House Passes Amended Bill To Fix Loophole in Health Reform Law
On Wednesday, the House unanimously passed an amended version of a bill (HR 674) that would repeal a contractor withholding tax and fix a loophole in the federal health reform law that would allow millions of middle-income early retirees to qualify for Medicaid, the New York Times reports (Steinhauer, New York Times, 11/16).
Under the overhaul, an individual's modified adjusted gross income -- a calculation that excludes some Social Security benefits -- will be used to determine Medicaid eligibility. The health reform law increases the income eligibility limit for Medicaid to 133% of the federal poverty level.
Retirees are eligible for Social Security at age 62, but they must wait until they are 65 to qualify for Medicare, unless they are disabled.
Hypothetically, a married couple who retired early and receives Social Security benefits of about $25,000 a piece could be eligible for Medicaid if the remainder of their income is less than 133% of the poverty level, even though their total income, including benefits, would be well above the threshold (California Healthline, 6/22).
In October, the House passed legislation (HR 2576) that would repeal a contractor withholding tax. Separately, the House passed another bill that would close the Medicaid loophole.
After the votes, the two bills were combined -- so that the money saved by fixing the Medicaid error would offset the loss of the tax withholding funds -- and sent to the Senate.
The Senate last week passed the bill with an amendment that would provide tax credits to businesses that hire unemployed veterans (Pear/Steinhauer, New York Times, 11/10).
The bill now goes to President Obama, who has said he will sign it (Hennessey/Mascaro, "Politics Now," Los Angeles Times, 11/16).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.