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Healthcare Insurance Bill: 14 Yrs Of Taxes To Pay 10 Yrs Of Insurance

By Lisa Olsen Posted in Health Insurance News

With the specter of an unpopular healthcare reform bill still looming, some taxpayers are wondering just how Congress plans to fund this proposed reform. President Obama has repeatedly promised not to sign any bill that adds even one penny to the deficit.

Pay It Forward

As soon as the President began discussing his desire for a government overhaul of the healthcare system in 2009, the plan has been to begin funding the bill immediately while withholding services until 2013. It amounted to 14 years of taxes to pay for 10 years of healthcare services. Officials in the Obama administration claim that the delay is necessary to setup the bureaucracy that will oversee the new healthcare program. So far, vocal voter protest and skittish Congressmen and Senators have prevented the dubious plan from being implemented.

Breaking A Promise Without Breaking A Promise

To fund the healthcare bill, some new taxes would immediately be implemented. One source of revenue for the proposed healthcare bill could come, not from new taxes per se, but from a renewal of previously cut taxes. If the Bush tax cuts expire as scheduled in 2011, top wage earners would see their tax rates increase even before new taxes are imposed.

Robbing Peter To Pay Paul

As was noted during the February 25 Healthcare Summit, another proposed revenue source would come from the expansion of the Medicare tax. Currently Medicare is funded through a 2.9% tax on earned wages, but new legislation would assess the Medicare tax on so-called unearned income as well, including dividends, capital gains and other sources of income beyond a paycheck. It was unclear how funds committed to Medicare could also be committed to the new healthcare bill.

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