New Fee on Health Insurance Companies Is Proposed to Help Expand Coverage

New York Times ^ | September 6, 2009 | Robert Pear

[reaganaut1]

In a last effort to give the Senate a bipartisan health care bill, the chairman of the Senate Finance Committee circulated a comprehensive proposal on Sunday to overhaul the health care system and proposed a new fee on insurance companies to help pay for coverage of the uninsured.

...

The proposal by Mr. Baucus does not include a public option, or a government-run insurance plan, to compete with private insurers, as many Democrats want.

...

It remains to be seen how Mr. Baucus’s plan might mesh with any proposals Mr. Obama lays out as he tries to pump up support for health care legislation, his top domestic priority.

People familiar with Mr. Baucus’s plan said it was calculated to appeal to Senator Olympia J. Snowe, Republican of Maine. But, at first glance, they said, it appears unlikely that the proposal, in its current form, could win support from the other Republicans in the “group of six,” Senators Charles E. Grassley of Iowa and Michael B. Enzi of Wyoming.

The group is scheduled to meet on Tuesday, when Congress reconvenes after its August recess. Mr. Baucus is looking for a quick response from the Republicans.

Mr. Baucus’s plan, expected to cost $850 billion to $900 billion over 10 years, would tax insurance companies on their most expensive health care policies. The hope is that employers would buy cheaper, less generous coverage for employees, thereby reducing the overuse of medical services.

The separate new fee on insurance companies would help raise money to pay for the plan. The fee would raise $6 billion a year starting in 2010, and it would be allocated among insurance companies according to their market shares.

[reaganaut1]

Taxing people on their health insurance benefits polls poorly, and taxing health insurance companies is a backdoor attempt to do the same thing. Republicans should explain that taxes on health insurance companies will be passed on to consumers in the form of higher premiums and/or lower benefits.

[dawn53]

Mr. Baucus’s plan, expected to cost $850 billion to $900 billion over 10 years, would tax insurance companies on their most expensive health care policies. The hope is that employers would buy cheaper, less generous coverage for employees, thereby reducing the overuse of medical services.

They're actually talking about taxing the insurance companies themselves. Of course, they're going to pass on the cost. But the above paragraph makes no sense.

If they intend to raise money through the tax, but state that the tax will drive people to cheaper coverage, well there goes your revenue to pay for the uninsured that they intended to raise through the tax.

Totally illogical IMO.

[cripplecreek]

proposed a new fee on insurance companies to help pay for coverage of the uninsured.

And higher taxes help business grow. LOL

[counterpunch]

So the Government is going to impose a “fee” on insurance companies which they will pass down to every insured American to pay for coverage for the uninsured which will be next to worthless anyways?

What about dismantling Ted Kennedy’s 1973 “reforms” that created HMOs, or bringing down the costs with tort reform?

[bustinchops]

Yes, the pubs should explain that. But it’s very sad that it needs to be explained.

[counterpunch]

What I find amazing is that the Democrats are trying to coerce employers into providing LESS coverage for their employees!
How does this improve the state of healthcare coverage in America?
Honestly, the only reason for this that I can see is that people are generally happy with their current coverage, and the Democrats want to change that in order to increase support for their Government takeover of healthcare.

 

[x_plus_one]

The separate new fee on insurance companies would help raise money to pay for the plan.....at the expense of those paying for insurance coverage.

This is just another ploy to soak the rich, the middle class and anyone with two nickels just to keep the sorry chaotic bureaucracy in power....

[foxfield]

This is how the “government option” will compete with the private insurers, drive them out, and eventually move the whole system to the single-payer regime.

[chuck_the_tv_out]

Increasing use of euphemism to describe government activity is a sign of a doped-up population.

[dearolddad]

And higher taxes help business grow. LOL

That Max Baucus guy is a sheer genius!

[cripplecreek]

Must have gone to the same business school as Jenny Granholm.

[Fresh Wind]

Why not tax lawyers on every lawsuit filed?

[TomGuy]

a new fee on insurance companies to help pay for coverage of the uninsured

Which the insurance companies will pass on to clients, thus increasing their premiums, thus indirectly creating the equivalent of a hidden tax increase on the clients.

Thus, this proposal would cause a premium increase (hidden tax increase) on 85% of those who have private insurance to pay for public insurance for those 15% who do not have (and many of those may not even want) health insurance.

==

That is typical Washingtonthink.

[TomGuy]

Mr. Baucus’s plan, expected to cost $850 billion to $900 billion over 10 years, would tax insurance companies on their most expensive health care policies. The hope is that employers would buy cheaper, less generous coverage for employees, thereby reducing the overuse of medical services.

On close examination, that statement does not make sense.

It taxes the most expensive health care policies. That is altered rhetoric from tax the rich. So, where is the line drawn to determine at which premium amount the added tax starts?

How does putting a tax on expensive policies translate to employers buying cheaper policies for their employees which? If the employer buys the cheaper policies, there is no added tax. Thus, no excess money to pay for the uninsured.

What proof is there that the insured have caused the overuse of medical services? The overuse seems to come from the uninsured, mostly illegals, who use emergency rooms for general medical care.

[The Wizard]

charge fees and then expect them to compete....how BAD the bomb is....he must be stopped...

[kittymyrib]

While it is tempting to hope union members see their “Cadillac” insurance plans taxed, in reality, all insured people would pay this tax because corporations don’t pay taxes. Their customers do. How stupid Democrat voters are that after 50 years of “taxing rich corporations,” they still don’t get it.

[Shady]

Because, it isn't the usurping of Liberty that the Dems so desperately want!

[Condor51]

Mr. Baucus’s plan, expected to cost $850 billion to $900 billion over 10 years, would tax insurance companies on their most expensive health care policies.

The hope is that employers would buy cheaper, less generous coverage for employees, thereby reducing the overuse of medical services.

You'll have to excuse me as I've never been elected to Congress so I don't understand Government Mathematics! OR, excuse the term, 'LOGIC'!

1. So what if some company or employee can 'AFFORD' "expensive" policies?
   
2. SO what if those "expensive policies" cover Hangnails?
   
3. What the 'heck' is "overuse of medical services" and what business is it of Congress if the person and his Insurance Company can PAY FOR IT.
4. What difference does it make if someone with an "expensive policy" goes to the Dr three times a week?
   
5. What does ANY of this have to do with 'the uninsured'????

Again, excuse my ignorance on the above but I've never been elected to a Public Office. /s

Mark Twain: Suppose you were an idiot, and suppose you were a member of Congress; but I repeat myself.

And Einstein was right again, when he said what's in my Tagline.

[TBP]

They apparently want to punish the insurance companies for providing coverage to so many — it gets in the way of socializing it.

[Condor51]

While it is tempting to hope union members see their “Cadillac” insurance plans taxed,

Sorry.
Health Insurance Coverage negotiated by 'Organized Labor' is already excluded in HR 3200 and is Exempt from taxation as 'income'.

HR 3200 only will 'tax as income' Health Insurance policies of non union employees.