreme Court has affirmed time and again that ‘it is emphatically the province and duty of the judicial department to say what the law is.’…This ‘duty will sometimes involve the ‘resolution of litigation challenging the constitutional authority of one of the three branches,’ but courts cannot avoid their responsibility.’

…the Supreme Court has made clear that despite the political branches’ plenary power over immigration, that power is still ‘subject to important constitutional limitations,’ … and that it is the judiciary’s responsibility to uphold those limitations….the political branches’ power over immigration is not tantamount to a constitutional blank check, and that vigorous judicial review is required when an immigration action’s constitutionality is in question.”

The Court finds that there is sufficient evidence that the President’s justification for the Executive Order based on national security was proffered in “bad faith”, namely:

“Plaintiffs here claim that EO-2 invokes national security in bad faith, as a pretext for what really is an anti-Muslim religious purpose. Plaintiffs point to ample evidence that national security is not the true reason for EO-2, including, among other things, then-candidate Trump’s numerous campaign statements expressing animus towards the Islamic faith; his proposal to ban Muslims from entering the United States; his subsequent explanation that he would effectuate this ban by targeting “territories” instead of Muslims directly; the issuance of EO-1, which targeted certain majority-Muslim nations and included a preference for religious minorities; an advisor’s statement that the President had asked him to find a way to ban Muslims in a legal way; and the issuance of EO-2, which resembles EO-1 and which President Trump and his advisors described as having the same policy goals as EO-1….Plaintiffs also point to the comparably weak evidence that EO-2 is meant to address national security interests, including the exclusion of national security agencies from the decisionmaking process, the post hoc nature of the national security rationale, and evidence from DHS that EO-2 would not operate to diminish the threat of potential terrorist activity.”

Accordingly, Court looks beyond the text of the Executive Order to determine whether there was an impermissible purpose to disfavor Muslim individuals on the basis of their religion, which would be an unconstitutional violation of the First Amendment Establishment Clause:

“The evidence in the record, viewed from the standpoint of the reasonable observer, creates a compelling case that EO-2’s primary purpose is religious. Then-candidate Trump’s campaign statements reveal that on numerous occasions, he expressed anti- Muslim sentiment, as well as his intent, if elected, to ban Muslims from the United States….like EO-1, EO-2’s purpose is to effectuate the promised Muslim ban, and that its changes from EO-1 reflect an effort to help it survive judicial scrutiny, rather than to avoid targeting Muslims for exclusion from the United States. These statements, taken together, provide direct, specific evidence of what motivated both EO-1 and EO-2: President Trump’s desire to exclude Muslims from the United States.”

The Court also notes:

“EO-2’s text does little to bolster any national security rationale: the only examples it provides of immigrants born abroad and convicted of terrorism-related crimes in the United States include two Iraqis—Iraq is not a designated country in EO-2—and a Somalian refugee who entered the United States as a child and was radicalized here as an adult.”

While the dissenting opinions attack the majority opinion for reliance on candidate Trump’s statements as relevant to the review of the Executive Order issued by President Trump, the Court responds with the facts:

“For a past statement to be relevant to the government’s purpose, there must be a substantial, specific connection between it and the challenged government action. And here, in this highly unique set of circumstances, there is a direct link between the President’s numerous campaign statements promising a Muslim ban that targets territories, the discrete action he took only one week into office executing that exact plan, and EO-2, the ‘watered down’ version of that plan that ‘get[s] just about everything,’ and ‘in some ways, more.’…To the extent that our review chills campaign promises to condemn and exclude entire religious groups, we think that a welcome restraint.”

The Court states emphatically:

“The Government has repeatedly asked this Court to ignore evidence, circumscribe our own review, and blindly defer to executive action, all in the name of the Constitution’s separation of powers. We decline to do so, not only because it is the particular province of the judicial branch to say what the law is, but also because we would do a disservice to our constitutional structure were we to let its mere invocation silence the call for meaningful judicial review. The deference we give the coordinate branches is surely powerful, but even it must yield in certain circumstances, lest we abdicate our own duties to uphold the Constitution. EO-2 cannot be divorced from the cohesive narrative linking it to the animus that inspired it. In light of this, we find that the reasonable observer would likely conclude that EO-2’s primary purpose is to exclude persons from the United States on the basis of their religious beliefs.”

The Court has a final constitutional law lesson on the three branches of government:

“…we reject the notion that the President, because he or she represents the entire nation, suffers irreparable harm whenever an executive action is enjoined. This Court has held that the Government is ‘in no way harmed by issuance of a preliminary injunction which prevents [it] from enforcing restrictions likely to be found unconstitutional.’… ‘If anything,’ we said, ‘the system is improved by such an injunction.’…Because Section 2(c) of EO-2 is likely unconstitutional, allowing it to take effect would therefore inflict the greater institutional injury.”

The Court quotes a 1967 U.S. Supreme Court ruling to turn the President’s national security argument on its head:

“Implicit in the term ‘national defense’ is the notion of defending those values and ideals which set this Nation apart…[O]ur country has taken singular pride in the democratic ideals enshrined in its Constitution, and the most cherished of those ideals have found expression in the First Amendment. It would indeed be ironic if, in the name of national defense, we would sanction the subversion of one of those liberties . . . which makes the defense of the Nation worthwhile.”

