Ilovebenefits’s Blog

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What started out as a Tax on One Group and For One Purpose…

Editor’s note: This is an excellent post by Dick Quinn –

The current estate tax was enacted as a temporary measure to help fund World War I, the Alternative Minimum Tax was designed for a few individual who escaped paying income tax, it’s still with us and has not been indexed, The Medicare Part B tax once stopped at the Social Security wage base, it does no longer.  Once a tax is in place, the revenue is always spent and new things always found to spend it on.  If the tax is spent on entitlements that are ever increasing and upon which more and more people come to depend, the tax will forever be expanded.  Keep all this in mind when you decide about health care reform, not that you are going to have any say.

Read the rest of the post here:


March 3, 2010 Posted by | Cost, Federal Government, healthcare, tax | , , , | Leave a comment

Health Reform Act II

Editor’s note: Here is what apparently is going on behind the scenes to try to move health reform forward. From this report it appears that the ‘Health Summit’ is simply political maneuvering, there will still be significant Medicare cuts, and a cadillac tax that will cause health plans to slim down their coverage over time and shift more cost to the consumer.


WHERE IT STANDS – President Obama, House Speaker Pelosi and Senate Majority Leader Reid are preparing to begin the reconciliation process after next week’s bipartisan White House health care summit. ‘They are coming out of the summit guns-a-blazing and they’re committed to reconciliation,’ said one Democratic insider. All three are dedicated to comprehensive reform, but Reid and White House chief of staff Rahm Emanuel are cautioning that ‘it’s going to be a heavier lift than a lot of people expect it to be,’ said a senior Democratic official. ‘It’s going to cause political problems.’ Not the least of which is how Democrats pivot to reconciliation, a procedure Republicans view as a partisan ramrod, shortly after Obama hosts the GOP to talk about bipartisan solutions. Right now, Democratic leaders are considering a $200 billion reconciliation bill that includes more affordability subsidies, the union-tweaked Cadillac tax and filling in the gap in seniors’ drug coverage, which would be paid for primarily by additional Medicare cuts and an increase in Medicare payroll taxes above those in the Senate bill, an insider said. Still, Democratic sources stress that neither Pelosi nor Reid know if they have the votes to pass a reconciliation bill. And despite rumors that a House-Senate deal is imminent, a senior Democratic aide said there is virtually no chance it gets done before next week’s summit. That leaves insiders suspecting that Obama will release a set of principals or conceptual language that includes the greatest hits from the House and Senate bills.

February 19, 2010 Posted by | Federal Government, healthcare, Medicare | , , , , | Leave a comment

Health Care: Deficit Neutral is Not Tax Neutral

Editor’s note: One of the main contentions of this letter is that it is, ‘better than deficit neutral’. However it is not better than spending neutral. It depends on raising taxes significantly. Are these folks listening the the majority of  their constituency. No more taxes, in fact, lower taxes and spur economic growth so that there is job growth and real recovery.


Dear Leader Reid:

We respectfully ask that you bring for a vote before the full Senate a public health
insurance option under budget reconciliation rules.

There are four fundamental reasons why we support this approach – its potential for
billions of dollars in cost savings; the growing need to increase competition and lower
costs for the consumer; the history of using reconciliation for significant pieces of health
care legislation; and the continued public support for a public option.

A Public Option Is an Important Tool for Restoring Fiscal Discipline.

As Democrats, we pledged that the Senate health care reform package would address
skyrocketing health care costs and relieve overburdened American families and small
businesses from annual double-digit health care cost increases. And that it would do so
without adding a dime to the national debt.

The non-partisan Congressional Budget Office (CBO) determined that the Senate health
reform bill is actually better than deficit neutral. It would reduce the deficit by over $130
billion in the first ten years and up to $1 trillion in the first 20 years.
These cost savings are an important start. But a strong public option can be the
centerpiece of an even better package of cost saving measures. CBO estimated that
various public option proposals in the House save at least $25 billion. Even $1 billion in
savings would qualify it for consideration under reconciliation.
Put simply, including a strong public option is one of the best, most fiscally responsible
ways to reform our health insurance system.

