Thursday, August 06, 2009

ObamaCare: The Tax Solution

Gee. This is just shocking!

The [Senate] group is closer to resolving other major questions and has already agreed to about $500 billion in changes to existing federal health programs, including Medicare and Medicaid. For example, negotiators would require wealthier seniors to pay more for prescription drug coverage under Medicare, and they would charge co-payments for clinical lab procedures. The lab co-pays are potentially lucrative, raising about $20 billion over 10 years.

Other new sources of revenue include penalties on individuals who do not obtain health insurance, and a "free-rider" provision that would require employers that currently offer health insurance to continue to do so, or to reimburse the federal government for workers who switch to subsidized coverage through an insurance exchange. Both provisions could yield about $43 billion over 10 years.

The rest of the additional revenue -- about $250 billion -- would come from new taxes, primarily from an excise tax of up to 35 percent on insurance companies that sell extremely generous policies worth at least $21,000 a year for family coverage or $8,000 a year for individuals, according to aides involved in the discussions. About 7 percent of taxpayers hold such policies.

Lawmakers said insurance companies are likely to pass the cost of such a tax to policyholders, raising the price of those plans. That would create a strong incentive for employers to stop offering them, thus driving down overall health-care costs. With employers paying less for insurance, tax analysts predict, they would pay workers more in wages, increasing income tax collections by as much as $180 billion over the next decade.

No tax increase. Nosirreee!

Some of this, of course, is directly at odds with HR3200's provisions, and you might notice that details are very sketchy, indeed.

HT: Ace

1 comment:

Riva said...

This is interesting. My question is, are CATS covered under Obama family health care plan?