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House Health Plan To Boost Taxes On Rich


hou.jpgHouse Democrats on Tuesday rolled out an ambitious $1.5 trillion plan that for the first time would make health care a right and a responsibility for all Americans, with Medical providers, employers and the wealthiest picking up most of the tab.

The federal government would be responsible for ensuring that every person, regardless of income or the state of their health, has access to an affordable insurance plan. Individuals and employers would be required to get coverage, or face hefty penalties.

Health care overhaul is President Barack Obama’s top domestic priority, and his goal is to slow rising costs and provide coverage to nearly 50 million uninsured Americans.

The plan would slow Medicare and Medicaid payments to medical providers. From big hospitals to solo physician practices, providers also would be held to account for quality care, not just ordering up tests and procedures. Insurance companies would be prohibited from denying coverage to the sick. The industry also would face stiff competition from a new government plan designed along the lines of Medicare.

The liberal-leaning plan lacked figures on total costs, but a House Democratic aide said the total bill would add up to about $1.5 trillion over 10 years. The aide spoke on condition of anonymity to discuss the private calculations.

The legislation calls for a 5.4 percent tax increase on individuals making more than $1 million a year, with a gradual tax beginning at $280,000 for individuals. Employers who don’t provide coverage would be hit with a penalty equal to 8 percent of workers’ wages with an exemption for small businesses. Individuals who decline an offer of affordable coverage would pay 2.5 percent of their incomes as a penalty, up to the average cost of a health insurance plan.

With Obama pressing Congress to act on health care this summer, House leaders want to move their bill quickly through three committees and to a floor vote before the August congressional recess. But a group of moderate and conservative Democrats has withheld support, and no Republican votes are expected. The House bill seemed unlikely to win broad backing in the Senate.

Standing before a banner that read “Quality Affordable Care for the Middle Class,” House Speaker Nancy Pelosi, D-Calif., called the moment “historic and transformative.” The bill would provide “stability and peace of mind” by braking costs and guaranteeing coverage, she said.

“We are going to accomplish what many people felt wouldn’t happen in our lifetime,” said House Energy and Commerce Committee Chairman Henry Waxman, D-Calif., one of the main sponsors. Obama issued a statement hailing the measure.

Democrats said the income tax increase would apply only to the top 1.2 percent of households, those who earn about one-quarter of all income. The wealthiest 4 percent of small business owners would be among them. The tax would start at 1 percent for couples making $350,000 and individuals earning $280,000, ramp up to 1.5 percent above $500,000 of income, and jump to 5.4 percent for those earning above $1 million.

The tax would raise an estimated $544 billion over 10 years.

Business groups and the insurance industry immediately assailed the legislation. In a letter to lawmakers, major business organizations branded the 1,000-page bill a job-killer. Its coverage mandate would automatically raise the cost of hiring a new worker, they said.

“Exempting some micro-businesses will not prevent this provision from killing many jobs,” the letter said. “Congress should allow market forces and employer autonomy to determine what benefits employers provide, rather than deciding by fiat.”

The business groups also warned that the U.S. health care system could be damaged by adding a government-run insurance plan and a federal council that would make some decisions on benefits, as called for in the legislation. Thirty-one organizations signed the letter, including the U.S. Chamber of Commerce, the Business Roundtable representing top corporate CEOs and the National Retail Federation.

The House bill would change the way individuals and many employers get health insurance. It would set up a new national purchasing pool, called an exchange. The exchange would offer a menu of plans, with different levels of coverage. A government plan would be among the options, and the exchange would eventually be open to most employers. Insurers say that combination would drive many of them out of business since the public plan would be able to offer lower premiums to virtually all Americans.

But backers of a public plan – including Obama – say it would provide healthy competition for the insurance industry.

Under the House bill, the government would provide subsidies to make coverage more affordable for households with incomes up to four times the federal poverty level, or $88,000 for a family of four and $43,000 for an individual. Medical – the federal-state health program for the poor – would be expanded to individuals and families up to 133 percent of the poverty line. The legislation also would improve the Medicare prescription drug benefit by gradually reducing a coverage gap known as the ‘doughnut hole.’

The individual and employer coverage requirements would raise about $200 billion over 10 years, the Democratic aide said.

Even before the bill was unveiled, the House Ways and Means Committee announced it would vote on the proposal beginning on Thursday. The panel is one of three that must act before the bill can go to the full House, probably later in the month.

Across the Capitol, the Senate Health, Education, Labor and Pensions Committee slogged toward passage of its version of the bill on what was expected to be a party-line vote. Another panel, the Senate Finance Committee, was striving to unveil a bill by the end of the week. But the outlook in the Senate remained uncertain.

