and the
Citizens Economic Research Foundation

Wednesday, March 15, 2006

Massachusetts Healthcare Reform
"First do no further harm"

On the Ides of March, beware new taxes parading as healthcare reform!

No, really, serious analogy. The Roman senators had a point: Caesar’s status quo was getting to be a problem. But just as assassinating him wasn’t the proper response, killing the Massachusetts economy isn’t sensible healthcare reform.

We recognize that this issue isn’t simple, so you may not find an easy sound bite about "new taxes" in here - though the "assessment" on employers that don’t provide health insurance is a new tax.

But we are still objecting to the "old tax" – the $62 per employee paid by those who ARE providing health insurance. There can be no justification for taxing the responsible employers, who are not part of the problem, to support the bad debt/free care pool.

This is the same wrong-headed concept as the Massachusetts nursing home tax, that taxes self-payers $10.99 a day for the privilege of not being a burden on the Medicaid system.

A bill to repeal this tax over three years, H.4728, has come out of the Elder Affairs Committee, to that committee’s credit.

We also object to the concept that employers should be paying for health insurance at all. Business provides the jobs that provide not only the paychecks of its employees, but all the money for all state services. It is foolish to jeopardize Massachusetts jobs while forcing business to directly provide social services, in this case healthcare.

So here is the bottom line. The $62 is a tax, a bad tax. Adding a new $295 tax for companies that do not provide health insurance is adding another bad tax to an existing bad tax. So Massachusetts should repeal the $62, and not assess the $295, and repeal the nursing home tax.

Healthcare is too big an issue to be done at the state level. If this bill passes, the tax on all businesses will increase as more people come here for subsidized health insurance while more businesses do not come here, or leave, putting us at further competitive disadvantage.

The federal government should deal with this issue by letting individuals purchase health insurance with pre-tax dollars. It should not further subsidize Massachusetts’ incoherent system with federal tax dollars.

If the final bill looks like the bill that is presently being floated, Governor Romney should veto it, then address it as President of the United States. Massachusetts health care reform: first, do no further harm.

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