Subscribe to Common Dreams News Updates
Most Popular This Week
Popular content
Today's Top News
Obama Leaves Door Open to Tax on Health Benefits
WASHINGTON - President Barack Obama left the door open to a new tax on health care benefits Wednesday, and officials said top lawmakers and the White House were seeking $150 billion in concessions from the nation's hospitals as they sought support for legislation struggling to emerge in Congress.
President Barack Obama meets with governors in the Roosevelt Room of the White House in Washington, Wednesday, June 24, 2009. From left are, the president, Vermont Gov. Jim Douglas, Washington Gov. Christine Gregoire, and South Dakota Gov. Mike Rounds. The governors co-hosted the Regional Forums on Health Reforms earlier this year. (AP Photo/Pablo Martinez Monsivais) "I don't want to prejudge what they're doing," the president said, referring to proposals in the Senate to tax workers who get expensive insurance policies. Obama, who campaigned against the tax when he ran for president, drew a quick rebuff from organized labor.
Obama also fielded a pointed personal question during an ABC News town hall at the White House on Wednesday. The prime-time program was the latest in a string of events designed to build public support for his plan to slow the rise in health care costs and expand coverage to the nearly 50 million uninsured.
Dr. Orrin Devinsky, a neurologist at the New York University Langone Medical Center, challenged Obama: What if the president's wife and daughters got sick? Would Obama promise that they would get only the services allowed under a new government insurance plan he's proposing. Obama wouldn't bite.
If "it's my family member, if it's my wife, if it's my children, if it's my grandmother, I always want them to get the very best care," Obama said.
Earlier in the day, the administration and its allies pushed for a prominent display of progress in the Senate before Congress begins a weeklong vacation on Friday.
Senate Finance Committee Chairman Max Baucus, D-Mont., labored in a series of meetings to produce at least an outline of legislation that could command bipartisan support. Of the five House and Senate committees working on health care, Finance is the only one that appears to have a chance at such an agreement.
For their part, key Republicans pressed the White House for assurances that any concessions made now would not merely lead to additional demands at a later date. "We want to know the president is working in good faith along the way as we are," said Sen. Olympia Snowe, R-Maine, after meeting with Nancy-Ann DeParle, the top White House official on the issue.
Baucus appeared especially eager to show progress before the exodus from the Capitol began.
To that end, several officials said he was negotiating with representatives of the nation's hospitals, hoping to conclude an agreement that would build on an $80 billion weekend deal with the pharmaceutical industry.
Hospitals were being asked to accept a reduction of roughly $155 billion over the next decade in fees they are promised under government programs such as Medicare and Medicaid, according to numerous officials.
Officials at the American Hospital Association and the Federation of American Hospitals said they could not comment on any discussions.
Baucus is seeking similar concessions from nursing homes, insurance companies, medical device makers and possibly others, noting that any legislation would create a huge new pool of customers for industry providers.
At its heart, any legislation is expected to require insurance companies to offer coverage to any applicant, without exclusions or higher premiums for pre-existing medical conditions.
Overall, Baucus has said he hopes to hold the size of any legislation to $1 trillion or less, and in private negotiations, there were discussions about further scaling back eligibility for insurance subsidies from the government.
Additionally, Baucus was still searching for ways to cover the cost of his emerging legislation, and numerous officials said he appeared roughly $200 billion shy of achieving that goal. They added that a proposal to make it harder for taxpayers to itemize their medical expenses was drawing renewed interest among key senators as one way to raise revenue.
Current law allows those expenses to be itemized when they exceed 7.5 percent of adjusted gross income. The proposal under review would raise that to 10 percent, officials said.
At the White House, Obama sidestepped when asked if he was open to taxing health care benefits - a proposal he opposed vigorously in the campaign for the White House.
"I have identified the ways that I think we should finance this. I think Congress should adopt them. I'm going to wait and see what ideas ultimately they come up with," he said on ABC's "Good Morning America."
"I don't want to prejudge what they're doing. We've put forward what we think is best."
