Health Care Reform Bill 101: Who Will Pay for Reform?

By Grier, Peter | The Christian Science Monitor, March 21, 2010 | Go to article overview
Save to active project

Health Care Reform Bill 101: Who Will Pay for Reform?


Grier, Peter, The Christian Science Monitor


If the health care reform vote succeeds today, the $940 billion bill would be the biggest change to domestic policy in a generation. The rich and the health industry would pick up most of the tab.

For the United States, health care reform would come with a hefty co-pay.

As we've noted throughout this series on what's in the health care bill, the legislation, if the vote succeeds, would represent the most sweeping change in national domestic policy in a generation.

Among other things, it would provide or subsidize health coverage for 32 million currently uninsured people. That's more than one- tenth of the entire population of the US.

Change like that doesn't come cheap. More specifically, change like that would cost about $940 billion over its first 10 years, according to the Congressional Budget Office.

Add these two things together, throw in $40 billion worth of tax credits for small business, and you're pretty close to the bill's top line for expansion of health coverage.

So where's the cash to pay for this coming from? Remember, CBO says this bill will actually cut the deficit over 10 years. That means it has to raise a little more money than it will spend.

The answer is that the money will be provided by new taxes, fees on industries involved in health care, and cuts in projected spending growth for existing government health efforts, primarily Medicare.

Here are specifics on some of the biggest money raisers:

Higher Medicare taxes on rich people

If you are an individual making more than $200,000 a year, or a married couple making more than $250,000 a year, get ready to pay more for your Medicare if health care reform passes.

First of all, your Medicare Part A (that's hospital insurance) tax rate would be increased by 0.9 percent, to 2.35 percent. Second, the bill creates an entirely new tax of 3.8 percent on unearned income (dividends, interest, stuff like that) for people in those same income brackets.

The good news is that this would not take effect until Jan. 1, 2013. And it is a big money raiser, truth be told. The Joint Committee on Taxation estimates this would bring in $210 billion between 2013 and 2019.

New tax on expensive health insurance

They used to call this the "Cadillac tax," but it's been pared back enough so it might better be called the "Chevy with leather and A/C" tax.

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
Loading One moment ...
Project items
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited article

Health Care Reform Bill 101: Who Will Pay for Reform?
Settings

Settings

Typeface
Text size Smaller Larger
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

While we understand printed pages are helpful to our users, this limitation is necessary to help protect our publishers' copyrighted material and prevent its unlawful distribution. We are sorry for any inconvenience.
Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.

Are you sure you want to delete this highlight?