The House Health Bill: Here come the taxes

Just to be clear, I have not read the entire House health care bill which dropped on our heads like a roughly 2,000 page albatross yesterday. (I’ve gotten through the first hundred or so, and my hat is off to anyone who reads fast enough to have finished the whole thing already.) However, Americans for Tax Reform have the manpower to split up the job and have helpfully identified the laundry list of new taxes and fees which will be coming our way to pay for this boondoggle. Here are just a few of the high (low?) lights.

Employer Mandate Excise Tax (Page 275): If an employer does not pay 72.5 percent of a single employee’s health premium (65 percent of a family employee), the employer must pay an excise tax equal to 8 percent of average wages. Small employers (measured by payroll size) have smaller payroll tax rates of 0 percent (<$500,000), 2 percent ($500,000-$585,000), 4 percent ($585,000-$670,000), and 6 percent ($670,000-$750,000).

Individual Mandate Surtax (Page 296): If an individual fails to obtain qualifying coverage, he must pay an income surtax equal to the lesser of 2.5 percent of modified adjusted gross income (MAGI) or the average premium. MAGI adds back in the foreign earned income exclusion and municipal bond interest.

Medicine Cabinet Tax (Page 324): Non-prescription medications would no longer be able to be purchased from health savings accounts (HSAs), flexible spending accounts (FSAs), or health reimbursement arrangements (HRAs). Insulin excepted.

Excise Tax on Medical Devices (Page 339): Imposes a new excise tax on medical device manufacturers equal to 2.5 percent of the wholesale price. It excludes retail sales and unspecified medical devices sold to the general public.

There are plenty more listed, so click through the link for the full monty. (So to speak.) But in case the likely unconstitutional individual mandate and the increased tax burden on employers wasn’t enough, I wanted to focus on the last one quoted above. Frankly, I’m shocked that the new taxes on medical devices made the cut, but somehow it did.

When rumors of this plan first surfaced in committee Ed Morrissey did a couple of great rundowns on the list of items which were going to be costing all of us more in order to fund this adventure. The original plan called for taxing virtually everything you might find in a drug store, from tampons to tongue depressors. But even the most spend-crazy Democrats realized the backlash that would have caused, so it was scaled back to only certain classes of medical devices and products. They still hit a wide variety of common products, though. A very limited selection includes:

    Dentures, both partial and full (Class VI)
    Female condoms, single use (Class III)
    Stair-climbing wheelchair (Class III)
    Hip, knee, ankle, breast prosthetics (Class III)
    Soft contact lenses, extended wear (Class III)
    Dialysis catheters (Class III)
    Mammograms (Class II)

So while the Obama administration’s talking heads continue insisting they will only tax the “very rich” (a joke which really never gets old) and they work on taxing cigarettes, soda, coffee, gasoline and heating oil, (with hamburger soon to follow, I’m sure) now we’ll be treated to a whole new set of taxes. Need more help with your health care needs? No problem! We’ll just tax your wheelchairs, your teeth and your prosthetic devices!

One can only imagine what else we’ll dig up when we finish going through this behemoth, but the early results don’t look promising.

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  • DLS

    Not only are non-fools skeptical of claims the deficit won't be increased by this “reform” effort, but any claims of small or no deficits by people like the proponents are an immediate (warning or alert) signal that higher taxes are virtually assured.

  • DLS

    “I call this the Baucus Birth Tax, although it’s probably more accurate to call it the Life Tax, since these begin almost at conception and don’t expire until we do.”

    If you think they'll stop there, think again. It's time for more Death (inheritance) taxes, too! (If it has been “wrongfully neglected” in the current legislation, fear not, for that “error” will be “remedied” later.)

  • jchem

    Jazz: (I’ve gotten through the first hundred or so, and my hat is off to anyone who reads fast enough to have finished the whole thing already.)

    Ha! You know the funny thing is that you've probably read more of it thus far than anyone in Congress, considering a lot of them are in full damage control.

    I'm not sure any of this is much of a surprise. We are talking ~$1.055 Trillion. It does make me wonder about that “If you make less than $250,000, then your taxes will not go up one dime” nonsense. Perhaps we should have known better when that number kept decreasing from one week to the next.

  • tidbits

    “The worst laws start with good intentions.” Witness here the poster child of that adage.

  • shannonlee

    Yes, they'll need to raise taxes. No more getting something for nothing.

  • Silhouette

    When I was being raised a christian, going to bible study and being confirmed as a member of the church, we were repeatedly told that tithing was part of God's way. What tithing is, is very similar to any taxes collected on behalf of affordable public health care. There is no cause more directly biblical and of morality than to be thy brother's keeper in the most basic of ways: providing for his physical health so he can stand up strong and be at your side working with you to help others in turn.

