With millions of Americans bracing for the cost of their health insurance premiums to go through the roof when Covid-era tax credits expire at the end of this year, Republicans in Congress are mulling whether to use the same partisan tactic they used on the unpopular One Big Beautiful Bill Act this year to force through direct cash payments in line with President Donald Trump’s most recent musings on health care costs.
During an event in the Oval Office earlier this month Trump responded to a question about what he’d like the GOP Congress to do about the impending deadline by repeating a line he rolled out several weeks back, pushing the idea of direct payments that, in his estimation, could help Americans defray health care costs even though most people do not purchase insurance individually but as part of a large group, whether through an Affordable Care Act exchange or through an employer.
“I want all money going to the people and let the people buy their own health care. It'll be unbelievable. They'll do a great job. They'll get much better health care at a much lower cost,” he said.
Now, with midterm elections — and possible electoral devastation — looming over the Republican-led legislative branch, members are struggling over whether they’d be able to cobble together the votes to turn Trump’s seat-of-the-pants, stream-of-consciousness musings into actual legislation.
According to Politico, a number of Republicans in both the House and Senate are discussing whether they can use the budget reconciliation process — a parliamentary maneuver that lets certain spending bills pass with bare majorities in the Senate by evading the filibuster — to advance a bill that would use tariff revenue to fund direct cash payments as a way of addressing the coming rise in insurance costs.
Although Trump and his allies frequently claim tariffs are paid by foreign countries as a sort of entry fee for the privilege of having their products sold in American markets, tariffs are actually taxes that are paid by American importers and passed on to consumers in higher prices for finished goods.
This means the GOP proposal would essentially give Americans their own money back for meager cash payments that in all likelihood would not cover the higher premiums they will have to pay after Congress allows the ACA subsides to expire in seven days.
While the plan has garnered some interest among rank-and-file Republicans, the chairman of the House’s primary tax law-writing committee, House Ways and Means Committee Chair Jason Smith, is skeptical of any reconciliation bill actually making it through either chamber, much less both.
“I don’t see a path of a second reconciliation ever passing,” said Smith, a Utah Republican.
Representative Mike Lawler, a New York GOP moderate who has endorsed the idea of simply extending the Obamacare subsidies rather than face the wrath of angry voters next November, reportedly said a reconciliation bill would “never” happen.
And a key Republican Senator, Alaska’s Lisa Murkowski, poured cold water on the idea earlier this month.
“I don’t want another one-sided, partisan reconciliation bill right now — I want us to legislate,” Murkowski said. “Let’s be legislators here. Reconciliation is, yes, it’s a tool for us, but it’s a partisan tool and look at how divided we are right now. … That’s not the way to go.”
But the chairs of the House and Senate budget committees, Republican Representative Jodey Arrington of Texas and GOP Senator Lindsey Graham of South Carolina, are more bullish on the prospect. Arrington, who will retire from the House after next year, said he feels there is “a critical mass to start” the reconciliation process, while Graham told Semafor that he would like to see a reconciliation bill focused on health care, immigration enforcement and military funding.
The Trump tariff rebate proposal has other hurdles it may struggle to clear, most notably the strict rules around what can go in a reconciliation bill.
Under the party-line process, only taxation and spending provisions can make it through under Section 313 of the Budget Act and Senate rules requiring “extraneous” provisions — policy changes unrelated to budgeting — from bypassing the upper chamber’s filibuster.
But that hasn’t stopped some in the GOP and the White House from pushing the idea anyway.
Earlier this month, White House Deputy Chief of Staff for Policy James Blair told Bloomberg News the White House would support legislation for tariff “dividends” around $2,000 per person in addition to any health care-related provisions in a reconciliation bill.
The chair of the conservative Republican Study Committee group, Rep. August Pfluger of Texas, has said he is on board and urged colleagues to “come together and coalesce around policy that works.”
But Pfluger said the “trick” to doing so would be first figuring out what Trump wants and going along with it.
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