The Center for a Free Economy believes in a health care system which is focused on the empowered patient and her doctor. Neither the government nor big business forces in the healthcare system should not get between patients and providers. Families need the means to take control of their own health care decisions. It’s also important to remember that health care policy these days is tax policy, and vice-versa.
Recent News about Healthcare Policy:
By Ryan Ellis There has been a lot of loose talk recently both in the conservative healthcare policy community and in the GOP Senate cloakroom about delaying or stopping repeal of the "net investment income tax" (NIIT), a 3.8 percentage point increase in the capital gains and dividends tax. That loose talk should end. According to the Tax Foundation, ending the NIIT would create 133,000 jobs. It will increase GDP by 0.7 percent. This in turn raises after-tax income by 0.6 or 0.7 percent for the lower four quintiles--i.e., the non-rich. A family of four making $80,000 per year would see a raise of $480. A single person making $35,000 per year would see a raise of $210. Republicans didn't just dream up a plan to cut the capital gains rate as part of Obamacare repeal. I agree with those who say that a healthcare bill is no place to have [...]
By Ryan Ellis The Congressional Budget Office (CBO) today released their score of the "Better Care Reconciliation Act of 2017" (BCRA). There's the usual nonsense about how millions of people will lose coverage (which only makes sense if you think the individual mandate is a good idea or that using an outdated Medicaid coverage baseline is sound actuarial science), all of which can be safely ignored as #fakenews. The tax side is pretty straightforward, however. It's a tax cut of $700 billion, achieved by repealing all the tax hikes in Obamacare and expanding health savings accounts (HSAs). Three quick thoughts: BCRA provides an immediate, pro-growth, pro-jobs shot in the arm to the economy. By far the most under-reported upside to this bill is the immediate (indeed, retroactive) capital gains and dividends tax cut. By repealing the "net investment income tax" (NIIT) of 3.8 percentage points, BCRA results in a right-now [...]
By Ryan Ellis This week, the Senate GOP is reportedly putting pen to paper on their version of "repeal and replace" of Obamacare. One of the key design decisions they have to make is how to structure the individual health insurance refundable tax credit. As Avik Roy has pointed out, it's essential that the Senate get this right. No one is quite happy with the way the House (i.e., AHCA) version of this tax credit ended up. It's a flat dollar credit variable by age, which creates difficulties for very sick individuals and creates a "poverty trap" for those emerging from Medicaid and needing help in the individual market. Again, Roy documents all of this very expertly and he's right about his criticisms. The solution, everyone seems to say (and taking the lead of Senator John Thune of South Dakota), is to switch the credit from flat-dollar (within an age band) to means [...]
By Ryan Ellis Where's Jack Kemp when you need him? Heck, for that matter where is Bill Roth or Phil Gramm? The biggest tax cut the U.S. House of Representatives is likely to pass this calendar year is, ironically, the American Health Care Act (i.e., AHCA or Obamacare repeal). According to the Congressional Budget Office, it's a ten year tax cut of $1 trillion. Eventually, all twenty or so new or higher taxes in Obamacare are repealed by the bill--most of them retroactive to the beginning of this year. These include: Zeroing out the taxes associated with the individual and employer mandates Eliminating the "net investment income tax" (NIIT) that effectively increases the capital gains and dividends rate by nearly four points Striking out a hike in the Medicare payroll tax, but more on this below Doing away with a host of tax increases on health savings accounts and flexible spending [...]
By Ryan Ellis One of the best conservative elements of Obamacare repeal in general and the House-passed "American Health Care Act" in particular is the repeal of the twenty new or higher taxes in Obamacare, totaling nearly $1 trillion over a decade. This tax relief has come under fire in recent days by left wing columnists, crony capitalist in chief Warren Buffett, late night talk show host and nouveau health policy expert Jimmy Kimmel, and even Republican senator Bill Cassidy of Louisiana. Meanwhile, Republican Members of Congress in town halls across the country are, to put it mildly, having to gird their loins and sharpen their talking points when it comes to health care. Everyone needs to be on board for what will be a very tough policy fight, or we endanger losing the tax relief component of Obamacare repeal, which in turn would make tax reform far less likely. Now would be a very bad time [...]
By Ryan Ellis Big news tonight broken by Jennifer Haberkorn, Rachael Bade, and Josh Dawsey of Politico. Over the weekend, the House conservative Republican Study Committee negotiated a series of rightward-directed improvements to the American Health Care Act (AHCA). According to Politico, one of those changes is a major upgrade in the tax policy side of the bill. Under the version of the bill reported out by the House Ways and Means Committee, virtually all of the new or higher taxes in Obamacare would be repealed prospectively, as of January 2018. The improved bill now makes that tax relief effective retroactively, to January 2017. Nowhere is this a bigger deal than for savers and investors. One of these Obamacare tax increases is the hated "net investment income tax" or NIIT. The NIIT slaps a 3.8 percentage point surtax on capital gains, dividends, interest, and almost all other yields on investment. That's why [...]