    To belittle this effort is to belittle God himself.

    I'm no longer christian but some of these lessons have stayed with me because they factually make sense and they just feel right for lack of a better description. Does it feel bad to you to support your brother's and sisters' most basic of wellbeings? Maybe you're in the wrong religion.

    We are a religious nation and always have been. The only difference is that slowly, subtley, almost imperceptively, our God has been replaced as a nebulous all-seeing being, instead to a $God…

  • CStanley

    Sil, if you're proposing a tax rate of 10% (which is what tithing is)…I'm in!

  • DLS

    “There is no cause more directly biblical and of morality than to be thy brother's keeper in the most basic of ways: providing for his physical health”

    In more ambitious days, it was presumed health care would be provided, eventually, on earth, while the truly celestial thing to do instead was to provide a guaranteed minimum income to everyone.

  • VeratheGun

    I have not read the bill. I doubt very many people have. But it all comes down to WHAT WE ARE DOING RIGHT NOW IS NOT WORKING!

    I work in health care. I see it every single day. The waste, the mismanagement of patients and funds. EVERYONE wants something for nothing or next to nothing. EVERYONE. Heck, I'm probably just as guilty as the next person. But if we keep going down the path we are on now, we are going to bankrupt ourselves, COMPLETELY. It's unsustainable. Absolutely unsustainable.

    Everyone should be covered, everyone should PAY. Health care costs–it costs a LOT of money. But its the cost a civilized society bears, to call itself civilized. A single night in our SICU costs $5000–and that's before any medications or procedures. A single bottle of IVIg costs $12,000–and a couple of months ago, one of my patients got 8 of them, over a period of a few weeks. On and on and on.

    Look, I'm just as conflicted as most people. I've gotten some heat for telling the truth about what it's like on the front lines, as one of the people who actually does the work of taking care of sick people. There are people who abuse the system, in the most egregious ways, it would make you sick. But there are far many more people who are not getting the treatment they need and deserve. We have the ability to tackle both problems at once.

    We need to cover who we can cover, PAY for it, and then focus on the serial abusers of the system, either getting them outpatient treatment, psych treatment, placement, etc. It's not going to be cheap, but it's costing us a fortune TODAY to keep the existing system in place.

    End of rant. I wish some other health care workers would post here.

  • AustinRoth

    I like the '$2.2M per word' in the bill calculation. Given that it is such a huge bill, that is really something.

  • Jim_Satterfield

    Americans for Tax Reform? How low can you go for sources, Jazz?

  • http://www.facebook.com/people/Cibercore-Cybercorrespondent/100000128297898 Cibercore Cybercorrespondent

    What would happen if any other political party pushed for a cap and trade bill that could create green jobs of which 9 out of 10 created would be unsustainable, require government subsidizing and cost the nations economy millions of real jobs? And this is not to mention the increase in manufacturing costs that would be passed on to us in time of depression. No matter if you are a Democrat, Republican, Libertarian or an Independent, what do you think is going to happen when the government revenues are down and spending is quadrupled? As one senator from Florida was categorized as, “One must be a fry short of a happy meal” to believe that wiping out the U.S. dollar and reducing the purchasing power of our salaries and retirement savings is a good thing. How do you think the media or yourself would react if the republicans were the majority party and were negotiating behind closed doors on a republican senator’s proposal to overhaul one of our economy's largest industries, especially when it hasn't been written yet? On an almost straight party-line vote, Democrats in the Senate Finance Committee squashed an amendment by Senator Jim Bunning that would have required the Obama, Nancy Pelosi, Harry Reed and the Baucus healthcare or “rob our children and their children bill” to be posted on the Internet for all Americans to read for 72 hours prior to the Committee voting on it. There are Republicans who should be voted out of office as well. They are the ones who didn’t listen to the American people and under the veil of “negotiations,” kept the “rob our children and their children” bill scheme to socialize the nation's health care system alive. And those are not the only ones. Every politician who allowed the Federal Reserve to loan two trillion dollars without knowing to whom, for what or the disclosure of terms should be investigated, made accountable for their irresponsibility and thrown out of office as well. Sleeping on the job is no excuse. The Federal Reserve has no real oversight and it’s time for these politicians to get the message loud and clear. We need to learn from our past mistakes and before voting, find out the candidate’s passed association’s, voting record, speeches made and most importantly, don’t let the progressives in the media or celebrities who receive bribes from the likes of George Soros brain wash you. The buss is speeding to go over a cliff and we need to get hold of the staring wheel and the brakes. Cybercorrespondent http://cybercorrespondent.blogspot.com

  • imavettoo

    Cyb, I realize that spellcheck recognizes buss & staring as words in the English language but if you are going to pose as an intellectual please write like one.

