President Obama’s health care reform package was just a week old when it started to cost taxpayers more money.
By signing the reconciliation bill last Tuesday—the last step in his legislative two-step—the president raised the price of the original health care reform measure by $65 billion, to $940 billion over the next decade.
Reform is indeed necessary, as health costs are spiraling out of control. But this “reform” bill does nothing to stop the spiral. In fact, it burdens Americans with billions in new taxes just when they—and the economy—can least bear them.
Let’s take a look at some of the health care bill’s most onerous levies.
Take the increase in the Medicare payroll tax. Starting in 2013, individuals with incomes over $200,000 a year and families making more than $250,000 will see their payroll taxes rise from 1.45 to 2.35 percent.
These individuals and families will also be burdened by an entirely new tax—a 3.8 percent Medicare tax on interest, rental income, capital gains, and dividend income.
In one fell swoop, Democrats are punishing upwardly mobile families and discouraging them from saving. A substantial number of small businesses will also face these taxes. Money that could have gone to creating jobs or investing in their firms will instead be siphoned off by Washington.
With these two new job-killing taxes, don’t expect the recession to end any time soon.
These aren’t the only tax hikes scheduled for 2013. The bill halves the amount of money people can set aside in Flexible Spending Accounts for routine medical expenses, from $5,000 to $2,500. And people who face catastrophic health care expenses in a given year will not be permitted to deduct as much from their taxes.
These changes hurt the middle- and lower-class people the president claims he wants to help. After all, half of those who take advantage of the medical-expense deduction make less than $50,000 a year.