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Tax Bill Goes to President’s Desk for Signature

The Tax Cuts and Jobs Act has passed both the House and Senate this afternoon and will now go to President Donald Trump’s desk for a final signature. The bill will likely be signed into law by the end of this week.
The nonpartisan Congressional Budget Office (CBO) previously released their report for the House of Representatives proposed legislation, , and found that it would raise the deficit by nearly 1.5 trillion dollars over 10 years. The Statutory Pay-As-You-Go Act of 2010 (PAYGO) requires that new legislation passed during a term of Congress does not collectively increase estimated deficits. The Office of Management and Budget (OMB) tracks any legislation that impacts revenue or mandatory spending and keeps a scorecard on the legislations’ effects. At the end of each year, OMB analyzes the scorecard to see if the legislation has increased the estimated deficit. In the case of an increase, OMB is required to implement an across-the-board sequestration of mandatory spending programs to offset the cost.

Under the final Tax Cuts and Jobs Acts, Congress would be forced to cut $136 billion, including $25 billion from Medicare, in mandatory spending programs next year. The current Medicare 2% limitation under the Budget Control Act (BCA) will be doubled to 4% in this new sequester, resulting in a 6% total cut to reimbursements when stacked on top of the sequester from BCA.  Congressional intervention to stop this is possible but unlikely. NRHA will keep members updated as more information becomes available.

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