A Public Option Would Provide Americans with a Low-Cost Alternative and
Improve Market Competitiveness.

A strong public option would create better competition in our health insurance markets.
Many Americans have no or little real choice of health insurance provider. Far too often,
it’s “take it or leave it” for families and small businesses. This lack of competition drives
up costs and leaves private health insurance companies with little incentive to provide
quality customer service.

A recent Health Care for America Now report on private insurance companies found that
the largest five for-profit health insurance providers made $12 billion in profits last year,
yet they actually dropped 2.7 million people from coverage. Private insurance – by
gouging the public even during a severe economic recession – has shown it cannot
function in the public’s interest without a public alternative. Americans have nowhere to
turn. That is not healthy market competition, and it is not good for the public.

If families or individuals like their current coverage through a private insurance
company, then they can keep that coverage. And in some markets where consumers have
many alternatives, a public option may be less necessary. But many local markets have
broken down, with only one or two insurance providers available to consumers. Each and
every health insurance market should have real choices for consumers.

There is a history of using reconciliation for significant pieces of health care

There is substantial Senate precedent for using reconciliation to enact important health
care policies. The Children’s Health Insurance Program (CHIP), Medicare Advantage,
and the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA), which
actually contains the term ‘reconciliation’ in its title, were all enacted under

The American Enterprise Institute’s Norman Ornstein and Brookings’ Thomas Mann and
Molly Reynolds jointly wrote, “Are Democrats making an egregious power grab by
sidestepping the filibuster? Hardly.” They continued that the precedent for using
reconciliation to enact major policy changes is “much more extensive . . . than Senate
Republicans are willing to admit these days.”

There is strong public support for a public option, across party lines.
he overwhelming majority of Americans want a public option. The latest New York
Times poll on this issue, in December, shows that despite the attacks of recent months
Americans support the public option 59% to 29%. Support includes 80% of Democrats,
59% of Independents, and even 33% of Republicans.
Much of the public identifies a public option as the key component of health care reform
— and as the best thing we can do to stand up for regular people against big insurance
companies. In fact, overall support for health care reform declined steadily as the public
option was removed from reform legislation.

Although we strongly support the important reforms made by the Senate-passed health
reform package, including a strong public option would improve both its substance and
the public’s perception of it. The Senate has an obligation to reform our unworkable
health insurance market — both to reduce costs and to give consumers more choices. A
strong public option is the best way to deliver on both of these goals, and we urge its
consideration under reconciliation rules.


Michael Bennet (D-CO), U.S. Senator
Kirsten Gillibrand (D-NY), U.S. Senator
Jeff Merkley (D-OR), U.S. Senator
Sherrod Brown (D-OH), U.S. Senator

February 17, 2010 Posted by | Federal Government, healthcare | , , , | Leave a comment

Federal Workers to be Included in Any Union Deals

Hoyer: Federal Workers’ Healthcare Plans Won’t Be Subject To Excise Tax. In the Washington Post (1/21) “Federal Diary” column, Joe Davidson says House Majority Leader Steny Hoyer “says federal employees need not worry about being left out of a provision in pending health insurance legislation that would allow state and local government workers and other unionized employees a five-year delay before possibly being hit by an excise tax on high-cost health insurance plans.” Though the Republican win a day earlier in the Massachusetts Senate race left the future of the legislation uncertain, Hoyer announced Wednesday that federal rank-and-file workers would not be subject to the tax until 2018.”

January 21, 2010 Posted by | Federal Government, healthcare | , , , , | Leave a comment

Here is What We Know About the Excise Tax so Far

Isn’t it amazing how difficult it is to determine what is in the Healthcare bill…so much for transparency.

