The Republican plan to replace Obamacare is already falling apart, as new revelations show a massive handout for health insurance executives.
As BuzzFeed News reported on Tuesday, a provision in the AHCA would put an end to a cap on tax deductions for executive salaries that the ACA (sometimes called Obamacare) had put in place. Prior to the Affordable Care Act, insurance companies could deduct CEO compensation as part of a “business expense.” But the ACA put a cap on those deductions, ensuring that taxes would be collected and those business expense deductions couldn’t exceed more than $500,000. The Republican plan put out this week would put an end to that cap, which generates around $72 million in tax revenue annually, and put it back into the hands of CEOs and insurance companies.
CEO compensation for insurance giants like Aetna and Cigna are in the many millions, meaning that those companies’ tax liability will likely go down considerably by paying their CEOs even more. Aetna CEO Mark Bertolini made over $17 million in salary and stock compensation in 2015. That same year, Cigna CEO David Cordani received approximately $49 million. Health insurance giant Blue Cross Blue Shield paid its top 33 executives a collective $102 million in total salary and compensation in 2014.
It’s still unclear yet whether the AHCA will pass or not. Just hours after a leaked version of the bill was released, four Republican U.S. Senators expressed their displeasure with some of the law’s key components, like repealing the expansion of Medicaid, which covers 11 million people. If every Democrat votes against the bill in the Senate, the bill would fall short of the necessary 50 votes it would need to pass Reconciliation unless two of those four Republican senators change their mind.
Chris Walker has been writing about political issues for the past decade, including for sites such as Elite Daily, AMERICAblog, and Mic. You can follow him on Twitter @thatchriswalker.