Calling All Red Staters…You Have 1,018 Pages To Read: Some Progress And We Need Your Help! A follow up to Swamp Yankee’s Column

Several of us in a thread to an excellent diary by Swamp Yankee: “Dear House Republicans and Conservative Activists: You Have 1,018 Pages To Read” decided to form an informal committee to read parts of the recently released Health Care Bill and post relevant material so at least one bill making it’s way through cCongress this year will be read before it’s voted on even if our Representatives even bother.

In the interest of full disclosure, due to business commitments cropping up at the last minute I will admit I have yet to do my part aside from writing this diary compiling the info gathered from those committed to reading the bill. I will be cutting and pasting in the work the others have done and then read a portion to post here in an update. With the bill being 1,018 pages long we need help. I’ve posted an index of the bill at the end of this and will mark the portions already read and co0mmented on in bold colors. If you are interested in helping us in this endeavor, please check the index and let me know in the thread which parts you would like to tackle. I’ll keep track of what’s already been covered so we don’t duplicate work.

For those who have already done a section, please do a commentary on the portion you read that covers items you found, what you believe will be the result, how they apply to the Constitutional roll of government and or any other opinions you’ve formed from reading your section.
I’m simply cutting and pasting in what other authors have written in the original thread with attribution so please don’t hold me responsible for inaccurate content but let us know if you identify any mistakes so we can debate and correct them as appropriate. I’ll also point out the excellent work done so far by thersites. His is by far the most comprehensive and is so packed with information to be studied and commented on.

Ok I read title one up to subtitle b
kyle8 Wednesday, July 15th at 4:16PM EDT

It gives out the usual definitions and then begins to describe what sort of plan will be accepted after the law comes into effect.

Essentially Employer based plans will be grandfathered in ONLY if there are no changes to the plan or premium increases. And only if the plan meets the minimum standards for the new “basic Plan” to be defined later in the bill.

Private plans will be disallowed unless they are part of the new national coverage. Here is the section;

{{(1) IN GENERAL.—Individual health insurance

2 coverage that is not grandfathered health insurance

3 coverage under subsection (a) may only be offered

4 on or after the first day of Y1 as an Exchange-par5
ticipating health benefits plan.}}.page 19

It also sets up a “Health Insurance Exchange” to become an authority over health insurance.

Sec. 102 “promise” to let you keep your current coverage. You didn’t expect them to acually let you keep it forever, did you?
ddstrain Thursday, July 16th at 1:58AM EDT

I’ve just read Section 102, which purports to preserve our right to keep our current health coverage. As far as I can tell, any such right is EXTREMELY limited and VAST numbers of people will start to be forced into the government plan on or about January 1, 2013.

I don’t regularly engage in statutory interpretation, but it is really not that hard to parse this screed. I think I’m giving a fair interpretation and accurate description of what will happen in 2013 and 2018. If someone out there thinks I’m wrong, please give me a more plausible interpretation.
SHORT VERSION: We will ALL (you, me, the paperboy, the grocery cashier, Rosie O’Donnell, EVERYONE) will be suffering together with Obamacare by Jan. 1 2018, with next to no exceptions. The “you can keep your current coverage” is true in a very short term sense…otherwise IT IS A LIE.
LONG VERSION: My interpretation is that…

NOTE: I use “government plan” throughout below. By government plan, I mean the public option that will mimic Canada or the UK or a “private” plan that is effectivly under massive government control and oversight (e.g. bureaucrats in charge).

Sec. 102(a) “grandfathers” any private insurance plan in effect on or before Jan. 1, 2013. This means that any entity wishing to implement a health plan after Jan. 1, 2013 must use the government health plan. So if you have any aspiration of owning your own business and want to offer private health benefits to your employees … do it before 2013. [[[ Well … actually … it doesn’t matter. Sec. 102(b)(1)(A) makes it a waste of time to establish a new plan if you plan to still be in business in 2018.]]]

Sec. 102(a)(1) (a) prohibits an employer with a “grandfathered” private plan from adding new employees to that plan after Jan. 1, 2013. So if a company expands and adds people it will be forced to place them on the government plan. More directly, if you change jobs on or after Jan. 2, 2013, you will be put on the government plan, whether your new employer has a “grandfathered” plan or not.

