ObamaCare: Taxing the uninsured
posted at 10:11 am on July 15, 2009 by Ed Morrissey
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Keith Hennessey has done a little digging into the House method of paying for health-care reform and sees some significant sleight-of-hand in the details. Barack Obama says that he wants to provide health-care coverage for all Americans without raising taxes on anyone under $250,000. Keith points out that the proposal in fact does tax people who make less than the Obama definition of rich, and significantly:
As expected, the House bill would mandate that individuals and families have or buy health insurance.
But what if they don’t buy it?
Then Section 401 kicks in. Any individual (or family) that does not have health insurance would have to pay a new tax, roughly equal to the smaller of 2.5% of your income or the cost of a health insurance plan. …
I assume the bill authors would respond, “But why wouldn’t you want insurance? After all, we’re subsidizing it for everyone up to 400% of the poverty line.”
That is true. But if you’re a single person with income of $44,000 or higher, then you’re above 400% of the poverty line. You would not be subsidized, but would face the punitive tax if you didn’t get health insurance. This bill leaves an important gap between the subsidies and the cost of health insurance. CBO says that for about eight million people, that gap is too big to close, and they would get stuck paying higher taxes and still without health insurance.
This doesn’t just amount to a slight gap in the net that allows a few oddball cases to slip, either. Keith provides two scenarios, both entirely plausible, to demonstrate how the CBO determined that eight million people — around 20% of the current uninsured — would likely end up with no insurance and higher taxes. The mandate in the bill would force people to choose between paying the taxes or paying as much as three times as much for health insurance, assuming a family plan.
The House plan may not live for very long, anyway. The Senate doesn’t want to impose taxes at all if they can get away with it, especially not the Charlie Rangel “soak the rich” taxes the House proposes:
But the plan has drawn sharp attacks from Republicans and is already creating friction with Democrats in the Senate.
“Tax is a four-letter word” with voters, said Sen. Ben Nelson (D-Neb.). Even families not ranking in the top 1 percent of earners “hope they’re going to be there someday,” he said. “So they don’t necessarily think it’s fair.”
Senate negotiators have all but abandoned plans to directly tax the wealthy and are focusing instead on an array of smaller, more narrowly targeted revenue measures that would raise money from drug and insurance companies, as well as individuals and corporations. A tax on employer-provided health benefits remains part of that discussion, but Sen. Kent Conrad (D-N.D.), who is promoting a tax on the most generous 1 percent of private plans, conceded yesterday that such a proposal is “a very tough sell.”
Why? Doesn’t everyone hate the “rich” these days? Not exactly. As John Boehner points out, many of the so-called “rich” above $250K a year in earnings are small-business owners who simply file their business revenues as personal income. A 5.4% “surtax” — really just a hike in the upper tax bracket — will take more of their capital out of their businesses and reduce the opportunity for job growth.
The Post notes that the “surtax” would apply to about 2.1 million Americans. The mandate for coverage will force almost four times as many middle-class Americans to pay higher taxes as a result of the ObamaCare plan in the House while preventing them from getting coverage. The House hasn’t soaked the rich; they’ve declared war on the middle class and the uninsured.
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I wonder if there will be an ethics complaint against Barry for wearing a White Sox jacket when he threw out the first pitch at the All-Star game?
Sven on July 15, 2009 at 11:32 AM
Praise the Lord now that Obama is President, I don’t have to worry about mortgage payments, car payments or gas for my car.
Praise the Lord!
Jeff from WI on July 15, 2009 at 11:33 AM
It’s not possible to put a bigger joke candidate in the Senate than Al Franken.
You could put a big pile of crap in a seat and it would be more dignified and useful to the country, than what is currently defiling it.
NoDonkey on July 15, 2009 at 11:34 AM
And where are the fashionista’s to tell us how great Barry looked in his mommy jeans?
Knucklehead on July 15, 2009 at 11:34 AM
I don’t go to Dallas unless absolutely necessary. Downtown FT Worth is the cat’s pajamas compared to Big D.
Limerick on July 15, 2009 at 11:35 AM
Tax, Tax, Tax, Spend, Spend, Spend the middle class into oblivion.
http://www.teapartynation.com
tnmama on July 15, 2009 at 11:36 AM
That’s basically what Huckabee said on Jon Stewart weeks ago. But then again, HA does seem to suffer from HDS a bit, so I am not surprised that it got overlooked.
