Here's an idea that is likely to create to a firestorm of criticism from those lucky enough to enjoy health coverage: A growing number of health reform plan leaders on the Hill are considering a plan under which the government would tax people who have high-priced health benefits from their employers to pay for those who have no coverage at all.
Right now, payments employers make to pay for a worker's health insurance aren't taxed as income, and employees pay their share of premiums with before-tax earnings. Proposals being discussed on the Hill would consider some of the value of this spending as income and tax it that way. Congressional estimates suggest such a tax could yield a whopping $100 billion over five years.
But analysts warn that while the idea may sound like a sweet and simple way to finance health reform, the plan could actually hit many workers hard who aren't affluent, and raise the cost of coverage further. Others suggest that such a tax could undermine the whole concept of an employer-based health insurance system.
To learn more about this proposal:
- read this piece from The New York Times