Senate Republicans unveil Obamacare replacement bill after months of closed-door crafting

WASHINGTON, June 22 (Reuters) - U.S. Senate Republicans on Thursday unveiled their version of legislation that would replace Obamacare, proposing to kill a tax on the wealthy that pays for it and reduce aid to the poor to cut costs.

With Democrats deeply opposed to Republican attempts to overhaul former President Barack Obama's signature healthcare law, the route to passage was extremely narrow for Republicans, who control both houses of Congress. There were no assurances that moderates and conservatives will be able to bridge their differences.

The proposal, worked out by Senate Majority Leader Mitch McConnell with other Republican leaders in secret, was welcomed by President Donald Trump. The president privately bashed as "mean" a version passed last month in the House of Representatives, according to congressional sources.

Trump, who said on Wednesday that he wants a health plan "with heart," told reporters at the White House that health care legislation will require "a little negotiation, but it's going to be very good." He said he doubted Democrats would help.

RELATED: A look at the contentious battle over the American Health Care Act

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WASHINGTON, DC - MAY 04: Republican House members join U.S. President Donald Trump on stage as he speaks during a Rose Garden event May 4, 2017 at the White House in Washington, DC. The House has passed the American Health Care Act that will replace the Obama era� Affordable Healthcare Act with a vote of 217-213. (Photo by Alex Wong/Getty Images)
WASHINGTON, DC - MAY 04: U.S. Sen. Bernie Sanders (I-VT) speaks during a Stop 'Trumpcare' rally May 4, 2017 in front of the Capitol in Washington, DC. Congressional Democrats joined activists for a rally to urge not to replace Obamacare, also known as the Affordable Care Act. (Photo by Alex Wong/Getty Images)
WASHINGTON, DC - MAY 04: U.S. Senate Minority Leader Sen. Charles Schumer (D-NY) (R) greets House Minority Leader Rep. Nancy Pelosi (D-CA) (L) during a Stop 'Trumpcare' rally May 4, 2017 in front of the Capitol in Washington, DC. Congressional Democrats joined activists for a rally to urge not to replace Obamacare, also known as the Affordable Care Act. (Photo by Alex Wong/Getty Images)
WASHINGTON, DC - MAY 04: U.S. President Donald Trump shares a moment with Speaker of the House Rep. Paul Ryan (R-WI) during a Rose Garden event May 4, 2017 at the White House in Washington, DC. The House has passed the American Health Care Act that will replace the Obama era� Affordable Healthcare Act with a vote of 217-213. (Photo by Alex Wong/Getty Images)
WASHINGTON, DC - MAY 04: U.S. House Minority Leader Rep. Nancy Pelosi (D-CA) (L) gestures as Sen. Patty Murray (D-WA) and Sen. Bernie Sanders (I-VT) wait for their turns to speak during a Stop 'Trumpcare' rally May 4, 2017 in front of the Capitol in Washington, DC. Congressional Democrats joined activists for a rally to urge not to replace Obamacare, also known as the Affordable Care Act. (Photo by Alex Wong/Getty Images)
UNITED STATES - MAY 4: Charlie Wood, 4, of Charlottesville, Va., plays with bubbles during rally on the East Front lawn of the Capitol to oppose the House Republicans' bill to repeal and replace the Affordable Care Act on May 4, 2017. She was born 3 1/2 months earlier and her mother Rebecca, at left, holding a picture of Charlie in the hospital, fears changes to the ACA will negatively effect her care. (Photo By Tom Williams/CQ Roll Call)
Health and Human Services Secretary Tom Price speaks in the Rose Garden of the White House following the House of Representative vote on the health care bill on May 4, 2017 in Washington, DC. Following weeks of in-party feuding and mounting pressure from the White House, lawmakers voted 217 to 213 to pass a bill dismantling much of Barack Obama's Affordable Care Act and allowing US states to opt out of many of the law's key health benefit guarantees / AFP PHOTO / Mandel NGAN (Photo credit should read MANDEL NGAN/AFP/Getty Images)
Ivanka Trump and Jared Kushner listen to US President Donald Trump speak in the Rose Garden of the White House following the House of Representative vote on the health care bill on May 4, 2017 in Washington, D Following weeks of in-party feuding and mounting pressure from the White House, lawmakers voted 217 to 213 to pass a bill dismantling much of Barack Obama's Affordable Care Act and allowing US states to opt out of many of the law's key health benefit guarantees / AFP PHOTO / Mandel NGAN (Photo credit should read MANDEL NGAN/AFP/Getty Images)
UNITED STATES - MARCH 9: Speaker of the House Paul Ryan, R-Wis., conducts a presentation in the House studio of the American Health Care Act, the GOP's plan to repeal and replace the Affordable Care Act, March 9, 2017. (Photo By Tom Williams/CQ Roll Call)
WASHINGTON, DC - MARCH 07: U.S. Secretary of Health and Human Services Tom Price compares a copy of the Affordable Care Act (R) and a copy of the new House Republican health care bill (L) during the White House daily press briefing March 7, 2017 at the White House in Washington, DC. Secretary Price answered questions on the new healthcare bill during the briefing. (Photo by Alex Wong/Getty Images)
U.S. Speaker of the House Paul Ryan speaks to the media about the American Health Care Act at the Capitol in Washington, D.C., U.S. March 15, 2017. REUTERS/Aaron P. Bernstein
WASHINGTON, DC - MARCH 13: U.S. Health and Human Services Secretary Tom Price (L) and Office of Management and Budget Director Mick Mulvaney talk to reporters following the release of the Congressional Budget Office report on the proposed American Health Care Act outside the White House West Wing March 13, 2017 in Washington, DC. Price said 'We disagree strenuously' with the findings of the CBO report about the Republican's attempt to repeal and replace the Affordable Care Act, or Obamacare. (Photo by Chip Somodevilla/Getty Images)
Speaker of the House Paul Ryan speaks at a news conference about Congressional efforts to repeal and replace Obamacare, on Capitol Hill in Washington, U.S. March 9, 2017. REUTERS/Aaron P. Bernstein
