Wednesday, July 22, 2009

Tax Options In Health Care Reform Debate

Funding health care reform, which the Congressional Budget Office (CBO) has estimated will carry a $1 trillion price tag, will involve both cost saving measures and tax increases according to Prescription for Change: Tax Issues in Health Care Reform, prepared by the Tax Policy Group of Deloitte Tax LLP in Washington, D.C. and reported by AccountingWeb.

The report does not define the debate or predict the outcome, but identifies areas where tax issues will arise.

Tax options directly related to health care have been prominent in the debate so far, but President Obama suggested tax reforms unrelated to health care as sources for funding reform in his FY2010 budget, and the funding debate may extend beyond taxing for health care.

“If Congress abandons any nexus to health care in its search for funding options,” the Deloitte report predicts, “then business and individual tax issues could be drawn into the discussion.”

Daunting as the prospect of reform may be, the case for health care reform is strong, the authors say.

The CBO estimates that health care costs will reach 20 percent of the gross domestic product by 2017.

The costs of Medicare and Medicaid alone, which consumed more than 20 percent of the federal budget in 2007, will “represent a serious threat to the fiscal health of the country.”

Forty seven million American are uninsured and 25 million are underinsured.

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1 comment:

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