McCain Health Credit Could Morph Into Tax Hike
EmailABC News’ Teddy Davis and James Gerber Report: Sen. John McCain’s, R-Ariz., health-care plan would replace the existing tax exclusion for employer-sponsored coverage with a refundable tax credit for all Americans. The tax change is intended to create a more equitable system that provides everyone — including those who do not receive their health coverage from their employer — with the same tax advantage. And since it is refundable, it would provide a cash benefit to those who earn too little to pay federal income taxes.
But if the cost of health care continues to outpace inflation in the economy at large, McCain’s health credit would morph into a tax hike for those who currently receive a tax exclusion for employer-sponsored coverage, according to a study released Wednesday by the liberal Center for American Progress.
"For millions of middle class families, the credit is smaller than the current tax subsidies, meaning that it is in fact a tax increase," said Elizabeth Edwards, the wife of former Sen. John Edwards, D-SC, and a senior fellow at CAP. "I know he’s pledged not to have any tax increases, but this in fact will work as a tax increase."
McCain’s tax credit could morph into a tax hike because the credit grows only at the rate of inflation (about 2 percent a year), while current tax subsidies keep up with health insurance premiums (which are growing at about 7 percent per year).
For a couple earning $40,000 per year and paying an average premium of $13,800, McCain’s new tax credit would cut their taxes by $50 in 2009.
"[B]ecause the credit quickly falls behind rising premiums that are the basis for the current tax break, the family would pay $1,169 more in taxes in 2013. The family would pay $2,809 more in taxes by 2018," write James Kvaal, Peter Harbage, and Ben Furnas, the report’s authors.
The McCain campaign does not dispute the study’s assertion that the Arizona senator’s proposed tax credit would offer a smaller subsidy over time than the current exclusion if health premiums continue to grow more quickly than inflation.
The McCain campaign is hoping, however, that its tax credit will exert downward pressure on prices.
It is also hoping that other reforms favored by the presumptive Republican nominee will lower costs, making his tax credit sufficient.
"John McCain believes that the fact that health care spending outpaces inflation by a factor of three is exactly the problem, and is exactly why health insurance is increasingly out of reach for Americans," said McCain spokesman Brian Rogers. "John McCain’s plan includes prevention, affordable drugs, greater use of health information technology, coordinated care, and medical liability reform to address the rising cost of care to reverse this trend."
Rick Santorum Sweeps 3 States 
Pentagon to Open Additional Jobs to Women
I’m sure we can believe what John Edwards wife has to say. LOL
Posted by: Giovanni | July 2, 2008, 7:34 pm 7:34 pm
Ruh-Roh! Did you just say John McCain and tax increase?
Calling Grover Norquist.
Posted by: Jeff C. | July 2, 2008, 7:37 pm 7:37 pm
Just answer me this. Who in the hell making $40,000 a year can afford $13,000 in health care premiums? Are any of theses people including McCain living in any kind of reality?
Posted by: Thinking | July 2, 2008, 7:39 pm 7:39 pm
Headline: “McCain Health Credit Could Morph Into Tax Hike”.
Headline in four years IF McCain wins: “McCain Presidency Morphs Into Disaster”.
Posted by: Jeff C. | July 2, 2008, 7:39 pm 7:39 pm
Right now we just need to focus on defeating John McCain.
Posted by: Giovanni | July 2, 2008, 7:52 pm 7:52 pm
What McCain’s program doesn’t include is making sure people can actually buy health coverage. If you’ve ever smoked, are overweight, or have ever been sick, you don’t have to worry about premiums or tax credits – there won’t be coverage available.
Posted by: Nancy | July 2, 2008, 8:02 pm 8:02 pm
FACTS REGARDING JOHN MCCAIN’S PLAN:
FACT 1.
John McCain wants the health insurance companies to be regulated by the state of their OWN CHOOSING, rather than the state they are operate in, as is now the case.
Say GOODBYE to all consumer protections.
Say HELLO to all disputes going to “arbitrators” sponsored by the health insurance companies!
Posted by: John's conscience | July 2, 2008, 8:14 pm 8:14 pm
FACTS REGARDING JOHN MCCAIN’S PLAN:
FACT 3.
