Kerry defends tax on 'Cadillac' health plans

[Freddie Stubbs]

Source: Boston Globe

Senator John F. Kerry is aggressively defending the tax on so-called Cadillac health plans that is central to the health care bill passed by the Senate, but opposed by unions and many liberals and not in the House version.

President Obama reportedly told House Democratic leaders on Wednesday that they should accept the tax on the plans with the most generous benefits. And Kerry, who offered the idea of levying an excise tax on insurers that is incorporated in the bill, said today that it is essential to passing health reform.

Addressing fellow Democrats in an opinion piece posted on Huffington Post, the Massachusetts Democrat said that "striking this provision from the final bill will make it much more difficult to pass final health reform legislation in the Senate and that's a huge mistake when we're closer than ever to completing a journey that began with Harry Truman. If passing health care reform was easy, it would've happened decades ago. It's not. It requires tough choices. And it's worth it.

"Second, this is an idea that will help health reform succeed in the long run. It will create competition and place sunshine on the process of pricing health insurance premiums," he added.

Read more: http://www.boston.com/news/politics/politicalintelligence/2010/01/kerry_defends_t.html

[yodoobo]

1. Kerry and Obama are right on this

We ask the most from those who have been given the most.

Asking a little more from those who enjoy the countries best healthcare so that those less fortunate can have -some- healthcare.

Progressive taxation is a core idea in our tax system and in every civilized country.

[Hello_Kitty]

3. So why not go with the House plan and tax the rich?

That's a helluva lot more progressive than taxing health plans.

[midnight]

9. I wonder what their response would be to tax the rich? Taxing health plan is not right.

[yodoobo]

35. I think they will do both

That way the wealthy pay, as well as the most privileged.

Rightly or wrong, I suspect that this will the be final result.

The Cadillac tax threshold will be raised and the tax on high incomes will be tweaked.

[Rage for Order]

37. "If you make less than $250,000 a year..."

"Your taxes will not increase"

You get a cookie if you can tell me who said those words.

[marshall]

176. I think the number kept going down as the campaign went on

And reality set in. The things that need to be done will not get done unless everyone contributes.

[laughingliberal]

107. Taxing benefits was part of McCain's plan. As I recall he was defeated in the election

I am 100% opposed to it. It's another hit on workers and the middle class.

[karynnj]

44. There are not 60 votes in the Senate that will agree

to doing it that way. Many of the conservative democrats feel there are not enough measures that act to constrain costs - and this is one of them.

[laughingliberal]

110. The House plan raises a lot more money and saves more to boot

The conservadems are favoring the wealthy and the corporate interests as always. All that spinning has got to be making them nauseous. At least we hope so cause they're sure nauseating all of us.

[No Elephants]

118. You don't know what people would agree to if the President and the party leaders

were to fight vigorously for something that is just, instead of trying to convince Democrats that they should love something like a tax on some supply clerk's health insurance.

[Better Believe It]

172. You don't need 60 votes. You need 51 votes. Just force the Republicans to filibuster ...

all filibusters end, don't let them two track the Senate and if all else fails just use the constitutional option which would immediately stop any filibuster.

[wisteria]

61. This way is more effective. Just because you have a lot of money doesn't mean you should have to

shoulders all the costs. This does nothing to change the system.

[laughingliberal]

108. All the costs? Seems to me those at the top have gotten all the tax cuts over the past 30 years.

And working and middle class Americans have been shouldering all the costs. Reagan gave the rich a cut and raised payroll taxes on everyone else to pay for it. Time to restore progression to the tax code.

[No Elephants]

120. "Way more effective?" By what measure? And how do you know?

As far as those with money shouldering all the costs, when has that happened din recent memory? Besides, those who make the most money use a disproproportionate amount of things like infrastructure, and they indeed should be paying more.

[sabrina 1]

4. Except that's not who is being asked. That is what we were

told would be in the bill. As it turns out 'cadillac' doesn't mean what we thought it meant. This tax will affect mostly the middle class. As always, the working class. It is exactly the tax that Obama opposed vehemently during the campaign.

Nancy Pelosi is proposing a tax on the wealthy, but Obama, the guy who has no power, is sticking with this as it will benefit his new best friends in the Insurance Business. It will force employers not to buy the best coverage for their employees to avoid the tax.

Since when should the government tell you, first that you are ordered to buy something you don't want, and then tell you you are forbidden from the best quality product or your provider will taxed on your premium.

You need to read more about this provision. It is not the wealthy, it is the middle class who will be mostly affected by this.

[karynnj]

45. This tax will not hit "mostly the middle class"

It will hit at most 2 to 3 percent of plans - most, if not all, held by top executives.

It is NOT the tax Obama opposed - McCain's plan removed the tax deduction to companies completely.

You need to read more on the provision. I have yet to see ONE union plan identified as costing more than $23,000 for a family or $8,500 for the individual. I have posted this often and NO ONE has found one for me.

To me this seems the 2010 version of the "death tax will hurt small farms" where NO ONE ever found an affected small farm. It, of course affects extraordinarily wealthy people.

[sabrina 1]

60. Well, I know someone personally who will be affected by it.

I have already mentioned it. My sister works for a small company that provides total coverage for its employees, no co-pays. It is expensive, the employees chose to keep that coverage and consider it part of their income rather than work for another company with higher pay and less benefits. It does cost more than the threshold in the bill. So, they will have to make a choice they do not want to make.

Her employer, one of the good people who does care about his employees, will be taxed on part of their premiums, which will put a big strain on a small business like his. He could drop those premiums which is probably his only option. They will have less coverage, more out of pocket expenses and even with a raise, which this employer is likely to do, (but in the survey that was done of business owners, a majority said they will not raise salaries) they are still going to be worse off than they are now.

Most of all, it is simply outrageous to force people to spend their money in ways they do not wish to spend it. It is undemocratic and autoritarian and the main beneficiaries will be the failed, corrupt Private Insurance Ind. I am very angry as is every one I know no matter what political party they belong to. As for the Unions, they are opposed to it. I think they know what's best for them. Apparently our government believes it is THEY who know what is best for us now.

[wisteria]

63. It will be tweeked and situations like your sisters will be considered.

This aims at CEO's not average workers. I also have great coverage, but I am not rich. I have enough confidence in our Democrats to know they will get this right.

[sabrina 1]

72. I doubt that. The goal of this tax is to discourage

premiums that entitle beneficiaries to good health care. I had to read that again as it is so outrageous an idea.

Hard as it was for me to believe, this is meant to prevent the Insurance Ind. from having to pay for that care. The very fact that someone thought of this, that they could sit there and decide that people should have their arms twisted to NOT spend their own money to buy something they believe is in their best interests.

I don't trust politicians, or legislation that isn't clear and that was written not with the welfare of the people in mind, but the survival and continued profits of a private industry.

On the other end of the scale, they are forcing people to pay or be fined whether they can afford it or not. The whole premise is just plain wrong and I regret going along with the first compromise. That was a huge mistake. But supporters kept saying, 'we'll have a robust PO', then well, a 'weak PO', okay no PO, but how about extended Medicare? No, not that either. Okay, re-importation of drugs, that will save the people some money? No, sorry you can't have that either.

Sorry every step along the way, people made excuses, then they moved the goal posts. The posts are now against the wall. There is nothing left to compromise on. We lost they won, and we lost because we didn't fight hard enough, because of the appeasers. I knew it and should have known better. Never compromise when you know are right. I learned a very good lesson from this for future reference.

