Oregon voters recently upheld a myriad of new taxes that were passed as part of a major health-care law last summer. The state government is planning to use the estimated $320 million in revenue to cover hundreds of thousands of residents who have enrolled through the Affordable Care Act. The outcome of this vote has serious implications anyone enrolled in a health-care plan in Oregon.
The referendum was on sections of House Bill 2391, which imposes a 0.7 percent tax on small hospitals as well as a 1.5 percent on individual and family health-care premiums. These revenue raisers are intended to generate more tax dollars for the state. But they also allow Oregon to receive $630 million to $960 million in federal Medicaid matching funds.
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The less-explored question involves why Obamacare’s overall combination of taxpayer subsidies, expanded insurance programs, health benefits requirements, AND coverage mandates had so much less of an effect than the law’s architects envisioned.
It turns out that many of the nominally uninsured still have other alternatives to health care than just through heavily-subsidized Medicaid and exchange-based insurance. You might call such uncompensated care either an option for “implicit insurance” or a hidden tax on acquiring more formal coverage.
Health policy researchers Amy Finkelstein, Neale Mahonem and Matthew Nolowidigdo unravel the puzzle in a recent National Bureau of Economic Research paper. They explain why there is less “demand” than expected for the increased “supply” of subsidized coverage for lower income individuals and more limited take up of subsidized coverage than once predicted.
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Congress is apparently not done cutting taxes, even after passing a $1.5 trillion tax overhaul last year.
The deal struck by Democrats and Republicans on Monday to end a brief government shutdown contains $31 billion in tax cuts, including a temporary delay in implementing three health-care-related taxes.
Those delays, which enjoy varying degrees of bipartisan support, are not offset by any spending cuts or tax increases, and thus will add to a federal budget deficit that is already projected to increase rapidly as last year’s mammoth new tax law takes effect.
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The House on Thursday night approved a stopgap measure to keep the government open less than 36 hours before a possible shutdown, shifting the drama to a Senate where Democrats are threatening to block the GOP bill.
The House measure includes a six-year extension of funding for the Children’s Health Insurance Program (CHIP), which expired at the end of September. States are at risk of running out of money to cover health care for children in low-income families.
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Because this exemption applies to employer-sponsored insurance but not individual coverage or out-of-pocket spending, it encourages group plans over consumer control. It should not be seen as sacred. However, the cap imposed by the Cadillac tax will become increasingly tight over time, which risks pushing Americans into public entitlements rather than empowering them as consumers. Policymakers should keep the Cadillac tax from biting too deeply — but a better way to end the tax bias toward employer-based plans would be to extend the tax exemption to health care that individuals purchase by themselves.
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House Republicans are considering adding a six-year extension of the Children’s Health Insurance Program (CHIP), as well as delays of certain ObamaCare taxes, to a short-term government funding bill this week, sources say.
The GOP’s new tax bill, which passed Congress on Wednesday afternoon after one last vote in the House of Representatives and will be signed by President Donald Trump, is also a health care bill. The tax bill does at least as much (if not more) to upend Obamacare, or the Affordable Care Act, than even all of the Trump administration’s thousand cuts to the health law over the past year by repealing the individual mandate. Which raises the question: Just what is the Obamacare individual mandate? And what does its repeal mean for Americans?
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The individual mandate repeal actually doesn’t take effect until 2019, Laszewski noted, “but I doubt many consumers knew that when they decided not to sign up during all of the news reports about the individual mandate being repealed.”
Thomas Miller, JD, resident fellow at the American Enterprise Institute, a right-leaning think tank here, sees the repeal as “more of a ‘mercy killing’ (putting it out of its chronically ineffective and unpopular misery),” he said in an email. As to whether more people will become uninsured if the mandate is repealed, “Self-serving claims by insurance sector interests and diehard ACA defenders that mandate repeal will trigger widespread disruption and despair in health care markets are vastly exaggerated, as long as other coverage subsidy dollars from taxpayers keep flowing. Good riddance to a half-hearted effort at trying to coerce some mostly less-affluent Americans into buying coverage they did not want, could not afford, or both.”
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Last November, the American people sent a message to Washington: Get things done. With Republican control of both chambers of Congress and the Oval Office, the time to enact pro-growth, pro-innovation policies that benefit American workers and businesses is now.
This month, Congress and the Trump administration have the opportunity to significantly boost one of America’s most vibrant and growing industries by suspending the federal excise tax on medical devices. This misguided tax is set to go back into effect on Jan. 1, which is why Reps. Jackie Walorski, R-Ind., and Erik Paulsen, R-Minn., recently introduced legislation that would suspend the medical device tax for five years.
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Republican lawmakers will overturn a key piece of the Affordable Care Act in their tax overhaul, a victory in a long GOP campaign against the health law.
Senate Majority Leader Mitch McConnell said the compromise tax bill from House and Senate negotiators will end the health law’s requirement that all individuals buy insurance or pay a fine.
The bill will “repeal Obamacare’s individual mandate tax, delivering relief to low- and middle-income Americans who have struggled under an unpopular and unworkable law,” the Kentucky Republican said in an emailed statement.
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