Summary of Improvements to the Excise Tax

Delays Effect of Tax Until 2018: Provides a five-year transition window for all plans negotiated through collective bargaining and for state and local employee plans before they are potentially subject to the tax.  This is what is typically done under federal laws to allow parties to collective bargaining agreements time to renegotiate the plans.
2) Raises Thresholds for Active Workers: Raises the threshold at which family plans are taxed from $23,000 to $24,000 in 2013 for all working families and from $8,500 to $8,900 for singles. Annual increases are tied to the Consumer Price Index plus one percentage point.
3) Increases Thresholds for Excessive Inflation: Raises the thresholds higher if health care costs grow faster than expected from 2010-2013.
4) Exempts Dental and Vision Plans from Threshold Calculations: This will begin in 2015, which could raise the thresholds as much as $2,000 for families.
5) Adds Demographic Factors to Determine Plan Thresholds: Thresholds for plans that have significant numbers of older workers and female workers will be modified to reflect the higher plan costs for those workers. The Secretary of HHS will establish an actuarially-based formula based on national averages. These factors could significantly raise the thresholds.
6) Maintains Protections for Pre-Medicare Retirees and for High-risk Workers: Preserves the original Senate proposal that would raise the thresholds for plans covering pre-Medicare retirees and for plans that include workers in high-risk professions (affecting more than 9 million workers). This protection includes workers “employed to repair or install electrical or telecommunications lines.” The thresholds are $26,000/family and $9,850/single.
7) Blending of Pre-Medicare and Medicare Premiums is Maintained: This averaging significantly reduces the affect of the tax on plans.
8) Maintains Thresholds for High-cost States: Preserves the original Senate proposal that would raise the threshold for high-cost states, affecting more than 38 million workers.  Thresholds are 120% for 2013, 110% for 2014 and 105% for 2015.
9) Health Plans Get Access to the Insurance Exchange: Allows any collective bargaining unit into the health insurance exchange in 2017, subject to collective bargaining. Under the House and Senate bills the ability to join is currently discretionary by the exchange (Senate) or by the Secretary of HHS (House).
10) Significantly Reduces Taxes on the Middle Class: These changes are estimated to reduce the amount of revenue raised by $60 billion – decreasing the hit from the excise tax to $90 billion, from the original $150 billion over 10 years.

January 16, 2010 Posted by | Federal Government, healthcare | , , , , | Leave a comment

Obama Reportedly Tells Union Leaders He May Compromise On Health Insurance Tax

This morning’s newspapers have few details on yesterday’s meeting between top labor leaders and President Obama regarding the Senate’s proposed tax on “Cadillac” health benefits, among other issues related to healthcare reform. Only the New York Times (1/12, A13, Stolberg, Greenhouse) has quotes from an anonymous Administration official hinting that the President intends to offer a comprise to his union supporters, though even the Times’ report lacks specifics on what form such a deal might take. The Times reports Obama “told union leaders at a private White House meeting…that he remained committed to taxing high-cost insurance policies as a way to drive down health costs,” but “he also signaled that he was willing to amend the proposal to ‘make this work for working families,’ a senior administration official said.” According to the Times, Obama “and the union officials used Monday’s session to search for a sort of compromise.”

        Fox News’ Special Report (1/11, Baier) reported that “organized labor is strongly opposed to a new tax on some healthcare plans, a tax the President needs to pay the cost of reform. … The issue, Senate plans to slap a 40% tax on health benefits, valued at $8,000 for individuals and $23,000 for families. A top union official said this scheme punishes working families.” AFL-CIO president Richard Trumka: “The Senate bill taxes the middle class by taxing workers’ health plans, not just union members’ healthcare plan. The Senate bill pits working Americans who need healthcare for their families, against working Americans struggling to keep healthcare for their families.” Fox added that “opponents of the Senate plan also say the tax on benefit undermines President Obama’s repeated promise that if you like your existing healthcare plan, you can keep it and not worry about big changes. Taxing benefits, critics say, will result in higher premiums or lower benefits.”

        The AP (1/12, Werner) describes the labor leaders as “irate,” and reports that Trumka “said there was a frank discussion at the nearly two-hour White House meeting with about a dozen heads of the country’s biggest labor unions.” Trumka also “warned that Democrats risk catastrophic election defeats similar to 1994 if they fail to come up with a health bill labor likes. ‘A bad bill could have that kind of effect – a place where people sit at home’ — as happened in 1994…Trumka told reporters.” The AP notes that Trumka “stopped short of saying labor would actively oppose the bill if it included the tax.” Harold Schaitberger, president of the International Association of Firefighters, “made similarly threatening remarks in a statement Monday” that read: “The president’s support for the excise tax is a huge disappointment and cannot be ignored. … We will hold him accountable.”

