I'm not sure what game the fascists, I mean democrats, are up to with requiring that employers report the value of insurance provided, although my gut tells me that that is a prelude to treating the value of employer-provided insurance as taxable income (currently it's not treated as taxable income - even though it should be in a sane tax system, since it's the functional equivalent of your employer sending a part of your paycheck directly to your electric company, for example, which would still result in the entire paycheck being taxable income to you), or else is a means for the fascists, I mean democrats, to identify private individuals who are "getting too much" and therefore should be subjected to even more punitive "taxes" than the rest (union members excepted as usual, of course).
The language regarding the 1099 information-reporting requirements are most likely intended to parallel the employee-reporting requirements in cases where a business uses independent contractors who receive part of their compensation in the form of health insurance coverage.
In the example that you give, the cabinet-maker who pays $601 for cabinets to be installed in your building would not need to file a form 1099 (technically, it would be a Form 1099-MISC) because payments for the purchase of merchandise are generally not reportable payments. See the 2010 instructions to Form 1099-MISC here. Absent a statutory provision or an IRS regulation that expressly extended reporting coverage to amounts paid for the purchase of merchandise, I do not think that the provision in the new Obastardcare legislation would require your hypothetical cabinet guy to file a form 1099 to report the purchase of those new cabinets for you.
