Senate Democrats' plan to overhaul health came in longer but cheaper than many people expected Wednesday. Still, with a cost of $849 billion and 2,074 pages of legalese, it's a bear of a bill to digest.
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Sen. Harry Reid unveils his plan for health overhaul.
Sen. Harry Reid unveils his plan for health overhaul. Win McNamee/Getty Images
Senate Majority Leader Harry Reid, principal architect of the legislation that melds the work of two Senate committees, got creative to pay for the proposed expansion of health coverage, estimated to reduce the ranks of the uninsured by 31 million over a decade.
Here are some of the ways he plans to raise the dough:
- A "botax": Brace yourselves, denizens of Hollywood, Miami and Park Avenue, for a 5 percent tax on elective cosmetic procedures and surgery. Doesn't matter if you pay out of pocket or have insurance coverage, the tax applies across the board. Details start on page 2045 of the bill. Could raise$5.8 billion over a decade.
- Increase in Medicare payroll tax: Adds half a percent to the Medicare payroll tax for the well-to-do. Individuals making more than $200,000 a year and couples making more than $250,000 would have to pay 1.95 percent in Medicare taxes instead of 1.45 percent. The tax hike could raise $53.8 billion over 10 years.
- Taxes on "Cadillac" health plans: If the insurance you get on the job has premiums of $8,500 or more for individual coverage or $23,000 for the family, then Reid wants to slap a 40 percent excise tax on the plans. The thresholds are higher than those proposed by the Senate Finance Committee of $8,000 for individuals and $21,000 for a family.
For the official cost and savings scorecard, see the letter the Congressional Budget Office fired off to Sen. Reid Wednesday.
Update: For a rundown of the taxes in the Senate bill, check out this summary from the Joint Committee on Taxation. Hat tip to WSJ Health Blog. The grand total, by the way, comes to $371.9 billion over 10 years.