Wolftech on July 15, 2009 at 11:36 AM
So, every American is FORCED to have insurance whether they what it or not? Um, how is that constitutional?
marklmail on July 15, 2009 at 11:37 AM
Because Sotomayor will make it so.
Limerick on July 15, 2009 at 11:37 AM
I’m not sure, let’s ask Judge Sotomeyor.
On second thought, let’s not. She’s Hispanic, what more do we need than that?
NoDonkey on July 15, 2009 at 11:39 AM
I’m 60.
I have been railing against deficit spending since Carter’s days. When even Reagan failed I knew we were doomed. What little hope I had left was shattered by Bush and the Repubs when they blew a historic opportunity to right the ship of state. I yelled and screamed back at Captain’s quarters that the Repubs were blowing their mandate of fiscal prudence and limited government.
Now I don’t give a shit. Our last hope is the size of the “bender” we are going on now. The bigger the better. It’s our only hope for a revolutionary change in our thinking.
What is it going to take–quadtrillions?
patrick neid on July 15, 2009 at 11:42 AM
I don’t go to Dallas unless absolutely necessary. Downtown FT Worth is the cat’s pajamas compared to Big D.
Limerick on July 15, 2009 at 11:35 AM
I agree. We stayed downtown in Fort Worth last July for the APHA World Show and loved it.
TXMomof3 on July 15, 2009 at 11:44 AM
Constitutional? Silly you. The question now is, “How is that empathetic?” We don’t need no stinkin’ Constitution. On the other side, the Washington junta is arguing that it is the federal government’s responsibility to “provide competition” to private health insurance firms by opening up government companies.
We are so far through the looking glass that I’m not sure English is still an acceptable language to use in America.
progressoverpeace on July 15, 2009 at 11:45 AM
I like Fort Worth, but I rarely go to either downtown. I find the lack of free parking beyond annoying.
Esthier on July 15, 2009 at 11:45 AM
Limerick on July 15, 2009 at 11:31 AM
I can only think that they are convinced that they will stay in power because people will want their handouts continued.
No jobs, no taxes, they are going to have a tough time financing their handouts to secure their power. I honestly think that they are too stupid and arrogant to see that this is unsustainable.
ORconservative on July 15, 2009 at 11:46 AM
It won’t stop there. Did you notice how easily things went from billions to trillions? The few of us who are outraged don’t register with the whiners who want their nanny state and screw those greedy rich bastards, they don’t appreciate their money anyway.
Monica on July 15, 2009 at 11:47 AM
There is no way any one of these hairbrain schemes are going to get actual funding. They can pass bills till the cows come home but there is no money to pay for them. Our Asian sugar-daddy’s are going to let us twist in the wind and I have a great deal more respect for Beijing now than before. You can keep printing money but if it’s worthless, where does that leave us? Hang onto your seats and your seatbelts fastened, we’ve hit turbulance and it could bring down the whole airline.
Esthier…..I’m off the 121 @ the 114. Not there now, too hot. Will return when it cools down. Small world.
24K lady on July 15, 2009 at 11:53 AM
Parking is free on weekends (parking garage just north of Borders and east of City Hall). You can walk the streets of downtown FT Worth at 2am and count on getting from dive A to dive B. On Greenville, or the West End it is like walking through a field of mines.
Limerick on July 15, 2009 at 11:53 AM
I’m not so sure. These handouts may be nice for those who want that sort of thing. However, the consequences of the spending are going to outweigh the perceived benefits. When inflation goes through the roof no amount of handout will be enough.
It is at this time that serious rationing from healthcare to food will take place. I know. Bleak scenario. Unfortunately for the first time in my life I am really pessimistic about our future.
HoustonRight on July 15, 2009 at 11:54 AM
Sorry….not Borders…Barnes & Noble.
Limerick on July 15, 2009 at 11:55 AM
No joke. We’re melting over here. That’s actually not far from me though.
That’s right. I forgot about that. It’s Dallas that doesn’t have free parking. I’ll have to remember that when it cools down enough so that a light walk is a little more pleasant.
Esthier on July 15, 2009 at 11:57 AM
I am a 29-year-old metal worker and when it came time to choose an insurance plan through my company, I chose the HSA.
