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Two Committees Roll Out Mandatory Savings Package

Mar 14, 2016 | Health Care| Taxes

Last week, two House Committees, Ways and Means and Energy and Commerce, released a package of bills that would reduce mandatory spending. The bills, which mostly contain policies included in a 2012 sequester replacement bill, would save a combined $123 billion over ten years. The Energy and Commerce legislation will be marked up next today, and the Ways and Means Committee may act as soon as this week.

The W&M package contains three separate bills. The first would require taxpayers claiming the refundable portion of the child tax credit to provide a Social Security number, which would save $4.8 billion over two years. The second bill requires taxpayers to repay any overpayments of health insurance subsidies; current law limits repayments to $300-$1,250 for singles and $600-$2,500 for married couples who make below 400 percent of the poverty line. This policy would save $8.7 billion over two years. The third bill would eliminate the Social Services Block Grant, which would save $3 billion over two years.

The Energy and Commerce package is one bill with five different policies:

  • Limiting Medicaid eligibility for lottery winners by counting winnings as income beyond the month they win.
  • Eliminating enhanced Medicaid matching for prisoners.
  • Reducing the Medicaid provider tax threshold, which limits how much revenue states can raise from providers to finance their Medicaid program, from 6 percent to 5.5 percent.
  • Eliminating the increased matching rate for the Childrens' Health Insurance Program (CHIP) contained in the Affordable Care Act
  • Eliminating the Prevention and Public Health Fund
Budgetary Effect of W&M and E&C Mandatory Packages
  Two-Year Savings Ten-Year Savings
Require SSN for Refundable CTC $4.8 billion ~$30 billion
Collect All Exchange Subsidy Overpayments $8.7 billion ~$50 billion
Eliminate Social Services Block Grant $3 billion ~$15 billion
End Medicaid for Lottery Winners ~$1 billion $11 billion
Eliminate Higher Medicaid Matching for Prisoners
Reduce Medicaid Provider Tax Threshold
Eliminate CHIP Matching Increase
Eliminate Prevention and Public Health Fund ~$2 billion $14 billion
Total ~$20 billion $123 billion

 Sources: Ways and Means Committee, CRFB calculations

These two packages are part of the effort surrounding the Fiscal Year 2017 budget resolution to find $30 billion in savings over two years. In other words, they are small steps to address our unsustainable fiscal situation.