WASHINGTON, DC - MARCH 10: U.S. Vice President Mike Pence (4th L) delivers remarks at the beginning of a meeting with representatives of conservative political organizations to discuss the American Health Care Act in the Indian Treaty Room in the Eisenhower Executive Office Building March 10, 2017 in Washington, DC. Pence and Health and Human Services Secretary Tom Price led the meeting that included representatives from the Cato Institute, Tea Party Patriots, the American Conservative Union, Freedom Works, the American Legislative Exchange Council and other conservative groups. (Photo by Chip Somodevilla/Getty Images)
U.S. Speaker of the House Paul Ryan speaks to the media about the American Health Care Act at the Capitol in Washington, D.C., U.S. March 15, 2017. REUTERS/Aaron P. Bernstein
WASHINGTON, DC - MARCH 10: (L-R) U.S. Vice President Mike Pence and President Donald Trump greet House of Representatives committee leaders (L-R) House Budget Committee Chairwoman Diane Black (R-TN), Energy and Commerce Committee Chairman Greg Walden (R-WA) and Education and Workforce Committee Chairwoman Virginia Foxx (R-NC) before a meeting to discuss the American Health Care Act in the Roosevelt Room at the White House March 10, 2017 in Washington, DC. The proposed legislation is the Republican attempt to repeal and replace Obamacare. (Photo by Chip Somodevilla/Getty Images)
U.S. Speaker of the House Paul Ryan speaks to the media about the American Health Care Act at the Capitol in Washington, D.C., U.S. March 15, 2017. REUTERS/Aaron P. Bernstein
U.S. Health and Human Services Secretary Tom Price speaks about efforts to repeal and replace Obamacare and the advancement of the American Health Care Act on Capitol Hill in Washington, U.S., March 17, 2017. REUTERS/Joshua Roberts
A copy of Obamacare repeal and replace recommendations (L) produced by Republicans in the U.S. House of Representatives sit next to a copy of the Affordable Care Act known as Obamacare as U.S. Health and Human Services Secretary Tom Price addresses the daily press briefing at the White House in Washington, U.S. March 7, 2017. REUTERS/Carlos Barria
(L-R) U.S. House Speaker Paul Ryan, U.S. House Majority Leader Kevin McCarthy, and U.S. Representative Greg Walden hold a news conference on the American Health Care Act on Capitol Hill in Washington, U.S. March 7, 2017. REUTERS/Eric Thayer
UNITED STATES - MARCH 14: House Minority Leader Nancy Pelosi, D-Calif., and Senate Minority Leader Charles Schumer, D-N.Y., attend a news conference in the Capitol Visitor Center to voice opposition to House Republican's health care plan, the American Health Care Act, March 14, 2017. The event featured testimony from patients and doctors who benefit from the Affordable Care Act. (Photo By Tom Williams/CQ Roll Call)
UNITED STATES - MARCH 14: From left, Dr. Alice T. Chen, Senate Minority Leader Charles Schumer, D-N.Y., Sen. Maggie Hassn, D-N.H., and House Minority Leader Nancy Pelosi, D-Calif., attend a news conference in the Capitol Visitor Center to voice opposition to House Republican's health care plan, the American Health Care Act, March 14, 2017. The event featured testimony from patients and doctors who benefit from the Affordable Care Act. (Photo By Tom Williams/CQ Roll Call)
Speaker of the House Paul Ryan speaks at a news conference about Congressional efforts to repeal and replace Obamacare, on Capitol Hill in Washington, U.S. March 9, 2017. REUTERS/Aaron P. Bernstein
WASHINGTON, DC - MARCH 08: House Energy and Commerce Committee staff members work during a markup hearing on the proposed American Health Care Act, the Republican attempt to repeal and replace Obamacare, in the Rayburn House Office Building on Capitol Hill March 8, 2017 in Washington, DC. House Republicans were rushing the legislation through the powerful Energy and Commerce, and Ways and Means committees, aiming for a full House vote next week. (Photo by Chip Somodevilla/Getty Images)
WASHINGTON, DC - MARCH 07: House Energy and Commerce Chairman Greg Walden (R-OR) (R) and House Ways and Means Chairman Kevin Brady (R-TX) (L) arrive for a news conference on the newly announced American Health Care Act at the U.S. Capitol March 7, 2017 in Washington, DC. House Republicans yesterday released details on their plan to replace the Affordable Care Act, or Obamacare, with a more conservative agenda that includes individual tax credits and grants for states replacing federal insurance subsidies. (Photo by Win McNamee/Getty Images)
White House Press Secretary Sean Spicer (L) looks on as US Secretary of Health and Human Service Tom Price (R) points to a print-out of the Affordable Care Act (ACA) and a copy of the new plan introduced to repeal and replace the ACA during the daily briefing at the White House in Washington, DC on March 7, 2017. / AFP PHOTO / JIM WATSON (Photo credit should read JIM WATSON/AFP/Getty Images)
WASHINGTON, DC - MARCH 07: House Ways and Means Chairman Kevin Brady (R-TX) (L) and House Energy and Commerce Chairman Greg Walden (R-OR) (R) answer questions during a news conference on the newly announced American Health Care Act at the U.S. Capitol March 7, 2017 in Washington, DC. House Republicans yesterday released details on their plan to replace the Affordable Care Act, or Obamacare, with a more conservative agenda that includes individual tax credits and grants for states replacing federal insurance subsidies. (Photo by Win McNamee/Getty Images)
UNITED STATES - MAY 4: Protesters yell 'shame'' to members of Congress on the East Front of the Capitol after the House passed the Republicans' bill to repeal and replace the Affordable Care Act on May 4, 2017. The protesters support the ACA. (Photo By Tom Williams/CQ Roll Call)
WASHINGTON, DC - MAY 04: U.S. Sen. Bernie Sanders (I-VT) speaks during a Stop 'Trumpcare' rally May 4, 2017 in front of the Capitol in Washington, DC. Congressional Democrats joined activists for a rally to urge not to replace Obamacare, also known as the Affordable Care Act. (Photo by Alex Wong/Getty Images)
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The draft bill proposes repealing the 3.8 percent net investment income tax on high earners retroactively to the start of 2017, not at some point in the future, as some analysts had speculated. The tax, which affects high-income Americans and was imposed to help pay for Obamacare, has been a key target for Republicans.

