Raising Taxes = Cutting Costs

I was reading a NY Times article about how lobbyists are fighting the “last big plans to cut healthcare costs” and noticed that one of those “big plans to cut healthcare costs” is actually a tax hike.

The tax on gold-plated insurance plans is the last vestige of most economists’ favorite idea, eliminating the tax exemption for employer plans. The finance bill would impose a 40 percent excise tax on insurance plans that cost more than $8,000 a year for an individual or $21,000 for a family.

The white house budget director referred to this tax when he said:

“A key priority now, is to make sure cost containment holds up as we move through the legislative process.”

They call it a tax on “gold-plated insurance plans as if only CEO’s get them. What gets conveniently overlooked is that some companies, such as Zappos, provide excellent health care to all their workers and would be considered “gold-plated”. Some of the labor unions have also negotiated “gold-plated” plans. Although some would prefer to simply exclude those plans from the tax. After all, labor is the democratic base.

Naturally the healthcare and insurance industries don’t mind since it will give them money. What they opposed were the provisions that would allow Medicare to negotiate pricing on prescriptions.

Only in Washington could a tax we pay be considered “cost containment”. If you feel the tax is a good idea at least call it what it is. This is what sends me over the edge in the healthcare “debate”. The politicians talk about controlling costs as if they are trying to lower them. What they really mean is they want to control who pays.

Tags: Health Care Reform