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Lesniak & Holley Introduce the ‘TrumpCare Nullification Act’

Legislation Would Protect NJ from Impact of GOP’s Health Care Plan

Responding to concerns that approximately 550,000 New Jersey residents will lose health insurance under proposals in Congress to cut Medicaid coverage for families whose household income is near the federal poverty level and give tax breaks to high income households, Senator Raymond Lesniak joined with Assemblyman Jamel Holley in introducing legislation Thursday to nullify the impact of TrumpCare in New Jersey.

The bill, entitled the “TrumpCare Nullification Act,” would replace the tax cuts on high income families with an equivalent state tax and use the proceeds to continue the Medicaid coverage for the low-income families and the elderly who will suffer lost coverage or severe reductions in care.

“This legislation will maintain the status quo and protect low-income families and the elderly from the mean-spirited and heartless impact of TrumpCare,” said Senator Lesniak. “Donald Trump and Washington Republicans want to take away the health insurance and medical care that is so important to the lives of so many people at the same time they give tax breaks to the wealthy. We want to prevent that from happening in New Jersey with a plan that effectively nullifies and protect those in need. Under our plan, high income households in New Jersey won’t be paying any more in taxes than currently while lower income households won’t lose their health insurance coverage.”

“Aside from being downright cruel and morally indefensible, cutting Medicaid – especially considering the dire need in our urban communities and the severity of the opioid crisis – will have grave public health and public safety implications,” said Holley (D-Union). “Contrary to President Trump and Republican members of Congress, New Jersey residents believe that health care should not be regarded as a luxury in this country. Our state cannot – and will not – allow irresponsible decisions at the federal level to cause its most vulnerable residents to lose access to high-quality, affordable health care.”

In addition to the 550,000 New Jersey residents who could lose their health insurance under the House-approved plan, another 1.3 million Medicaid members could face more limited benefits, and hundreds of thousands of working-poor patients could find themselves paying more for coverage — or priced out of the market entirely — according to policy analysts who have reviewed the plan that Donald Trump initially praised and then labeled “mean.”

Today, U.S. Senate Republicans finally made public the TrumpCare plan they have been working on in secret. The Senate proposal largely mirrors the House measure but it would impose even deeper long-term cuts to Medicaid, the health-care program for low-income Americans that was expanded in most states under the Affordable Care Act. The Republican plan would also slash funding for Planned Parenthood.

Under the bill, all revenue collected will be deposited in a state “Affordable Health Care Fund,” established pursuant to the bill. All funds deposited in the fund are dedicated for the purpose of providing health care coverage under the Medicaid program for individuals who meet the eligibility criteria for the ACA Medicaid expansion.

The specific federal taxes to be replaced by State taxes under the bill are:

  • The net investment income tax under 26 U.S.C. s.1411;
  • The tax on manufacture and importation of prescription medications under section 9008 of the ACA;
  • The health insurance providers’ fee under section 9010 of the ACA;
  • The additional 0.9 percent payroll tax on high-income households under 26 U.S.C. s.3101(b)(2); and
  • The indoor tanning tax under 26 U.S.C. s.5000B.

No State replacement tax will be imposed except in the event that the federal tax to be replaced is reduced, allowed to expire, or repealed by enactment of federal legislation on or after January 1, 2017.

Senator Lesniak added he’s awaiting a fiscal analysis being prepared by the Office of Legislative Services to determine if the high income tax cut nullification will cover complete Medicaid coverage restoration or perhaps even allow for restoration of pre-existing condition coverage priced out of affordability by the TrumpCare legislation. Senator Lesniak also wants to look to restore funding for Planned Parenthood

Senator Lesniak gave credit for the idea to fellow Democratic gubernatorial candidate Bill Brennan who announced this proposal at a gubernatorial forum.