July 16th, 2009
06:03 PM ET
5 years ago

Senate Dem criticizes Obama opposition to taxing health benefits

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 Sen. Max Baucus said Thursday 'the president is not helping us.'
Sen. Max Baucus said Thursday 'the president is not helping us.'

WASHINGTON (CNN) – President Barack Obama's opposition to taxing employer-provided health benefits has slowed progress on passing a health care reform bill, the chairman of the Senate Finance Committee complained Thursday.

"Basically, the president is not helping us," said Sen. Max Baucus, D-Montana, after emerging from closed talks on the bill.

Baucus' criticism came on the same day the head of the non-partisan Congressional Budget Office said the health reform bills moving through Congress won't reduce long-term health care costs - in part because the bills don't include taxes on health benefits.

The comments by CBO Director Douglas Elmendorf provided ammunition for Republican opponents of the two Democratic-sponsored measures made public so far - one passed Wednesday by the Senate Health, Education, Labor and Pensions (HELP) Committee and one proposed this week by House Democrats.

"I don't see any Republicans that have any interest in voting to ration care for their constituents, raise costs to their constituents, and put the federal government in charge of the best health care system in the world," said House Minority Leader John Boehner of Ohio.

In the Senate, Baucus is one of seven bipartisan members of the Senate Finance Committee who have been meeting for weeks trying to negotiate health care reform. Taxing the employer-provided benefits - which are currently excluded from taxation - had been the principal way Baucus wanted to raise $320 billion to help pay for the trillion-dollar health overhaul.

It was also considered a key way to reduce costs because tax-free benefits encourage more spending on health care, many experts believe.

"With the tax exclusion off the table, it's difficult to come up with revenue measures and other savings measures," Baucus said. "We are clearly going to find ways to bend the cost curve in the right direction. That is, include provisions that actually vary the rate of increase in health care costs."

White House spokesman Bill Burton said Obama was committed to "getting stakeholders to the table, finding different ways to save money and produce the revenue that we need for comprehensive health care reform."

"Once we get something through the House and through the Senate, we'll be able to go to conference and really put the rubber to the road and get something done," Burton said, referring to a conference committee comprising members of both chambers that would create a compromise bill.

Testifying earlier on the long-term budget outlook, Elmendorf said trying to lower costs without taxing benefits was like "tying one of the two hands behind one's back."

Senate Majority Leader Harry Reid bluntly dismissed Elmendorf for appearing to take a position on a political issue.

"What he should do maybe is run for Congress," Reid said.

Rep. Mike Ross, D-Arkansas, a key leader of the conservative Democratic group known as Blue Dogs, told reporters he shares Elmendorf's concerns, saying: "That's what we've been trying to tell everyone for three months."

Ross said opposition to the initial Democratic plans for health care reform has extended beyond his group to other Democrats.

"No way they can pass this bill on the House floor now," he said. "No way. Not even close."

Boehner leveled particular criticism at proposed tax surcharges on the wealthy contained in the House bill. The surcharges intended to raise $550 billion over 10 years start at 1 percent for people reporting income of more than $350,000, go to 1.5 percent for those with income of more than $500,000 and climb to 5.4 percent for those with income of more than $1 million.

"This will kill jobs in America and make it more difficult for people to hire more people," Boehner said, adding that the measure would harm small business owners. "You just can't continue to tax employment and tax employers and think you're going to get more jobs. It doesn't work that way."

House Speaker Nancy Pelosi of California said Thursday she would willing to lower the amount of the surtaxes if more savings from proposed reforms can cover the cost of the bill.

"If we can get more savings, we can perhaps lower the percentage that the high end will pay," Pelosi said at her weekly press conference.

But Pelosi made it clear that Democrats still plan to tax the rich and said if the money isn't needed to pay for health care it would be directed at the nation's budget deficit.

"There is going to be a revenue change at the high end," she said. "It will be directly to reduce the deficit or to reduce the deficit by helping to cover the cost of this initiative."