Organized labor weighed in quickly.
Gerald W. McEntee, president of the 1.6 million-member American Federation of State, County and Municipal Employees, said in an interview that union leaders believe Obama is "a person of his word." He was referring to Obama's opposition to taxing those benefits during last year's campaign.
"They're not going to tolerate that," McEntee said of workers' views of that proposal.
It was the latest in a series of signs of presidential flexibility. He has said he could accept a requirement for individuals to buy insurance, a position he opposed in the campaign.
Baucus and many Republicans support taxing health care benefits, and officials have said discussions center on imposing the tax in cases in which premium costs exceed $17,000 combined in payments by the employer and worker. Democrats want to exempt union members covered by contracts, but Republicans are resisting.
The officials who provided specifics on the negotiations in the Senate did so on condition of anonymity, saying they were not authorized to disclose private talks.
ABC News was the lone network broadcasting Obama's town hall - drawing criticism from Republicans who wanted equal time.
Associated Press writers Erica Werner, Ricardo Alonso-Zaldivar, Charles Babington and Alan Fram contributed to this report.

13 Comments so far
Show AllNo f------ sh-- we are not going to tolerate that.
Stop drinking that stuff Obama.
Obama wasted millions of dollars last year advertising against Mccain taxing health benefits all throughout the campaign and his ads were completely annoying. I cannot wait to see the Republicans gutting Obama like a trout when they expose his flip-flopping. There's no way the GOP will allow Obama to get away with that kind of taxing. And no, I'm not a Republican in case anyone wondered.
Obama apparently is trying to leave the door open to a Jeb Bush victory in 2012, probably with Romney as VP (or maybe the other way around). Obama is playing the role of some sort of set-up man, ensuring absolute failure of "leftist policies" (actually fascism-lite) so the Republicans can claim that "the US government tried a liberal approach and it failed," which they expect to somewhat dampen resistance when they impose full-bore police state fascism in 2013.
Whatever Obama's trying to do for the Republicans, he sure has the nerve to screw us all for it. Based on the issues, I find both parties unsuitable. If Obama is going to be this pathetic as president, we might as well be stuck with Jeb/Romney from 2013 to 2020 as it's all the same anyway. Not that I like the Republicans but with them you know what's coming. Most Democrats, on the other hand, snivel but stab. When the Democratic Party can consist of more pols ala Kucinich then I'll take the party seriously since they'd have some or even most to share with us on the issues. Until then, I can be sure that I will always end up voting Independent because I vote on issues with an open heart and mind rather than vote by party, "personality", money, fake "electibility", etc ... Even those who voted for Obama are having deep regrets and I welcome them to join us.
I'm so disillusioned with this fast-food nation right now. Even me, Mr. Positive is waxing cynical. Maybe I just need to get away for awhile. I've been working too hard lately and am not getting enough sleep.
Before I drift away, promise me, no, promise yourself rather, that you'll never vote for an R or D ever again! Ya got that?!!
For myself, I'm tempted to follow through on an old dream to defect to a socialist country like... well, take your pick! There's about 199 of them to choose from.
Sweet dreams Jennifer and everybody else!
Just another step toward the Oligarchy's goal of having a nation of homeless, hungry, sick and hopeless people with their hands out begging for any job, a little food to keep their families alive another day, hands outstretched in supplication as the limos drive by.
They're getting closer every day.
Can someone explain what "tax health care benefits" means?
Do they mean taxing the insurance premium? Only the employee share which is now dedicted from the paycheck pre-tax? Employee plus employer share?
Or do they mean taxing the actual medical expense payments?
Are they, in effect not only forcing us to continue to use the awful private insurance system, but making it more expensive by requiring us to pay for it with taxed income?