[laughingliberal]

111. Forgive me if I'm a little skeptical. I'm still waiting for them to 'fix' NAFTA nt

The premium to cover my husband in 2004 would have been hit with this tax and it wasn't great coverage. It's cause we're older. I do not want one penny of taxes on the middle and working classes. It's enough. Time to tax the people whose taxes have gone down over 3 decades. Period.

[No Elephants]

122. Did you also have enough confidence in Democrats when this started to think

they would defeat any public option whatever and also defeat the bill that would have allowed folks to re-import drugs from Canada?

[Zhade]

98. It's actually quite literally fascist -- the government forcing consumers to buy private products.

Mussolini himself said fascism could more rightly be called corporatism.

[amandabeech]

79. I'm 54, and the cost of the mandatory plan for me, and me alone,

under the Senate version will exceed $8,500. That is not a Cadillac plan. That's the Obama plan estimates for older workers. This thing will hit older workers and their employers very hard, and I'm not talking unionized older workers.

Furthermore, the union folks have given up pension and wage increases in order to keep high quality health care plans.

Now they're going to be taxed at a high rate for bargains that they made going back decades.

How is that fair?

Better to tax high earners now or else raise the "Cadillac" level above the cost of plans for older workers or long-bargained for union plans.

[karynnj]

91. This affects ONLY employer paid plans, not ones you purchase

I think the level should be raised - and the people I saw arguing for raising it on the Finance committee were John Kerry and Debbie Stabanow. (Baucus originally set it at $21,000 for families - I forget the single amount)

[laughingliberal]

113. It was an employer sponsored plan in 2004 that was charging me enough to qualify for this tax for

covering my husband. They need to scrap it and go with the House plan for revenue. What the hell is the problem with taxing people who make over $500,000 a year? It raises 3 times the money and begins the process of restoring fairness to the tax code.

[karynnj]

151. Absolutely nothing is wrong with that .... if it could get 60 votes in the Senate

The reason this was originally suggested (with a higher threshold) was that there were "some" Democrats unwilling to increase the taxes on the top. I don't know who they are or why, but that was what was said.

[laughingliberal]

175. I believe Obama would have 60 votes for almost anything he wanted in the Senate

I think the Blue Dogs have been doing his bidding all along and giving him cover with the left.

[Joe Bacon]

103. Mine does.

I have Kaiser through the Federal Government and this asinine tax WILL hit me when I least need to get any more screwing. I already have diabetes and rheumatoid arthritis, thanks to this asinine provision, I'm going to get hit with that tax.

Those who had the party under Bush ought to pay the bills. Make the millionaires pay their fair share. If Obama rams this tax through, i"ll gladly support anyone, even Pee Wee Herman, who will challenge him in 2012.

[laughingliberal]

109. Save your talking points for those who have not spent countless hours studying it

I paid close to the level they are speaking of taxing to cover my husband on 2004. Many people over 50 pay these kinds of rates for pretty basic coverage. And, as premiums rise, more middle class workers will be hit.

You may want to let the unions know how this won't hurt their workers. They seem to be of the opinion it will. Why is anyone obligated to relate the terms of their contracts to you?

This is not 'the death tax will hurt small business' story. This is real people over 50 often have premiums this high. One couple I know is paying $2000 per month to cover themselves and it is not in any way 'gold plate' coverage.

[No Elephants]

112. It does NOT affect only "extraordinarily wealthy" people."

And I am not talking unions.

When I started out in private employment after working in the public sector for a time, I had great health care benefits. I never asked for them. I got them because tax laws penalized employers who gave better health plans to the most highly paid in the firm than they gave to the lower paid folks. Since the owners wanted their benefits to come out of the business, rather than out of their own income, the owners gave the same benefits they had to everyone in the firm.

The supply clerk, the folks who worked the copy room and the messengers had the same "cadillac plan" as the older and highest paid managing partners. The managing partners would have had the bucks to pay the tax; the supply clerk and the messengers could not have afforded a tax on their health insurance. The place was not unionized, so getting the cadillac plan was just part of getting a job, not anything anyone specifically bargained for.

The way to do this fairly is by taxing income, not by taxing health insurance. (The worst possible tax situation is having a tax hit you when you never saw the dollars to begin with; and this is that situation.)

[bread_and_roses]

153. You are wrong

You can go here http://blog.aflcio.org/2010/01/07/health-care-reform-tax-hits-more-chevys-than-caddies/#more-23828 and read the links for yourself, but from one of them:

Both Rep. Courtney, EPI policy analysts Larry Mishel and Josh Bivens and former Clinton Labor Secretary Robert Reich offered compelling reasons why the House version of financing, featuring a surtax on high-income earners, would be preferable to the excise tax. Courtney noted that, according to a Joint Committee on Taxation study, 27% of family plans would be hit by the tax in its fifth year of operation in 2019, and 22% of individual plans. He termed the indexing of CPI +1% “inadequate,” and believed that, as health insurance premiums go up, the excise tax would turn into “the AMT on steroids.” That’s a reference to the alternative minimum tax, which was originally designed to affect high-income earners who avoided paying taxes through multiple deductions, but which now impacts so many people in the upper-middle class that a patch is offered every year. My guess is that would be how the excise tax would work in practice, making it ineffective as a revenue raiser.

Furthermore, it’s completely unclear that this tax, designed to target insurance plans which are too lavish, would actually meet that goal. Because of the age rating in the Senate bill, where insurance companies would be able to charge three times as much for an older customer than a younger one, the tax would disproportionately hit older Americans. In addition, regional disparities play a major role in driving premium prices, which middle class families cannot control...

...Larry Mishel of EPI noted that 75% of all teacher plans would be affected because that profession employs a disproportionate number of older women.

emphasis added

Obama supporting this is a profound betrayal.

[Zhade]

15. THEY WERE NOT GIVEN THESE PLANS. THEY FOUGHT FOR THEM AND GAVE UP RAISES TO KEEP THEM!

This is NOT progressive taxation. You've been duped.

[yodoobo]

19. And they would have been taxed on those raises

Healthcare is a human right. The quality of your healthcare should not depend on the quality of your negotiator or your bank account.

This legislation is a stepping stone. Until we take the next step some will receive a higher quality of this human right than others. Its only fair that they give back a little to insure that those less fortunate will have this right as well.

This entire argument boils down to not wanting to pay a fair share of taxes.

[Zhade]

20. Wrong, of course. It boils down to not wanting to be forced to buy inferior insurance.

Insurance with no enforceable price controls that cements Big Pharma's hold on our health and pocketbooks.

[karynnj]

46. This has nothing to do with the excise tax

[Crzyrussell]

29. It comes

down to people like you wanting to reduce the level of access of health care of the middle class in the name of social justice.

Why not improve the level of access for all instead of reducing it for the middle class?

Is that really fair?

[yodoobo]

34. This is completely about improving the level of access for all

But we have to pay for it somehow.

What is fair, is that those who benefit the most, give back the most - to insure that everyone can benefit.

[Iowa]

40. That's a crock of shit.

There are a thousand better ways to pay for it than this abomination. If these sell-outs go through with it, there will be hell to pay.

[Joe Bacon]

104. Oh you have that right.

If Obama slaps this tax on us, I will vote for a primary challenger and I'll gladly send cash to a primary challenger to my Senators or Congressman if they vote to tax my health insurance.

[laughingliberal]

116. The House plan raises 3 times the money and covers more people

by taxing those who make over $500,000 per year. Much fairer and more people benefit.

[No Elephants]

132. People who benefit most in what way, and from what? Please see

Reply #112. Do you really think some 18 year old messenger or supply clerk who gets a great health care plan--whether they want one or not--should be "giving back" the most? The people who take the most out of this society are not the ones who, for whatever reason, got cadillac health plans. It's the folks who earn twenty or thirty a million a year, plus perks up the yin yang. And the way to make them give back is a progressive income tax.

