Section 1 Short title
This Act may be cited as the “Federal Repeal of Expensive Exchanges Act” or the “FREE Act”.
Federal Repeal of Expensive Exchanges Act
A BILL
To repeal certain provisions of the Patient Protection and Affordable Care Act relating to the premium tax credits and cost-sharing subsidies.
Sec. 2 Findings
The Congress finds the following:
The Patient Protection and Affordable Care Act makes health care more expensive and less accessible, while also driving up the Federal deficit and debt.
This increase in cost is most noticeable in the health insurance exchanges established under such Act, which would increase the Federal deficit by $1.017 trillion over an eleven-year timeframe, as stated in a July, 2012 Congressional Budget Office report.
The Federal mandate to establish health insurance exchanges directly assaults the States’ traditional authority to regulate health insurance.
Such Federal mandate imposes unknown insurance costs on consumers and administrative costs on States.
Such Federal mandate imposes a one-size-fits-all approach that ignores State differences.
Such Federal mandate undermines choice and competition and guarantees further consolidation of the health insurance markets.
Sec. 3 Repeal of the Patient Protection and Affordable Care Act premium tax credits and cost-sharing subsidies
Premium tax credits— The Internal Revenue Code of 1986 is amended by striking section 36B.
Advance determination and payment of premium tax credits and cost-Sharing reductions— The Patient Protection and Affordable Care Act is amended by striking section 1412.
Cost-Sharing— The Patient Protection and Affordable Care Act is amended by striking section 1402.
Conforming amendments—
Internal Revenue Code of 1986—
Section 280C of the Internal Revenue Code of 1986 is amended by striking subsection (g).
Clause (iii) of section 6055(b)(1)(B) of such Code is amended to read as follows:
“(iii) in the case of minimum essential coverage which consists of health insurance coverage, information concerning whether or not the coverage is a qualified health plan offered through an Exchange established under section 1311 of the Patient Protection and Affordable Care Act, and”
Section 6103(l)(21) of such Code is amended—
by striking “any premium tax credit under section 36B or any cost-sharing reduction under section 1402 of the Patient Protection and Affordable Care Act or” in the matter preceding subparagraph (i),
by striking “(as defined in section 36B)” in subparagraph (A)(iv), and
by adding at the end the following:
“(D) Modified adjusted gross income—For purposes of this paragraph, the term modified adjusted gross income means adjusted gross income increased by—
“(i) any amount excluded from gross income under section 911,
“(ii) any amount of interest received or accrued by the taxpayer during the taxable year which is exempt from tax, and
“(iii) an amount equal to the portion of the taxpayer's social security benefits (as defined in section 86(d)) which is not included in gross income under section 86 for the taxable year.”
Section 6211(b)(4)(A) of such Code is amended by striking “36B,”.
The table of sections for subpart C of part IV of subchapter A of chapter 1 of such Code is amended by striking the item relating to section 36B.
Fair Labor Standards Act of 1938—
Section 18B(a) of the Fair Labor Standards Act of 1938 (29 U.S.C. 218b(a)) is amended—
by inserting “and” at the end of paragraph (1), and
by striking paragraph (2) and redesignating paragraph (3) as paragraph (2).
Section 18C(a) of the Fair Labor Standards Act of 1938 (29 U.S.C. 218c(a)) is amended by striking paragraph (1) and by redesignating paragraphs (2) through (5) as paragraphs (1) through (4), respectively.
Public Health Service Act— Title XXVII of the Public Health Service Act (42 U.S.C. 300gg et seq.) is amended—
in section 2705(l)(3)(A) (42 U.S.C. 300gg–4(l)(3)(A))—
by striking the em dash before clause (i) and inserting “will not result in any decrease in coverage.”; and
by striking clauses (i) and (ii); and
in section 2793(c) (300gg–93(c))—
by inserting “and” at the end of paragraph (3);
by striking “; and” at the end of paragraph (4); and
by striking paragraph (5).
