How Baucus's plan will help uninsured
Senate Finance Committee Chairman Max Baucus released his plan to overhaul the health system. Tamara Keith reports on what the plan means for people who don't have insurance and the businesses that employ them.
U.S. Senate Finance Committee Chairman Sen. Max Baucus speaks to the media after a meeting with the 'Gang of Six' on health-care reform on Capitol Hill in Washington, D.C. (Alex Wong/Getty Images)
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Links
- Full text of Sen. Baucus's health reform proposal
(PDF document)
TEXT OF STORY
Kai Ryssdal: Health potion number five is the one brewed up by the Senate Finance Committee. More accurately, by that committee's chairman Max Baucus.
MAX BAUCUS: This is a good bill. This is a balanced bill. It can pass the Senate.
Caveat number one today today with all that is that the Baucus plan isn't even an actual piece of legislation yet. It's going to take a couple of weeks for that.
Caveat number two is that the devil, as always, is in the details. One of those details is what today's proposal means for people who don't have insurance and for the small businesses where a lot of those people work. Here's Marketplace's Tamara Keith.
TAMARA KEITH: We're talking about more than 17 million people here. They work for small businesses, and they don't have insurance. The latest plan aims to help them, by giving employers a tax break to cover their workers. The tax credits would apply only to very small businesses who pay their workers low wages. And the biggest credit a business could get is 50 percent of the cost of the insurance. But a half-off sale is only a good deal if you can afford to pay half.
BILL GALE: I think it's going to be very hard to get small businesses to significantly raise coverage, just through these sort of standard tax incentives.
Bill Gale is co-director of the Tax Policy Center at the Brookings Institution.
GALE: So, for someone making $20,000 if their health insurance costs, say, $8,000, even with the subsidy the firm has to pay an additional $4,000. And it seems unlikely that firms are going to think that's a good deal.
And a company could only cash in on the incentive if they owe taxes, which means they have to turn a profit, which happens less often than you'd think. Gale says the companies with the most to gain are those that already insure their employees.
Todd McCracken is president of the National Small Business Association. He doesn't think the tax breaks alone will make much of a difference, when it comes to expanding the number of workers with coverage.
TODD MCCRACKEN: There have been proposals for years to do something like that, and we've said for a long time that while it would certainly help some companies, and it's better than a poke in the eye, you really need to reform the whole system if you're really going to improve rates of coverage.
McCracken says what would really help is slowing the sky-rocketing cost of insurance. And of course, all of the health-care bills aim to do that.
In Washington, I'm Tamara Keith for Marketplace.
Comments
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09/19/2009
This is a junky bill. It is a useless bill. It will pass the Senate.
Why do politicians insist on speaking to us peasants as if we are stupid? A tax CREDIT is not a tax REFUND and the differences are significant.
A Tax credit is a discount off of your taxable income. In order to qualify you have to pay taxes. For small businesses, they have to turn a profit to qualify. Which as Tamara Keith pointed out happens more often than one would think. So it doesn't apply to many companies/individuals. And even if they did qualify, they wouldn't see it until taxes are filed next April. Well I need that cash now, not in 12-16 months.
A tax refund is a check back from the government in the amount indicated by law. It can be sent to any and everyone who filed taxes last year. It too isn't the best situation but is far more helpful than a tax credit.
Of course, a tax credit of $8000 (which translates to about $1500 back in my pocket come April) sounds a lot better than a $600 tax refund.
From East Setauket, NY, 09/18/2009
The responsibility for health care needs to be taken off the backs of businesses. The use insurance companies have at this point is to pay contributions (bribes) to Congress and Presidential campaigns. We need to catch up to the rest of the industrialized world and have a national health plan. Insurance companies can either play as they must in these other countries or shut down. National health plans are freedom -- freedom for businesses to grow and individuals to do the work that is best suited for their talents, not just for the sake of an insurance policy.
From Merritt Island, FL, 09/17/2009
The real argument is between people who don't want Americans to suffer and die in front of our eyes when we could easily save them, and people who don't want a dime of their money going to help anyone else, and have frequently chanted "Let 'em die."
Baccus' bill is irrelevant to the real debate. It does nothing but give tax dollars to insurance companies that are already rich.
From San Antonio, TX, 09/17/2009
Seriously and excuse my French, but this plan is a buge crock of $#(t. This would've done nothing for me when I owned my own business. One, I didn't turn a profit because I was an LLC so it was always within my best interest to pay out any plus if there was any. And then it doesn't change the fact why I had to stop insurance. I hired one employee that had a history of type 2 diabetes and surgery bills. They wanted to charge me $700/month instead of $300/month for an HSA $5000 deductible plan. Why haven't any of the proposed legislation talked about portable medical records? Let's fix the problems instead of just expanding.
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