Democrats Open to Raising Medicare Tax to Fund Health Overhaul
A Senate bill would impose an additional 0.9 percent Medicare tax on individuals earning more than $200,000 a year in salary and on joint filers who make more than $250,000.
The House and Senate are at odds over how to pay for the health legislation. The Senate would impose a 40 percent tax on high-end employer-provided insurance plans, a move labor unions oppose; the House wants a 5.4 percent surtax on couples earning at least $1 million, which some senators dislike.
“The Medicare approach taken in the Senate bill may provide the kind of path forward that would get some compromise” on how to raise revenue, Maryland Democrat Chris Van Hollen, an adviser to House Speaker Nancy Pelosi, told reporters yesterday.
Democratic leaders are working to merge the Senate bill passed on Christmas Eve with the House plan approved in November. Theyre trying to resolve a number of other issues including the amount of subsidies that low-income people would receive to make mandatory insurance purchases more affordable, with the House providing more aid.
Meeting With Obama
The White House will play an active role in melding the bills by helping settle disagreements between the two chambers, Democratic legislative aides said after congressional leaders, including Pelosi, met last night with President Barack Obama.
White House aides will convene meetings with congressional aides starting today to reconcile some disagreements, and lawmakers will begin meeting, possibly as early as this week to begin discussions, said the aides, who requested anonymity.
Obama didnt express policy preferences between the two measures, a Senate staff member said. A House aide said the president urged that subsidy provisions in the Senate bill be strengthened.
The aides also said Pelosi and Senate Democratic Leader Harry Reid, who phoned in to the White House meeting with Obama, decided to scrap the traditional House-Senate conference committee to avoid procedural delays that Senate Republicans could impose in the appointment of Senate negotiators.
The Democratic leaders have said they want to pass the legislation before Obama delivers his State of the Union address to Congress at months end or in early February.
Tough Negotiations
New York Democrat Charles Rangel, chairman of the tax- writing Ways and Means Committee, told reporters the Senates plan to raise the Medicare tax on high wage earners to 2.35 percent may be a basis for compromise. “Yeah, we can work out something,” he said. Still, he predicted “its going to be a tough” set of negotiations to merge the two bills.
Pelosi was noncommittal on the tax proposals.
“We think that we have the fairest approach in our bill,” the California Democrat told reporters yesterday. “The Senate thinks theirs is fairer.” She added, “we will do what is necessary to pass the bill.”
Among the other differences in the two bills is that the Senate measure doesnt contain a government-run insurance program, or public option, which House Democrats included in their plan to provide competition to private insurers. Pelosi signaled flexibility on that issue, too.
“There are other ways to do that,” Pelosi said. “We will have what we need to hold the insurance companies accountable.”
Low-Income Subsidies
Providing subsidies for low-income people to buy insurance will be “a critical part of this discussion” with the Senate, Van Hollen said. The House version “is much more generous” for people who earn more than the poverty level and dont qualify for Medicaid, he said.