Patient Protection and Affordable Care Act— The Patient Protection and Affordable Care Act (Public Law 111–148, as amended) is amended—
in section 1303(b) by striking paragraph (2);
in section 1311(c)(5)(B) (42 U.S.C. 18031(c)(5)(B)), by striking “or eligible for a premium tax credit or cost-sharing reduction”;
in section 1311(d)(4) (42 U.S.C. 18031(d)(4))—
in subparagraph (G), by striking “after the application of any premium tax credit” and all that follows through “section 1402”; and
in subparagraph (I), by striking clause (ii);
in section 1311(i)(3)(B) (42 U.S.C. 18031(i)(3)(B)), by striking “, and the availability of premium tax credits ” and all that follows through “section 1402”;
in section 1312(e) (42 U.S.C. 18032(e))—
in paragraph (1), by striking “; and” and inserting a period;
by striking paragraph (2); and
by striking “brokers—” and all that follows through “to enroll” and inserting “brokers to enroll”;
in section 1313(a)(6)(A) (42 U.S.C. 18033(a)(6)(A)), by striking “, including payments of premium tax credits and cost-sharing reductions through the Exchange”;
in section 1331(d)(3)(A)(i) (42 U.S.C. 18051) is amended by inserting “and the Federal Repeal of Expensive Exchanges Act had not been enacted” before the period at the end;
in section 1332(a) (42 U.S.C. 18052(a))—
in paragraph (2)—
by striking subparagraph (C); and
in subparagraph (D) by striking “36B, 4980H,” and inserting “4980H”; and
in paragraph (3), by striking “premium tax credits, cost-sharing reductions”;
in section 1334(c) (42 U.S.C. 18054(c)) by striking paragraph (3);
in section 1401(c)(1)(A), by striking clause (i);
in section 1411 (42 U.S.C. 18081)—
in subsection (a)(1)—
by striking “or who is claiming a premium tax credit or reduced cost-sharing,”; and
by striking “sections 1312(f)(3), 1402(e), and 1412(d) ” and inserting “section 1312(f)(3)”;
in subsection (a), by striking paragraph (2);
in subsection (b), by striking paragraphs (3) and (4);
in subsection (e)—
in paragraph (2), by amending subparagraph (A) to read as follows:
“(A) Eligibility for enrollment—If information provided by an applicant under paragraphs (1) and (2) of subsection (b) is verified under subsections (c) and (d) the individual’s eligibility to enroll through the Exchange shall be satisfied.”
in paragraph (4)(B), by striking clauses (ii) and (iii) and redesignating clause (iv) as clause (ii);
by striking subsection (f)(2);
in subsection (g)(1)—
by striking “or for a premium tax credit or cost-sharing reduction”, and
by striking “, determine eligibility, and determine the amount of the credit or reduction” and inserting “and determine eligibility”; and
in subsection (g)(2) by striking “or to claim a premium tax credit or cost-sharing reduction or the amount of the credit or reduction”;
in section 1413(e)(1) (42 U.S.C. 18083(e)(1)), by striking “, including the premium tax credits under section 36B of the Internal Revenue Code of 1986 and cost-sharing reductions under section 1402”;
by striking section 1415 (42 U.S.C. 18084); and
in section 2901 (25 U.S.C. 1623), by striking subsection (a).
Social Security Act— Section 1943(b) of the Social Security Act (42 U.S.C. 1396w–3(b)) is amended—
in paragraph (1)(C)—
by striking “and, if applicable, premium assistance” and all that follows through “section 1412 of the Patient Protection and Affordable Care Act),”; and
by striking “reduced cost-sharing for eligible individuals under section 1402 of the Patient Protection and Affordable Care Act, and any other” and inserting “any”;
in paragraph (1)(D), by striking “, child health assistance, or premium assistance,” and inserting “or child health assistance,”;
by striking paragraph (2); and
in paragraph (4), by striking “and who is eligible to receive premium credit assistance for the purchase of a qualified health plan under section 36B of the Internal Revenue Code of 1986”.
Sec. 4 Repeal of Employer and Individual Mandates
Employer Mandate—
In general— Chapter 43 of the Internal Revenue Code of 1986 is amended by striking section 4980H, and the table of sections for such chapter is amended by striking the item relating to section 4980H.
Information return—
Chapter 61 of such Code is amended by striking section 6056, and the table of sections for such chapter is amended by striking the item relating to section 6056.
Section 6724(d) of such Code is amended—
in paragraph (1)(B) by inserting “or” at the end of clause (xxiii), by striking “or” at the end of clause (xxiv) and inserting “and”, and by striking clause (xxv), and
in paragraph (2) by inserting “or” at the end of subparagraph (FF), by striking “or” at the end of subparagraph (GG) and inserting “and”, and by striking subparagraph (HH).
Patient Protection and Affordable Care Act conforming amendments—
Section 1332(a)(2)(D) of the Patient Protection and Affordable Care Act (as amended by section 3(d)(4)(H) of this Act) is amended by striking “Sections 4980H” and inserting “Section”.
Section 1513 of the Patient Protection and Affordable Care Act is amended by striking subsection (c).
Repeal of individual health insurance mandate—
In general— Section 5000A of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:
“(h) Termination—This section shall not apply with respect to any month beginning after December 31, 2013.”
Conforming amendment— Section 1311(d)(4) of the Patient Protection and Affordable Care Act (42 U.S.C. 18031(d)(4)) is amended by striking subparagraph (H).
Effective date— The amendments made by this section shall apply as if included in the respective sections the Patient Protection and Affordable Care Act to which such amendments relate.