NO TAX INCREASE...except on Healthcare Reform

[chefdennis]

Yeap barry said no healthcare plan could add to the fed deficit, but it will add to the Taxes we ALL pay.......including those that most need the help, the elderly....

There are 2 articles from the Hertiage Group, read them both, open the links and just take it all in...barry and his minions are lying through their teeth and simply setting up our country to go completely broke, making us a depended nation, and letting barry show the world that he has taken us to the place that we need their help, instead of them needing our help..we will be a 3rd world nation......


Despite New Deficit-Cutting Claim, Baucus Bill Is Just Tax-and-Spend

by Michael D. Tanner
Added to cato.org on October 9, 2009

Despite New Deficit-Cutting Claim, Baucus Bill Is Just Tax-and-Spend | Michael D. Tanner | Cato Institute: Commentary

This article appeared in the Investor's Business Daily on October 8, 2009.

The Senate Finance Committee's version of health care reform is being hailed as a model of bipartisan moderation. One Republican may even vote for it.

And it's undeniably an improvement over the bill approved early by the Senate Health, Education, Labor, and Pensions Committee, or the one making its way ever so slowly through the House.

But that's a low bar. In reality, the Finance Committee bill still represents a radical government takeover of the U.S. health care system.

Let's start with the price tag. According to the report just released by the Congressional Budget Office, the bill will cost roughly $829 billion over the next 10 years. And, significantly, it is even projected to reduce the budget deficit over 10 years by $81 billion. Of course, both those numbers are misleading.

The $829 billion cost is for the next 10 years, 2010-2019, but the most expensive provisions of the bill don't take effect until July of 2013. The cost over the bill's first 10 years of actual operation is closer to $1.3 trillion.

In addition, the bill assumes that Congress will implement a 21% reduction in Medicare payments that is already scheduled under current law. The only problem is that Congress has been supposed to make those reductions since 2003 — and never has. There is no reason to believe it will do so this time either.

Most importantly, the bill does not achieve its deficit reduction by controlling spending or reducing health care costs. In fact, by the end of the 10-year budget window, the cost of the program is expected to be growing at 8% per year. But revenue from the bill's new taxes would be growing between 10% and 15% per year.

In particular, the bill imposes a 40% excise tax on health insurance plans that offer benefits in excess of $8,000 for an individual plan and $21,000 for a family plan. Insurers would almost certainly pass this tax on to consumers via higher premiums.

As inflation pushed insurance premiums higher in coming years, more and more middle-class families would find themselves caught up in the tax — providing the government with more revenue.

The overall tax increases in the bill are more than double the amount of deficit reduction. This isn't a health care efficiency bill or a cost-containment bill. It is a tax-and-spend bill, pure and simple.

And, when not raising taxes, the bill simply pushes costs on to others. For example, the bill would push $35 billion in Medicaid costs off onto already cash-strapped state governments. Other costs would be offloaded onto businesses and individuals.

Nor should it be forgotten that this bill would still give the government the power to force most Americans to purchase insurance, and allow the government to dictate what benefits insurance should offer.

People who have health insurance today — and like it — would have to switch to the government-approved plan, even if it was more expensive or contained benefits that they didn't want. That insurance will likely be more expensive, because the bill contains a host of new insurance regulations that will drive up premiums, especially for the young and healthy.

Others could lose their current insurance as well, including the 10 million Americans with health savings accounts (HSAs) and the one in five seniors currently on Medicare Advantage plans. The bill guts both programs.

Numerous other provisions would allow the government to interfere with how doctors practice medicine — for example, cutting Medicare reimbursements to providers whose utilization is in the 90th percentile or above compared to national averages, that is, doctors who do more procedures than the government thinks they should.

With all this, the bill still leaves 25 million people uninsured.

If that's moderation, it's just not good enough.

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October 15, 2009

Adding Insult to Injury: The Baucus Health Plan Imposes New Taxes on the Sick

by Robert A. Book, Ph.D., Guinevere Nell and Paul L. Winfree
WebMemo #2651
Adding Insult to Injury: The Baucus Health Plan Imposes New Taxes on the Sick

Public support for health care reform is based on a desire to help the sick or, at the very least, to protect the non-wealthy from the financial impact of illness, chronic disease, and accidents. Unfortunately, the reform proposals under active consideration in Congress do precisely the opposite.

