Word from the White House: Common Ground on Health Insurance Reform & The Real Health Care Tax

TUESDAY, SEPTEMBER 29TH, 2009 AT 10:39 AM
Word from the White House: Common Ground on Health Insurance Reform & The Real Health Care Tax
Posted by Jesse Lee
It's no secret that institutions of all stripes focus their communications on certain messages day to day. We thought it would all be a little more open and transparent if we went ahead and published what our focus will be for the day, along with any related articles, reports or documents.

Supporting article: "Study: Insured pay 'hidden tax' for uninsured health care," USA Today, 5/29/09

Supporting report: "Hidden Health Tax' for Family Health Coverage Climbed to $1,017 in 2008," Families USA, 5/28/09



Talking Points: Common Ground on Health Insurance Reform

· As we continue to move closer and closer to reform, one encouraging sign is the striking degree of consensus between the various bills making their way through Congress.

· The common features in these bills underscore the level of fundamental agreement about what health insurance reform should look like and offer a clear outline of what it will mean for Americans:

Ø Unprecedented security and stability
o Each bill would put an end to some of the insurance industry’s worst practices, like denying you coverage because of a pre-existing condition, or dropping or watering down your coverage when you get sick and need it most.

Ø Expanded access to affordable care
o Each bill would provide affordable options by creating an exchange where you can leverage the purchasing power of a large group to get reasonable prices and choose the option that’s best for you and your family.

Ø Lower costs for all Americans – including seniors
o Each bill would increase choice and competition in the health care market.
o For seniors, each would protect and strengthen Medicare while making prescription drugs more affordable in the "donut hole."

Ø Improving quality of care by bolstering prevention and primary care
o Each bill invests in both prevention and building the workforce of primary care providers.
o Insurance companies would be required to fully cover preventive care and checkups.


Talking Points: The Real Health Care Tax

· Not surprisingly, as health insurance reform continues to gain momentum, its opponents continue to hurl baseless attacks in the hopes that something will stick.

· The latest en vogue assault in their last-ditch effort to preserve the status quo is an alleged tax that reform will impose on middle-class families.

· But here’s the reality: Right now, under the system they wish to preserve, hundreds of millions of Americans who get insurance through their job or buy it on their own are paying a hidden tax of $1,000 to cover the costs of caring for Americans without health insurance.

· And that figure is growing by the day as more and more people lose their insurance.

· What President Obama is proposing is not a tax, but a requirement to comply with the law.
o People are required to obey the speed limit and have to pay a penalty if they get caught speeding? Does anyone consider that a tax?
o People are required to have car insurance and can be fined if they are caught without it. Is that a tax?
o What we’re talking about is a penalty for the few people who will refuse to buy health insurance – even though they can afford it – and who expect the rest of us to pick up the tab for their care.

Q: But what about the fees on insurance companies, drugmakers, devicemakers? Won’t that be passed on to consumers as a hidden tax?

A: No, for at least three reasons:

1. First, the fees are lump sum, not per unit, so you should not expect that manufacturers will pass them on.
o Do critics really think the drug companies are holding back their prices today out of the goodness of their hearts and would decide to raise them to make up for this lump sum - but couldn't raise them today to get higher profits?

2. Second, these fees are intended to recapture part of the benefits these businesses will get from reform, as they acquire tens of millions of new customers.
o If you believe the lump sum tax put pressure on them to raise prices, then the fact that they are getting lots of revenue from new customers will reduce that pressure.

3. Third, the fees are all going to ensure that we are increasing the numbers getting affordable coverage and thus reducing the $1,000 hidden tax that millions of Americans pay for the uncompensated care of the uninsured.
o So even if you believed that somehow companies would find a way to pass them along, that would be more than outweighed by the benefits middle-class families would get from not only hundreds of billions of dollars in health care tax credits but from reducing the hidden tax they currently pay for the uninsured.