John McCain has never said it is immoral for a great nation to allow people without insurance to suffer and die without treatment.
Posted by: John's conscience | July 2, 2008, 8:24 pm 8:24 pm
FACTS REGARDING JOHN MCCAIN’S PLAN:
FACT 4.
John McCain says he wants to reduce the rate of medical inflation.
But what he doesn’t mention is that his METHOD for reducing the cost of medical care is to make sure that the middle class CAN’T AFFORD it, thus reducing demand!
“BAA BAA BAA”:
That’s the sound of YOU, as John McCain’s sacrificial lamb.
Posted by: John's conscience | July 2, 2008, 8:33 pm 8:33 pm
Hello. John McCain. We didn’t all dump our wives and marry the boss’ daughter (worth over $100 million). Pls come back down to earth with the rest us real Americans. You’re embarassing us fellow military vets.
Posted by: CMSgt Gary Preston | July 2, 2008, 8:33 pm 8:33 pm
What would Ron Paul do? He probably has the correct approach.
Posted by: James | July 2, 2008, 8:56 pm 8:56 pm
Wow. Now that’s a turkey. Yet Another We Fix This Code and That Money Magically Appears Solution. ???
Do either of these candidates understand what $4 dollars a gallon of gas is doing to people with fixed incomes RIGHT NOW?
Or do they just not care?
You want my independent vote? Tell me how to save the seniors on fixed incomes. I’m not one. I just don’t like seeing old people and the very poor pushed onto the streets by the greed of the wealthiest .001 percent.
It sucks. Really. You won’t get your bridges fixed starving our mothers and grandmothers.
C’mon McCain, show some spine on this one. It’s your generation.
Posted by: len | July 2, 2008, 9:08 pm 9:08 pm
Ahh the Republican health care plan: “Pray you don’t get sick…” And the Democrat plan: “let’s mandate coverage, micromanage everybody’s life with the health care police, and fee everybody to death who has the gall to actually choose to live how they wish. Oh and, of course raise taxes to pay for the newest big government health plan that promises to bankrupt what’s left of the country while we continue to fund all of these merry wars. Folks, for your country and least of all for yourselves… Vote OUT the darn incumbents will ya??? What have they done in the last eight years for you that has made your life better… WHAT?!! Just vote out these pathetic paralysis stricken phonies, and let’s just start over with some folks we can hold accountable for their actions. Otherwise, SHUT UP, and just keep taking the abuse they keep dishing while your quality of life and your checkbook IMPLODES!!! You can hang them out to dry, or they can hang YOU, what’ll it be folks… what’ll it be???
Posted by: pity | July 2, 2008, 9:12 pm 9:12 pm
McCain’s problem is that he doesn’t understand people’s budgets. You can’t just raise people’s taxes to force them to get insurance on their own just because of a report written by some bozo at an industry-funded rightwing think tank. Under McCain’s plan, insurers will be able to shop from state to state for favorable regulations. For instance, they will dodge regulations on pre-existing conditions. So McCain’s plan is to force people out of coverage from their employer by raising the tax on it then make them renegotiate coverage of existing conditions. He thinks that’s going to lower inflation? He’s either economically illiterate as well as computer illiterate or he thinks we are. Forcing people to renogotiate coverage of pre-existing conditions will raise their costs. Of course, it will probably also raise profits for McCain’s “friends” so he doesn’t care about the people. This is in keeping with his favoritism towards “his friends” going back to Keating.
Posted by: Jeremy | July 2, 2008, 9:25 pm 9:25 pm
Whats This?
Another “Tax and Spend Republican”???
Tax everyone to give more to the wealthy? And disguise it as a ‘health care plan’? The spin on this one is more intense than a carnival ride!
And now, Colonel Bud Day is on the payroll? One of the prominent figureheads in the Swift Boat scandal unleashed by the Republicans against John Kerry? The very same guy McCain denounced in 2004?
And now we are seeing the ‘hot-head’ side of McCain? One breath away from launching war weapons?
Its starting to look like McCain is senile. Or absent minded. Wow, this is really getting scary!