When is the government gonna come after the money i’ve put in there?
Jayrad on July 15, 2009 at 11:58 AM
Exactly.
I hope they propose to raise taxes by 10-15% on everyone. Nothing, absolutely nothing seems to phase the Dems and Repubs.
We need a final straw. Something passed that is so outrageous that millions, tens of millions of people take to the streets causing politicians to fear for their lives.
Nothing else seems to work. We are all frogs in the pot.
patrick neid on July 15, 2009 at 11:58 AM
Same thing :)
Esthier on July 15, 2009 at 12:04 PM
I Intend to be there, barring any pressing family matters. I’ll probably stay in nearby military lodging and rail in/out.
Fletch54 on July 15, 2009 at 12:04 PM
please, everyone call their congressman about this socialized medicine plan. please, please call today.
kelley in virginia on July 15, 2009 at 12:04 PM
HoustonRight on July 15, 2009 at 11:54 AM
agreed. There isn’t enough money to keep the wheels on this bus.
Stupidity and arrogance rule.
ORconservative on July 15, 2009 at 12:05 PM
If Obama or the Congress were to float the idea of simply seizing everyone’s checking and savings accounts in order to handle the financial crisis (after admitting that they’ve already spent all of the money the government had), I’m guessing that might do it.
This administration can’t possibly end well.
Aitch748 on July 15, 2009 at 12:13 PM
Republicans need to do more than vote against this bill. They should refuse to vote and stage a Walk-Out. Go outside to the steps of the capital and hold a press conference to force the msm to aire concerns about this continual push to shove legislation down the throats of taxpayers without virtually any debate. Republicans can’t stop the bill if the dems hold their troops together so what’s the harm in not voting at all and forcing the msm to cover the walk-out.
CapnLarge on July 15, 2009 at 12:15 PM
The staff of John Adler(D)NJ and Chris Smith(RINO)NJ both politely and succinctly told me to f*ck off over Crap and Tax, what makes you think I’ll get any different response to opposing ObamaCare?
The only thing these m*therf*ckers are going to respond to is outright revolt.
bloviator on July 15, 2009 at 12:16 PM
I was told to f off over cap and trade too.
ORconservative on July 15, 2009 at 12:17 PM
Vashta Nerata, yep. those 20 somethings are so screwed, well they brought us this age of TOTUS..
How will the Abercrombie and Fitch Neoprogressive tools react when the plan TOTUS bashed all thru the primaries, the penalty for not buying insurance, hits them? He lied and their high paying jobs died…
from Keith Hennessey:
ginaswo on July 15, 2009 at 12:21 PM
If you refuse to purchase insurance do you have to wear a Star of David on your outer garment? Proscribed from voting, holding office or owning property?
GarandFan on July 15, 2009 at 12:23 PM
kelley in VA is right, the only thing that effects them is calls
ESPECIALLY the ones who already ignored their constituents on cap and tax, if they got tons more calls on health care they will have to think twice or three times before doing it yet again….
make it as hard as you can for them to pretend this is what the people want
the Gallup and CBS etc polls are already skewed to give false cover to these mod Dems and RINOS , the calls from the people are the only REAL feedback they get
so please call
ginaswo on July 15, 2009 at 12:24 PM
I remember all the moderate Dems and RINOs telling me not to worry, Obama knows in a recession you cannot raise taxes and he will not implement all his grandiose spending plans this year because of the economy..
yeah right..give them an inch they take a mile these free spenders….
ginaswo on July 15, 2009 at 12:25 PM
Will Hussein and Congress be receiving Healthcare at the same Clinic from the same Physicians as everyone else?
Will they be standing in line?
Will they be waiting for hours?
Will they be shuffled around the system?
Will they wait 6 months for a referral?
BigMike252 on July 15, 2009 at 12:39 PM
I’m thinking that a year from now, the government will be issuing vouchers, just like CA.. With millions without jobs and their ambitious plans in D.C. – AITCH748 you’re right – the next step would be to seize bank accounts, or make the money you do have worthless.
24K lady on July 15, 2009 at 12:43 PM
ginaswo
I’ve tried calling and get the same response as others here, their staffers talk to me like I need medical attention.