The Court concludes:

“…the Government’s asserted national security interest in enforcing Section 2(c) appears to be a post hoc, secondary justification for an executive action rooted in religious animus and intended to bar Muslims from this country. We remain unconvinced that Section 2(c) has more to do with national security than it does with effectuating the President’s promised Muslim ban….on balance, we cannot say that the Government’s asserted national security interest outweighs the competing harm to Plaintiffs of the likely Establishment Clause violation. For similar reasons, we find that the public interest counsels in favor of upholding the preliminary injunction. As this and other courts have recognized, upholding the Constitution undeniably promotes the public interest….when we protect the constitutional rights of the few, it inures to the benefit of all.”

The Court has a final admonition for the President:

“Improper government involvement with religion ‘tends to destroy government and to degrade religion,’…encourage persecution of religious minorities and nonbelievers, and foster hostility and division in our pluralistic society. The risk of these harms is particularly acute here, where from the highest elected office in the nation has come an Executive Order steeped in animus and directed at a single religious group.”

The Trump Administration has stated that it would appeal this latest decision to the U.S. Supreme Court.

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ACT TODAY: Send Comments to Office of Management and Budget Supporting Disaggregated Race and Ethnicity Data

This coming Sunday April 30 is the deadline for submitting comments to the Office of Management and Budget in support of its proposed changes to the federal classifications of race and ethnicity data that include additional disaggregation of each race and ethnicity category.

The Heritage Foundation and other conservative organizations have mobilized hundreds of comments in opposition to the proposed changes. The Asian & Pacific Islander Health Forum has created an easy tool to submit comments (it only takes two minutes to fill in your contact information).

Please submit a comment today and share widely with your networks!

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County of Santa Clara and City and County of San Francisco v. Donald Trump: Preliminary Injunction Against Defunding of Sanctuary Cities

Here is the preliminary injunction issued today, April 25, 2017, by U.S. District Court Judge William Orrick against the section of President Donald Trump’s Executive Order 13786 that threatened to withhold federal funding from “sanctuary jurisdictions”. This was one of the first executive orders issued by President Trump days after his inauguration, on January 25, 2017.

Both jurisdictions have had long-standing policies to limit their communication and cooperation with federal Immigration and Customs Enforcement (ICE) officials about individuals arrested and detained by Santa Clara and San Francisco law enforcement authorities. Federal courts have made clear that requests from ICE to continue to detain individuals in order to pursue potential federal immigration enforcement against them (“ICE detainers”) are voluntary requests that do not have to be honored by local jurisdictions.  Accordingly, Santa Clara conditioned its cooperation on reimbursement from ICE for any additional detention costs for individuals ICE would want detained, and when ICE declined to provide such reimbursements, Santa Clara declined to comply with the ICE requests. San Francisco has a city policy not to expend city funds to enforce federal immigration law and so it also declines to comply with ICE requests to continue to detain individuals solely for potential immigration enforcement.

There are three federal criminal justice grant programs that are explicitly conditioned on honoring ICE detainer requests. Santa Clara does not receive those federal grant funds and San Francisco is challenging those conditions as part of its lawsuit.

However, Santa Clara County estimates that it receives a total of $1.7 billion in federal funding each fiscal year and the City and County of San Francisco estimates that it receives $1.2 billion in federal funding each fiscal year. The local jurisdictions seek relief from against the executive order’s threat against all this federal funding. The Court ruled that the local jurisdictions had standing to seek the preliminary injunction and were likely to succeed on the merits of their claims.

The court notes statements by President Trump, Attorney General Jeff Sessions, and White House Press Secretary Sean Spicer characterizing the executive order as a “weapon”, to “claw back” federal funds already awarded, and its clear intent to specifically defund California cities such as San Francisco. This is yet another case in which the statements of the President and his key staff have been used to support an injunction against one of his executive orders.

The court ruled:

“The Constitution vests the spending powers in Congress, not the President, so the Order cannot constitutionally place new conditions on federal funds. Further, the Tenth Amendment requires that conditions on federal funds be unambiguous and timely made; that they bear some relation to the funds at issue; and that the total financial incentive not be coercive. Federal funding that bears no meaningful relationship to immigration enforcement cannot be threatened merely because a jurisdiction chooses an immigration enforcement strategy of which the President disapproves.”

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State of Hawaii v. Trump: Preliminary Injunction Against Revised Muslim Immigration, Refugee, and Travel Ban

U.S. District Court Judge Derrick Kahala Watson has converted his nationwide temporary restraining order against the implementation of President Donald Trump’s revised executive order banning immigration, refugees, and travel from Muslim-majority countries into an indefinite nationwide preliminary injunction. Judge Watson notes:

“…where the ‘historical context’ and ‘the specific sequence of events leading up to’ the adoption of the challenged Executive Order are as full of religious animus, invective, and obvious pretext as is the record here, it is no wonder that the Government urges the Court to altogether ignore that history and context….The Court will not crawl into a corner, pull the shutters closed, and pretend it has not seen what it has. The Supreme Court and this Circuit both dictate otherwise, and that is the law this Court is bound to follow.”

Judge Watson concludes:

“National security is unquestionably of vital importance to the public interest. The same is true with respect to affording appropriate deference to the President’s constitutional and statutory responsibilities to set immigration policy and provide for the national defense. Upon careful consideration of the totality of the circumstances, however, the Court reaffirms its prior finding that the balance of equities and public interest weigh in favor of maintaining the status quo. As discussed above and in the TRO, Plaintiffs have shown a strong likelihood of succeeding on their claim that the Executive Order violates First Amendment rights under the Constitution.”

Judge Watson also specifically ruled that he would not stay his preliminary injunction order if the U.S. government filed any appeals.



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