Senate Republican leaders said Tuesday they would include language in their tax reform bill that would effectively eliminate Obamacare's requirement that everyone buy health insurance.
"We are optimistic that inserting the individual mandate repeal will be helpful," Senate Majority Leader Mitch McConnell, R-Ky., told reporters. "And that is obviously the view of the Senate Finance Committee Republicans as well."
Senate Majority Whip John Cornyn, R-Texas, predicted, "We are going to repeal the individual mandate" in the tax bill. And Sen. John Thune, R-S.D., confirmed the plan and said the money saved would help the GOP deliver a tax cut to the middle class.
"It will be distributed in the form of middle-income tax relief," Thune said. "It will give us even more of an opportunity to really distribute relief to middle-income cohorts that could benefit from it."
While Republicans talked about "repeal," the language is expected to keep the individual mandate on the books, but zero out all the penalties that can be applied to people who don't buy insurance. That language will make the individual mandate unenforceable, and will give people the freedom not to buy health insurance as if the mandate weren't there at all. The individual mandate is one of the most unpopular parts of Obamacare, polling has shown.
Republicans made the announcement following a closed-door meeting with rank-and-file members.
Republicans have gone back and forth for days about whether to try to attack the mandate in the tax bill, and President Trump has been encouraging them to do so.
Much of the momentum to include the individual mandate penalty repeal came from Sen. Tom Cotton, R-Ark., who spoke about it to President Trump. Cotton said in a statement that he was "pleased" his proposal was being included in the tax bill, and urged the House to do the same.
"Repealing the mandate pays for more tax cuts for working families and protects them from being fined by the IRS for not being able to afford insurance that Obamacare made unaffordable in the first place," he said.
Republican leaders said if the mandate language is part of the tax bill, they would then take up a separate, bipartisan bill to help fund Obamacare's cost-sharing subsidy program.
That bill, from Sens. Lamar Alexander, R-Tenn., and Patty Murray, D-Wash., would fund Obamacare insurer payments for two years in exchange for more flexibility for states to waive Obamacare regulations. It has stalled amid opposition from House Republicans, as well as President Trump, who label the payments "bailouts."
But considering Alexander-Murray could help sway key centrists in the Senate who are worried about adding language to kill the individual mandate to tax reform.
"I personally think that it complicates tax reform to put the individual mandate in there, particularly if it is done before the Alexander-Murray bill passes because of the impact on premiums," said Sen. Susan Collins, R-Maine.
Another centrist, Sen. Lisa Murkowski of Alaska, said before the lunch that tax reform was complicated enough without adding healthcare.
It remains unclear if Democrats, who unanimously support Alexander-Murray but not the tax bill, will embrace the new proposal.
Sen. Ron Wyden, D-Ore., said during a markup of the tax bill in the Senate Finance Committee that nullifying the mandate will "cause millions to lose their healthcare and millions more to pay higher premiums."
The nonpartisan Congressional Budget Office estimated last week that repealing the mandate would generate more than $300 billion in savings over the next decade but result in 13 million more people going without insurance.
Senate Minority Leader Chuck Schumer slammed Republicans after their announcement.
“Republicans just can’t help themselves," the New York Democrat said in a statement. "They’re so determined to provide tax giveaways to the rich that they’re willing to raise premiums on millions of middle-class Americans and kick 13 million people off their health care."
He accused Republicans of "doubling down" on the same path they took when trying to repeal Obamacare earlier in the year.
“If the American people weren’t already outraged by this bill, injecting health care into it will certainly do the trick," he said.
Kimberly Leonard contributed