24K lady on July 15, 2009 at 12:44 PM
Awe they gave us a nice little schematic diagram of healthcare plan and how we’re getting screwed!
Follow the arrows…..I mean money right to the IRS!
http://docs.house.gov/gopleader/House-Democrats-Health-Plan.pdf
xler8bmw on July 15, 2009 at 12:45 PM
As I read the proposed bill some these new taxes are on GROSS INCOME. This is a disaster for small business. If you own a small grocery store which nets a reasonable 2.0%- 2.5% profit, a 4.5% “surtax” puts you our of business in a hurry.
bob4096 on July 15, 2009 at 12:47 PM
This soldier is full of bullshit, and so is his att’y. He VOLUNTEERED as an augmentee–as such, he may ask for a revocation of orders right up to the time of deployment.
There IS no case here–the Army acted within the guidelines set forth. So don’t anyone get their panties wadded on this one.
irongrampa on July 15, 2009 at 12:52 PM
He didn’t ask for a revocation of orders, but challenged the legitimacy of his orders. There’s a huge difference, and the military backed down before the hearing tomorrow. This is major.
progressoverpeace on July 15, 2009 at 12:58 PM
475 days until Election Day 2010.
n0doz on July 15, 2009 at 1:06 PM
How is having the Federal government involved in citizen’s healthcare decisions constitutional at all? We’ve come so far away from the 10th Amendment that nobody even thinks to ask that question.
The Constitution isn’t even a speed-bump on the highway to socialism anymore. It’s roadkill.
guntotinglibertarian on July 15, 2009 at 1:10 PM
guntotinglibertarian on July 15, 2009 at 1:12 PM
That’s true, but they have opened themselves to the same case popping up all over, all so that The Precedent doesn’t have to prove his eligibility (and not even in the most stringent sense, but only so far as his birth). There is clearly something much bigger going on, here. After all, we’re talking about a thuggish Executive that is happy to threaten states with a revocation of funds just to get back at a Senator who complains about the Porkulus.
Someone is running scared and it isn’t the plaintiff.
progressoverpeace on July 15, 2009 at 1:17 PM
I didn’t mean this to apply to the first part of your post. This is, to my mind, a clear victory for the plaintiff.
progressoverpeace on July 15, 2009 at 1:18 PM
Even better. If employers cut plans, for their employees, because of this…then the employer either ponies up for their own health care, or pay a tax? Now…how many could afford insurance, without the employer kicking in for it as well? So we could get taxed, and be without insurance. Sounds pretty unconstitutional to me, and goes back to the Dems saying EVERY American deserves to have health care.
See this, for the sham , and joke that it is. It’s not about health care….it’s about POWER!!!
capejasmine on July 15, 2009 at 1:25 PM
BTW–so’s not to derail the thread–suggest y’all check the Mudville Gazette. It’s a milblog, and has the straight skinny on the Major.
Thanx.
irongrampa on July 15, 2009 at 1:30 PM
In the words of our Commie-in Chief, “Let me be clear…”
The ever more desperate intent to Rahm State mandated healthcare on us, is about taking control over our lives! As we have seen with the administration’s upcoming executive order to the military banning cigs in the services. Their justification is that it is costing the Gov’t run VA too much money. As they are responsible for soldiers care they can dictate how they live!
When they become responsible for the costs of your care, they will dictate how you live! 1st it’ll be cigs, then junk food, then alcohol, then red meat entirely, anything at all they feel isn’t healthy for you and may eventually lead to increased cost will become illegal!
It’s is the Orwellian nightmare taking shape before our eyes! Indulging yourself with anything the Guv feels bad for you becomes a crime against the State!
Archimedes on July 15, 2009 at 1:45 PM
BigMike252 on July 15, 2009 at 12:39 PM
I’ve directed this question to both of my State Senators, and have received responses from both of them; in both cases they failed to answer my direct question, talking around the question. See below:
My response:
Keemo on July 15, 2009 at 1:47 PM
To All Hotair members:
Would any of you let me and others know what response you are getting when you call, fax or email the House members when you contact them?
bluefox on July 15, 2009 at 1:45 PM
bluefox on July 15, 2009 at 1:51 PM
From instapundit:
Keemo on July 15, 2009 at 4:37 PM
Guess who will be getting taxpayer-funded coverage under the Dims’ health care plans, but who will not be required to purchase their own health insurance policies?