  • kathykattenburg
  • AustinRoth

    Americans for Tax Reform? How low can you go for sources, Jazz?

    What? The only groups you think are valid are those that are mouthpieces of the Democrats. Let me guess, ACORN, MoveOn, SEIU, etc., are your idea of independent organizations.

  • AustinRoth

    Well put, Kathy! :-)

  • dduck12

    It's nice to hear from someone from the real world. I wonder what could happen if the lawyers and accountants spoke to people like you and insurance people (the people in the trenches, not only the execs) when considering monster bills like this. I have used the analogy of a Frankenstein in the past. After seeing parts of this one, my new analogy will now be Godzilla.

  • kathykattenburg

    Ha, AR. I posted in the wrong thread and tried to delete. Only the text deleted; I couldn't delete the frame.

  • Jim_Satterfield

    Silly comment, AR. Grover Norquist, the would be drowner of government, just doesn't have much credibility in the book of anyone other than right wing ideologues.

  • AustinRoth

    And the ones I listed don't have much credibility in the book of anyone other than left wing ideologues. But they are all darling of the Left and the Democrats, aren't they?

  • http://sovereignmind.wordpress.com/ adelinesdad

    I don't understand the medical device tax. Who are the ones most likely to need medical devices? People who are sick. So we are paying to help those who are sick by taxing the sick? Now, I'm not one to say that the world is going to end because we're imposing an additional 2.5% tax. But I just don't get it. Why would you do that?

    I usually don't like to get into the details of my family medical situation, but I think I have to say this in order to express my frustration. My son is kept alive and well thanks to an innovative enteral feeding pump. As I read the list of taxed devices, I felt sure that enteral feeding pumps would not be among the list. Surely they would just tax things they consider to be unnecessary medical extravagances. Nope. Apparently, the government thinks families like mine don't have enough to deal with already. We should pay an extra 2.5% (which on some of these expensive devices is not chump change).

    I understand that all of these new programs and services need to be paid for. I just don't understand why anyone would target those who are already paying out the nose for devices they need because they are sick. Please tell me this is just right-wing fear mongering. I thought the point was to make health care less expensive, not more.

  • http://sovereignmind.wordpress.com/ adelinesdad

    I don't even know how to respond to Sil's comment. I'll need to let it sink in. For now, all I can say is that we seriously need a “Dislike” button.

  • ProfElwood

    Sorry, but giving and getting robbed aren't equal concepts. Giving to charity improves your health, being forced to pay taxes just makes you poor. I have a choice of which charity to give to, and I take the time to check them out. When a charity shows a problem, like the United Way did a decade or so ago, it reacts quickly to fix the problem and get their vital reputation back. When a public program, like farm subsidies, is proven to be welfare for the rich, well, tough luck: you're “giving” to it anyway. And good luck getting your loving representative to hurt their own campaign financing by fixing it.

    Now, don't get me started on the “charities” of bank and union bailouts.

  • JeffersonDavis

    “Yes, they'll need to raise taxes. No more getting something for nothing.”

    Geez, Shannon….. I don't know about you, but I already pay TOO MUCH in taxes.
    We should all be aware that with FICA, Social Security, Medicare, State Taxes, County property taxes, Sales Taxes, and all of the fees from other bureacracies (DMV, etc); add up to way more than 50% of our salaries.

    In my case it's way more than 50% (if my math is correct). Don't you find that a tad bit unacceptable? I've worked hard for that money. Over half of my pay is not worth what I get from the government.

    Out of the less than half of my pay, I must also pay for my family to live.
    This is a form of slavery. I'm tired of it.

  • JeffersonDavis

    “I'm no longer christian but some of these lessons have stayed with me “

    Oh, that's quite obvious.

    Monetary gifts to the Church are to support the work of the Church – and ONLY as you have been prospered. If you haven't prospered, you give nothing. You must have been absent that one day you actually went to Bible study.

    And we Christians do take care of our brothers and sisters. It is our duty as CHRISTIANS, not our duty as AMERICANS per the Constitution. As I've exhaustedly tried to get across to Kathy Kattenburg. This is why America is the most generous nation on planet Earth.

    We give more to charity than any other country.
    Why?
    Is it because we have more social programs?
    No.
    Is it because we have so many government bureacracies?
    Nope.

    It is because we remain a nation of faith – and faithful Christians give without end.