The latest package Biden signed into law Tuesday is expected to cut the deficit by more than $300 billion over 10 years, according to the Congressional Budget Office
What the law says:
Medicare drug price negotiations: allow people to negotiate the price of certain expensive medicines administered in clinics or purchased at pharmacies. The Secretary of Health and Human Services said that in 2026 he will negotiate prices for 10 drugs, and in 2027 and he will negotiate prices for another 15 drugs in 2028. The number will increase to 20 per year after 2029.
This controversial provision is far more restrictive than those supported by House Democratic leaders in the past. But it would open the door to achieving a long-standing party goal of allowing Medicare to use that burden to lower the cost of drugs.
Medicare out-of-pocket drug cost limits: Legislation redesigned Medicare's Part D drug plans to allow seniors and people with disabilities to pay $2,000 or more in drug costs annually. avoid paying for It will be available in pharmacies from 2025. Insurance and pharmaceutical companies need to get more tabs.
Free Vaccines for Seniors: All vaccines are free for Medicare subscribers. Currently, only certain vaccines are free, such as Covid-19, flu and pneumonia vaccines.
Overall, drug pricing rules are expected to cut federal deficits by $288 billion over his decade, according to the CBO.
Cheaper Insulin: Medicare beneficiaries will start paying $35 or less per month for insulin starting next year.
Democrats wanted to extend this provision to cover private insurance, but Congress decided that including the commercial market was not in compliance with the Settlement Rule. Democrats retained the package's broader provisions, while Republicans upped the order to force a vote stripping the private insurance market from the bill.
Affordable Care Act Subsidies: This act extends enhanced federal premium subsidies for Obamacare coverage through 2025, and lawmakers recently A year later than discussed. That way, it won't expire immediately after the 2024 presidential election.
Participants pay no more than 8.5% of their income in premiums, down from nearly 10%. Low-income policyholders also receive subsidies that completely waive premiums.
And for the first time, those earning 400% or more of his federal poverty level were eligible for assistance. According to the Centers for Medicare and Medicaid Services, which manages the federal Obamacare Marketplace, a person whose income is between 400% and 600% of the poverty level would have double her premium without federal subsidies. will be.
Overall, the increased support has reduced premiums by 50%, or $67 per consumer per month, the agency said.
According to the Kaiser Family Foundation, if enhanced federal subsidies are allowed to expire at the end of the year, 13 million subsidized registrations almost all of them will see premium increases in 2023. More than 3 million people could go uninsured, according to an analysis by the Urban Institute.
Democrats wanted to avoid negative publicity from such premium increases. If Congress doesn't act, consumers will know how much more they'll have to pay in the fall. Free registration opens on his November 1st, one week before Election Day.
Instead, CMS predicts that more people will flock to the Affordable Care Act exchange now that the president has signed the bill into law.
CMS administrator Chiquita Brooks-LaSure told her CNN: "The only reason we're having those conversations is because subsidies have been extended."
According to the CBO, she's $64 billion in enhanced subsidy extensions. costs.
Climate Clause: This agreement is the largest climate investment in US history. By 2030, he will cut US greenhouse gas emissions by 40%, the office of Majority Leader Chuck Schumer said.
The new pacts range from electric vehicle tax credits to clean energy production to investments in the environmental justice community.
The extension of the tax credit for electric vehicles came after previous objections from Manchin. Tax credits will continue at current levels, up to $4,000 for used electric vehicles and $7,500 for new electric vehicles. However, the income threshold for eligibility is reduced. This is Manchin's main request.
The law also includes a 10-year consumer tax credit to reduce the cost of heat pumps, rooftop solar, electric HVAC and water heaters. This includes $60 billion in funding for the environmental justice community and the reduction of legacy pollution.
He also put $60 billion into domestic clean energy production and $30 billion into production credit tax credits for wind, solar and battery storage.
Tax credits are technology-neutral, meaning they do not prioritize renewable energy over fossil fuels with carbon reduction measures. But they are designed to reward those who cut their emissions the most, according to Oregon Democrat Senate Finance Chairman Ron Wyden.
The deal also includes key provisions such as the Methane Program, which imposes fees on oil and gas producers who emit methane above certain thresholds. Also included is his $27 billion into the so-called Clean Energy Accelerator. It's essentially a green bank leveraging public and private funds to scale up more green projects.
Tax Provisions: To raise revenues, the law imposes a minimum tax of 15% on the income reported to shareholders by large corporations (book income). Contrast with the Internal Revenue Service. The latest figures provided by Schumer show he will raise $258 billion in 10 years, and the bill will apply to companies whose profits exceed his $1 billion.