        The Washington Post (1/12, A3, MacGillis) says that “while Obama has pleased unions on several fronts, he has done little to push labor’s biggest priority, the Employee Free Choice Act, which would make it easier for workers to organize,” and during the 2008 campaign, Obama “rallied union members’ support by repeatedly attacking a proposal by Sen. John McCain to lift the tax exemption for employer-provided health benefits.”

January 12, 2010 Posted by | Federal Government, healthcare, insurance | , , , , | Leave a comment

Are Health Care Costs Being Shifted to the States

Schwarzenegger, Paterson Criticize Health Reform Bill. Politico (12/30, Isenstadt) reports that New York Gov. David Paterson (D) and California Gov. Arnold Schwarzenegger (R), “the governors of the nation’s two largest Democratic states, are leveling sharp criticism at the Senate health care bill, claiming that it would leave their already financially strapped states even deeper in the hole.” They want “congressional leaders to rework the Medicaid financing in the Senate-passed bill, warning that under that version their states will be crushed by billions in new costs.” Gov. Paterson has said that the Senate reform bill would leave New York with $1 billion in new costs, which Schwarzenegger predicts California would be left with $3 billion to $4 billion in extra costs. According to Politico this “resistance…underscores the anxieties facing states as they grapple with the prospect of a massive expansion of the Medicaid program.”

December 31, 2009 Posted by | Federal Government, healthcare | , , , , , | Leave a comment

Understanding the Impact of the ‘Cadillac’ Tax

Editor’s note: Technically, Gibbs’ statement is true. Operationally, those of us who design plans will continually ‘skinny’ down plans to stay under the tax ceiling. The practical impact of that will be a relentless shift of the cost of health care to the consumer.


Gibbs Says Obama Wants Tax On Insurance Companies For “Cadillac” Plans. Asked, on NBC’s Meet The Press(12/27, Gregory) if the President is “committed” to retaining the tax on so-called Cadillac plans, White House press secretary Robert Gibbs said, “Understand that that is not a tax on a worker or an individual, that’s a tax on an insurance company that provides a plan that, quite frankly, many would deem is far too generous. The best way to bend that cost curve is to go after and work on eliminating excessive Cadillac plans that people at Goldman Sachs and big bankers might get. That’s what the focus will be in this.”

December 28, 2009 Posted by | Federal Government, healthcare, insurance | , , , | Leave a comment

The Senate healthcare legislation passed last week aims to reshape the U.S. healthcare system

The Congressional Budget Office, which analyzes legislation for its fiscal and real-world impact, predicts that 94% of legal U.S. citizens would have coverage by 2019. Of that, 26 million people would be covered through newly created insurance “exchanges,” and another 15 million would fall into expanded Medicaid and children’s health insurance programs.

The article goes through most of the significant elements of the Senate Health Care Bill, in a simple and understandable way. It will give you a basic understanding of the nuts and bolts in a short and understandable manner.

December 27, 2009 Posted by | Federal Government, healthcare, hospitals, insurance, Medicare, physicians | , , , , , , , , , | Leave a comment

Are the People Exactly Right?

Editor’s note: Look at the results of the latest Rasmussen report. How close are the percentages of those who believe they will be worse off and those who be better off to reality? If worse or the same care, and more taxes represent those opposed, and those with better access and government financial aid represent those that believe they will be better off…

Earlier this morning, the United States Senate passed its version of health care reform on a party-line vote. The Senate Democrats must now reconcile the bill with the version passed by the House of Representatives and then hope to sell voters on the idea. Most voters (55%)oppose the health care legislation working its way through Congress. Those who feel strongly about the legislation are overwhelmingly opposed to it.

Most voters (54%) also believe they personally will be worse off if the health care plan passes. Just 25% think they will be better off. Some Democratic leaders and strategists have suggested the plan will become more popular once it has been passed and people see how it works.

December 24, 2009 Posted by | Cost, Federal Government, healthcare | , , , | Leave a comment