The 3 Mostly Likely Obamacare Cuts In A Debt Deal

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On Wednesday afternoon, the White House shot down Speaker John Boehner’s (R-OH) call for chopping Obamacare in upcoming debt reduction negotiations. Indeed, neither party expects the major pieces of the law to suffer in any deal. But various smaller items will be part of the discussions as the two parties look for savings in the federal budget.

Democrats aren’t ruling out the prospect of cuts to parts of the law, as long as they don’t weaken its overarching goals — and Republicans will push hard for them. Even minor cuts to the law’s spending would earn GOP lawmakers political points among their conservative constituents, something that’ll be valuable if they have to swallow tax increases.

Here are the three pieces of the Affordable Care Act that Republicans believe they have the best chance of securing cuts to, GOP sources say.The Prevention And Public Health Fund

The prevention fund was designed to help local communities combat disease and promote wellness. Republicans deride it as a “slush fund.”

Initially set at $15 billion, GOP leaders convinced the president and Democratic leaders to chop it by $6.25 billion in the payroll tax cut deal early this year. Having sensed that Democrats are willing to reduce its size, they’ll hope to continue chipping away at it.

Overpaid Premium Subsidies

The ACA provides subsidies to help Americans within 400 percent of the poverty line buy insurance on the exchanges. Republicans see that as a major source of potential savings.

Democrats have previously agreed to alter the formula to save money, and Republicans see further opportunities. One policy idea they have to extract more savings is to force those who incorrectly received subsidies to pay them back. Another is to recapture subsidies from those whose incomes rise above the 400 percent of the poverty line shortly after they get the payment.

Center For Medicare And Medicaid Innovation

The ACA allotted $10 billion to create an agency called the Center For Medicare And Medicaid Innovation, which would be tasked with testing payment reforms and new delivery system models to improve efficiency. Republicans see the money as a waste.

Top Republicans have floated the idea before in previous debt reduction talks and, with the fiscal cliff negotiations coming up, will hope to reduce the funding for CMMI.

ABOUT THE AUTHOR

Sahil Kapur is TPM's senior congressional reporter and Supreme Court correspondent. His articles have been published in the Huffington Post, The Guardian and The New Republic. Email him at sahil@talkingpointsmemo.com and follow him on Twitter at @sahilkapur.
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