[No Elephants]

131. Your wish is that this legislation be a stepping stone. No one says your wish will come true.

Please see Reply 112, then tell me how some 18 year old messenger who gets a job with a cadillac plan whether s/he wants a cadillac plan or not is going to come up with the money to pay the tax on the plan. Then tell me what is fair about making him or her do that. Their only choice is going to be paying a tax they cannot afford or walking away from a job they need.

Something is not going to be fixed just because you imagine it is, nor is something fair just because you claim it is.

[yodoobo]

135. I'm more concerned about the 18 year old WITHOUT insurance

than this mythical 18 year who is enjoying that absolute top tier healthcare we have to offer.

Most 18 year supply clerks don't have any coverage, let alone gold plated executive style insurance.

However if that means asking a privileged 18 year old to give back a little so the vast majority of uninsured 18 year olds can get some coverage, well I'm ok with that.

Thats how a progressive tax code works.

[laughingliberal]

114. +1000 nt

[No Elephants]

127. Sometimes, you are given a cadillac plan, whether you want it or not. See Reply 112.

Why should the issue be whether or not you or your union bargained for it? If you need a job and get one at a low salary, but it comes with a cadillac plan, even if you are a healthy 20 year old and could care less, what are you supposed to do?

An bad tax is an bad tax, period. It should not exist, no matter how you came to be subject to it.

[MrsBrady]

18. excuse me, but my husband is not "given" health care

he works his ass off every day -- it's not a gift. It's part of his compensation package.

We do feel fortunate to have a good plan. Everyone should have what we have, but it's not a gift.

So what...now...punish the middle class and the unions who fought so hard to preserve the rights of workers?

We are not wealthy. We make a VERY middle class income. Our home is small.

He and his co-workers are looking at having to NOT take salary increases in order to keep their current health care benefits.
This tax my cut into our take home pay.

I don't know how we are going to afford it.

The middle class should not bear the brunt of this, when we have borne everything else.
This needs to be on the shoulders of the wealthy or the insurance companies, that can actually afford to take the hit. They wouldn't miss it.

We will.

[yodoobo]

21. But if you did take a salary increase instead

You would certainly be taxed on it.

And certainly union members enjoy a higher wage than most that they fairly and rightly negotiated..and those higher wages come with higher taxes as well. This is no secret.

So how is it fair that you get a tax break for receiving a better quality of healthcare that is denied to most of us?

I was initially against this provision as well, but the more I've looked into, the more it appears that this is good tax policy. In fact it perfectly aligns with our ideals of progressive taxation and helps ensure our goal of healthcare equality.

Nobody really likes paying taxes - but as progressives we know that they are necessary and our responsibility to others.

[dysfunctional press]

26. as long as Kerry and Obama are fine with losing the union vote...

because they definitely will. my father is a lifelong union member and dem voter- but he won't be any longer.

this tax as written is a HUGH mistake afaic.

what we NEED to do is go back to a higher top marginal rate like we had pre-raygun.
and to maybe tax capital gains as regular income.
i also like the idea of a quarter-cent tax on every share of stock traded.
but taxing the health benefits of retired blue-collar workers would be WAAAY down on my list.

[Crzyrussell]

31. They won't only loose the union vote

(mine has already dropped them over this) they will loose the middle class vote as well.

What a huge train wreck..

[Crzyrussell]

27. Denied?

You act as if those of us who are union are going out and preventing others form receiving the same benefits?

Instead of knocking us down to bring others up... why not find a way to bring others up while letting the rest of us keep what we have?

That way health care is improved for all....


Destroying what we currently have in order of "healthcare equality" isn't healthcare equality...

it is social engineering.

[Iowa]

42. Well said Crzyrussell. I agree.

[yodoobo]

50. If you aren't wealthy enough to afford it. Its has been denied

Only a Republican would argue against this simple life fact.

No its not denied by YOU or unions, That is just a strawman.

And what, pray tell is wrong with social engineering? That's the entire purpose of our leadership and the laws they make.

[Rage for Order]

52. What utter bullshit!

"If you aren't wealthy enough to afford it. Its has been denied"

I had no idea I've been denied a ferrari, a private jet, and a life of luxury all these years.

:eyes:

Who is paying you to disseminate your disinformation?

[yodoobo]

54. Well then. Post of picture of them!

Which did you pick? The learjet or the gulfstream?

Seriously though. lets stop with the strawmen and discuss rationally.

[Rage for Order]

58. You are the one who said...

If one can't afford something, one has been denied that item. That line of reasoning is specious at best.

Should people who live in $150,000 homes be forced to move into $50,000 homes to ensure that there are no homeless people in the US?

[yodoobo]

62. The $150k house is assessed more property tax than the $50k house

And housing, like healthcare is a human right.

So your analogy is perfect and provides justification for taxing the gold plated plans.

Furthermore, I would be perfectly ok with using some of the property taxes from high end homes, to provide housing for the homeless.

[Rage for Order]

68. Why do insist on gutting the middle class?

What happened to "families making less than $250,000 a year will not see their taxes go up"? What you advocate is a race to the bottom, taking from those who have some (not a lot) and giving it to those who don't have quite as much. And all the while, the ultra wealthy laugh at your gullibility.

Again I ask you, whose payroll are you on?

[yodoobo]

75. Please with the hyberbole

This bill is about, and will improve the lives of most all Americans. Even those with top shelf care.

Its not mana from heaven, this bill needs much improvement. But I'm going to to fall for the "race to the bottom" and "gut the middleclass" hyberbole either. Lets stay rooted in reality.

No one is ever happy about increased taxes. Ever. But they are necessary and they should always be progressive.

Futhermore, this is not a tax increase on families. It is a tax increase on businesses.

Who I work for is my personal business. No I'm not a paid poster. Frankly I don't think they exist. If they do exist, please point me to a link where my spouse can apply as we could use the money.

[Rage for Order]

78. So we should accept one more bait-and-switch then?

Let's see, Obama promised that he would not raise taxes one penny on individuals making less than $200,000 a year, and families making $250,000 a year. He also railed against John McCain for suggesting that health benefits be taxed. Now, barely a year removed from the campaign, he has done a complete 180 on both of these issues.

How will this bill improve the lives of Americans who already have decent (not "great", "gold", or "Cadillac") health care plans by making them pay more for the same level of care?

Why are increased taxes necessary? We spend about $600 billion a year on the military. Why not trim that to $400 billion and use the $200 billion in annual savings to provide health care to those who do not have it?

Do you think businesses will absorb this tax increase and accept lower profits, or do you think it is more likely that it will be passed through to us, the consumers?

[laughingliberal]

121. The House bill taxes the wealthy, raises 3 times the revenue and covers more people

The Senate bill protects the wealthy, once again, from paying their fair share and falls much more heavily on workers and middle class families. But that's become the American way over the past 3 decades, hasn't it?

[No Elephants]

142. Calling this tax progressive is beyond hyperbole. It's false.

Hyperbole is wild exaggeration, but there is a germ of truth to it. Charging what amounts sales tax on health care plans is not progressive in any way, even if the tax is on only the costlier plans.

[Zhade]

99. Once again, these aren't "gold-plated". These were not given, but earned.

What you're advocating isn't what's happening here. You want to tax those who are wealthy enough to have amazing coverage.

Union members ARE NOT WEALTHY, in part because they gave up raises to ensure their coverage. And before you pull out that "raises would have been taxed" canard, think about this: not at 40%, they wouldn't.