From an article at National Review online:
“No health legislation on the table requires federal, state, or local agencies — or private institutions receiving federal funds — to check the immigration status of health-program applicants, so some of the money distributed via Medicaid and tax credits inevitably would go to illegal aliens.
. . .
And another part of the Finance Committee plan would exempt illegal immigrants from a mandate to buy insurance. Uninsured Americans would have to pay a fine, but uninsured illegal aliens would be off the hook — thus, they would have no reason to buy their own coverage or to stop receiving taxpayer-funded health services at clinics, emergency rooms, etc.”
Sounds like a great plan, doesn’t it? More freebies for illegal aliens, while U.S. taxpayers continue to get screwed over to pay for the illegals’ freebies.
What’s not to love?
AZCoyote on July 15, 2009 at 6:00 PM
You know, I just won’t pay it. They can do what they like about it. It’s about damn time we had some tax revolt in this country, and this is the perfect opportunity–to tax me because I won’t shop the company store of HMO healthcare? Go pound sand! I already know what happens when 12 million people disobey a federal law– I see it everytime I drive past Home Depot.
Chris_Balsz on July 15, 2009 at 6:58 PM
People – just because the Dems can figure out a way to pay for
nationalizedsocialized healthcare doesn’t mean we should.redfoxbluestate on July 15, 2009 at 7:16 PM
I printed this out today and made many copies! Follow the green brick roads! Taxes from employers go right to the IRS, Taxes on Consumers go right to the IRS. Mandates on consumers to buy insurance, mandates on employers to provide insurance. All of this money goes into IRS and then it DIRECTLY FED to the Health and Human Services Dept! and is DIRECTLY FED to the “Health Insurance Exchange Trust Fund” Whatever the hell that is…….then on to the Treasury dept which feeds the “Public Health Investment Fund” then into COMMUNITY HEALTH AND CARE CENTERS.
Point? Those of us that choose to work and buy insurance from our employer will pay for it, get taxed for it and our income taxed for it and we will PAY THREE TIMES in taxes to fund these Trust Funds!!
I am about to blow a vessel in my brain! Thanks for letting me rant!
Coastal Paradise on July 15, 2009 at 7:39 PM
Evening all –
Haven’t had time to read all the comments, but I have a question. Will someone tell me why the stock market is going up with the news of all these deficits and tax increases? I don’t get it. I feel really down that this health care proposal cleared one of the senate committees already. Why is the stock market greeting the demise of this country with a huge jump??
KickandSwimMom on July 15, 2009 at 7:55 PM
That’s a lot of middle-class voters who won’t be happy if the Dems ram this healthcare through.
Something to look forward to: Early Voting, 2010! Vote the bums out of office!
TN Mom on July 15, 2009 at 8:51 PM
Again, it’s just part of the plan to integrate the whole of North America. You can see the methodical step by step fashion it’s been implemented with, one piece of legislation at a time. The next step is this wonderful new healthcare plan for illegals, and next is amnesty to make them legal. In several years all the healthcare plans in Canada, America, and Mexico will be merged to some degree.
Dude’s, we have continually put our faith in the GOP because we chose to believe their lies, and now the very existence of our nation is at stake. I can only wonder when we will all wake up.
True_King on July 15, 2009 at 10:38 PM
Remember during the election season when it was considered racist for even raising the possibility that Obama would raise taxes? Good times.
OneGyT on July 15, 2009 at 10:50 PM
today it went up because of Intel’s good numbers.
But, if you delve a bit deeper, its been staying between 8000 and about 8500…. gaining and loseing for months…
They want you to THINK its going up… but really its just been daily gains and losses up till now.
Romeo13 on July 15, 2009 at 10:54 PM
You don’t get something for nothing.
Shylock would be proud of Rahm Obama.
Demand that pound of flesh!
maverick muse on July 16, 2009 at 8:46 AM
McCain, out of sequence.
maverick muse on July 16, 2009 at 8:48 AM
Obama touts China’s exemplary leadership in all things. The Chinese citizens pay $805./month to be tortured for using the internet.
maverick muse on July 16, 2009 at 9:11 AM
I see nothing wrong with charging people for the public option and requiring participation.
AnninCA on July 16, 2009 at 10:36 AM
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