Tax Quarry

The Obama Administration has been exploring a number of possibilities for funding health care reform in the US.   Much of the uncertainty should dissipate soon now that the Ways and Means Committee has commenced work on the Bill. 

Supporters champion the bill as logical alternative to the private insurance companies.  Ways and Means Chairman Charles Rangel, a big supporter of the bill writes on his website, “Historic legislation will reduce out-of-control costs, improve choices for patients, and expand access to quality, affordable health care.”  He goes on to say that “[r]eforming America’s health care system to control costs and improve access to quality affordable care is not only the moral thing to do, it is also critical to our economic recovery and the long-term fiscal health of our nation,”   On the other hand, some argue that the government’s health reform bill will not provide the needed change that the current Administration is expecting.  The New York Times reported that, “Senate Republicans so far have been unanimously opposed to the health committee measure. All 10 Republicans on the health panel voted against it, warning that it would not reduce the cost of medical care and would not expand coverage to all Americans as Mr. Obama hopes.”  Nonetheless, if the Administration can find a plausible way to fund the bill, there is a high probability that some form of the bill will be passed, despite resistance.   

One proposal for funding the bill is to levy an income surtax.  This has not received a lot of support.  Some expect that a change in tax rules governing non-resident investments in the US and US persons investing in foreign countries will help to provide some of the much needed cash.  What seems to be certain, though, is that lawmakers are focused on exploring money raising initiatives that will not add to the US debt level.  The goal is to fund the cost of the bill with additional tax revenue. 

Below is a summary of some of the key benefits you can expect from the bill: 

• No more co-pays or deductibles for preventive care

• An annual cap on out-of-pocket expenses—keeping Americans from financial ruin
   
• An end to rate increases for pre-existing conditions, gender or occupation.
   
• Group rates of a national pool if you buy your own plan
   
• Guaranteed affordable oral health, hearing and vision care for kids

• End to denials for pre-existing conditions like heart disease, cancer or diabetes

• Get needed care, no lifetime limits

• Job and life choices no longer based on health care coverage

Marsha Henry

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