They're pulling the wool over your willfully-blind eyes.

[No Elephants]

136. Real estate tax is not at all analogous, nor is it necessarily fair.

neconly means cities and towns have of raising taxes. They don't have income taxing authority. Given that, and ONLY given that, it makes sense for them to tax the costliest houses the most, even if that makes the home unaffordable for someone who may have become disabled or lost their income after purchasing their homes. Or for those who bought homes early in a an older neighborhood that has since become gentrified and therefore expensive.

Nothing is the least fair about forcing disabled, elderly or simply poorer people out of homes they may own outright by making their real estate taxes unaffordable. However, real estate tax is very blunt tool.

State and federal governments, however, do have authority to tax income. They are free from the real estate tax restriction under which local government must labor, so the feds and states can tax much more fairly.

A progressive income tax is the way to make those who use the most of what society has to offer and who get the most from our society to pay the tax. There is not necessarily any correlation between a cadillac plan and compensation in general.

[laughingliberal]

117. +1000 nt

[DebbieCDC]

30. Is it "good tax policy" to screw the middle class yet again?

How much more of a burden does the middle class have to bear in this country?

We pay for every fucking thing.

How can you call yourself a progressive while for a for a regressive tax on the working class?

[Zhade]

32. My bet? Rose-colored confusion.

NT!

[karynnj]

48. How many people in the middle class have plans above the threshold?

This is not a regressive tax. Although it is paid by the employer, if you look at those impacted, it is FAR more likely to affect you the more you earn.

[dflprincess]

92. The more an employer has to pay in taxes, the less they will pay

in wages or other benefits.

All this bill means is that more employers will move to lower premium/higher out of pocket insurance plans. It guarantees that while more people will have "coverage" more and more people will be underinsured and looking at out of pocket expenses that are so high they still won't be able to access care.

[laughingliberal]

119. It is far more regressive than the House plan

and many people over 50 and companies that employ a large number of older workers pay premiums like this. It not only falls more on workers but it discourages small companies from hiring older workers who would increase the cost of providing benefits. It is wrong on so many levels I can't believe anyone is defending it.

[No Elephants]

138. It is a regressive tax. Sales taxes are regressive. This is very like taxing

restaurant meals of over $10, regardless of what your income is. It's worse, though, because society has a large interest in people having excellent coverage. If they don't, society may have to pick up the slack, whether directly or because people have to file for bankruptcy, or whatever. Society does not have a huge interest in people having restaurant meals instead of cooking at home.

[laughingliberal]

115. As a progressive I favor taxing those who have the most first

The House plan taxes those who make over $500,000 per year. I think that qualifies as those who have the most far more than a worker who has an expensive premium. This working and middle class tax does not 'align with' my ideals of progressive taxation. It, once again, lets the wealthy shirk while workers take it in the shorts.

[No Elephants]

133. It's lousy tax policy. It amounts to making employees, some of them earning very little,

pay a sales tax on a health insurance plan chosen and purchased by their employers. See Reply #112.

Sales taxes, even when you choose to make the purchase yourself, are regressive. And taxing behavior that is desirable for your own good and for that of the society's good, like having good health care plans, is lousy tax policy. So is creating a tax situation where the person who has to pay for the tax never received the cash to pay the tax.

Sorry, but a progressive income tax is the fairest of all taxes.

[No Elephants]

134. A pay increase is not comparable to this situation and nothing about this tax is progressive.

With a pay increase, you've received cash to pay any tax on that income that you may owe. That is not the case when your boss gives you health insurance as a fringe. And, if you want to get out of paying a tax on your income, you can decline the raise. You don't have to decline the job entirely, as you would if an employer were offering good health insurance and you could not afford the tax.

And income taxes are progressive, while a tax like this is regressive, like a sales tax. Further, it is taxing behavior we want to encourage so that the rest of us don't have to pick up the slack from someone who has lousy coverage. Please see Reply 133.

The reality is that this is lousy tax policy, any way you look at it. Good tax policy is paying for programs via a progressive income tax on income that has actually passed through your hands. Even "sin" sales taxes are more progressive than this. So are taxes on restaurant meals.

[karynnj]

47. Does your husband's plan cost more than $23,000 a year?

In addition, you will not pay the tax.

[No Elephants]

137. The first question we should be asking is whether this is good tax policy or not.

If it isn't, the tax should not exist, period. And this is not good tax policy.

[jmm]

41. If we were asking the most from those given the most so we can

take care of the less fortunate then we'd have a single payer system. Taxing plans as low as $8,000 individual $21,000 (Cadillac plans are determine by cost not benefits, where you live, why your premiums are higher, etc.) not factoring in inflation only encourages people to switch to less comprehensive plans and burdens people who don't have Cadillac salaries.

[laughingliberal]

106. Uh, the House taxes people who make over $500,000 per year

Taxing the working and middle class is not taxing those who have been given the most. It is taxing middle class workers for a bill that is already a giveaway to wealthy corporations. I'm all for progressive taxation and it needs to fall on those who have been getting the tax cuts all these years.

[politicasista]

168. The comments and thread are a mirror of Free Republic

They both wrong and smeared as lying, rich DLC corporate sellouts. :eyes:

[haele]

173. We aren't asking "a little more" from those actually benefit from our "healthcare system"

As Americans and American businesses pay 40 - 50% more for the same level of health care one can get in other countries that have private insurance. The only people who "enjoy" the country's "best healthcare" are the ones who are profiting off the lack of regulation and kickbacks from those who supposedly provide our healthcare. Oh, and perhaps government workers, the military and veterans, and those on Medicare that can be covered where they live. You know "insurance opportunity lottery winners".

The ones who actually enjoy our best healthcare are people who have access to our best healthcare. And most American workers - even those lucky-ducky union workers - who pay premiums, co-pays, and deductibles that may seem to reach into the so-called "Cadillac" levels, don't really have the access.
Americans give up wages for medical benefits that are supposed to be tax-deductible, not because they're tax cheats, but because medical costs are not regulated and who knows what you're going to have to pay for a lab test or an MRI - it all depends on how much the people providing the service want to make for their shareholders and their upper management. How much they need to charge to satisfy Wall Street.
Not how much the medical service actually costs.
And the cost of downsizing your actual health care in a race to the bottom of the balance sheet costs more in the long run. Disabled people becoming destitute because they can't afford care costs taxpayers far more than not taxing insurance plans that give a break to the working American.

I hear it all the time - "I'm healthy and pay taxes on everything that could be considered wage, why shouldn't Jim the Welder making $35K a year for tax purposes pay for that $20K worth of health benefits he gets from his employer than I get from mine in lieu of his getting raise?"