Sec. 102(a)(2) prohibits a “grandfathered” private plan from making any changes to the policy
coverage on or after Dec. 31, 2012. So an employer is PROHIBITED for amending the plan to meet the needs of the business or the employees effective Dec. 31, 2012. Even INCREASING COVERAGE is banned. Seems to be a perfect paragraph to include if you want to sped the obsolescence of existing private plans.

Sec. 102(b)(1)(A) was drafted by someone who clearly wants to hide it’s true intent. Basically this paragraph essentially says that on Jan. 1, 2018 all “grandfathered” private plans must be made identical to the government plan. Sure it’s still privately run…but it’s the same as the government plan. Sooooo, why would a company keep it’s private plan come 2018?

Sec. 102(b)(1)(B) – provides some very specialized and limited exceptions to the 2018 deadline to become just like the government plan. Specifically, COBRA coverage extended under the Porkulus and special purpose insurance coverage like long-term care. However, these excepted plans shall “[i]n no case…be treated as acceptable coverage…]. So there will be a very limited number of truly private special purpose plans that exist after 2018, but the government doesn’t like them because they are not acceptable. Who wants to bet that by 2018, they’ll have eliminated those special purpose private plans?

Sec.102(b)(2) says that the “grandfathered” private plans existing on Jan 1, 2013 enter a “grace period” until 2018, when they need to become clones of the government plan. During this grace period the private plans are “treated as acceptable”, meaning they are inherently unacceptable and only the good graces of the government allows them to exist between 2013 and 2018. Again, bets on how quickly this grace period will be shortened or how nebulous “acceptable” is interpreted?
Sec. 102(c) has a title that says it all … “LIMITATION ON INDIVIDUAL HEALTH INSURANCE COVERAGE” How much more clear does this need to be for people to wake up?

Sec. 102(c)(1) says that if a health plan isn’t “grandfathered” it must be a government plan. Recall my above inpretation of Sec. 102(a) that all entities offering new health coverage aftr Jan 1, 2013 must be on the government plan.

Sec. 102(c)(2) provides another very limited exclusion for specialty coverage.
Sure we can keep our current superior private coverage … for a little while. Should this get enacted say goodbye to insurance coverage as you want it, how you want it and where you want it.

Maybe I’ll make this a Diary entry…

What’s the point in having private coverage ? None says Section 403.
lholsenbeck Thursday, July 16th at 8:34PM EDT


“TAX IMPOSED.—In the case of any individual
who does not meet the requirements of subsection (d) at
any time during the taxable year, there is hereby imposed
a tax equal to 2.5 percent of the excess of—
the taxpayer’s modified adjusted gross in2
come for the taxable year, over
the amount of gross income specified in
section 6012(a)(1) with respect to the taxpayer.”

If you aren’t paying what some governement committee decides is your share in private insurance, they’ll be taxing you an additional 2.5%

Oh, and illegals(those who are one heck of a big cost to the US health system, but pay relatively nothing); they’re exempt.

Don’t tell me this isn’t an attempt to buy immigrant votes(amongst all the other vile things going on in here).

Ok, off to looking for the next floater.

Hey vets, Obama’s taking over the VA(and you thought the VA couldn’t get worse) – Sec 401.
lholsenbeck Thursday, July 16th at 9:05PM EDT


“(F) VA.—Coverage under the veteran’s
health care program under chapter 17 of title
38, United States Code, but only if the coverage
for the individual involved is determined
by the Secretary in coordination with the
Health Choices Commissioner to be not less
than the level specified by the Secretary of the
Treasury, in coordination with the Secretary of
Veteran’s Affairs and the Health Choices Commissioner,
based on the individual’s priority for
services as provided under section 1705(a) of
such title.”

Obama’s appointed health commissioner and Obama’s chosen HHS secretary are determining what VA acceptable coverage is.

Considering I think Obama’s actions or non-actions for vets so far have been shameful; i’m not optimistic.

