Senate Finance struggles with health reform funding options

While some of the more contentious health reform issues may be put aside, for the time being at least, one that still haunts Senate Finance Committee members is how to pay for all of the good stuff. Right now, the committee is reportedly considering an increase in taxes on so-called "Cadillac" health plans, new fees on health-related industries and limits to tax benefits of flexible savings accounts, but doesn't seem to have settled on any one of these options.

The idea of taxing pricier health plans does seem particularly tricky, however. Sen. Max Baucus (D-Mont.) and other Dems are looking at a 35 percent tax on plans worth more than $8,000 for individuals and $21,000 for families. There's some talk of raising the tax percentage and threshold, but that plan has met opposition from Sens. Debbie Stabenow (D-Mich.) and John Kerry (D-Mass.), who say these plans would hurt "high risk" workers such as coal miners.

Meanwhile, Senators continue to debate how to make sure middle-class Americans can afford health insurance and protect them against excessive penalties when they can't pay. One option under discussion is to phase in a planned penalty for not obtaining coverage, rather than imposing it immediately, as well as setting exemptions to the penalty if it would be more than 7 percent of family income. (The bill had previously proposed a 10 percent level.)

To learn more about this debate:
- read this Bloomberg report
- check out this New York Times blog
- here's another Bloomberg piece

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