Jim, his union, and his employer made a deal so that his employer wouldn't go out of business giving Jim enough for his labor that Jim and his family can have a decent life without having to pick up a second job to make ends meet. Not a job like the old union days where he can get a new car every five years, or buy a house and still put his kids through college. But a job where he can take care of his family in relative comfort - put a roof over their heads, pay the utilities, keep food in the pantry, keep them healthy, and take care of the household transportation without going into debt.
That's where we should all be heading - that's what's "fair". Unfortunately, it's not really quantifiable, because of the variables - location of employment, the environment, resources available to the community, costs of living; are there dependants that are employable, are there medical issues that could be driving costs up, all those are variables to an individual's quality of life and earnings.
But instead, everyone - well, everyone who cares more about policy than people, wants a cookie-cutter citizenry that's standardized to make the population easier to put in bullet points and on balance sheets.
And that's what taxing "Cadillac" plans does. The workers who through luck are eligible for plans that are over the limit who don't make much $50K annually - which are probably a good 70% of people paying into these "Cadillac" plans are going to be hurt because everyone is focusing on those in the top 1% wage earners. The businesses who provide those plans are going to be hurt, and will have to drop the good plans for crap plans.
Their lower wage employees who "make too much" to be subsidized are going to be hurt because when they need that "Cadillac" plan to cover them, they are going to find that they can be stuck with out of pocket deductibles that can get to up to or over a third their annual wage before the new insurance will start covering "care", and even then, prescriptions and appliances aren't covered. Ghods help those employees who have a disabled spouse or children.
There's a situation called a "Medicaid Divorce" - where spouses will officially divorce so a disabled member of the family can get Medicaid to survive. Otherwise, the family will become homeless, even if one of the parents makes "good money" - an electrician who used to work on some of my projects did that so his wife (herself with severe arthritis) could get Medicare for herself and their three kids, one with MS and another with mental issues.
He took home over $60K a year, but couldn't afford to cover his wife and kids on a reasonably decent insurance plan. So, they officially divorced, but are still pretty much sharing the property to make ends meet (he spends 4 nights a week in the RV with his "stuff" in their driveway to ensure she remains eligible just in case anyone wants to make a stink). He pays his child support to the household account. They plan to get re-married once the youngest is out of the house and the child with MS can go on SSDI and get covered that way.

Health care bills are one of the primary causes of divorce and bankruptcy. Taxing good health care insurance as "income" will just increase the occurrence of both situations.

Best and fairist way to pay for a more universal health care - lift the cap on Medicare tax. Heck, increase it by another 1% once you lifted the cap, and it will both pay for itself and not

Haele

[sendero]

2. They better index the damn thing..

.. or it will start out as a Cadillac tax and end up as a Yugo tax.

[yodoobo]

24. I have mixed feelings on indexing it.

My gut reaction is that it should be indexed.

However if its not indexed, that will serve as an economic factor that will put downward pressure on healthcare cost increases.

Net Net, I think I favor indexing though.

[karynnj]

56. It is indexed at the inflation rate plus one percent

[sendero]

71. By "inflation rate"...

.. I assume you mean CPI. Of course, health care costs have historically risen much faster than the CPI.

That said, I could live with that level of indexing, as it would put some pressure on increases (as the previous poster mentioned) while not putting us in a position like the AMT where average families are being taxed like they are rich.

[yodoobo]

76. which will put macro economic downward pressure on healthcare prices

[karynnj]

87. I agree - and I think that your second sentence is why it is indexed

to inflation ( the Reid document doesn't specify the index, but I assue it is CPI too.)

[laughingliberal]

123. It is not indexed in the bill as it stands now and I have heard of no plans to do so

That is one of the unions' objections is that it will fall on more and more middle class workers as premiums continue to rise.

[katandmoon]

5. Spoken like a true gazillionaire

[Hello_Kitty]

6. EPI has debunked the higher wages claim

http://epi.3cdn.net/f121df10fab53d2b16_3nm6bhd7e.pdf

[doc03]

7. Why of course Mr. Heinz would n/t

[karynnj]

59. You should be ashamed of yourself

This type of attack belongs on RW boards

[doc03]

73. Well he is for it now maybe he will be against it later n/t

[karynnj]

84. uhm .. you do know that the Republicans made that up in spite of it being two different versions

and Kerry was right on both. He voted for the $87 billion paid for by a rolling back a tax cut for the top 2% and with oversight and against the no oversight bill added to the deficit.

[No Elephants]

143. He was for the war in Iraq before he was against it refers to the fact

that he voted to authorize the Iraq War, then voted against a bill to fund it. So, no, he was not right both times. And he stopped voting against funding.

[karynnj]

165. Not true - it was the 2 votes on funding that Kerry spoke of in the clip the Republicans used

The fact is Kerry made it clear at the time of the funding votes that he was not voting against funding the troops.

It was years later when Kerry and others voted against some funding bills without an exit plan, after Bush vetoed a funding bill with an exit plan. Neither the Democrats or Bush were really voting to cut funding.

[No Elephants]

141. Maybe, but there is something about the single richest man in Congress shilling for a tax on health

insurance purchases.

[karynnj]

164. If you watched the Finance committee hearings, he and Rockefeller

were the two most concerned for people affording the plan.

[politicasista]

169. **crickets**

They chirp when fact filled posts like this one and others are posted. :thumbsup:

[IndianaGreen]

8. With all due respect to Senator Kerry, but he was born into privilege

It is the working class, and not some Boston Brahmin, who will get hit the hardest by Obama's "Chevy Tax."

Health Care Excise Tax = A Big Middle Class Tax Increase

Health care legislation under consideration in the U.S. Senate would raise $149 billion over ten years by imposing a 40 percent excise tax above certain thresholds on insurance company health plans and self-insured plans offered by companies to their workers. This tax would have a dramatic effect on those plans forcing steep reductions in benefits, shifting of costs to workers and a significant increase in taxes on millions of middle-class families.

Contrary to claims by proponents that it will affect only “Cadillac” health plans, like those enjoyed by Goldman Sachs executives, according to Joint Committee on Taxation(i) data the excise tax will:

• Affect 19 percent of workers with employer-sponsored health coverage in 2016.
• Affect nearly 25 million households(ii) in 2019, including one-fifth of middle-class households making between $50,000 and $75,000.
• Affect about 25 percent of health plans by 2019.
• Cost affected households an additional $7,500 in taxes on average between 2013 and 2019, or more than $1,000 a year.
• In 2019, cost affected taxpayers who are millionaires an extra $2,600 in taxes and those making between $50,000 to $75,000 an extra $1,100 in taxes, but the wealthy taxpayers’ income will be at least 13 to 20 times greater.
• Be a tax increase of 0.1 percent of income for those households affected that make more than $1 million a year and be a tax increase of 1.4 percent for those households affected that make $50,000 to $75,000.

The JCT assumes that 82.5 percent of the revenue raised from the tax will be generated by increased wages to make up for health benefits cuts and increased cost sharing. However, most employers say they will not increase workers’ wages in response:

• Only 9 percent of human resource executives in a recent Towers-Perrin survey said if health care reform reduced their benefit costs would they increase salary or direct compensation; 78 percent said they would retain the savings in the business as profit.
• Just 16 percent of health plan sponsors in a recent Mercer survey said they would convert any health care cost savings into higher pay for their workers.

--------------------------------------------------------------------------------

(i) Figures 1 to 5 in this report were prepared by CWA based on data from the Joint Committee on Taxation in a letter to Rep. Joe Courtney (D-Conn.), from Thomas A. Barthold, Chief of Staff, Dec. 8, 2009.

(ii) In this report “households” refers to individuals and families paying taxes. Based on JCT data showing that 24.6 million “tax units” would be affected by the excise tax in 2019, Citizens for Tax Justice estimates that 12.6 million are married couples, 3 million are single parents and 9.1 million are childless single people for a total of 58 million men, women and children affected. http://www.ctj.org/pdf/healthexcisetax20091211.pdf

http://www.healthcarevoices.org/pages/impact-of-the-excise-tax-on-the-middle-class

[twitomy]

12. Nah, he only married into it....

But anyway,

Isnt a tax on health care what John McCain proposed? Did I not recall Obama pounding him on this?

Arent the Unions against this?

And once again, the difference between Dems and Repubs get blurry and blurrier.

Sigh....

[Zhade]

22. It is, and he did. But he may lie (like he did about "not" campaigning on a PO) and say otherwise.

NT!

[karynnj]

57. McCain's tax started at zero, This starts at $23,000 - a pretty big difference

The unions were ok with it when it had a $25,000 threshold.

