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The number of waivers the Obama administration has awarded for a provision of the year-old healthcare reform law grew by 128 in March.

With the new waivers, that means 1,168 businesses, insurers, unions and other organizations have received one-year exemptions from a healthcare reform provision requiring at least $750,000 in annual benefits.

The administration says the temporary waivers are granted to help stabilize the insurance market until a fuller package of reforms takes effect in 2014, but the growing number of waivers have exposed the White House to heavy criticism from Republican opponents of the law.

“The fact that over 1,000 waivers have been granted is a tacit admission that the healthcare law is fundamentally flawed,” said Rep. Fred Upton (R-Mich.) last month. Upton is one of three House committee chairmen who has used new oversight powers to investigate the annual limit waivers.
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After months of failing to agree on how to repeal an unpopular IRS reporting provision included in the healthcare reform act, the Senate voted overwhelmingly to strike it down Wednesday night.

The Senate voted 81-17 on the 1099-reporting requirement, with 17 Democrats voting against the measure.

The healthcare reform provision requires businesses to report for each vendor annual purchases of goods or services of more than $600. The House, which must still approve its own version of the legislation, has signaled it would move quickly to repeal the 1099 requirement.

For months, President Obama has called on lawmakers to repeal the provision, but Democrats and Republicans have clashed over how to offset the $19 billion in lost revenue. Sens. Max Baucus (D-Mont.) and Mike Johanns (R-Neb.) each pushed separate bills last year that failed to garner enough support.

The repeal measure approved Wednesday night – an amendment raised by Sen. Debbie Stabenow (D-Mich.) on an aviation bill – would offset the cost of repeal by authorizing the Office of Management and Budget to identify unobligated funds. The amendment was almost identical to a bill offered by Johanns, but the Stabenow measure specified funds could not be taken out of the Social Security Administration to offset the costs.

Some Democrats expressed unease with giving OMB the power to cut federal funds.

“What is convenient is not always right,” Sen. Carl Levin (D-Mich.) said on the Senate floor before the vote. “The Constitution places in our hands, and ours alone, the authority to appropriate funds. We cannot statutorily pass that buck and we should not.”

Levin, backed by Sen. Daniel Inouye (D-Hawaii), offered an alternative 1099 amendment Wednesday evening that he said would eliminate tax loopholes for the oil and gas industry to fund repeal. The amendment failed 44-54, with a number of Democrats voting against.

Senators struck down two amendments that would repeal provision in the 2010 health care overhaul (PL 111-148, PL 111-152) requiring businesses to file a 1099 form to the IRS for every vendor to which they pay more than $600.

The first amendment, offered by Nebraska Republican Mike Johanns, would pay for the repeal with spending cuts.

The second proposal, by Finance Chairman Max Baucus, D-Mont., did not contain offsetting language.

Johanns expressed disappointment that senators rejected his repeal effort, 61-35, which fell short of the required two-thirds vote.

“More than 40 million businesses across the country are now in jeopardy of being hit by this paperwork monsoon,” Johanns said in a statement.

Johanns argued earlier in the day on the Senate floor that a repeal must be fully offset because the midterm elections sent a clear message about how Americans view Washington’s spending habits.

The Congressional Budget Office estimated that the repeal of the reporting provision would increase the deficit by $19.2 billion over 10 years. The Johanns amendment would require $39 billion in spending rescissions (cuts or offsets).

Baucus, whose amendment was rejected, 44-53, warned that the Johanns version “would give the unelected director of OMB unprecedented authority to determine the source of this funding, and that would abdicate congressional responsibility over the budget.”