I need a drink, but i probably shouldn’t have one. If my liver goes bad and i’m not paying enough taxes to keep this monster afloat; that may be it for me. Well, as long as I still have “hope”.

Review of Title IV Subtitle A
thersites Thursday, July 16th at 11:12AM EDT

Subtitle A—Shared Responsibility
Tax on persons without health insurance
Persons without “acceptable health care coverage” will be taxed at 2.5% of modified adjusted gross income. But the amount paid may not exceed the average premium for the taxable year, as determined by the Secretary of HHS. If the taxpayer has dependents, average premium for “family coverage” will be the limit. If the person is not covered for part of the year then their tax will be prorated.

The following persons are exempt from the tax.
Persons who could be claimed as a dependent on another persons tax filing.
Non-resident aliens living in the US.
Persons living outside the US.
Persons living in a possession of the US.
Persons with religious conscience exemption granted by the HHS Secretary
Persons have “acceptable coverage” if they are covered by one of the following.
A “qualified heath benefits plan”.
A grandfathered employer-based health insurance plan.
Members of the armed forces (including Tricare).
Veterans Administration.
Other coverage as specified by the HHS Secretary.

The Secretary of HHS may make regulations regarding exemptions from the tax and a process for applying for a hardship waiver.

Persons must file reports every year proving that they provided coverage for themselves and dependents. There is an unspecified penalty for failure to file.

The tax described in this section shall not be treated as a change in tax rate. (Thus not breaking Obama’s pledge not to raise taxes on the middle class. Apparently, if you say it isn’t a tax then it doesn’t count. ).

Employer Responsibilities

Employers who claim to cover employees under a private health care plan must ensure that all are covered. They may be fined $100 per day per employee for failure to comply with the universal coverage requirement. Employers must pay the government for past uncovered periods if it is found that they have uninsured employees.

Employers who do not claim to cover their employees under a private plan must pay an excise tax equal to 8% of of employees’ wages. Small employers get a break depending on the size of their payroll: $350-400K=6%, $300-350K=4%, $250-300K=2%, <$250K=0%.

Review of Title IV Subtitle B
thersites Thursday, July 16th at 11:12AM EDT

Subtitle B—Credit for Small Business Employee Health Coverage Expenses
Small businesses get a credit of up to 50% of the average cost of employee health care coverage.
But the section goes on to say that the deduction will be reduced by “a number of percentage points which bears the same ratio to 50 as such excess bears to $20,000?. I’m pretty good at math but poor at tortured english. I interpret this to mean that the deduction goes down from 50% as the average employee compensation goes up from $20,000 until the deduction drops to 0% at $40,000 annual average compensation. The deduction dwindles in the same fashion as the number of employees goes up from 15 to 30. (But in a later section the bill states that the business does not qualify as a small employer if they have more than 25 employees.) The two types of reductions to the deduction are cumulative.

Health coverage expenses of employees who make more than $80,000 (referred to as “certain highly compensated employees”) do not count toward the credit. Employees are not “qualified employees” unless they make more than $5000 per year.

In partnerships and sole-proprietorships the owners are considered employees.
The dollar amounts used to calculate deductions described above are subject to cost of living adjustments rounded down to the nearest $50.

Review of Title IV Subtitle C & D

thersites Thursday, July 16th at 11:52PM EDT

Subtitle C—Disclosures to Carry
Out Health Insurance Exchange
(sec 431)
The Secretary of HHS will have access to and may share the information in your yearly tax filing but only for the purpose of determining the “appropriate amount of any affordability credit”.
Subtitle D—Other Revenue
(sec 441) Surcharge on high income individuals
Individuals with modified adjusted gross income in the following brackets must pay the corresponding additional income taxes.
More than $350,000 but not more than $500,000 – 1% tax
More than $500,000 but not more than $1,000,000 – 1.5% tax
More than $1,000,000 – 5.4% tax

The dollar amounts above are halved for married persons filing separate returns. The dollar amounts above are reduced by 20% for surviving spouses.