[doc03]

66. $8500 single ! In 1984 they put a tax on SS for high income

retirees with earnings of $25000 single and $32000 married. That wasn't indexed for inflation either now today the middle class that have have a small pension plan from their employer or a 401k are taxed on their SS.

[karynnj]

67. true for individuals - the point is this is substantially above the average policy

and far different than McCain's.

[doc03]

70. Is it indexed for inflation? What if you are in a hazardous

occupation such as miner, steelworker, construction, firefighter or policeman? We will either lose benefits or have our wages reduced to pay for the extra premiums, the insurance companies won't pay the tax the customers will.

[karynnj]

82. Yes it is - and if you are in a high risk industry the limits are higher

[doc03]

93. That's the first I ever heard of higher limits! n/t

[SpartanDem]

100. Yes the limits are higher for retirees, and those in high risk jobs

for these people the limit is 9,850 single, 26,000 faimly.

[karynnj]

156. There are higher limits for high risk professions

[amandabeech]

80. Try being 54. The single person threshold of $8,500 is very unlikely to

cover the cost of a plan for an older worker. I know. I've shopped.

Older people are going to get screwed on this.

Not that anyone around here seems to care. Yet. We all get old.

[karynnj]

81. I am older than 54 - and this affects ONLY employer plans which are

negotiated for the entire pool - so there is no age variable.

[laughingliberal]

124. It is not substantially above the average premium for those over 50 or for small businesses that

have a large number of older workers. This tax is not only anti worker, it is ageist.

[karynnj]

155. Small businesses will be able to buy cheaper plans through the exchange

placing them in a bigger risk pool which will lower rates. In addition, it was Kerry, who fought in the Finance Committee to reduce the ratio between oldest and youngest. Baucus had initially gone for 5:1, but changed it before mark up to 4:1 partially accepting a Kerry amendment. In the hearing Kerry argued for 2:1 - preferring it even lower. The final version came out as 3:1. Too high, but better than the current often more than 10:1.

Given the 3:1 constraint in the bill and the ability of small business to get big group rates, the overall effect of the entire bill is not ageist, but helps older people either in small businesses or buying insurance individually.

[laughingliberal]

157. I do not expect to see current premiums lower

In fact, the most anyone has really said is the increase in premium costs will slow down. But I do not expect to see them come down from where they are. The House version of community rating only allows a 2:1. The House version uses progressive taxation by taxing the very wealthy and not the income or benefits of the working or middle classes.

I am adamantly opposed to this tax on benefits. It is another hit on middle class workers. It is akin to Reagan cutting taxes on the wealthy and raising payroll taxes so the workers got to pay for the break for the wealthy. Taxing the benefits raises 1/3 the amount of money the House tax on those making over $500,000 raises. The House version raises more money, covers more people, provides better subsidies for lower income people to obtain health insurance.

I consider President Obama's support of the tax on benefits a direct violation of his campaign pledge: "If you make less than $250,000 per year, you will not see your taxes go up one dime-not one dime."
I argued this point with Republican acquaintances to no end to the point that a couple of them voted for him. Don't think they haven't let me know about it, either. The defense of this as opposed to raising taxes on those who make $500,000 per year or more by Democrats is astounding!

[karynnj]

159. The House version is far more liberal/progressive

This is to be expected because they only need 50% of the vote - so they could lose about 40 Democrats.

[laughingliberal]

160. Yes and it does more to help people and lays the cost on those who have gotten all the breaks for

the past 3 decades. A Democratic president supporting the revenue sources and community ratings models of the Senate is shocking.

[karynnj]

161. I would suggest that it is because, as a Dempocratic President,

he has more leverage on the House than on the Senate - *** Lieberman**** Even the Senate community ratings are far better at 3:1 than the current situation.

He obviously feels that the Senate bill is better than no bill at all.

[laughingliberal]

162. I'm sure you are sincere in your belief here but I disagree

I believe Lieberman totally acted at the behest of the administration. He was the one promoting an early Medicare buy in back in September when no one else was really talking about it. I am certain Harry Reid put that in because he could get Lieberman's vote on it. The White House tanked this and used Joe to do it. I have no love for Joe Lieberman but this turn around with little real explanation was a stretch even for him. I think Joe took one for the team and it was only fair after Obama saved his chairmanship for him. There had to be some reason Obama did that.

The Senate bill is a right wing piece of garbage that places more costs on the working and middle classes (both by the excise tax and the lack of control on premium costs), covers fewer people, and puts more money in the pocket of a corrupt industry and Pelosi needs to make this the battle of her political life which it looks like she may do.

[karynnj]

86. This IS indexed to inflation plus 1%

[doc03]

95. Is that wage inflation or health care inflation, we all know

health care costs always rise much more than the inflation rate. This is just a f----g stupid argument anyway Obama opposed it during the election to get Union support now he betrays use just like Clinton did with NAFTA. All I know is I will not vote for my Congressman or Senators again if they vote for this insurance windfall bill. Do realise how pissed off people are about his, I have yet to meet anyone that supports this POS. There will be hell to pay in November.

[twitomy]

69. Now who said:

"Your taxes will not increase" if you make 250K or less??? HMMMMMMM


So I guess he meant $25,000 or 23,000. But what the heck, whats a decimal place between friends?

I guess I am filthy rich then....


I hope nobody wonders why the Dems will probably tank in November. Why should someone vote for a DINO when they can vote for a real Repub? At least the real Repuv doesnt deny he is what he is.

[karynnj]

85. One is health insurance cost - the other income - not the same thing

[No Elephants]

147. Sorry, but a tax is a tax is a tax is a tax.

If you listened to Obama say those who earned under $250K were not going to have to pay any more in taxes, he did not always specify income taxes. Besides, he promised to lower the cost of health care insurance and this increases it. And he also campaigned on not taxing health care plans. Daily Show played the video of Obama promising that last night. It will re-run today, so you can catch it if you wish.

Anyway, promising something that you mean only as a technicality is called being a con man.

[Zhade]

101. The same liar who said he never campaigned on the PO when video evidence proves he did.

NT!

[No Elephants]

140. Explain how it's better than raising income taxes on the rich, as the House plan calls for.

A regressive tax is a regressive tax, no matter where it starts. As far as the unions, with all due respect: (a) the unions have had their knees broken; and (b) millions of workers are not unionized. So, what unions are or are not ok with is not the be all and end all of this matter--and I was in the AFL-CIO for years.

[Freddie Stubbs]

65. So was Ted Kennedy and FDR

[No Elephants]

144. So were many people who were fair to those poorer than they were. What's your point?

No one says it's wrong to be wealthy. However, when the single wealthiest member of both houses of Congress says taxing health care plans is peachy, it's valid to bring up the fact that his reality is, and always has been, different from the reality of the working poor or the small business owner.

[Freddie Stubbs]

177. Woudl it have been fair for Republicans to have made the same point against Ted kennedy?

:shrug:

[Don Caballero]

10. As a champion of progressive causes I will trust Kerry

[laughingliberal]

125. As a champion of progressive causes I trust the unions and the progressive caucus in the House.nt

[No Elephants]

146. The Progressive Caucus in the House will probably bow to Obama and the Blue Dogs, though.

I would say that I trusted their first instincts on this, which were single payer (HR 676) and then "robust public option," with no tax on health care plans.

[laughingliberal]

158. Maybe. But I must say I have not seen Pelosi defend her position so firmly before

In the past 2 or 3 days, she has put this debate squarely in the lap of the White House and has shed the charade that this is all about the unreasonable Senate. Obama has used the Senate as cover for the right wing elements of this bill that he has, actually, been pushing for all along. Shining the light on his real intentions is starting to focus the anger on Obama's support of these issues in the bill and may win us some concessions. Maybe not but it is the best shot we have.

