"Baucus health insurance plan aimed at priciest policies; But critics see cost for elderly, middle class" by Lisa Wangsness, Globe Staff | September 19, 2009
WASHINGTON - Critics say a proposal by Senate Finance Committee chairman Max Baucus to raise money for the health care overhaul by taxing insurers on their most expensive plans could hit middle-class pocketbooks - particularly in New England, where health costs are high.
Baucus has proposed paying for more than a quarter of his $750 billion health care proposal with a 35 percent excise tax on “gold-plated’’ insurance plans. It would be levied on insurance companies, which could pass on the expense to their customers.
The tax was meant to be a compromise, but it has already caused an uproar on both sides of the political aisle, with liberals and conservatives alike complaining it would hurt low- and moderate-income workers and older workers - particularly in high-cost areas....
Also see: National Health Care: Liberals Left in the Waiting Room
Insurers this week announced they would increase premiums by about 10 percent next year in Massachusetts, where premiums have doubled in the past decade.
Also see: The Massachusetts Model: Comes At a Premium
Bruce Bullen, interim chief executive officer of Harvard Pilgrim Health Care:
“Our concern is whether or not this is just a hidden attempt to tax insurers....’’
Yeah, the poor, billions-in-profit insurers.
In July, Senator John Kerry, Democrat of Massachusetts, circulated an alternative proposal to tax insurers on high-end plans instead of workers.
So EVEN IF you HAVE a JOB and INSURANCE you are going to get screwed on this.
The Finance Committee’s “Gang of Six’’ bipartisan negotiators considered it more politically palatable approach and snapped it up.
Yeah, right.
Related: National Health Care: Who Will Pay the Bill?
Going nowhere.
But in a phone interview yesterday, Kerry said he was not so happy with Baucus’s bill - he had proposed higher thresholds that would raise substantially less money but affect fewer plans, and therefore fewer taxpayers. Next week, when the Finance Committee begins voting on Baucus’s proposal bit by bit, Kerry said he would suggest raising the thresholds, as well as alternative ideas for getting the rest of the money somewhere else. But he said he did think it was a good idea to tax insurers because it would force them to contribute something toward a health insurance overhaul. He said insurers would feel new competitive pressure to keep prices down once the “exchanges’’ were set up, offering people a more transparent way to shop for insurance....
We DON'T WANT to SHOP for INSURANCE, we JUST WANT HEALTH CARE to BE THERE!
Robert Book, a health economist at the conservative Heritage Foundation, noted the 35 percent tax rate is close to the income tax rate for the wealthiest earners - so theoretically a low-income worker with expensive insurance could be indirectly taxed at a rate two or three times their income tax rate on a small portion of their benefits.
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Update:
“He’s trying to avoid the perception that the middle class is going to be taxed,’’ said Dan Mendelson, president of Avalere Health, an information company that serves the health industry and government. “The trick is to get funding for the bill but not to have anything that smacks of a middle-class tax.’’
If it smells like it, looks like it, and tastes like it, it is probably it.
There is no choice but Single Payer, America.