Posted by: Mickey | July 2, 2008, 9:28 pm 9:28 pm
Just answer me this. Who in the hell making $40,000 a year can afford $13,000 in health care premiums? Are any of theses people including McCain living in any kind of reality?
Posted by: Thinking | Jul 2, 2008 7:39:31 PM
44444444444444444444444444
Why would McCain care about the average american when it was reported his wife put 750,000 3 quarters of a million dollare on her credit card last month. And one of their children has a fifty thousand dollar balance on his credit card.
And Rove, Mccain and republicans are trying to paint Obama as elitist. Good grief what a bunch of selfish elitist low lifes.
Posted by: Merri | July 2, 2008, 10:23 pm 10:23 pm
Hey libs, Check with the Amish re health care. Might expand your horizons. Nah…. no way!!
Posted by: Temagami | July 2, 2008, 10:28 pm 10:28 pm
Merri.
How reveling!! All by yourself!!
Posted by: Temagami | July 2, 2008, 10:32 pm 10:32 pm
Hey Thinking. Weren’t you that guy who was a Marine on active duty who was knocking his superiors for NOT bringing in Osama??
Posted by: Temagami | July 2, 2008, 10:35 pm 10:35 pm
Hey libs!! Please keep knocking McCain for his service record, as it has been credited for pro McClain backlash on same, especially since Obama DOES NOT HAVE ANY MILITARY RECORD!!
Posted by: Temagami | July 2, 2008, 10:40 pm 10:40 pm
Hey libs, Check with the Amish re health care. Might expand your horizons. Nah…. no way!!
Posted by: Temagami | Jul 2, 2008 10:28:19 PM
444444444444444444444444
Are you suggesting the entire u.s population including you live like the amish? If not shut your sewer trap.
Posted by: Merri | July 2, 2008, 10:41 pm 10:41 pm
Typical McCain/Bush. Give to the rich and take from the poor and middle class.
After hearing Cindy McCain had a $750,000 monthly credit card bill, I realize why John McCain doesn’t understand what we’re going through.
McCain is your typical millionaire who’s afraid to reveal his wife’s full tax records. He knows they’ll show wealth beyond most Americans dreams.
Posted by: Dan | July 2, 2008, 10:42 pm 10:42 pm
Hey Merri.
If you don’t live live the Amish – YOU REALLY DON’T HAVE ANY CLUE WHAT YOU HAVE MISSED!! DUMMY!!
Posted by: Temagami | July 2, 2008, 10:45 pm 10:45 pm
Hey Dan.
Unfortunately, Neither you nor I are not the movers and shakers of our society. Money talks and you know what walks, makes them REVELANT. WAKE UP!! Money talks and you know what walks, but those people EMPLOY which makes them active players!! Big Gov DESTROYS!!!!
Posted by: Temagami | July 2, 2008, 10:54 pm 10:54 pm
Dan, the problem for YOU and ME is the fact that the so called Fat Cats employ the rest of us slaves, BUT we still have our fast foods, Internet, beer and lottery , etc. So we accept that!! Kill it off like Obama wants to do and we all turn into a nation of hunters, fishermen and trappers. THAT IS PRETTY BASIC STUFF – WHAT PART OF THAT DO YOU NOT UNDERSTAND!!
Posted by: Temagami | July 2, 2008, 11:05 pm 11:05 pm
Hey Dan.
Unfortunately, Neither you nor I are not the movers and shakers of our society. Money talks and you know what walks, makes them REVELANT. WAKE UP!! Money talks and you know what walks, but those people EMPLOY which makes them active players!! Big Gov DESTROYS!!!!
Posted by: Temagami | Jul 2, 2008 10:54:49 PM
44444444444444444444
If you are an average american as you suggest in your post. The saddest thing about your thought process is you are rabidly supporting the very party (republican)that makes it harder and harder for you as an average american to ever be a monied mover and shaker. I know of no republican policy that is skewed toward average americans. However, most republican policies are skewed toward the rich, wealthy and uber wealthy. So you are supporting the very party that continues to enact laws and policies that keep you in neutral or reverse.
Posted by: Merri | July 2, 2008, 11:13 pm 11:13 pm
once again the repugs want to make the rich richer off us middle class
Posted by: angie | July 2, 2008, 11:14 pm 11:14 pm
Merri.
