My colleague and fellow Virginian Rep. Eric Cantor e-mailed me Friday with a list of 10 things every person should know about the new healthcare bill that was unveiled last week. At 1,990 pages, the bill was written behind closed doors by a handful of people and the proposals in the bill never debated – the result is these concerning provisions:
1. It Still Raises Taxes on Small Businesses
Surtax
Individuals, including small business owners (who pay their business taxes at the individual level) making $500,000 ($1 million joint) will be hit with a 5.4 percent surtax.
Employer mandate still applies to small businesses
Small employers with a payroll as low as $500,000 will be hit with a tax.
(0 percent (<$500,000), 2 percent ($500,000-$585,000), 4 percent ($585,000-$670,000), and 6 percent ($670,000-$750,000)).
2. New Medical Device Tax
The bill includes a new 2.5 percent excise tax on the sale of a medical device in the United States. Some have taken to calling this the wheelchair tax as it will cover everything from bandages to prosthetics.
3. New Taxes on Health Savings Accounts
The bill eliminates the nontaxable reimbursements of over-the-counter medication from HSAs, HRAs, and FSAs.
4. New Payroll Tax
The bill creates a new “voluntary” payroll tax to fund new long-term care program—requiring mandatory spending—aka a new entitlement.
5. Abortions Are Authorized
In a break from the Hyde Amendment and other long-standing pro-life policies, the bill includes the Capps Amendment to authorize government funding of abortions through the public option. It also establishes an accounting gimmick to justify subsidizing private plans that cover abortion.
6. Members of Congress are Exempt from “Public Option”
The bill doesn’t require Members of Congress to enroll in the new government-run plan. Instead the language says the Members “may” enroll in the public option. In contrast the bill uses the word “shall” 3,425 times.
7. Doctors’ Reimbursement Levels Are Up in the Air / Budget Gimmicks
The new government-run plan will reimburse providers based on rates set by the government. “Negotiated rates” could start at Medicare and future rates could be set at levels below Medicare reimbursements. The Secretary of Health and Human Services could coerce doctors to participate in the program by tying participation to other government run health programs, like Medicare.
Removes the Medicare Doc Fix. The Pelosi bill does not include doc fix–instead it has been introduced as a standalone bill, unpaid for – meaning that Democrats’ proposals really aren’t deficit neutral.
8. Reduces Affordability Credits and Instead Expands Medicaid
The bill reduces the size of the affordability credits for patients to purchase the insurance in the exchange and instead expands eligibility for Medicaid to 150% of the federal poverty level—placing more Americans on entitlement programs at a cost to both the federal and state governments.
9. Significantly Changes the Medicare Part D Prescription Drug Program
The bill requires the Secretary of HHS to negotiate drug prices for the prescription drug program. There are also several provisions in the bill that will likely increase seniors premiums, as identified by CBO, including that the bill would force seniors to pay at least an additional 20 percent more for their Medicare prescription drug coverage (Part D).
10. Real Medical Liability Reform, Instead Rewards Trial Lawyers
The bill includes a new grant program to encourage states to implement alternative medical liability reforms like early offer or certificate of merit programs. However, a state is not eligible for the incentive payments if its law limits attorneys’ fees or imposes caps on damages—a key reform recognized by CBO as necessary to reduce defensive medicine.
Randy Forbes represents the Fourth District in the United States House of Representatives.
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