The Homa Files

Ken’s Take: I’m a big fan of the so-called Cadillac tax — not because it hacks off the unions (that’s a lucky strike by-product) — but because it it about the only vehicle being discussed that might contain some healthcare costs. 

In fact, I’m an advocate of putting all company paid premiums on W-2s and then allowing taxpayers reasonable deductions for health insurance premiums (say, $5,000 per person).

And, as a political junkie, I love when WH spokepeople contradict each other, e.g. Summers: recession is over”, Romer: “no, it’s not”.  Here’s another example …

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Excerpted from WSJ: White House v. White House,  Dec.18, 2009 

The ad hoc arguments that WH spokesmen use to put out one healthcare political fire invariably contradict those they’re using to put out another.

Among labor’s complaints is a 40% excise tax on high-cost insurance plans, given that union-negotiated benefits are more generous than average.

So Jason Furman, the deputy economic director, declared that this so-called Cadillac tax “will affect only a small portion of the very highest cost health plans — a total of 3% of premiums in 2013.”

But wait: White House budget director Peter Orszag has been emphasizing the excise tax as critically important in the cost-control stone soup that he’s been trying to sell.

As he put it earlier this month, “You’re creating an incentive for plans for employers to design their plans in such a way that they’re under that threshold. . . . You’re creating an incentive to slow the growth rate in private health costs.”

So a tax that applies to 3% of premiums is going to reshape the entire health-care market? These guys can’t even get their blog posts straight.

The White House brain trust seems to have been placed in a blind trust, and is finding it so hard to make a coherent case.

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Mr. Furman used to advocate policies that really would make a difference, by “helping consumers become more cost conscious about their health-care choices,” as he put it in a 2007 Brookings paper. He estimated that increasing cost-sharing could lower total health spending from 13% to 30%.

Full article:
http://online.wsj.com/article/SB10001424052748704238104574602191760050978.html?mod=djemEditorialPage

This entry was posted on December 18, 2009 at 7:45 am and is filed under Health Care / Medical Insurance, Obama Administration. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.