The Senate bill maintains much of the structure of the House bill, but differs in several key ways.

It would phase out Obamacare's expansion of the Medicaid program for the poor and disabled over three years, from 2021 to 2024, and then enact deeper cuts in the program than the House version beginning in 2025. It would also allow states to add work requirements for some Medicaid enrollees. The legislation also reshapes subsidies to low-income people for private insurance.

Democratic leaders of Congress, who want the Obamacare law fixed but not abandoned, immediately assailed the Senate Republican version.

"The president said the House bill was mean," said Senate Democratic leader Chuck Schumer. "The Senate bill may be even meaner."

Like the House bill, the Senate would repeal a penalty associated with the individual mandate to have health insurance or else pay a fine. Policy experts said that would keep more young, healthy people out of the market and likely create a sicker patient pool.

The legislation would also repeal the penalty associated with the employer mandate that they provide employees health insurance.

The Senate bill would provide money to stabilize the individual insurance market, allotting $15 billion per year in 2018 and 2019 and $10 billion per year in 2020 and 2021.

SEE ALSO: Trump told Republicans to 'add some money' to health care plan

The nonpartisan Congressional Budget Office (CBO) has estimated that the House bill would kick 23 million people off their health care plans. The CBO is expected to weigh in on the Senate draft bill early next week.

As lawmakers made speeches about the legislation on the Senate floor, a protest erupted outside McConnell's personal office, with many people in wheelchairs blocking a hallway, holding signs and chanting. Capitol police were on the scene and physically removing protesters.

HOSPITAL STOCKS SURGE

U.S. hospital stocks traded sharply higher after the bill was released, adding to gains from earlier in the session. HCA Healthcare Inc rose 3.8 percent, while Tenet Healthcare Corp surged 8.4 percent.

