House Panel Approves Health-care Overhaul With Millionaire Tax
The tax panel voted 23-18 in favor of its part of the historic legislation, with three Democrats joining all the Republicans in voting against the measure. Its the first of three committees to finish consideration of the health-care overhaul as the House works to pass legislation before an August deadline set by President Barack Obama.
“Were very, very proud of what weve done,” Ways and Means Chairman Charles Rangel of New York said after the panel debated the measure for 15 hours. “Were one-third of this tripod. I think we carried our weight.” The House Education and Labor and Energy and Commerce panels aim to finish their portions of the measure by today or next week, aides said.
Democrats touted the measure as a landmark initiative to expand access to affordable health care to 46 million people who lack insurance while driving down costs. Republicans said it would increase costs and force tens of millions Americans into government-run care they said would be substandard.
“This is not some think-tank experiment,” Michigan Representative David Camp, the panels top Republican, said of the biggest expansion of health care since the establishment of Medicare and Medicaid in 1965. “These are peoples lives, peoples jobs were talking about.”
Deadline Looms
The House and Senate must each pass their own versions of the bill, then reconcile them before sending the legislation to Obamas desk for his signature. The Senate health committee approved a plan this week, although the Finance Committee is struggling to reach a bipartisan compromise.
There was little bipartisanship on the Ways and Means panel. Democrats rejected a slew of Republican amendments that would have stripped a government-run plan from the legislation, prohibited rationing of health care and forced members of Congress into the public plan. While Democrats control the committee, three party members — Ron Kind of Wisconsin, Earl Pomeroy of North Dakota and John Tanner of Tennessee — voted with the Republicans against the measure.
“The other side is trying to make people afraid,” said Washington Representative Jim McDermott, a senior Democrat on the panel. “To make it sound like we are compelling people to go in one direction is an unfair mischaracterization,” added fellow Democrat Xavier Becerra of California.
Insurance Mandate
The legislation would require companies to provide health insurance or pay an 8 percent payroll tax to help pay for their coverage by the government plan. The House is also proposing a mandate on Americans above a certain income level: People would be penalized as much as 2.5 percent of their income for failure to buy health insurance.
The plan would cost about $1 trillion over 10 years and reduce the number of uninsured by roughly 37 million Americans, according to a preliminary analysis by the Congressional Budget Office. The nonpartisan agency said that by 2019 some 17 million people, about half of them illegal immigrants, would lack coverage.
Graduated Surtaxes
House Ways and Means Committee members approved a series of graduated surtaxes that kick in on incomes above $280,000.
The surtax would also place a 1.5 percent additional levy on couples with incomes between $500,000 and $1 million, and a 1 percent surtax on incomes over $350,000. The measure is intended to raise $544 billion over 10 years and calls for the taxes to increase if the bill doesnt hit a target for cost savings. Capital gains as well as earned income would be subject to the surtax.
The legislation also contains several tax increases on corporations, and a new provision to prohibit reimbursements for over-the-counter drug purchases using pretax health-spending plans such as employer-administered Flexible Spending Accounts and individually owned health savings accounts.
Health Exchange
The bill creates a new national health exchange that would allow small-business employers and individuals to comparison shop among insurers. The exchange would coordinate with state insurance departments to enforce regulations and administer the sliding-scale credits the bill would create to help low- and middle-income individuals and families buy coverage.
The bill would prohibit insurance companies from establishing any lifetime or annual ceiling on benefits and limit companies from charging higher rates due to health status, gender or other reasons. Premiums would only be allowed to vary based on age, geography and family size.