In particular, the Baucus health reform proposal, recently passed by the Senate Finance Committee, imposes new taxes on those who need health care the most and on lower-income people with the least ability to pay--in some cases to fund coverage subsidies that will primarily go to young, healthy people with moderate incomes.

The proposal would impose higher taxes on taxpayers at all income levels who face high out-of-pocket medical expenses or have high-cost health plans, including patients living in poverty. It would impose "annual fees" (i.e., taxes) on the medical device and pharmaceutical industries, which would have to be passed on in the form of higher prices to patients who pay out of pocket, and to insurance plans, which will have to raise their premiums. There is also an "annual fee" on insurance companies that will be passed on to patients directly in the form of higher premiums.

Taxing Medical Devices

The Baucus proposal imposes an "annual fee" on medical device companies, which amounts to an excise tax on medical devices. Although it would not apply to Class I devices (simple items like tongue depressors and bedpans) or Class II devices priced under $100, it would apply to all other medical devices, including items from powered wheelchairs and breast-milk pumps for working mothers to pacemakers, hearing aids, prosthetics, and replacement joints. It would also apply to diagnostic tools like MRI and CT scanners.

The tax is structured in an unprecedented way: as an "annual fee" on the "industry sector," to be "allocated" across companies according to their U.S. market share. The tax would be passed on to patients who need these devices both directly (through higher prices for out-of-pocket purchases and higher co-payments) and indirectly (through higher health insurance premiums).

The total tax would initially be set at $4 billion per year. Yet the true impact would be higher because the annual fee would be treated as profit for corporate income tax purposes. This would make the effective tax as much as $5.4 billion and could result in money-losing companies paying tax on profits they do not actually have--in addition to their allocated share of the industry sector fee. For example, a company with market share but no after-tax profit would have to pay its share of the annual fee, the amount of which would be treated as profit and taxed as such. Thus, a pre-tax profit would turn into an after-tax loss.

Taxing Prescription Drugs

The Baucus bill would also impose a tax ("annual fee") on prescription drugs (excluding FDA-designated orphan drugs and generics). As with the device tax, the prescription drug tax is structured as an annual fee on the pharmaceutical industry sector. But the drug tax would be "allocated" to drug companies according to their share of sales only to federal health care programs--Medicare, Medicaid, the Veterans Health Administration, and TRICARE.

Since the tax will be charged on the basis of sales only to government programs, the government will pass much of the tax onto itself and the rest onto Medicare beneficiaries through higher co-payments.

The total pharmaceutical-sector tax would initially be set at $2.3 billion. Like the device tax, the pharmaceutical tax would be treated as profit, making the effective tax as much as $3.1 billion and possibly forcing some drug companies to pay a "profits" tax on profits that do not exist.

Taxing Patients with High Health Care Expenses

One provision of the bill would raise taxes on people with high health care needs--but only if they have jobs--by reducing the limit on employer-sponsored tax-free flexible spending accounts from $5,000 to $2,000.[1] Most affected workers would see an increase in income taxes; there would also be a payroll tax increase that would fall most heavily on lower- and moderate-income workers. Those with incomes under $106,800 would pay up to $459 more; workers with higher incomes would see an increase of no more than $87.

Another provision would increase taxes on those with high out-of-pocket health expenses, as well as those who pay their own health insurance premiums regardless of their employment status. Currently, medical expenses (other than those paid pre-tax through an employer) that exceed 7.5 percent of adjusted gross income are tax deductible. The Baucus proposal would raise this threshold to 10 percent, increasing taxes on more than 6 million households at all income levels.

About half of affected households have incomes low enough that they would qualify for the subsidies for which these taxes are intended to pay. Despite the President's promise that families with incomes under $250,000 would not pay higher taxes, 98.8 percent of those affected by this tax increase have incomes below $213,800.[2]

Affected households have higher health expenses because they have pre-existing conditions or buy health insurance themselves because they do not have access to employer-sponsored insurance. This group includes over 250,000 people who are disabled or in very poor health.[3] By any reasonable standard, health care reform should be directed at helping precisely these households. However, the Baucus plan would make them pay extra--to foot the bill for subsidies to healthy households with lower health care expenses.



