For all the partisan fighting about the House Republican proposal to pay for repealing 1099, the GOP proposal is very similar to the one Democrats supported and approved last year.
In last year’s healthcare law, Democrats themselves proposed a system that offers subsidies to people for buying healthcare, and then allows overpaid subsidies to be recaptured based on how much a family’s income is higher than the federal poverty level.
In the healthcare law, Democrats decided that $400 in subsidies could be recaptured for families with incomes lower than 400 percent of the poverty level. For families at 400 percent of the poverty level or higher, full subsidy repayment was required.
These repayment amounts were changed later in order to “pay for” a bill ensuring payments to Medicare physicians. In that so-called “doc fix” bill, much higher recapture amounts were approved by Democrats, ranging from $600 to $2,500 for families earning less than 400 percent of the poverty level.
The doc fix bill also allowed for just partial repayments — not full repayments — for families between 400 and 500 percent of the poverty level. Republicans have objected to this change because families earning more than 400 percent of the poverty level do not qualify at all for these subsidies, and that full repayment should be required.
The Republican bill being debated today, H.R. 4, requires full repayment again for families above 400 percent of the poverty level, and makes only two other changes compared to the doc fix bill.
First, it increases the recapture amount from $1,000 to $1,500 for families between 200 and 250 percent of the poverty level. Secondly, it increases the amount from $2,000 to $2,500 for families between 300 and 350 percent of the poverty level.
Democrats on Thursday continued to argue that these changes amount to a tax increase on middle-class families. But Republicans countered that the Republican changes are far less drastic than the changes Democrats supported in the doc fix bill, which in most cases increased the subsidy recaptured from $400 to $2,500.
“Does that mean in December that Democrats increased taxes on middle class families?” one GOP staffer asked. “If it wasn’t a tax increase then, how can it be a tax increase now?”