Raising Women’s Voices

Health Care and the States: Effects of the stimulus package

Posted in Affordability by raisingwomensvoices on March 6, 2009

The American Recovery and Reinvestment Act of 2009, a $789 billion economic stimulus bill, was signed into law by President Obama on February 18.  The bill includes an $87 billion provision to help states cover rising Medicaid costs, and allocates additional funds to aid states in subsidizing coverage options for the unemployed and furthering investment in health information technology.

The Commonwealth Fund has an in-depth analysis of expected effects of federal aid to states for the provision of increasingly expensive health care in the midst of tightening budgets everywhere.  The document also takes a look at the state-by-state impact of the Children’s Health Insurance Program (CHIP) Reauthorization Act of 2009, which will provide $32.8 billion through 2013 to cover 6.5 million more children under Medicaid and CHIP.

Some highlights below, but you’ll have to check this out for the full story.

  • Under the Consolidated Omnibus Budget Reconciliation Act (COBRA), laid-off workers are allowed to buy into their former employers’ health plans, but studies show that only 9% of those eligible take advantage of COBRA.  The stimulus package provides a federal subsidy to cover 65% of COBRA premiums for up to nine months for people who have lost their jobs.
  • CHIP Reauthorization gives states the option to cover pregnant women with CHIP funds; eliminates the federal five-year waiting period previously imposed on legal immigrant children and pregnant women in Medicaid or CHIP; and establishes a new Medicaid commission, similar to the Medicare Payment Advisory Committee, to evaluate children’s access to care and payment policies in Medicaid and CHIP.

Obama to fund improved health care with taxes on the wealthy

Posted in Uncategorized by raisingwomensvoices on March 6, 2009

President Obama announced his plan to raise half of the proposed $634 billion “reserve fund” for health care reforms off the revenue generated from reduced tax breaks on the wealthiest Americans.  Specifically, he will lower the value of itemized tax deductions for everyone in the 35% income tax bracket and for many in the 33% bracket.

Under existing law, the tax benefit of itemizing deductions rises with a taxpayer’s marginal tax bracket (the bracket that applies to the last dollar of income). For example, $10,000 in itemized deductions reduces tax liability by $3,500 for someone in the 35 percent bracket.

Mr. Obama would allow a saving of only $2,800 — as if the person were in the 28 percent bracket.

The White House says it is unfair for high-income people to get a bigger tax break than middle-income people for claiming the same deductions or making the same charitable contributions.

Balancing a lop-sided tax code, from which the wealthiest members of our society have been benefiting at the expense of millions of uninsured Americans for years, sounds to me like a good place to start.

Read last week’s NYT article on the plan.