Will the Affordable Care Act be repealed?
The results of the 2016 presidential election are likely to have a big impact on federal tax policy in the coming years – especially as it relates to the Affordable Care Act. To get a sense of what changes might be on the way, the Journal of Accountancy recently spoke with Eddie Adkins, CPA, a partner in the Washington National Tax Office at Grant Thornton, about the future of the ACA.
There are several things that are in the Affordable Care Act that are likely to go away. And the reason I can say they are likely to go away is these are items that can go away under a procedure in the Senate called “reconciliation” that just requires a simple majority vote, which the Republicans do have.
So what are those? Well, those are all the tax- and funding-related items. So all the tax items, such as the individual mandate—the requirement that individuals have coverage or pay a tax; the employer mandate—the requirement that employers offer coverage or pay an excise tax; those can go away, very likely will go away, because again, with a simple majority vote in the Senate, those can go away.
Other items are the premium tax credit. The premium tax credit, of course, is a credit that helps lower-income individuals pay their premiums when they purchase their insurance on an exchange. That is very, very likely to go away. Another item that’s very likely to go away is the funding for Medicaid expansion under the Affordable Care Act. So, many states expanded Medicaid. That funding, which is primarily funding from the federal government, very, very likely to go away. So those are several of the things that will go away. Really any tax-related items, so the 3.8% additional tax on investment income, very likely to go away. The additional 0.9% Medicare tax on earnings above a certain level, that’s also very likely to go away.
So all those tax and funding items that were part of the Affordable Care Act will go away.