Some House Democrats privately have expressed concern that they will be required to vote on higher taxes, only to learn later that the Senate does not intend to follow through with legislation of its own. That would leave rank-and-file House Democrats up for re-election next year in the uncomfortable position of having to explain their vote on a costly bill that never reached Obama’s desk or became law.

(Source: CBS News)



9 Responses

  1. 1. and you expected they would pay for new programs with a bake sale?????

    2. if the system is changed so that medical insurers can not discriminate on the basis of pre-existing conditions, and most importantly, family size or a liklihood that the insured will have children — IT WILL BE A TREMENDOUS BENEFIT FOR ORTHODOX JEWS. It would mean the a kollel family or a small business would have the same access as someone working for a very large employer (such as the Federal government, whose plan forces insurers to ignore pre-existing conditions and to cover all our children)

  2. Can anyone label even ONE of Obama’s policies that the improved the life of the average Joe. $750,000,000,000.00 were spent and I personally don’t know of a SINGLE person who benifited even one iota from this great stimulas package. The only thing that changed in the past 6 months is that CA taxes have gone UP. Prices on basics have gone UP. Fuel is gone UP. Home Utilities have gone UP. The value of the dollar has gone DOWN. Way to go!

    AKUPERMA, all the insurance policies that I have seen (in California, at least) have a SINGLE plan, a COUPLE plan, and a FAMILY plan. It doesn’t matter if the family if 2 adults and 1 child or 2 adults at 16 children. I am not saying the medical insurance in affordable but the government is NOT the answer.

    There are two types of medical procedures that are usually NOT covered by most plans and in those fields (where the open market is more fairly played) that the services have become better and cheaper. They are LASIK and plastic surgery. Why have the prices fallen in those field? Because the insurance companies don’t cover them, there is a LIMIT to how much they can charge and people will still use them. If insurance did cover them, the fees can go UP and UP and UP and nobody will complain, because “It’s covered!” The current problem isn’t medical COSTS it’s the INSURANCE that adds to most of the expense.

  3. akuperma your 2nd point is true but realize (and i hope everyone else does too) is that this plan will cost 1.5 trillion and the tax only pays for 544 billion, about a third of it. What the best option is, is to fix the problems without govenizing it like make it discrimination not to accept someone.

    Obama is just digging us into an economic hole

  4. akuperma, you are falling for their propaganda drivel. This will only elongate the recession making it more difficult for yeshivos to raise the money needed to pay their rebbes on time. They may have to combine classes and lay off people.

    If the recession elongates further, the kollelim may have to close or shrink.

    The reason why medical care is so prohibitive is because of the unlimited amount of money that can be petitioned for in a lawsuit especially medical malpractice, the mandates that states such as New York impose on insurance companies, and the costs of providing medical care as mandated by Medicaid and Medicare.

    What it will lead to is the rationing of care especially of the chronically ill children, and the elderly roshei yeshiva. I only see you trying to sell a propaganda piece but you are leaving out some very crucial pieces of the pie. Why don’t you go to Betsy McCauey-Ross’s website and see for yourself what is in the legislation before you try to manipulate yeshivaleit, okay?

  5. Another problem is that we are taxing the rich right out of America. The rich will either find new ways to hide their income or move away and then we will lose all the taxes they already pay.

  6. I’m glad so many people (except akuperma) are not being naive. The problem that akuperma has is the same as most of the world- conventional news media does a terrific job of selling anything and everything that Obama says (while they berated Bush non stop) and the only way you’ll hear the other side is to listen to people like Rush Limbaugh and such.
    On paper, everything Obama says is terrific but if he taxes the rich, whom does akuperma think will be laid off from their jobs? The employees of those rich people! And who else will be affected? The consumers who will have to pay more in goods and services if the heads of the corporations will be taxed- it will filter down to the average Joe- that the news media won’t tell you.
    Who else will be affected? All the mosdos who rely on these rich people who will be affected.
    So if you think further, nothing is as simple as it sounds!

  7. If you work for a large company (e.g. the federal government, with its FEHBP) it doesn’t make any difference if you are likely to file claims. The rate is the same if you have eight kids. A pregnant woman can sign up on Monday, have a baby on Tuesday, and be fully covered.

    If you are trying to get a plan as an individual, or are a small business (such as a Jewish day school), if you can get coverage at all, family is often not included, there are often exclusion for preexisting conditions, and they can drop you or raise your rate for having too many claims. Monday’s Wall Street Journal had a great article on the subject.

    Thus a national insurance system will be great for Orthodox Jews. Unfortunately it may bankrupt the country, and push us into deep (deeper) depression.

    Or as I said in the original post, we could try having a bake sale… 🙂

  8. To Democrat tax-and-spend politicos, anyone making over $40,000/year is “rich” and must be taxed into oblivion.

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