While this column has been quiet due to other priorities (like working so that the mortgage is paid, and volunteering so that others may improve their lot in life), it doesn’t mean we haven’t been watching the wankers in Washington as they continue their dangerous attempts to complete the progressive’s long-planned enslavement of the citizens of these United States. Indeed, our silence is due, in part, to head-shaking amazement that writing fresh material for this column becomes harder and harder because every day has become Groundhog Day. President “I Won” continues to use our hard-earned tax monies to hump his campaign stump; appearing on television almost every day in order to jolly Americans into thinking he’s just a normal guy via some talk show or to actively campaign for Democrat candidates in upcoming elections around the country. Speaker of the Nuthouse, Nancy Pelosi, hasn’t stopped her deer-in-the-headlights, utterly non-sensical evasion of legitimate questions; like, for example, exactly where in the Constitution does it give Congress the power to, among other oversteps, mandate health care be purchased by every American?
And true to their lying form, “the most transparent administration in history”, this legend-in-their-own-minds gang of thugs and thieves, scuttled off like the rats they are and locked themselves into an obviously airless room in order to poke and prod and breathe some semblance of life back into deadly, massive HR 3200, their first blatant, sweeping attempt at the usurpation of the private-sector, free market-driven business of American health care. What came out of that headlong rush into madness is HR 3962. A veritable Frankenstein’s monster at 1,990 pages and about 400,000 words, this latest incarnation of mandated submission to government welfare is designed to take over and, as is the case with anything run by the government, annihilate a full ONE-FIFTH of the nation’s economy.
It is a monster only progressives and idiots could love. Like its predecessor, HR 3962 sets up a financial shell game by front-loading revenue and postponing serious spending to later years (years when those who would otherwise be called on the carpet for such reckless misuse of hard-earned taxpayer monies will be far away, enjoying their taxpayer-funded retirements). It contains 13 tax hikes that will hit everyone one way or another:
Employer Mandate Excise Tax (Page 275): If an employer does not pay 72.5 percent of a single employee’s health premium (65 percent of a family employee), the employer must pay an excise tax equal to 8 percent of average wages. Small employers (measured by payroll size) have smaller payroll tax rates of 0 percent (<$500,000), 2 percent ($500,000-$585,000), 4 percent ($585,000-$670,000), and 6 percent ($670,000-$750,000).
Individual Mandate Surtax (Page 296): If an individual fails to obtain qualifying coverage, he must pay an income surtax equal to the lesser of 2.5 percent of modified adjusted gross income (MAGI) or the average premium. MAGI adds back in the foreign earned income exclusion and municipal bond interest.
Medicine Cabinet Tax (Page 324): Non-prescription medications would no longer be able to be purchased from health savings accounts (HSAs), flexible spending accounts (FSAs), or health reimbursement arrangements (HRAs). Insulin excepted.
Cap on FSAs (Page 325): FSAs would face an annual cap of $2500 (currently uncapped).
Increased Additional Tax on Non-Qualified HSA Distributions (Page 326): Non-qualified distributions from HSAs would face an additional tax of 20 percent (current law is 10 percent). This disadvantages HSAs relative to other tax-free accounts (e.g. IRAs, 401(k)s, 529 plans, etc.)
Denial of Tax Deduction for Employer Health Plans Coordinating with Medicare Part D (Page 327): This would further erode private sector participation in delivery of Medicare services.
Surtax on Individuals and Small Businesses (Page 336): Imposes an income surtax of 5.4 percent on MAGI over $500,000 ($1 million married filing jointly). MAGI adds back in the itemized deduction for margin loan interest. This would raise the top marginal tax rate in 2011 from 39.6 percent under current law to 45 percent—a new effective top rate.
Excise Tax on Medical Devices (Page 339): Imposes a new excise tax on medical device manufacturers equal to 2.5 percent of the wholesale price. It excludes retail sales and unspecified medical devices sold to the general public.
Corporate 1099-MISC Information Reporting (Page 344): Requires that 1099-MISC forms be issued to corporations as well as persons for trade or business payments. Current law limits to just persons for small business compliance complexity reasons. Also expands reporting to exchanges of property.
Delay in Worldwide Allocation of Interest (Page 345): Delays for nine years the worldwide allocation of interest, a corporate tax relief provision from the American Jobs Creation Act
Limitation on Tax Treaty Benefits for Certain Payments (Page 346): Increases taxes on U.S. employers with overseas operations looking to avoid double taxation of earnings.
Codification of the “Economic Substance Doctrine” (Page 349): Empowers the IRS to disallow a perfectly legal tax deduction or other tax relief merely because the IRS deems that the motive of the taxpayer was not primarily business-related.
Application of “More Likely Than Not” Rule (Page 357): Publicly-traded partnerships and corporations with annual gross receipts in excess of $100 million have raised standards on penalties. If there is a tax underpayment by these taxpayers, they must be able to prove that the estimated tax paid would have more likely than not been sufficient to cover final tax liability.
Note for the record that those individuals paying the “individual mandate” tax don’t get anything for their money. It is a penalty, cleverly set up to be enforced (as a criminal liability) by the IRS. Those folks still have to buy health insurance, and the government’s option contains higher premiums that low- and moderate-income individuals and families would have to pay for health coverage to avoid the tax.
Like its predecessor, HR 3962 includes yet another uncontrolled and unaccountable czar who will determine the requirements for health insurance policies. For ALL health insurance policies; which means, as before, if your employer’s plan doesn’t meet the czar’s requirements, it will be determined to be illegal and you will be forced to make another “choice”. Read: take the government’s plan.
Of course, mandating requirements that are unsustainable, such as no exclusions for pre-existing conditions and specific items and services than must be covered as well as the minimum frequency or duration of a required covered service and the maximum allowable patient cost sharing, sets the stage for failure of the free market. The government will simply regulate the free market for health insurance out of existence. Leaving you with no choice but what the government wants to give you.
And with that lack of choice must, by definition, come rationing. The same rationing that exists in the free market and with welfare programs like Medicare and Medicaid today, though the former driven (and therefore avoidable) by consumer choice and the latter driven by its inherent purpose of pulling the unsuspecting under the control of the government for the gains of a few who consider themselves above those they see as the stupid, great unwashed masses (citizens of these United States whom they are, by oath, supposed to represent).
There’s nothing new in this warmed-over, dung-filled bowl of swamp water soup. Those who work hard and play by the rules are going to continue to pay for those who buy into the progressive mindset that they are entitled to something for nothing for the price of their freedom.
HR 3200 was wrong. Its latest incarnation as HR 3962 does nothing to fix any problems and, indeed, only serves to make them worse.
I added your blog to bookmarks. And i’ll read your articles more often!