The Gang of One Plan: A Huge Tax on Workers

Max Baucus has released his plan, with no cosponsors.

“There is no way in its present form
    that I will vote for it.”
                                                 — Sen. Jay Rockefeller (W-Va.)               
 “The Baucus bill is the worst piece of healthcare legislation
I’ve seen in 30 years.”
                                                       — Former DNC chair Howard Dean    
“Seldom have so many waited so long for so little.
  This isn’t negotiation; it is capitulation
             to the insurance industry.”         
                            — Rep. Lloyd Doggett (D-TX)

This is James Capretta’s take:

[It has] three key provisions: a requirement that individuals secure “qualified coverage” or pay a hefty tax to the federal government (the so-called “individual mandate”); a requirement on most employers to offer “qualified coverage” to their full-time workers; and a “firewall” which requires most working Americans to sign up with insurance offered on the job without any additional governmental assistance…

For low wage, full-time workers who are offered qualified coverage on the job, the hidden and implicit taxes of Obamacare are truly stunning. A worker with an annual income at 200 percent of the federal poverty line — $44,100 if the worker is married with two children — could be required to sign up with insurance costing $13,375 per year. The employee portion of the premium would be notionally capped at 13 percent of annual income, or $5,720. The employer would pay the other $7,655 — but the employer portion too would come out of the worker’s take-home pay (possibly after some period of adjustment)… The foregone tax liability on an average employer-sponsored plan is likely to be about $4000 (including payroll taxes). The other $9,000 plus in health insurance premiums — regardless of how it is split between worker and firm — would be shouldered by the worker himself.  At $44,100, a $9,000 health insurance premium amounts to 20 percent of income.

Comments (5)

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  1. Neil H. says:

    This is hilarious. Not the tax on labor, but the way the Democrats are fighting with each other.

  2. Bret says:

    The only thing bipartisan about this bill is the opposition to it.

  3. Ken says:

    This may be a good development. The Democrats appear to be coming apart.

  4. Vicki says:

    I believe the best of all possible worlds at this point is no bill at all.

  5. Nancy says:

    I agree with Vicki.