GOP to Obama: We Don’t Want Health-Care Subsidies

Republican lawmakers are taking aim at the federally-provided subsidies provided to Congress members and some staffers to purchase insurance via state and federal exchanges.

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Sen. Ron Johnson, (R-WI), filed a lawsuit in January to overturn the restoration of health-care subsidies for members of Congress by the Office of Personnel Management. Currently, 38 GOP lawmakers have signaled support for the lawsuit.

The federal government used to subsidize health insurance for lawmakers and some of their staff, but the Affordable Care Act eliminated them. The OPM restored the subsidies in August 2013.

Johnson says the move shows “stunning disregard” for the ACA.

“I am not opposed to employers contributing to their employee’s health care,” Johnson says. “My issue is the way the president has changed the law, without the legal approval to do so. Millions of Americans are losing their employer-sponsored care because of the ACA, and only Congress and their official staffs are getting this tax-preferred subsidy for their insurance.”

Johnson says he signed up for coverage in Wisconsin’s private market, but does not criticize any member of Congress using the tax credit to buy insurance on an exchange. The subsidies cover about 75% of lawmakers’ care, he says.

“It’s not out of line with what many employers provide,” he says. “But its pre-tax and only members of Congress and their staffs can enjoy that. No other American gets that tax-preferred benefit and we need to rein in an out-of-control executive.”

The Judicial Education Project, along with 38 Congressional Republicans, including Sen. Ted Cruz, (R-TX), and Sen. John McCain, (R-AZ), filed an amicus brief in support of Johnsons’ suit.

The brief says that in passing the ACA, Congress provided that lawmakers and their official staffs can no longer participate in special federally-subsidized health plans. Meaning they will  have to get their insurance through state and federal exchanges.

“But under pressure from Beltway insiders, President Obama personally intervened to waive that requirement, decreeing that the special subsidies will continue to be available to members of Congress and their official staffs, contrary to the clear requirements of the law,” the brief states.

The Affordable Care Act mandates that every individual in the country have insurance by March 31, or face a fine of $95 a year or 1% of their annual income for failing to comply. Subsidies are available under the law for those making up to 400% of the federal poverty level-- $94,000 for a family of four or $45,000 for an individual.

As of April 17, 8 million people had signed up for insurance via state and federal exchanges, President Obama said at a press briefing with reporters.

Greg Katsas, partner at Jones Day which represents the Judicial Education Project, says Johnson’s lawsuit has strong odds, because he is challenging a portion of his compensation. The scenario is different than most employer-employee compensation and benefits cases, however, because Johnson isn’t asking for more--but less.

“If he were entitled to a salary of $100,000 and the government didn’t pay him, he could sue to get the salary, no question whatsoever,” he says. “But he is challenging health-care benefits instead of salary.”

The government filed a motion to dismiss Johnson’s suit on March 17, and Johnson replied Monday, along with the amicus brief.

“What I ultimately want is the president to act within his constitutional boundaries,” Johnson says. “This is one instance where a member of Congress may get the standing to have judicial review of this president’s executive overreach. He is creating law through regulation, without the authority to do so.”