Tell your senators and representative: Pass health care. Don't tax benefits.
In the coming weeks when the House and Senate write the final health care reform bill, they need to know that real reform includes a robust public insurance option, a strong employer responsibility provision—and does not finance health care by taxing workers' benefits.
.The window for winning key changes to the health care reform bill is narrowing by the day, and a tax on employer-provided health benefits remains a serious threat to middle class families.
On Christmas Eve, the Senate passed a bill which would impose a 40 percent tax on health plans exceeding $23,000 annually for family coverage and $8,500 for individuals. If the final bill merged by the House and Senate contains this same tax on health benefits, its impact on the middle class would be devastating.
The Congressional Budget Office reports that within three years of its implementation, the tax would affect nearly 31 million people or 20 percent of all workers with employer-provided health coverage. Within six years, the Congress’ Joint Committee on Taxation estimates that the tax would reach one-fifth of all households earning between $50,000 and $75,000 annually. Furthermore, as health care costs continue to rise, more and more families will reach the taxation threshold each year.
.Since employers and families will try to avoid the tax threshold, many workers and policyholders will be forced to accept lower value plans which have higher out-of-pocket expenses, larger co-pays, and costly deductibles. Not only would this reduce benefits for millions of middle class families, but it would also be contrary to President Obama’s promise that health care reform will not force people out of the plans they already have.
Legislators are pushing for final passage of health care reform before the President’s State of the Union Address likely to take place by the end of January or early February. With the House set to reconvene on Tuesday, January 12, 2010, and the Senate on Wednesday, January 20, 2010, there is very little time to ensure that health reform benefits, rather than burdens, the middle class.
