The American Health Care Act, introduced in the House Energy and Commerce and Ways and Means committees late Monday, was advertised as a bill to repeal and replace the Affordable Care Act. But the real focus of the legislation is not on health-care reform, not even on repealing the ACA as such. What the AHCA would in fact do is massively redistribute wealth from the poorest Americans to the wealthiest, says Timothy Jost – an emeritus professor at Washington and Lee University School of Law.
The proposed legislation would repeal virtually all of the taxes created by Congress in 2010 to finance the ACA as of 2018. The ACA imposed taxes on insurers, pharmaceutical manufacturers and medical-device manufacturers, and imposed Medicare tax surcharges on Americans earning a quarter of a million dollars a year and more. The AHCA gets rid of them. The Joint Committee on Taxation estimates that the bill would cut taxes by almost $600 billion over 10 years. The Center on Budget and Policy Priorities notes that the AHCA’s repeal of Medicare taxes would give the 400 highest-earning American taxpayers a $7 million tax cut each.
In sum, the AHCA offers massive tax cuts for the wealthy, significant Medicaid cuts for the poor, a reshuffling of premium-assistance tax credits to offer more help to younger, higher-income individuals and less to the older and poorer — and it still may not save the individual insurance market.