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The problem

Issue: "Hurtling toward havoc," Aug. 1, 2009

• Spending on healthcare in the United States has grown from 7.2 percent of GDP in 1970 to 12.3 percent in 1990 and 16.2 percent in 2007.

• In 2007 Medicare and Medicaid accounted for nearly 20 percent of the federal budget and more than 27 percent of total healthcare expenditures.

• 47 million Americans are uninsured.

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• Premiums increased 114 percent between 1999 and 2007 while workers' earnings increased only 27 percent.

• The average cost of an employer-based insurance policy in 2008 was $12,680 for a family and $4,704 for an individual.

• The United States had approximately 8.1 million uninsured children in 2007.

The players

The administration

• HHS: Sebelius

• Treasury: Geithner

• Budget: Orszag

• NEC: Summers

The Senate

• Leadership: Reid, D-Nev.; McConnell, R-Ky.

• Budget: Conrad, D-N.D.; Gregg, R-N.H.

• Finance: Baucus, D-Mont.; 
Grassley, R-Iowa

• HELP committee: Kennedy, D-Mass.; Enzi, R-Wyo.

The House

• Leadership: Pelosi, D-Calif.; Boehner, R-Ohio

• Commerce: Waxman, D-Calif.; Barton, R-Texas

• Budget: Spratt, D-S.C.; 
Ryan, R-Wis.

• Ways and Means: 
Rangel, D-N.Y.; Camp, R-Mich.

• Education and Labor: Miller, D-Calif.; Kline, R-Minn.


• The nation's insurers, hospitals, pharmaceuticals, doctors, employers, and medical groups are spending $1.4 million a day on influencing the debate.

The proposals

• Impose an individual mandate to carry health insurance or face tax penalties.

• Force employers to pay for 50 percent to 65 percent of employee premiums or pay penalty.

• Expand Medicaid to households earning less than 150 percent of the federal poverty level; expand Medicaid to childless adults.

• Provide subsidies to purchase insurance for families earning up to 300 percent or 400 percent of federal poverty level ($66,000 or $88,000 for a family of four).

• Provide government-funded comparative effectiveness research.

• Establish a government-run "public plan" option to compete with private insurers; it may be able to set prices for doctors and hospitals, which opponents say would put private plans at a competitive disadvantage.

• Provide a refundable tax credit for the uninsured to purchase coverage.

The price

The costs for Democratic proposals range from $1.04 trillion to $1.6 trillion over 10 years, to be paid for by:

• A new tax on employer-provided health insurance benefits ($90 billion to $300 billion over 10 years)

• Limiting itemized deductions like mortgages and charitable contributions for high-income earners ($326 billion over 10 years)

• A new "value-added" tax on sugary drinks and increased taxes on alcoholic beverages: $110 billion over 10 years

• A penalty for employers not offering health insurance ($300 billion)

• A new tax on Flexible Savings Account and health reimbursement accounts ($70 billion)

• Trimming Medicare/Medicaid payments to hospitals and other providers ($313 billion)

• An income tax surcharge of 1 percent to 3 percent on Americans earning more than $280,000. The surtax would rise for those earning $500,000 and rise again for those earning more than $1 million, sending the top federal tax rate toward 52 percent ($500 billion over 10 years)

• A voluntary agreement by drug manufacturers to provide a discount on medicines purchased for government programs like Medicare ($80 billion)

• Savings offered by hospitals ($155 billion)

Opponents of many of these items say they would harm the economy and increase unemployment.

Edward Lee Pitts
Edward Lee Pitts

Lee is WORLD's Washington Bureau chief. As a reporter for the Chattanooga Times Free Press, he was embedded with a National Guard unit in Iraq. He also once worked in the press office of Sen. Lamar Alexander.


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