[No Elephants]

145. I've seen you chamption a number of positions that are not progressive.

[politicasista]

166. Looks like he ain't "progressive" or liberal enough for people in this thread

Go figure.

[Libertas1776]

11. Yeah, tax the people

who had to fight for their insurance and benefits and have a barely livable wage.:eyes: The unions in this country are weak as it is, and now we're gonna tax them, not the rich mother fucking bloodsucking bankster class?

[stray cat]

13. Do you want equality or inequality in health care - the tax promotes equality

I of course prefer inequality if I can keep a decent health care plan given the option of a lesser equal plan - however a single payer would also probably be a lesser but equal plan which is why some people would be allowed to opt out in favor of a better plan - leading to a two tier system for haves and have nots.

[laughingliberal]

126. I like the plan that taxes those making over $500,000 per year and covers more people nt

[No Elephants]

139. The tax does not promote equality. The way to pay for this is by progressive

income tax, not by taxing health care plans. The haves in our society are the ones with lots of income, not the ones who buy health care.

[Zhade]

14. "Tough choices" you conveniently don't have to make, Richie Rich.

NT!

[ProSense]

16. The claim that moving away from high-cost plans means fewer benefits is false:

High-priced, but not high-quality

But many of the people who pay the most for health insurance have benefits that are far from gold-plated. High premiums are found among small businesses, not because the plans are especially lavish, but because they have high administrative costs and include too few employees to constitute the broader risk pool that would qualify them for lower premiums. High premiums are found in companies with older workers because those workers are expected to have higher health care costs. The high price of these plans may not stem from any bells and whistles in their coverage but rather from a fundamental inequity in the way that insurance is currently priced.

Second, the Senate bill includes a tax on brand-name drug companies, health insurers and high income individuals in the form of a Medicare tax

The largest element of the financing of the House plan is a surtax on high income taxpayers (raising $460 billion over 10 years), a proposal not included in the Senate bill. The Senate plan, in turn, includes two proposals not in the House bill – an increase in the Medicare payroll tax for high income workers (producing $54 billion), and a new tax on high-premium employer-sponsored health plans (raising $149 billion). Both proposals contain new excise taxes on various health industries, though the scope of the taxes varies – the House taxes only medical device makers (for revenues of $20 billion), while the Senate bill also includes taxes on brand-name drug companies and health insurers (for total revenue of $102 billion).

PDF

Third, it's great to tax people with incomes of $500,000 or more, but why not do both? Combine the benefits of taxing the rich and high-premium plans.

[Zhade]

25. You want to tax people who already have to pay high premiums?

How on Earth does that seem right to you?

[Iowa]

83. +1. There's no way to put enough lipstick on this pig - but they keep trying.

[Telly Savalas]

74. If high premiums are a function of admin costs and a risk charge for small businesses

how does this tax help?

[laughingliberal]

128. Why not do both?

Because the very wealthy have consistently seen their taxes go down over 3 decades as more regressive taxes have been passed on to workers and middle class families. There is a point at which fairness is an issue and we have reached that point. The House plan raises 3 times the money, covers more people, and provides a more generous subsidy for those who need help.

[tucsonlib]

17. "Plans With The Most Generous Benefits"??

As opposed to what - cut-rate health care plans? With no "luxury" options? Surgery is covered, but anesthesia and sterilized instruments cost extra? Is health care just another product? Like a mattress, where you can choose "Good" quality, "Better" quality or "Best" quality?

Or do these so-called "Cadillac" plans offer zero deductibles, zero co-pays and no lifetime limits on benefits? In every other civilized country in the world these "extras" are "standard equipment". They call it "Universal, Comprehensive Health Care For All"!

By all means, raise taxes on the wealthiest among us. But use those proceeds to fund "Cadillac Care" For Every American.



:pals:

[Goldstein1984]

23. I already have an exit strategy

I have one of those "cadillac" health plans, but it comes at the cost of a $300 monthly contribution from me. That comes to $3600/year for the privilege of being taxed.

I drop to the low-end plan, which isn't a "cadillac" plan, and my annual contribution drops to a little less than $1200/year. I save about $2400/year that I can use to pay deductibles. I still have the same catastrophic coverage, which is the most important part.

And we are NOT completing a journey. I doubt the people who began the journey had anything like this sellout plan in mind.

[laughingliberal]

129. "I doubt the people who began the journey had anything like this sellout in mind"

Indeed we did not.

[Dr.Phool]

28. Screw you Kerry.

I can't believe I worked my ass off for you.

You and the chimp can go back to Boston and play with Geronimo's skull.

[MindPilot]

33. If there is a tax at all, it should be a Lamborghini tax, not a Cadillac tax

Why we always have to move toward the lowest common denominator? This is nothing more than robbing Peter to pay Paul just because Peter has a job with decent benefits.

[theFrankFactor]

36. If Only We Had a Majority!

[Name removed]

39. Deleted message

Message removed by moderator. Click here to review the message board rules.

[Name removed]

49. Deleted message

Message removed by moderator. Click here to review the message board rules.

[Cal Carpenter]

38. Hey working class! We're gonna punish you

...for successfully standing up for yourselves and getting some health care. Too bad it takes some of the weight outta the billionaire's wallets.

This is so fucked up. This is health care, not disposable income or something. Taxing HEALTH care, while giving the people no choice but to rely on their employer for it. God forbid they manage to unionize and negotiate and actually get some substantial crumbs.

Divide and conquer works so well, solidarity is so far away...

:shrug:

[karynnj]

55. How many working class people have employers that give them $23,000 insurance plans

[Cal Carpenter]

77. Not very many

but those who do have it fought for it, and we'd all be better off with as much health care as $23,000 can buy.. Health care is not the same as income. Taxes should be based on income, and health care should not be a factor, especially if our system essentially forces you to rely on your employer to get it. And encourages your employer to provide it, if you are lucky.

Your implication is that only wealthy people will have such a plan - so tax those wealthy people on their INCOME instead of encouraging the lowest common denominator of crappy health insurance by taxing anything resembling health care.

From what I understand, for individuals the threshold is $8500. For a lot of people, if they can even afford it or get it as an employment benefit, that still doesn't buy very good insurance, let alone care.

This 'health care reform' is, in essence, being paid for by taxing the people who are lucky enough to have decent health care. It is mind boggling, really.

[Iowa]

89. I have a decent plan that costs $20,088 per year for a family right now...

This is the standard plan for front-line state employees in Iowa. By next year it will probably exceed $23,000.

[karynnj]

94. Thank you for posting this

[laughingliberal]

130. Again, many smaller companies that employ a number of older workers do have premiums that high

I was paying that to cover my husband through my employer in 2004. And it was not 'gold plated' coverage.

[No Elephants]

148. Too many. Please see Reply # 112.

Besides, what is the tax policy goal here? To discourage employers from providing their employees with excellent coverage? Who benefits from that? Not you or I or the government because all of us pick up the slack when someone cannot afford his or her health care. So, it is in our collective interest to have everyone get the best available coverage, so we don't end up paying for any part of their care (or for their bankruptcies). Maybe plans that afford only so so coverage are more profitable for insurers than ones that afford "wall to wall" coverage, with low deductibles? If not, I cannot see who benefits from penalizing employers for buying the best they afford for their employees.

