Hatch: Harmful Obamacare Taxes Must Be Repealed

Utah Senator Says, “The tax provisions in Obamacare were poorly conceived and recklessly enacted, and they are harmful to our economy.”

WASHINGTON – In a speech on the Senate floor today, Finance Committee Chairman Orrin Hatch (R-Utah) reiterated the need to repeal and replace the burdensome Patient Protection and Affordable Care Act (PPACA) and highlighted the importance of repealing the harmful taxes imposed by the health law.

“All of us want to right what went wrong with the poorly-named Affordable Care Act and provide patients and consumers with more healthcare choices that address healthcare costs, Hatch said. “The tax provisions of the Affordable Care Act represented a trillion dollar hit on the U.S. economy in the first ten years. The burdens of the vast majority of these taxes are ultimately borne by patients and consumers in the form of higher costs, larger tax bills, and reduced value in existing health plans and savings accounts.”

Hatch went on to note the past work to chip away at a number of burdensome taxes and reaffirmed his commitment to continue the effort to repeal and replace the harmful taxes and the health law in its entirety.

“We’ve been able to forestall the impact of a number of the Obamacare tax provisions. We’ve fought and negotiated long and hard to do so. Virtually all of those taxes are still looming on the Obamacare horizon,” Hatch continued. “It is essential that we repeal all of these taxes along with the rest of Obamacare.”

The complete speech as prepared for delivery is below:

    Mr. President, I rise today to once again discuss the ongoing effort to repeal and replace the so-called Affordable Care Act.

    Of course, this isn’t the first time I’ve come to the floor to discuss Obamacare, and I’m fairly certain it won’t be the last. I was here just last week in fact talking about the general unanimity among Republicans on these issues, despite the seemingly eternal focus on the supposed divisions among our ranks.

    While some are still advancing that narrative, Republicans are, overall, still united in our desire to repeal and replace Obamacare. As I said last week, I don’t know if there’s a single Republican in Congress who supports keeping the healthcare status quo in place. All of us want to right what went wrong with the poorly-named Affordable Care Act and provide patients and consumers with more healthcare choices that address healthcare costs. Most differences of opinion that do exist on these matters are more about timing than anything else.

    As I’ve said before, I support moving quickly to repeal Obamacare and include as many replacement policies as possible under the rules of the reconciliation process. More specifically, I support repealing Obamacare’s harmful taxes, and I’ll explain why.

    Put simply, the tax provisions in Obamacare were poorly conceived and recklessly enacted, and they are harmful to our economy.

    Those taxes came in a number of forms, including the Employer Mandate and the Individual Mandate, both of which are enforced through the tax code.

     In addition, there is the Health Insurance Tax, the Cadillac Tax, along with new taxes on healthcare savings and pharmaceuticals.

    Obamacare also included a payroll tax hike for some high-income earners, as well as additional taxes on investment.

    And, of course, we cannot forget the Medical Device Tax, which, in just the first three years that Obamacare was implemented, resulted in more than 30,000 lost jobs in that important industry.

    All told, the tax provisions of the Affordable Care Act represented a trillion dollar hit on the U.S. economy in the first ten years. And, the burdens of the vast majority of these taxes are ultimately borne by patients and consumers in the form of higher costs, larger tax bills, and reduced value in existing health plans and savings accounts.

    I know some of my colleagues like to plead ignorance on the notion that taxes on a particular industry tend to be passed along to that industry’s consumers, but it’s a fact that can’t be ignored.

    Taxes on health insurance plans increase premiums for patients.

    Taxes on drug companies make drugs more expensive.

    Taxes on medical device sales increase the costs of those devices.

    It’s not a complicated concept, Mr. President, it is the natural byproduct of tax provisions negotiated with stakeholders behind closed doors under threat of increased government intrusion and market regulation. These taxes weren’t drafted solely to pay the cost of Obamacare, they were also part of a strategy to get the law through Congress, dividing the business community and pitting industries against one another to prevent widespread opposition.

    But, like I said, Mr. President, at the end of the day, it is the patients and consumers – individuals and families – that pay most of the freight on these types of tax policies.

    Don’t take my word for it Mr. President. Let’s look at one major example.

    Congress’s non-partisan tax scorekeeper, the Joint Committee on Taxation, indicated that, by and large, the tax on health insurance premiums would be passed along to health insurance policy holders. I ask unanimous consent to insert in the record a letter from the JCT to Senator Grassley, dated October 29, 2009.

    And, while we’re setting record straight on the taxes in Obamacare, my colleagues on the other side have repeated a particular false claim that needs correction.

    My Democrat friends are fond of characterizing the repeal of Obamacare as a tax cut for high income earners and a tax increase for low and middle-income taxpayers.

    That claim is simply false.

    According to JCT, the Affordable Care Act imposed significant and widespread tax increases on taxpayers earning less than $200,000 a year, despite President Obama’s repeated promises that the law would not do so.

     In fact, in 2017, a single provision – the reduction in the deductibility of catastrophic losses – is projected to raise taxes on 13.8 million taxpaying families and individuals, mostly from the middle class. That is more than the number of taxpayers that receive exchange credits and other premium subsidies under current law.

    And that’s just one example. There are others.

    Fortunately, we’ve been able to forestall the impact of a number of the Obamacare tax provisions. We’ve fought and negotiated long and hard to do so. But, virtually all of those taxes are still looming on the Obamacare horizon.

    Most of us on the Republican side have been fighting these taxes more or less since the day Obamacare was signed into law. We’ve highlighted their harmful impact on the economy and decried the crony capitalism that was behind the effort to draft and enact them.

    Given this long history, it is, in my view, essential that we repeal all of these taxes along with the rest of Obamacare. It’s difficult to imagine how Republicans, who are now in the majority in large part due to the promises we’ve made to repeal and replace the Affordable Care Act, can now sift through Obamacare’s taxes and decide which ones are the least objectionable so that we can use them to pay for our own healthcare reforms.

    Obamacare isn’t problematic simply because healthcare costs are now going up. It was fundamentally flawed at the outset.

    The way the law was drafted was, and still is, a problem.

    The way the law was negotiated – with stakeholders being played against each other – was, and still is, a problem.

    And, of course, the way the law was paid for was, and still is, a problem.

    The Obamacare taxes are a big part of this equation. And, in my view – and, I think, the view of the vast majority of my Republican colleagues – they have to go.

    Like I said, Mr. President, there really aren’t widespread disagreements among Republicans on these issues. Overall, we broadly agree on the fundamental issues surrounding Obamacare, and, as I noted last week, it’s not all that problematic to have some differences of opinion at the initial stage, so long as we can overcome those differences in the end.

    I think we can do that. More importantly, I think we will.

    With that, Mr. President, I yield the floor.

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