Pelosi also said she is willing to make further cost-cutting changes to the bill to satisfy the Blue Dog Democrats such as Ross.

soundoff (60 Responses)
  1. Tatianna

    Note to Reid: Elemendorf is head of the NON-PARTISAN Congressional Budget Office. You would love nothing more if he were a partisan hack. Too bad, people like you place party over important issues facing our nation.

    July 16, 2009 09:58 pm at 9:58 pm |
  2. Skiwee

    What about taxing soda, artifical fruit juices and things of that nature? Wouldn't that also possibly help in preventative measures towards good health?

    I do believe the US is just about one of the only major countries in the world that don't tax such items. Gee in Ontario Canada the sales tax on just about everything is 13 or 14%

    July 16, 2009 10:11 pm at 10:11 pm |
  3. The Truth

    lolol....man, what a bunch of clowns these democrats are. But, either way, the only thing they are disagreeing on is exactly which method to use to separate us from our money.

    Wake up democrats, you are being taken for fools again by your leaders.

    July 16, 2009 10:12 pm at 10:12 pm |
  4. Keith in Austin

    Baucus's political career will go down in flames along with the other liberal beaurocrats hell bent to laden the American taxpayers with higher payments. Wait and see the Congressional seats the Democrats lose in 2010. The leadership is causing a true implosion!

    July 16, 2009 10:16 pm at 10:16 pm |
  5. DJ, Los Angeles

    nonsense...Max is just so wrong on this. taxing benefits is not the solution. raise taxes on soda pop, cut spending in other areas, continue negotiating with hospitals, are among other possibilities. Max wants to do what John McCain suggested...DO NOT tax middle class Americans!

    July 16, 2009 10:26 pm at 10:26 pm |
  6. Tom

    Big John Boehner:

    "I don't see any Republicans that have any interest in voting to ration care for their constituents, raise costs to their constituents, and put the federal government in charge of the best health care system in the world," said House Minority Leader John Boehner of Ohio.

    – Care is rationed TODAY... bu the insurance companies... if you're coverage gets dropped, or you change jobs, or you get sick, and then need to change plans... you CAN'T DO THAT
    – Insurance companies tell you what you can and can't get covered for TODAY.
    – Insurance companies have raised rates 3x in the last 10 years.
    – The Feds will NOT be in charge... there will only be a PUBLIC OPTION to compete alongside the private plans.
    – "Best Health Care System in World"? Please. We rank 36th in the world or lower in almost all studies based on quality of care, cost of care, and number of people covered.

    Alright, I give, the sky is green, and down is up, just because Boehner and Rush and Hannity tell me so, every day, all day.

    July 16, 2009 10:41 pm at 10:41 pm |
  7. Abner

    Its a loser deal but what do you expect from the Obama secular welfare state. Spread the wealth and carry the lazy.

    July 16, 2009 10:45 pm at 10:45 pm |
  8. 4 and the door

    Yeah, Senator Baucus. Think how much more money we could spend on Health Care For Everyone(!) if we could just tax tax tax tax tax some more!

    July 16, 2009 10:49 pm at 10:49 pm |
  9. harold

    THE best health care system in the.. world...You including all the 50 million wihtout health care coverage..you creep?

    July 16, 2009 11:03 pm at 11:03 pm |
  10. Gary

    The Democrats in congress have a completely wrong approach to healthcare...we need solutions that:

    1. Incorporate malpractice reform.
    2. Do not involve tax increases on anyone.
    3. Encourages employers to provide insurance rather than punishes them for not providing coverage.
    4. Covers catastrophic medical costs but leaves the most basic care to the patients so that they feel the cost and therefore make more rational choices about their own cost/benefit trade offs.
    5. Brings more Doctors (immigration or training) – – this reduces wait times and lowers provider pay via market forces
    6. Requires working as a precondition to any participation in government subsidized programs – – we can not continue to had benefits to lazy people who won't work.
    7. An emphasis on preventative health and lifestyle issues to prevent or delay expensive diseases.
    8. No government run insurance – – private organizations alway are more efficient than government and they keep the politic out of our healthcare decision.

    July 16, 2009 11:08 pm at 11:08 pm |
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