House Passes Democrats’ Health Care and Climate Act, Clearing for Biden’s Signature

The bill — called the Inflationary Depreciation Act — does It represents the largest climate investment in American history And Make major changes in health policy Giving Medicare the power to negotiate prescription drug prices for the first time and extending expired health care subsidies for three years. The legislation would reduce the deficit, financed by new taxes — including a 15% lower tax on large corporations and a 1% tax on stock purchases — and increase the Internal Revenue Service’s collection capacity.

It would raise more than $700 billion in government revenue over 10 years and spend more than $430 billion to reduce carbon emissions and extend health insurance subsidies under the Affordable Care Act, and use the rest of the new revenue to reduce the deficit.

After Senate Democrats approve the bill, the House will take action

In the Senate, the bill passed a final party-line vote of 51-50, with Vice President Kamala Harris breaking the tie.

Senate Democrats, who narrowly controlled only 50 seats, ultimately held together to pass the bill. And a special filibuster-proof process known as reconciliation is used to pass the measure without a Republican vote.

The bill’s passage in the House gave Senate Democrats long hopes of passing a signature legislative package, but they have struggled for months to reach a deal that has the full support of their caucus.

The passage in the Senate came after a long round of amendment votes, known as a “vote-a-rama,” that lasted nearly 16 hours from Saturday night to Sunday afternoon.

Ultimately, Republicans lined up to oppose the bill. In a statement, Senate Minority Leader Mitch McConnell called the bill a “massive job-killing tax hike” and a “war on America’s fossil fuels.” “Middle-class families are not a priority,” the Kentucky Republican said.

How the bill solves the climate crisis

The nearly $370 billion clean energy and climate package is the largest climate investment in U.S. history and the biggest win for the environmental movement since the landmark Clean Air Act.

An analysis by Schumer’s office — as well as several independent analyzes — suggests the measure would cut US carbon emissions by as much as 40% by 2030. Strong climate laws from the Biden administration and action from states are needed to achieve Biden’s goals. 50% reduction in emissions by 2030.

The bill also contains several tax incentives intended to reduce the cost of electricity with more renewables and encourage more American consumers to switch their homes and vehicles to electric.

Key health care and tax policy in the bill

The bill would allow Medicare to negotiate the price of some expensive drugs that are dispensed in a doctor’s office or purchased at a pharmacy. The Secretary of Health and Human Services will renegotiate the prices of 10 drugs in 2026 and another 15 drugs in 2027 and 2028. The number will increase to 20 drugs per year for 2029 and beyond.

The controversial provision is the most restrictive of any that House Democratic leaders have supported in the past. But Medicare also opens the door to fulfilling the party’s long-term goal of reducing drug costs.

Democrats plan to extend federal premium subsidies for Obamacare coverage until 2025, a year after lawmakers recently debated it. That way, their term will not expire after the 2024 presidential election.

To raise revenue, the bill would impose a 15% lower tax on shareholders on the income of large corporations, unlike the Internal Revenue Service. The measure, which will raise $258 billion over ten years, is said to apply to companies with profits of more than $1 billion.

Concerned about how the provision would affect certain businesses, particularly manufacturers, she said she won changes to the Democrats’ plan to explain how cinema companies can deduct non-valuable assets from taxes. The details are unclear.

However, Sinema has tightened his party’s efforts to tighten the interest loophole, allowing investment managers to treat most of their compensation as capital gains and pay a 20% long-term capital gains tax instead of an income tax rate of up to 37%.

The provision extends the period from three years to five years for investment managers to hold excess interest to take advantage of the lower tax rate. Closing the gap, which could raise $14 billion over a decade, has been a longtime goal of congressional Democrats.

In its place, a 1% excise tax was added on the purchase of company shares, adding another $74 billion, according to a Democratic aide.