[Bluenorthwest]

43. John Kerry is another anti equality loser of important elections

What he thinks about anything is of no importance. He is a delusional bigot and out of touch billionaire. His word is worthless, that of an atavistic, superstitious, prejudiced old rich man.
Oh. And he could not beat Bush. Not my Senator, and I'd not vote for him. Not after 04. Just no way.
If Kerry likes it, you know it stinks to high heaven.

[karynnj]

53. Kerry has a 100% record on gay rights

He was the only Senator up for re-election who voted against DOMA. He also was the Senator who fought and lobbied others to remove the ban on people with HIV entering the country. He publicly endorsed the MA law suit to overturn DOMA, which if won would give couples in states with gay marriage full federal rights of marriage - that sounds like pro-equity to me.

Even in 2004, with the Republicans using gay marriage as a wedge issue, he spoke in detail about wanting legislation that would give equal federal rights for any state sanctioned civil union. Not gay marriage, but more than any nominee before him - and no worst than the generation younger Obama. (This on an issue that has seen rapid change since John Kerry was in college.)

As to 2004, there was likely no Democrat who could have won given the way the deck was stacked. Kerry did a brilliant job in the debates. Given that you live in another state, your comment that you wouldn't vote for him is idiotic. Only if he ran for President or Vice President would you have that chance.

[politicasista]

90. **crickets** n/t

[No Elephants]

149. What do gay rights have to do with his position on health care taxes, though?

[karynnj]

154. Look at the post I was responding to

which attacked Kerry as a bigot among other things. It was an uncalled for, extremely nasty and unfair post. My choice was to respond rather than to alert because the poster was a long time DUer.

I have no problem with anyone, like you saying that Senator Kerry is wrong on this. It is a controversial issue and many will disagree. I would bet Kerry himself would prefer funding exactly as he said in 2004 in his campaign - by repealing the tax cuts for the wealthiest. When that would not fly in the Senate, he proposed this idea (with a higher threshold) as a way to get the numbers needed to meet Obama's budget criterion. To me it is clear that his motivation is to help create a bill that can pass the Senate.

Personally, I do see that something needs to be done to keep medical costs from continuing to increase far faster than inflation. Although this might give insurance companies the incentive to compete to produce excellent plans just below each years limits (doing so would be in their interest IF they are in a state with any competition), it might be too clumsy a tool to do so.

I am not sure I like the tax being 40% starting right at the threshold. I think I would prefer the amount above the threshold simply be taxable income to the recipient (as happens on things like life insurance above a certain value paid by the company). This would mean that it would be taxed at the recipient's marginal rate. With the same threshold, this would raise less money as no one has a 40% marginal rate. I suspect the reason it is placed on the insurer is both to satisfy (in a technical way only) the promise that individuals with income below $250,000 would not see their "taxes" increased and to effectively try to cap the costs of high end policies near the threshold.

The reason this would do this is: Assume that the insurance industry creates a plan that costs $23,000 and another than costs $25,000. Without this, a company looking to purchase insurance plans has to decide if the benefits of the second plan are worth $2,000 more. With this, assuming the insurance company embeds the tax in their price, the plans are $23,000 vs $25,800 - now the difference is $2,800. It would likely be harder for the company to make the second plan, that gives the insurance comapny $2000 more seem to have $2800 of extra value above the $23,000 plan.

Plans in the $40,000 range for top executives will likely NOT be constrained. Here, if employers want to continue that perk, they will. The alternative to simply give no health care plan to these people and give them a salary increase high enough to pay for it after state and federal taxes would cost them far more than buying the insurance including the excise tax. (their employee's marginal rate in high tax states would be about 10 (state) plus 35 federal - if you gross up the $40,000 to cover that - the cost is far higher than the insurance plus the tax increase.

Ironically, the tax break is what led to the US having an employer based system and the new system, like every plan proposed by any Presidential nominee for decades, is based on a core of most continuing to get employer provided insurance. The tax break is itself regressive, in that the higher your income, the greater value it has, not just because higher paid employees tend to get more expensive plans but because the value if taxed would be taxed at a higher rate.

As you can see, I am not 100% in support of this, even though Kerry and earlier, Bradley, were the sponsors and I trust the motivations of both of them. What I have objected to is the uncalled for smears that some on this thread immediately jumped that were unrelated to the excise tax and because many things said were inaccurate and needed correction.

Here, I noticed that you called me out on my post, but did not respond to the poster I responded to - who first raised several off topic comments. In fact, in a thread where Kerry is called "Mr Heinz", S&B is raised, Kerry is called a homophobe and other things, you attack my post because it is off topic???

[shadesofgray]

51. Another sell-out.

[rayofreason]

64. "Cadillac" tax will result in "Yugo" plans.

To avoid the tax we will have to take less and less coverage, with higher deductibles. And Health Care Spending accounts count toward the total being taxed, so you get hit one way and the other.

Right now I am far from qualifying as the proud driver of a "Cadillac" plan. But given that I don't see this bill bending the cost curve, I am sure that faster-than-inflation increases in health care will soon push me over the line, presenting me with a Morton's fork! Thanks so much Congress!!!!

[karynnj]

88. The threshold is indexed to inflation plus 1%

[rayofreason]

96. Well below the increase in health care costs...

...which have been 6%/yr for the last 3 years

http://www.businessinsurance.com/article/20090219/NEWS/200015471

while inflation has been 3%

http://www.inflationdata.com/inflation/Inflation_Rate/CurrentInflation.asp

so inflation +1% means a 2% increase in health insurance relative to the tax threshold. But wait, there's more!

In Massachusetts, which has a plan that as far as I know is similar to what is in the current bill, has had much larger increases in costs, double-digit in many years.

http://www.boston.com/business/healthcare/articles/2009/09/16/health_insurers_plan_10_rise_in_rates/

So if the same thing happens nationwide under this "reform", at 6% adjusted rise in health insurance costs, before long everyone will have a "cadillac" plan, and be paying the tax for the privilege.

Oh, no - that could never happen (I can just hear the oleaginous Gibbs reassuring us). After all, with the spendulus, unemployment will never get above 8%, and we will be sure to televise all those health care negotiations on C-Span. Oops.

[doc03]

97. Average inflation or health care inflation?

[karynnj]

152. basic inflation - the idea is to get health care inflation down to regular inflation

The entire system will fail if health care inflation continues at the rates it has.

[Vidar]

102. I'm sorry to see Kerry following Obama's slimy lead on this.

[Bluebear]

105. Disgraceful, Senator. nt

[No Elephants]

150. You don't tax behavior you are trying to encourage. Just the opposite: you give tax breaks

for behavior you want to encourage, be it rehabbing old buildings for affordable housing or giving your employees good health care coverage. In fact, as Reply 112 states, the law used to penalize you if you gave yourself or your highest paid employees better coverage than you gave your lowest paid folk.

So, you gotta ask yourself just one question: Why is government taxing you if you give your employees great health insurance coverage?

I am not sure of the answer, but I bet if someone looks at this in ten years, it will be something like the $18,000 plans turn out to be more profitable for the health insurers than the $23,000 plans. Just a wild guess.

[mbperrin]

163. No single payer = betrayal.

I'm against any other approach, so kill all this nonsense.

Single payer is the only plan that actually provides healthcare to all AND saves money.

The current monstrosity does neither.

[harun]

167. Kerry is right, I didn't expect reform to be FREE. Now whether or not this

is actually reform is another question.

[EFerrari]

174. "Reform" isn't FREE. WE'RE PAYING FOR ALL OF IT.

[katkat]

170. What Harry Truman would have said about Kerry and Obama is probably unprintable n/t

[bullwinkle428]

171. His "NO" vote on drug re-importation should have been the tip-off

to how he was going to work WRT health care reform.