Labor to change to cash refunds policy to protect pensioners MORE (R-Ind.), Rep. Mike Bost (R-Ill.), Rep. Brad Sherman (D-Calif.) and Rep. Brad Schneider (D-Pa.).
The bill would also raise the federal payroll tax cap by a portion of payroll contributions and give some of them to seniors to pay for programs for the elderly, including senior-care savings accounts.
B???ut most of the $1.5 billion in spending cuts the bill proposes would come from reductions in the budget for programs for seniors. The budget would no longer cover costs associated with the “cost-sharing reduction program,” which is similar to Medicare’s prescription drug benefit. And the House will l?????ose its ability to impose significant increases in the annual cost of living increases.
There will be $634 million cut in funds for domestic programs — including unemployment insurance, the Children’s Health Insurance Program and the Supplemental Nutrition Assistance Program, or food stamps.
The bill also increases the Medicare payroll tax by 2.2 percentage points on employers. The tax would rise 1.3 percentage points for large companies with more than 50 employees and 1.8 percentage points for small businesses with fewer than 50.
The savings from these tax cuts would be enough to offset the spendi???ng cuts proposed for the House, including eliminating the estate tax and ending the alternative minimum tax. But they would cost $18.8 billion over 10 years — a total equal to 6 percent of GDP.
The Senate plan, which is expected to include only part of the House-passed tax bill, includes most of the savings for seniors. But some provisions would also leave seniors with higher rates of out-of-pocket expenses, such as those related to prescription drugs and Medicare prescription drug coverage.
The House will have to find a way to balance out the cuts it proposes for seniors, while also getting the budget moving.
If the Senate’s $3.8 billion deficit bill is adopted and the House’s deficit bill is rejected, the $17.8 trillion debt between the two bills will rise dramatically.
Republicans will also face a series of difficult elections for the House after 2016.