The package is the result of meticulous negotiations and will give Democrats a chance to achieve key policy goals ahead of the upcoming midterm elections. Senate Democrats use a special process to pass the package without Republican votes.
Once the legislation is passed in the Senate, it must then be approved by the House of Representatives before President Joe Biden can sign it into law.
The Senate is expected to hold the first procedural vote to pass the bill sometime on Saturday. A simple majority is required for the motion to pass.
Democrats have the smallest possible majority and only 50 seats in the Senate, but are expected to be united to push the bill forward in the first procedural vote.
In a landmark ruling, MP Elizabeth MacDonough authorized a key component of Democrats’ prescription drug pricing plans, giving Medicare the power to negotiate the prices of certain prescription drugs for the first time.
But MacDonough narrowed down another provision aimed at lowering drug prices: fines drug companies if they raise prices faster than inflation. Democrats would have liked the measure to apply to both Medicare and the private insurance market. But the lawmaker ruled that the inflation cap could only apply to Medicare, a Democratic aide said.
Still, Democrats welcomed the ruling, with Schumer saying “the overall program remains intact.”
Democrats are waiting for new cost estimates from the unbiased Congressional Budget Office to see how the ruling affects their deficit projections. It is likely that the curtailed drug supply would somewhat limit the package’s deficit reduction.
Meanwhile, MacDonough ruled to leave several climate measures from the Environment and Public Works Committee intact in the reconciliation bill, including a methane compensation that would apply to oil and gas producers that leak the potent greenhouse gas methane above a certain threshold.
Earlier Saturday, Oregon Senate Treasury Chairman Ron Wyden announced that the clean energy tax portion of the bill “complies with Senate rules and important provisions to ensure our clean energy future in America.” being built have been approved by the parliamentarian.”
Schumer has yet to decide when to start the debate this weekend, a senior Democratic official said. The timing of that vote is critical because it will start the process and determine when the bill will finally be voted on. If Schumer delays taking that first vote to open the debate, it could postpone the rest of the votes on the bill until later Saturday or even all of Sunday.
The reason Democratic leaders have not yet made a decision is that they were waiting for the MP’s statements. While they don’t need her to rule before the first procedural vote, Democrats’ goal is to make any changes they request before the process begins, the aide said. As a result, the timing of voting on amendments and final approval of the bill is very much in flux.
What happens after the bill is voted for the first time?
If the first procedural vote to pass the bill gets the support of all 50 members of the Democratic caucus, which is expected to happen, there would be up to 20 hours of debate evenly split between the two parties, although some of that time can be returned to speed up the process.
Republicans will be able to use the vote-a-rama to get Democrats on the scene and enforce politically hard votes. The process usually extends overnight and into the early hours of the next morning. It is not yet clear when the vote-a-rama will start, but it could start as early as Saturday night. If that happens, a final vote could potentially take place as early as the early hours of Sunday morning.
The House is poised to come back to pass the legislation on Friday, Aug. 12, according to the office of House Majority Leader Steny Hoyer.
How the bill tackles the climate crisis
For a party that failed to pass major climate legislation more than 10 years ago, the Reconciliation Act represents a big, long-fought victory for Democrats.
The nearly $370 billion clean energy and climate package is the largest climate investment in US history and the biggest environmental victory since the groundbreaking Clean Air Act. It also comes at a critical time; This summer has seen punishing heatwaves and deadly floods across the country, both of which scientists say are linked to a warming planet.
Analysis from Schumer’s office — as well as multiple independent analyzes — suggests the measures would reduce U.S. carbon emissions by as much as 40% by 2030. Strict climate regulations from the Biden administration and action from states would be needed to cut Biden’s goal of reducing emissions by 50% by 2030.
The bill also includes many tax incentives designed to lower the cost of electricity with more renewables, and encourage more U.S. consumers to switch to electricity to power their homes and vehicles.
Lawmakers said the bill represents a monumental victory and is also just the beginning of what is needed to fight the climate crisis.
“This isn’t about the laws of politics, this is about the laws of physics,” Democratic Hawaiian Senator Brian Schatz told CNN. “We all knew in this effort we had to do what science tells us to do.”
Main healthcare and tax policy in the bill
The bill would allow Medicare to negotiate the prices of certain expensive drugs that are administered in doctor’s offices or purchased from pharmacies. The Secretary of Health and Human Services would negotiate the prices of 10 drugs in 2026, and another 15 drugs in 2027 and again in 2028. The number would rise to 20 drugs per year for 2029 and beyond.
This controversial provision is much more restrictive than the provision that House Democratic leaders have supported in the past. But it would open the door to fulfilling a long-standing party goal of allowing Medicare to use its weight to lower drug costs.
Democrats also plan to extend increased federal premium subsidies for Obamacare coverage through 2025, a year later than lawmakers recently discussed. That way, they wouldn’t expire just after the 2024 presidential election.
To increase revenues, the bill would impose a 15% minimum tax on income that large corporations report to shareholders, known as book income, unlike the Internal Revenue Service. The measure, which would bring in $258 billion in ten years, would apply to companies with profits of more than $1 billion.
Concerned about the impact of this provision on certain companies, especially manufacturers, Sinema has suggested she would see changes to Democrats’ plan to curb how companies can deduct depreciated assets from their taxes. The details remain unclear.
Sinema, however, thwarted her party’s efforts to close the loophole in the interest-bearing interest rate, allowing investment managers to view much of their fees as capital gains and pay a long-term tax rate of 20% rather than income tax rates of up to 37%.
The provision would have extended the time to hold the profit interest of investment managers from three years to five years to take advantage of the lower tax rate. Addressing this loophole, which would have generated $14 billion in a decade, has long been a goal of Congressional Democrats.
Instead, a 1% tax on corporate share buybacks was added, bringing in an additional $74 billion, according to one Democratic employee.
This story has been updated with additional developments.
Manu Raju, Ella Nilsen, Tami Luhby, Katie Lobosco and Melanie Zanona of CNN contributed to this report.