Kicking The Sleeping Dog
Stanley Feld M.D., FACP,MACE
Harvard’s experts on health economics and policy have advised presidents and Congress on how to provide health benefits to the nation at a reasonable cost.
The benefits to the nation are not at a reasonable cost. The waste imposed on to the healthcare system is escalating daily. The cost healthcare coverage provided to the Harvard faculty by the Harvard administration has escalated significantly since Obamacare was enacted into law.
The Harvard administration has absorbed the increased cost of Obamacare for the faculty. The Harvard faculty continued to believe President Obama and the Obama administration were doing a noble deed for the nation until the costs affected them directly.
Now the Harvard administration has shifted some of the increased costs on to the faculty in the form of higher deductibles and direct costs. Corporations have been doing this since Obamacare was passed.
“ The Harvard faculty, and the professors are in an uproar”
I have touched on Harvard’s faculty outrage lightly while others felt this was a huge story pointing out Harvard’s faculty’s liberal hypocrisy.
It proves the point of an old Texas saying, “you shouldn’t kick a sleeping dog because if you do he will awaken and come back to bite you.”
The more important issue that the Harvard faculty should wake up to is the yearly tax increases that Obamacare has imposed on both the taxpaying and non taxpaying members of our society.
A big question is, are Americans getting their money’s worth?
The Harvard faculty outrage should be about the Obamacare tax increases.
“Cost of ObamaCare"
$1.4 Trillion ($1,383,000,000,000) *
ObamaCare's coverage provisions will cost the federal government $1.4 trillion (net) over the next 10 fiscal years, according to the CBO.
That is the net cost to the federal government of the provisions to expand and subsidize health insurance coverage over the fiscal 2015-2024 period.
The gross cost of the coverage provisions – before individuals and employers have paid their penalties and insurers have paid their excise taxes on "Cadillac" plans – stands at more than $1.8 trillion over the same period.
Since some will pay large penalties and some will pay none, this taxpayer calculator analysis doesn't attempt to distribute the $456 billion in coverage spending that is expected to be offset by penalties, excise taxes, and some other tax revenues.
*Congressional Budget Office”
We all know how wrong the CBO can be. The CBO is totally dependent on the data given to it. If there is bad data in bad data comes out. We can all recall the CBO publishing a surplus from Obamacare at the end of ten years before the bill was passed.
It is important for everyone to recognize the increased taxes that have been imposed with little evidence for significant payback. Below is my second printing of an article I wrote in March 2014.
"Obamacare's New Taxes And The Middle Class"
Stanley Feld M.D.,FACP, MACE
“It is important to review all the taxes written into the Affordable Care Act (Obamacare). Americans are recognizing that those tax increases are being passed on to all consumers. The middle class was not supposed to experience tax increases. The middle class is realizing it has less disposable income because of these new taxes.
Since 65% (sixty-five percent) of America’s economy is dependent on consumers discretionary spending, America is destined to further economic difficulty.
These new tax increases are timed in the hope that no one would notice them.
The increased taxes are supposed to fund Obamacare. The taxes continue to be collected even though much of the law’s implementation is delayed.
“The increases in Obamacare taxes arearranged by their respective effective dates. Below is the total list of all $500 billion-plus in tax hikes (over the next ten years) in Obamacare, where to find them in the bill, and how much your taxes are scheduled to go up as of today:
Taxes that took effect in 2010:
1. Excise Tax on Charitable Hospitals (Min$/immediate): $50,000 per hospital if they fail to meet new "community health assessment needs," "financial assistance," and "billing and collection" rules set by HHS. Bill: PPACA; Page: 1,961-1,971.
2. Codification of the “economic substance doctrine” (Tax hike of $4.5 billion). This provision allows the IRS to disallow completely-legal tax deductions and other legal tax-minimizing plans just because the IRS deems that the action lacks “substance” and is merely intended to reduce taxes owed. Bill: Reconciliation Act; Page: 108-113.
3. “Black liquor” tax hike (Tax hike of $23.6 billion). This is a tax increase on a type of bio-fuel. Bill: Reconciliation Act; Page: 105.
4. Tax on Innovator Drug Companies ($22.2 bil/Jan 2010): $2.3 billion annual tax on the industry imposed relative to share of sales made that year. Bill: PPACA; Page: 1,971-1,980.
5. Blue Cross/Blue Shield Tax Hike ($0.4 bil/Jan 2010): The special tax deduction in current law for Blue Cross/Blue Shield companies would only be allowed if 85 percent or more of premium revenues are spent on clinical services. Bill: PPACA; Page: 2,004.
6. Tax on Indoor Tanning Services ($2.7 billion/July 1, 2010): New 10 percent excise tax on Americans using indoor tanning salons. Bill: PPACA; Page: 2,397-2,399.
Taxes that took effect in 2011:
7. Medicine Cabinet Tax ($5 bil/Jan 2011): Americans no longer able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines (except insulin). Bill: PPACA; Page: 1,957-1,959.
8. HSA Withdrawal Tax Hike ($1.4 bil/Jan 2011): Increases additional tax on non-medical early withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent. Bill: PPACA; Page: 1,959.
Taxes that took effect in 2012:
9. Employer Reporting of Insurance on W-2 (Min$/Jan 2012): Preamble to taxing health benefits on individual tax returns. Bill: PPACA; Page: 1,957.
