Baucus health care plan relies on tax hikes, new fees

Chris Rizo Sep. 16, 2009, 3:00pm

Max Baucus (D)

WASHINGTON (Legal Newsline)-- U.S. Sen. Max Baucus on Wednesday unveiled his $856 billion much-anticipated plan to overhaul the nation's health care system.

Baucus, the Democrat from Montana and chairman of the Senate Finance Committee, introduced his 10-year-plan with no support from Republicans, whom he has been courting.

His plan would, among other things, require most people to purchase insurance coverage or pay a fine. The plan would also bar insurance companies from charging higher premiums to people with health problems.

"The Finance Committee has carefully worked through the details of health care reform to ensure this package works for patients, for health care providers and for our economy," Baucus said.

Under his plan, consumers would be able to buy insurance plans in a new exchange, and the Medicaid program for lower-income Americans would be expanded to offer subsidies to help people buy coverage.

Additionally, the bill would bar illegal immigrants from obtaining health coverage through the new insurance exchanges by enacting a verification system to make sure people buying insurance in the exchanges are either U.S. citizens or legal immigrants.

Unlike President Barack Obama's health care proposal, Baucus' plan does not include a government-run insurance plan -- and idea supported by most House Democrats.

To pay for the program, Baucus proposes $507 billion in cuts to government health programs and $349 billion in new taxes and fees, including a new excise tax on insurance plans worth more than $8,000 for singles and $21,000 for families.

Also facing new taxes and fees under the proposal are insurers, pharmaceutical companies, medical device makers and clinical labs.

Drug companies would face an annual levy of $2.3 billion, medical device manufacturers would pay $4 billion, while health care insurers would pay $6 billion -- apportioned according to a company's market share.

"This is a good bill. This is a balanced bill," Baucus said.

Not so, said Senate Minority Leader Mitch McConnell, R-Ky, who has also been critical of Obama's health care plan.

"Americans don't think a bigger role for government in health care would improve the system," he said. "Yet despite this, every proposal we've seen would lead to a vast expansion of the government's role in the health care system."

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