Senate Begins Floor Debate on Health Care
The Senate last week began floor debate on health care reform bill H.R. 3590. The Congressional Budget Office estimates that the Senate package would cost $849 billion over 10 years and would reduce the federal budget deficit by $130 billion over the same period while expanding medical coverage to 94% of Americans.
The Senate plan contains several notable differences from the bill that was recently passed by the House by a narrow 220 to 215 margin.
The Senate legislation would impose a surtax on high-cost “Cadillac” insurance plans to help finance coverage of the uninsured, while the House bill seeks to raise revenue by charging a surtax on taxpayers with adjusted gross incomes of $500,000 for single taxpayers and $1 million for joint filers. The two chambers differ in terms of abortion restrictions and the scope of the public option.
The Senate bill is far less burdensome to small businesses than its House counterpart. The House bill contains a broad employer mandate that the Senate bill does not. However, the Senate package would levy financial penalties on most firms that fail to provide health coverage and also would require all individuals to carry health insurance.
As the Senate bill currently stands, it does not have the necessary 60 votes to move forward. As a result, a number of amendments will be offered and debate will continue in an effort to pass the legislation by the end of the year. Senators must compromise on issues such as the public option, abortion and immigration.
The following is a breakdown of key areas of the Senate health plan of interest to NAHB members:
- Employer Responsibilities. Those with more than 200 employees must automatically enroll all new workers in health care coverage. Employers with more than 50 employees must offer coverage to their employees.
Employers with more than 50 employees who do not offer coverage and have at least one employee receiving the premium assistance tax credit would be fined the lesser of $750 multiplied by the number of employees or $3,000 for each employee receiving a tax credit. Businesses with 50 employees or less would be exempt from this responsibility.
Employers with more than 50 employees would be required to pay a fine for implementing waiting periods for employees who want to enroll in coverage: $400 per employee during a 30 to 60 day waiting period; $600 for any employee during a waiting period exceeding 60 days.
- Small Business Tax Credit. These firms would receive tax credits equal to 50% of the amount of health coverage they pay for each employee. The tax credit would be limited to businesses with 25 or fewer full-time employees and with average annual wages below $40,000. The full credit would phase out for employers with more than 10 full-time employees or average annual wages.
- Income Tax. The Senate bill would increase the hospital insurance payroll tax by .5% on individuals earning more than $200,000 and couples earning over $250,000, effective 2013.
- Insurance Fees. The Senate plan would impose a 40% excise tax on employer-sponsored health coverage that exceeds $8,500 for an individual and $23,000 for families, effective 2013.
To view the Senate bill, click here and type H.R. 3590 in the box at the upper center of the screen.
For more information, e-mail Carlos Gutierrez at NAHB or call him at 800-368-5242 x8242.