Concerned about the impact of this provision on businesses, especially manufacturers, Arizona Senator Kirsten Cinema, a moderate Democrat, has proposed a package that would allow businesses to pay off their investments more quickly. won the change. This reduces the tax burden.
Cinema also seeks to strengthen the carry-his-interest loophole that allows investment managers to treat much of their compensation as capital gains and pay a long-term capital gains tax rate of 20%. Disabled the effort. Up to 37%. This provision would extend the period from three years to five years for which an investment manager's interest must be held in order to take advantage of the lower tax rate. Addressing this loophole, which could raise $14 billion over 10 years, has long been a goal of Congressional Democrats.
In exchange, his 1% excise tax on corporate share buybacks was added, plus he raised $74 billion,according to Schumer's office.
And there are no new taxes for small businesses.
Manchin also threw cold water on his one of Schumer's priorities. Addressing his $10,000 cap on state and local tax credits known as SALT, which is part of the 2017 Republican tax cut package and will affect many states in 2017. northeast and west coast.
The deal also excludes a surcharge on wealthy individuals that was part of last year's House bill.
Excluded were
Universal Preschool and Childcare Cost Reductions: Previous House bill The version expands access to 6 million children a year for preschoolers ages 3 and 4 that would otherwise have been free. Also limits child support for families with children under age 6 to 7% or less of income for families earning up to 250% of state median income, extending access to approximately 20 million children . Funding for these programs lasted six years and cost an estimated $381.5 billion, according to the CBO.
Enhanced Child Tax Credit: Enhanced Child Tax Credit -- $300 per month for each child under the age of 6; $250 a month -- Under a House bill, it was to be extended through 2022 for more than 35 million families.
Previous enhancements that were part of the coronavirus relief package were implemented only in 2021. Eligible for full enhancement credits. However, unlike 2021, only these families will receive funds in monthly installments this year. High-income eligible parents were required to claim the deduction on next year's tax return. The
credit is permanently refundable, so the lowest income families can still qualify.
According to the CBO, this deduction, together with the income tax credit, would cost about $203 billion.
Income Tax Credit: The Extended Income Tax Credit, which was also part of the Coronavirus Relief Package , has been extended through 2022, helping 17 million low-wage children no workers.
Previous House bills almost tripled the maximum credits childless workers could receive, expanded eligibility to more people, and reduced the minimum age to Lowered and abolished upper age limit. The deduction, combined with the enhanced child tax credit, will cost about $203 billion, according to the CBO.
Home Health Care: Biden's original plan was to reduce the state's Medicaid waiting list by more than 800,000 people, including the elderly and people with disabilities. A permanent improvement in Medicaid coverage for home care services was sought. list.
The plan also aimed to improve the quality of care workers. The CBO said the move would cost about $158 billion.
Affordable Housing: This Act allows for the construction, restoration and purchase of affordable housing for low-income individuals and the construction and maintenance of affordable rental housing. $25 billion will be invested in That would have provided her $65 billion to address the backlog of public housing capital needs and increased rental support for hundreds of thousands of homes.
The bill would have also invested in down payment assistance and community-led redevelopment projects in resource-poor areas. And would have provided $24 billion to fund housing vouchers and supportive services.
The effort cost about $148.1 billion, according to the CBO.
would have invested in historically black colleges and other institutions serving underrepresented communities. And it will increase funding for workforce development.
The CBO estimated that these provisions would collectively cost $39.8 billion.
Biden had also originally called for her two years of community college tuition to be free, but that provision was removed from the House bill.
Medicaid Coverage Gap: Democrats are calling for Affordable Care Act premium subsidies for low-income Americans in 12 states that have not expanded Medicaid. asked to provide. This will allow people to purchase Obamacare coverage without monthly premiums until 2025.
Doing so will cost her about $57 billion, her CBO estimates.
Medicare Hearing Benefits: Hearing services were to be covered by Medicare beginning in 2023 under previous legislation passed by the House of Representatives.
According to the White House, only 30% of those aged 70 and over who can benefit from hearing aids have ever used one.
The move cost him $36.7 billion, according to the CBO.
Expand Medicare's ability to pay: 234} In early July, Senate Democrats finalized a deal that would extend Medicare's ability to pay for several years by closing a tax loophole. The proposal would have ensured that certain "pass-through" business owners who included business income on their personal tax returns would pay her 3.8% net investment income tax. Applies to individuals whose annual income exceeds $400,000 and joint filers who earn more than $500,000.
However, that agreement was also canceled by Manchin.
