Medicare prescription drug bill just another tax shelter for wealthy

[Guest guest]

> Unnecessary Measures

>

> Thursday, November 13, 2003; Page A30

>

> GIVEN THAT IT'S usually referred to as the " Medicare prescription drug

> bill, " most people assume the main purpose of the large health care

bill --

> now the focus of acrimonious House and Senate negotiations -- is to add

> prescription drugs to the services provided by Medicare. Why, then, has

> House Speaker J. Dennis Hastert (R-Ill.) been quoted as saying that " one

of

> the most important pieces " of this bill is a measure that has nothing to

do

> with Medicare.

>

> Mr. Hastert was referring to a measure to create " health savings accounts "

> -- tax-free savings accounts for medical expenditures. These accounts are

> intended to be used by anyone, not just those eligible for Medicare.

> Originally, House members wanted the measure to provide $163 billion worth

> of tax relief. Negotiations have whittled the measure to a mere $6

billion,

> according to some, partly by making the accounts available only to people

> who use at least a portion of the money to purchase high-deductible health

> insurance policies -- a proposal that makes the accounts attractive only

to

> those in good health and those with spare cash to stash away. The

reduction

> in funding may make what was already a dubious proposition even worse.

>

> The principle behind the medical savings accounts is a good one: Over

time,

> this country should find a way to move from an employer-based health care

> system to one that allows people to carry health insurance from job to

job.

> In practice, however, removing a small pool of what will be relatively

> wealthy and healthy people from the employer-based insurance groups will

> serve only to increase the price of health insurance for everyone else.

> Several studies have found that premiums for comprehensive insurance could

> more than double if the use of such accounts became widespread. Some in

> Congress, such as Sen. John Breaux (D-La.) -- a longtime supporter of

> health care reform and a major influence on this bill -- have voiced their

> dislike of the provision precisely on those grounds.

>

> What Congress appears to be talking about -- along with a gaggle of

> interest groups -- is not a measure that would serve as a transition to a

> more sophisticated health care system but a particularly lucrative tax

> shelter for the rich; the medical savings accounts, in some versions of

the

> legislation, would allow people to invest as well as withdraw money

> tax-free. This almost unprecedented double tax break sets a bad model. It

> can only be construed as another piece of congressional fiscal

> irresponsibility.

> http://www.washingtonpost.com/wp-dyn/articles/A34411-2003Nov12.html

>