Tuesday, April 05, 2011

I don't want to say I told you so, but....

Updated When the health insurance "reform" was being debated, one of the arguments offered in support was that despite its obvious shortcomings, it was a "good start" on which we would build over time. In response, others - I was among them - noted that the same arguments were made 45 years earlier on behalf of Medicare and Medicaid: They, too, were "first steps" that were sure to be followed with others, others which never came.

Instead, those other voices declared (and again I was among them), future efforts would not go toward improving the system but to defending it, not toward expansion but merely against retraction and that the pressure for changes would not come from the advocates for better access to health care but from those whose goal is forever to move backwards. I was reminded of that by the news that
Congress is poised to send the White House its first rollback of last year's health care law, a bipartisan repeal of a burdensome tax reporting requirement that's widely unpopular with businesses. Even President Barack Obama is eager to see it gone.
Present tax law requires business to file 1099s with the IRS when they purchase more than $600 in services from a vendor in a year. Under the new provision, in 2012 that would be extended to include the purchase of goods. It was intended to ensure vendors pay their taxes and was expected to raise about $25 billion over the next decade to help pay for the costs of the health insurance reform system.

But we can't have that! It's "burdensome!" It'd create "a paperwork nightmare!" Businesses are "already swamped by government paperwork!" No, no, a thousand times no! A nice bipartisan expression of support for business.

And how is the revenue to be made up?
[B]y changing another part of the health care law, requiring more families to repay tax credits designed to help them cover insurance premiums, if their incomes increase beyond certain levels.
The new law says that starting in 2014, low- and middle-income families will be eligible for tax credits to help pay for health insurance if they don't get insurance through their employers. According to the NY Times' "You're the Boss" blog, the credits are paid in advance with the amount based on prior years' income tax returns. If a taxpayer earns more than expected and so gets a bigger credit than they were supposed to, they have to repay part of it. The bill which passed today would require more people to repay more of the credit, which is expected to make up the $25 billion lost by changing the reporting requirements for businesses.

So let's recap: Congress and PHC* are about to relieve businesses of a "burden" (any cost of which, let it be noted, is a tax-deductible business expense) and thereby enable vendors to continue to get away with underpaying their taxes to the tune of billions a year, openly and avowedly by shifting the cost - one which is apparently not considered a burden - on to the shoulders of the poor and the workers who have the temerity to somewhat improve their economic condition.

I doubt even Ezra Klein is going to be able to spin that into a victory for better health care.

Updated to clarify how the credit works.

*PHC = President Hopey-Changey

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