Taxes that took effect in 2013:
10. Surtax on Investment Income ($123 billion/Jan. 2013): Creation of a new, 3.8 percent surtax on investment income earned in households making at least $250,000 ($200,000 single). This would result in the following top tax rates on investment income: Bill: Reconciliation Act; Page: 87-93.
|
|
Capital Gains |
Dividends |
Other* |
|
2012 |
15% |
15% |
35% |
|
2013+ |
23.8% |
43.4% |
43.4% |
*Other unearned income includes (for surtax purposes) gross income from interest, annuities, royalties, net rents, and passive income in partnerships and Subchapter-S corporations. It does not include municipal bond interest or life insurance proceeds, since those do not add to gross income. It does not include active trade or business income, fair market value sales of ownership in pass-through entities, or distributions from retirement plans. The 3.8% surtax does not apply to non-resident aliens.
11. Hike in Medicare Payroll Tax ($86.8 bil/Jan 2013): Current law and changes:
|
|
First $200,000 ($250,000 Married) Employer/Employee |
All Remaining Wages Employer/Employee |
|
Current Law |
1.45%/1.45% 2.9% self-employed |
1.45%/1.45% 2.9% self-employed |
|
Obamacare Tax Hike |
1.45%/1.45% 2.9% self-employed |
1.45%/2.35% 3.8% self-employed |
Bill: PPACA, Reconciliation Act; Page: 2000-2003; 87-93
12. Tax on Medical Device Manufacturers ($20 bil/Jan 2013): Medical device manufacturers employ 360,000 people in 6000 plants across the country. This law imposes a new 2.3% excise tax. Exempts items retailing for <$100. Bill: PPACA; Page: 1,980-1,986
13. Raise "Haircut" for Medical Itemized Deduction from 7.5% to 10% of AGI($15.2 bil/Jan 2013): Currently, those facing high medical expenses are allowed a deduction for medical expenses to the extent that those expenses exceed 7.5 percent of adjusted gross income (AGI). The new provision imposes a threshold of 10 percent of AGI. Waived for 65+ taxpayers in 2013-2016 only. Bill: PPACA; Page: 1,994-1,995
14. Flexible Spending Account Cap – aka “Special Needs Kids Tax” ($13 bil/Jan 2013): Imposes cap on FSAs of $2500 (now unlimited). Indexed to inflation after 2013. There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children. There are thousands of families with special needs children in the United States, and many of them use FSAs to pay for special needs education. Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education. Bill: PPACA; Page: 2,388-2,389
15. Elimination of tax deduction for employer-provided retirement Rx drug coverage in coordination with Medicare Part D ($4.5 bil/Jan 2013) Bill: PPACA; Page: 1,994
16. $500,000 Annual Executive Compensation Limit for Health Insurance Executives ($0.6 bil/Jan 2013). Bill: PPACA; Page: 1,995-2,000
Taxes that take effect in 2014:
17. Individual Mandate Excise Tax (Jan 2014): Starting in 2014, anyone not buying “qualifying” health insurance must pay an income surtax according to the higher of the following
|
|
1 Adult |
2 Adults |
3+ Adults |
|
2014 |
1% AGI/$95 |
1% AGI/$190 |
1% AGI/$285 |
|
2015 |
2% AGI/$325 |
2% AGI/$650 |
2% AGI/$975 |
|
2016 + |
2.5% AGI/$695 |
2.5% AGI/$1390 |
2.5% AGI/$2085 |
Exemptions for religious objectors, undocumented immigrants, prisoners, those earning less than the poverty line, members of Indian tribes, and hardship cases (determined by HHS).Bill: PPACA; Page: 317-337
18. Employer Mandate Tax (Jan 2014): If an employer does not offer health coverage, and at least one employee qualifies for a health tax credit, the employer must pay an additional non-deductible tax of $2000 for all full-time employees. Applies to all employers with 50 or more employees. If any employee actually receives coverage through the exchange, the penalty on the employer for that employee rises to $3000. If the employer requires a waiting period to enroll in coverage of 30-60 days, there is a $400 tax per employee ($600 if the period is 60 days or longer).Bill: PPACA; Page: 345-346 Combined score of individual and employer mandate tax penalty: $65 billion/10 years
19. Tax on Health Insurers ($60.1 bil/Jan 2014): Annual tax on the industry imposed relative to health insurance premiums collected that year. Phases in gradually until 2018. Fully-imposed on firms with $50 million in profits. Bill: PPACA; Page: 1,986-1,993
Taxes that take effect in 2018:
20. Excise Tax on Comprehensive Health Insurance Plans ($32 bil/Jan 2018): Starting in 2018, new 40 percent excise tax on “Cadillac” health insurance plans ($10,200 single/$27,500 family). Higher threshold ($11,500 single/$29,450 family) for early retirees and high-risk professions. CPI +1 percentage point indexed. Bill: PPACA; Page: 1,941-1,956
This “tax” is under everyone’s radar. It has never been mentioned in the traditional mainstream media. It is the tax on Seniors who are on Medicare.
$120.20 in 2013
$247.00 in 2014."
All seniors are means tested. This means the greater your income from any source including work income, pension income, capital gains and interest or dividend income the higher the baseline premiums become.
This “tax” had been decided by a Democratic controlled congress that had not read the bill or understood all of its consequences.
These are provisions incorporated in the Obamacare legislation, purposely delayed so as not to anger seniors during President Obama’s 2012 Re-Election Campaign.
Please send this blog to everyone you know and their children. It is important for them to know that President Obama is throwing seniors under the bus. Obamacare must be repealed.
Everyone must stay focused. President Obama is going to try to change the conversation and create a diversion to the facts.
Some of these taxes have already gone into effect. If the Republicans win the House and the Senate as well as the Presidency, Obamacare must be repealed.
Everyone interested in America’s economic future must tell a friend to repeal these crippling taxes. President Obama has deceived Americans with Obamacare and its new taxes.
It is time for everyone to get angry and give control of the House and Senate to the Republicans in November.”
It is difficult for Americans to comprehend all of these taxes. It is important for our surrogates that begged us to elect them to understand these taxes and act on our behalf.
The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone
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