Is there any doubt that our legislators are utterly cowed by the capitalist investor class into coming up with these absurd ideas? Why are they so frghtened, or is it fear at all? Might it instead be happy complicity with the leech-capitalist investor class?
pjd, what they are talking of taxing is the employer paid part of insurance premiums. Considering it as part of a worker's taxable wages. Of course, the rules are constantly shifting in this so called debate. And Obama has erased every single line he drew in the campaign. By the time the dust settles, the insurance industry will have what it wants and we will get the shaft. And the costs will continue to rise, unabated. And the rich will get richer and the rest of us will get poorer. So it is written.
When the people fear their government there is tyranny,
when the government fears the people there is liberty.
~ Thomas Jefferson
The worst aspects of the proposed healthcare "reform" are forcing everyone to purchase health insurance, subsidizing insurance policies for low income families, and punishing, with hefty fines, those who chose not to comply with their "mandate", whether a private individual or an employer, which is part of the scheme to pay for the low income subsidies.
Many people who lead healthy lifestyles and utilize natural holistic, preventive, health maintenance, don't want, or need, "insurance" in the form of mainstream "healthcare". But we risk being punished if we refuse to play their game.
I will NOT comply with their insurance mandate. I don't need it, nor do I want it.
Plop. Plop. Splat. Splat. You hear that? That is the sound of people falling out of the middle class, the lower middle class, the working class. Helloooo, Washington. What will you do for people who have just been hanging on? Union, schmunion. You're talking about people getting over $1400 a month in a benefit! That's more than someone makes on minimum wage.
What about the people who were just making it, and now a lot of them aren't even just making it anymore. No bailout. No green shoots. No golden parachute. No lobbyists. No check for your campaign to grease the wheels. Hellloooooo. I am not disqualified from insurance by a pre-existing condition. I cannot afford to buy it. When I had it, I couldn't afford to use it. And I can only "afford" it, so long as I don't need it, and it will not protect me from financial ruin. Making it MANDATORY is kind of a non sequitur for me.
And if you mandate that employers buy insurance, they will hire fewer people. Is this going to help us "recover" in this jobless recovery?
Anyone in Washington ever ask themselves why the insurers, the drug companies, the hospitals and everyone else is trying to cut a deal in the back room and promising to steal less than they stole this year if you'll let them keep stealing for the next 10 years?
Why can they not even make the smallest requirement on insurance? For instance, why not make them uphold a contract? If the insurer accepts you and your monthly premium, have they not entered into a contract with you? Why don't they have to do their due diligence when you sign up and tell you then if they have a problem with the application? Why are they allowed to wait, and thereby deprive you of the opportunity of doing business with someone else, and only break the contract when it becomes a cost to them? What kind of reform doesn't even address a single issue like that in favor of us, the invisible people out here? At least make it look like you've given us a thought.
This is a real question: exactly how do they plan make it "mandatory" to have health insurance?
When you get stopped by the cops for speeding will they ask to see your "health insurance card" like with car insurance?
If you have no money, even for food and rent, how the heck can you be "forced" to pay health insurance?
This is a terrible idea!!!
Who thought this up, anyway?
Baucus is the last person on earth who should be put in charge of healthcare reform. He has taken more money from the healthcare industry than any other member of congress.
http://cdw-ithink.blogspot.com
Everyone knows the way to cut costs is to go to single payer, a solution Baucus refuses to consider.
Cost and exclusion are not the only problems with our healtcare system, quality is.
Healthcare, in the hands of CEOs instead of healthcare professionals, has resulted in the US plummeting from 6th place to 36th place, just above Greece in health outcome. We have the highest infant mortality in the developed world.
Baucus isn't looking to reform healthcare, he's looking to line the pockets of his campaign contributors.
These guys are going to stick us with healthcare crafted in the corporate boardrooms, send us the bill and leave town.
If we put up with it, than we deserve it.
We should have people on Capitol Hill everyday in the faces of our Senators and Congressmen. They need to understand they cannot go on ignoring their constituents.
That's funny, the Republicans demanding equal time. They're the ones who destroyed the Fairness Doctrine. Oh, I forgot. Rules and laws only apply to other people.
When the people fear their government there is tyranny,
when the government fears the people there is liberty.
~ Thomas Jefferson