Click here to see Table #1:

http://www.heritage.org/Research/HealthCare/images/wm2651_table1.gif

Taxing "High-Cost" Health

The Baucus proposal would impose a 40 percent tax on plans with premiums or actuarial value over $8,000 for individuals or $21,000 for families.[4] This tax rate is higher than the top income tax rate for even the richest Americans--and it would apply to everyone with high-valued plans, regardless of income.

Union members are particularly likely to be affected, as their contracts often call for comprehensive, high-value health plans. Even more cruelly, those with more health problems are most likely to select comprehensive plans with higher premiums, bending the cost curve in the wrong direction.

Click here to see Chart #1:

http://www.heritage.org/Research/HealthCare/images/wm2651_chart1.gif

Taxing the Sick to Subsidize the Healthy

Despite President Obama's promise not to raise taxes "one dime" for those earning below $250,000, this proposal would increase taxes on households with incomes substantially below that level--and especially on households facing the worst health problems.

The revenue from these taxes is intended to offset premium subsidies for households with incomes below four times the federal poverty level (FPL), but these taxes would be imposed on Americans who need medical devices or prescription drugs, have high out-of-pocket costs, or pay their own health insurance premiums--including many households with incomes below four times the FPL.

The Baucus proposal would tax the sick to subsidize insurance for the healthy. And much of the tax burden would fall on the same people "helped" by the subsidies. In short, the Baucus plan would harm those it should help and help those who need help the least.

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Robert A. Book, Ph.D., is Senior Research Fellow in Health Economics, Guinevere L. Nell is Research Programmer, and Paul L. Winfree is a Senior Policy Analyst in the Center for Data Analysis at The Heritage Foundation.



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[1]A proposed amendment would set the cap at $2,500.

[2]Authors' calculations based on the Center for Data Analysis Individual Income Tax Model. The projection is for 2014, the first full year the Baucus plan would be in effect.

[3]Based on the Current Population Survey including those either categorized as "disabled" or whose health is categorized as "poor."

[4]Slightly higher limits would apply for retirees (but not workers) over age 55 and workers in certain yet-to-be-specified "high-risk" professions. These limits would be $9,850 for individuals and $26,000 for families. It is unclear why family members of high-risk workers are at higher risk.

 

[Poorboy]

"Dirty Harry" Reid Let it Leak Out today that this New Health Care Package was Actually Going to Cost Tax Payers (2) Trillion Dollars and Not the Original Lie of 58 Billion!! Another Lie from the Infamous Dumocrat Party!!

 

[greg334]

You all need to stop reading the blogs and start reading the details of the bills. It is really sad that many of the adult population of this country don't get that they will lose what they have today and most of us will get screwed, irregardless what income level you have.

I don't want doctors involved with making finanacial decisions, most of them don't handle their billing or insurance submissions and are clueless on what really goes on so to ask them to have a voice is like having your mechanic set the prices for your next new car.

I say to the insurance companies, don't be a target, fight back by threatening the subscribers that you will cut them all off in the states where the senator or congressman threatened you and follow through with your threat. If this passes, then stop offering medical insurance altogether and sell home owners or car insurance.

To you seniors, haha, you wanted this mess and your representive organization AARP fought for it so now it will cost you by shortening your life and your medical services.

 

[chefdennis]

I haven't read the baucus bill, but i did read the 1st b/s that came out what 6 weeks ago.....and what is out there now will be convolt into a mess that no one will see once reid gets it behind closed doors...the ways and means committee today made a provision in an upcoming spending bill to add HR 3200 to setup passing it behind the backs of the people attached to another bill....with no floor vote on it on its own..... and they can do it with just 51 votes.......

 

[greg334]

There are two senate bills and a couple in the house. The one in the house that was passed will be the one going into committee for reconciliation with the senate bill but the senate will have to reconcile its mess first. It will be a clusterf*** of a mess when it is finished and we have the union and the stupid people to blame.

I wrote to my senators asking them why are they taking my choices away and I got the usual Levin BS line that they are adding choices so I don't have to be without health care. Well I was already without health care as I told him in a follow up and I also told him I had choices with preexisting but didn't have a job so I told him work on creating jobs, not screwing the people.