Health insurers also traded broadly higher, with large players Aetna and UnitedHealth Group each up more than 1 percent. Insurers that specialize in Medicaid also gained, with Centene up 3.4 percent and Molina Healthcare rising 2.6 percent.

The overall S&P 500 health care sector was up 1.5 percent and hit an all-time high.

The health care sector has surged this week, fueled by biotechnology stocks. The sector has gained more than 4 percent this week already, with the Nasdaq Biotechnology index jumping nearly 10 percent.

"Hospital stocks are up on this news today," Mizuho Securities' director of research, Sheryl Skolnick, said in a research note. "They should be, in our view, as the near-term risks would be abated if the subsidy and Medicaid provisions hold through Senate and House negotiations."

RELATED: A look at the Senate's all-male health care working group

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U.S. Senator Tom Cotton (R-AR) (L) and Senator David Perdue (R-GA) (R) unveil legislation aimed at curbing legal immigration by halving the number of legal immigrants admitted into the United States, at the U.S. Capitol in Washington, U.S. February 7, 2017. REUTERS/Jonathan Ernst
U.S. Senator Cory Gardner (R-CO) smiles after he was ceremonially sworn-in by Vice President Joseph Biden in the Old Senate Chamber on Capitol Hill in Washington January 6, 2015. REUTERS/Larry Downing (UNITED STATES - Tags: POLITICS HEADSHOT)
U.S. Senate Majority Leader Mitch McConnell (R-KY) speaks during a media briefing on Capitol Hill in Washington, U.S. April 25, 2017. REUTERS/Joshua Roberts
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U.S. Senator Pat Toomey (R-PA) speaks to the 38th annual Conservative Political Action Conference meeting in Washington DC, U.S. February 10, 2011. REUTERS/Larry Downing/File Photo
U.S. Senator John Thune addresses the media during the 2017 "Congress of Tomorrow" Joint Republican Issues Conference in Philadelphia, Pennsylvania, U.S. January 25, 2017. REUTERS/Mark Makela
U.S. Senator John Cornyn (R-TX)questions Supreme Court nominee judge Neil Gorsuch during a Senate Judiciary Committee confirmation hearing on Capitol Hill in Washington March 21, 2017. REUTERS/Joshua Roberts
Senator Ted Cruz (R-TX) questions Supreme Court nominee judge Neil Gorsuch during his Senate Judiciary Committee confirmation hearing on Capitol Hill in Washington March 21, 2017. REUTERS/Joshua Roberts
Chairman of the Senate Health, Education, Labor and Pensions Committee Lamar Alexander speaks during Rep. Tom Price's (R-GA) nomination hearing to be Health and Human Services secretary in Washington, U.S., January 18, 2017. REUTERS/Joshua Roberts
Senator Orrin Hatch (R-UT) during the second day of confirmation hearings on Senator Jeff Sessions (R-AL) nomination to be U.S. attorney general in Washington, U.S. January 11, 2017. REUTERS/Joshua Roberts
Sen. Mike Lee (R-UT) speaks at a rally for nominee Neil Gorsuch outside the Supreme Court in Washington, D.C., U.S. March 29, 2017. REUTERS/Aaron P. Bernstein
UNITED STATES - APRIL 4: Sen. John Barrasso, R-Wyo., speaks as Senate Republican leaders hold their media availability focusing on the confirmation of Neil Gorsuch as associate justice of the Supreme Court following their policy lunch on Tuesday, April 4, 2017. (Photo By Bill Clark/CQ Roll Call)
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The subsidies enabling low-income people to buy private health insurance are expected to be linked to recipients' income in the Senate bill, a "major improvement" from a measure approved last month by the House that tied them solely to age, Republican Senator Susan Collins said.

Some of the Senate bill's provisions could be political land mines, with individual senators' reactions crucial to determining whether or not the Affordable Care Act, popularly known as Obamacare, survives a Republican attack that has been underway since its passage in 2010.

But, even though Republicans now have control of the White House as well as both chambers of Congress, they have struggled to make good on their bold campaign promises to repeal and replace Obamacare.

The law is credited with expanding health insurance to millions of Americans. Republicans say it costs too much and involves the federal government too much in healthcare. Trump made Obamacare repeal a centerpiece of his 2016 election campaign.

Democrats accuse Republicans of sabotaging Obamacare, and say the Republican bill will make health care unaffordable for poorer Americans while cutting taxes for the wealthy.

McConnell may have a tough job convincing enough Republican senators that the Senate bill improves on the House version. A Reuters/Ipsos poll this month found nearly 60 percent of adults believed the House bill would make insurance costlier for low-income Americans and people with pre-existing conditions. Only 13 percent said it would improve the quality of health care.

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