House Speaker Paul Ryan, R-Wis., and Senate Majority Leader Mitch McConnell, R-Ky., pledged to prevent deep cuts to Medicare because of tax reform, even though they would need Democratic support to do so.
Ryan and McConnell issued a joint statement Friday in response to concerns that the tax legislation would trigger $136 billion in mandatory spending cuts, including $25 billion to Medicare in fiscal 2018. The congressional leaders pledged to waive the trigger, but doing so would require at least eight Democratic votes in the Senate.
The 2010 Statutory Pay-As-You-Go Act enacts sweeping spending cuts if the deficit reaches a certain threshold. An estimate from the nonpartisan Congressional Budget Office found that a bill that raises the deficit by $1.5 trillion over a decade would trigger the spending cuts, specifically $136 billion that includes $25 billion to Medicare.
The nonpartisan Joint Committee on Taxation estimates the Senate’s tax reform bill would add $1 trillion to the deficit. Senate Republicans have dismissed the estimate as not credible.
Democrats have pilloried Republicans for advocating a bill that could cut Medicare.
Ryan and McConnell sought to respond to those attacks Friday.
“Congress has readily available methods to waive this law, which has never been enforced since its enactment,” the statement said. “There is no reason to believe that Congress would not act again to prevent a sequester, and we will work to ensure these spending cuts are prevented.”
The statement comes as McConnell promised Sen. Susan Collins, R-Maine, he would pursue a waiver in a must-pass legislative vehicle such as a spending deal. Collins has been concerned about the pay-go law, but announced Friday she would support the bill after acquiring several concessions.
Since pay-go was passed in 2010, it has been waived 16 times by Congress.
However, a new waiver would require support from Democrats to get it through the Senate. It is not clear if there is enough support to do that, as some Democrats were coy about whether they would support a waiver.
“Until I see what their package is with regards to healthcare, I am not going to shoot from the hip,” said Sen. Ron Wyden, D-Ore., ranking member of the Senate Finance Committee.