After December 31, 2012 the 1% and 1.5% taxes described above are increased to 2% and 3% unless the excess health reform savings are greater than $150 billion but not more than $175 billion. If the excess health reform savings are $175 billion or greater then none of the taxes above will be collected.

Excess health reform savings are defined as the health reform savings over $525 billion. Health reform savings are defined as the “reduction in Federal expenditures which have been achieved as a result of … the America’s Affordable Health Choices Act” as determined by the Office of Management and Budget. For the purposes of determining the reductions in expenditures, the “investments” under this act are not counted as expenditures.

Modified adjusted gross income (the income taxable under this act) is defined as gross income reduced by any deduction allowed for investment interest.

The dollar amounts above shall be adjusted by yearly cost of living adjustments with the result being rounded down to the nearest $5000.

The income of non-resident aliens and citizens living abroad that is normally taxed under the existing tax code is also taxable under this act.
Charitable trusts are not taxed under this provision.
The change in tax rates defined in this section are not changes in tax rate.
The tax provisions in this section take effect after December 31, 2010.
The deadline for international financial entities to declare themselves to be a “worldwide affiliated group” is extended to December 31, 2019. (What does this have to do with health care?)
(sec 451) Limitation of treaty benefits for certain deductible payments
The taxes in this section can not be reduced by treaty unless the payments were made directly to a foreign parent corporation. I think this means that a treaty agreement can not affect domestic companies.

This section ends with some vague language defining foreign entities.

(sec 452) Codification of economic substance doctrine (sounds ominous)
The economic substance doctrine is a set of IRS rules used to deny the validity of certain tax shelters. In short, the transactions involved must have some business purpose other than to avoid taxes. This section expands the language in the tax code. It has nothing to do with health care except that the money involved will now be taxable under this act as well.
This is the end of Division A of the act.

Table of Contacts. I’ve highligthed only those Titles and sections that have been covered comprehensively…again, Good job thersites, I hope my comprehensiveness will compare to yours.

TITLES.—This Act is divided into divisions, titles, and
3 subtitles as follows:
Subtitle A—General Standards
Subtitle B—Standards Guaranteeing Access to Affordable Coverage
Subtitle C—Standards Guaranteeing Access to Essential Benefits
Subtitle D—Additional Consumer Protections
Subtitle E—Governance
Subtitle F—Relation to Other Requirements; Miscellaneous
Subtitle G—Early Investments
Subtitle A—Health Insurance Exchange
Subtitle B—Public Health Insurance Option
Subtitle C—Individual Affordability Credits
Subtitle A—Individual Responsibility
Subtitle B—Employer Responsibility
Subtitle A—Shared Responsibility
Subtitle B—Credit for Small Business Employee Health Coverage Expenses
Subtitle C—Disclosures to Carry Out Health Insurance Exchange Subsidies
Subtitle D—Other Revenue Provisions

Subtitle A—Provisions Related to Medicare Part A
Subtitle B—Provisions Related to Part B
Subtitle C—Provisions Related to Medicare Parts A and B
Subtitle D—Medicare Advantage Reforms
Subtitle E—Improvements to Medicare Part D
Subtitle F—Medicare Rural Access Protections
Subtitle A—Improving and Simplifying Financial Assistance for Low Income
Medicare Beneficiaries
Subtitle B—Reducing Health Disparities
Subtitle C—Miscellaneous Improvements
Subtitle A—Comparative Effectiveness Research
Subtitle B—Nursing Home Transparency
Subtitle C—Quality Measurements
Subtitle D—Physician Payments Sunshine Provision
Subtitle E—Public Reporting on Health Care-Associated Infections
Subtitle A—Increased Funding to Fight Waste, Fraud, and Abuse
Subtitle B—Enhanced Penalties for Fraud and Abuse
Subtitle C—Enhanced Program and Provider Protections
Subtitle D—Access to Information Needed to Prevent Fraud, Waste, and
Subtitle A—Medicaid and Health Reform
Subtitle B—Prevention
Subtitle C—Access
Subtitle D—Coverage
Subtitle E—Financing
Subtitle F—Waste, Fraud, and Abuse
Subtitle G—Puerto Rico and the Territories
Subtitle H—Miscellaneous