Trump Says Republican Tax Bill ‘Essentially’ Repeals Obamacare

Updated on
  • Bill eliminates individual mandate, a pillar of the ACA
  • Insurers have warned repeal of mandate will raise premiums
"Obamacare has been repealed in this bill," Trump tells reporters on Wednesday.

President Donald Trump claimed victory for “essentially” repealing Obamacare in the Republican tax bill that cleared the House on Wednesday.

The bill eliminates a tax penalty for Americans who don’t carry health insurance, a pillar of the Affordable Care Act, while leaving the law’s other elements intact. Insurers have warned that eliminating the requirement will cause them to raise premiums. Healthy people will have less incentive to sign up for coverage, leaving insurers with a sicker pool of customers overall, the companies and many economists and health policy experts say.

“The individual mandate is being repealed. That means Obamacare is being repealed,” Trump told reporters at the White House on Wednesday. “We have essentially repealed Obamacare.”

The nonpartisan Congressional Budget Office estimated last month that repealing the individual mandate would lead to 13 million more uninsured in 2027, and that premiums in the individual market would increase by about 10 percent. Lifting the penalty saves the government $338 billion over the next decade, the CBO said, because some of those who go uninsured would have gotten subsidized coverage. Lawmakers used that savings to reduce taxes.

Removing the individual mandate doesn’t undo other essential elements of Obamacare. The law still requires insurers to sell policies to sick people at the same prices as healthy people, and provides subsidies for low-income families to make health plans more affordable.

Trump also boasted that he successfully downplayed the provision to avoid media coverage of the change.

“We didn’t want to bring it up. I told people specifically ‘be quiet with the fake news media because I don’t want them talking too much about it,’” Trump said. “But now that it’s approved I can say: the individual mandate on health care, where you had to pay not to have insurance -- think of that one, you pay not to have insurance -- the individual mandate has been repealed.”

Trump said Republicans will “come up with something that will be much better” to replace the mandate. Republican legislation to replace much of the Affordable Care Act failed earlier this year.

The true importance of the mandate has been debated by economists and policymakers, and the CBO has said it is revising how it calculates the effect. S&P Global Ratings suggested last month that rolling back the penalty would save less than expected, and increase the number of uninsured by only 3 million to 5 million. About 6.5 million people paid an average penalty of $470 for not having insurance in 2015, according to IRS data.

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