You use the term “AVERAGE.” There Isn’t an AMERICAN living who with some effort, plus some education, can’t earn 60K PLUS!! WHERE IN THE HECK ARE YOU COMING FROM?? THE HELP WANTED ADS ARE STILL CRYING FOR SKILLED PEOPLE!! GET AWAY FROM YOU MASTERS PROGRAM AND INTO THE REAL WORLD!!
Posted by: Temagami | July 2, 2008, 11:29 pm 11:29 pm
I cite the Amish in many of my blogs to show to others the value of self responsibility and determination as the Amish have so ably demonstrated, hoping that some may rub off. The Amish have lobbied congress(successfully) to be exempt from the Social Security program as part of their self determination, a value that I personally admire and hope that others can also!! What a difference in the value system of the liberals with their entitlement programs, and that of these wonderful Americans!!
Posted by: Temagami | July 2, 2008, 11:48 pm 11:48 pm
Merri.
You use the term “AVERAGE.” There Isn’t an AMERICAN living who with some effort, plus some education, can’t earn 60K PLUS!! WHERE IN THE HECK ARE YOU COMING FROM?? THE HELP WANTED ADS ARE STILL CRYING FOR SKILLED PEOPLE!! GET AWAY FROM YOU MASTERS PROGRAM AND INTO THE REAL WORLD!!
Posted by: Temagami | Jul 2, 2008 11:29:05 PM
44444444444444444444444444
Why don’t you try telling that to the people losing thier jobs at the 600 Starbucks stores being closed? Or the people in the automotive business from assembly line workers to car salesmen? I’m sure your words will be immediately taken to heart.
Posted by: Merri | July 2, 2008, 11:51 pm 11:51 pm
I cite the Amish in many of my blogs to show to others the value of self responsibility and determination as the Amish have so ably demonstrated, hoping that some may rub off. The Amish have lobbied congress(successfully) to be exempt from the Social Security program as part of their self determination, a value that I personally admire and hope that others can also!! What a difference in the value system of the liberals with their entitlement programs, and that of these wonderful Americans!!
Posted by: Temagami | Jul 2, 2008 11:48:51 PM
444444444444444444444444
So you’re saying that americans are naturally lazy? Seems like a ignorant comment because their are many hard working americans that need food stamps and other forms of government assistance to get by. But of course you’re call them lazy right? Btw Where is your outrage about all of our tax dollars going to companies that gambled screwed up but we the tax payers bail them out. The S&L and subprime scandals come to mind or better yet how about this?
http://www.msnbc.msn.com/id/25487136/
Your fearless leader Bush hard at work looking out for us hard working tax payers.
Posted by: Merri | July 2, 2008, 11:59 pm 11:59 pm
Merri. I would tell them to get with the program and train for those occupations which are KEEPERS!! HEALTH OCCUPATIONS FOR ONE. I DON’T KNOW WHERE YOU LIVE, BUT HERE IN CLEVELAND, HEALTH JOBS ARE FOR THE TAKING! GREAT MONEY!! I am almost 70 years, But I could go to Tampa, FL. on the next flight get a teaching job tomorrow!! BUT, YOU HAVE TO PAY YOUR DUES. YOU CAN’T THINK JOBS, YOU HAVE TO THINK CAREER!! MAJOR DIFFERENCE, OTHERWISE YOU WILL BE 70 AND STILL MAKING MIM WAGE!!
Posted by: Temagami | July 3, 2008, 12:02 am 12:02 am
Sounds like this assessment of the invasion of Iraq which McCain supports:
“The big story is Iraq, and the Americans unwittingly opened it up for the Iranians” by their invasion in 2003, analyst Farid al-Khazen, a Christian Lebanese lawmaker whose party is allied with Hezbollah said. “There is a Shiite majority, oil, the shrine cities and borders with Saudi Arabia.”
Posted by: Last Call | July 3, 2008, 12:06 am 12:06 am
Merri. I would tell them to get with the program and train for those occupations which are KEEPERS!! HEALTH OCCUPATIONS FOR ONE. I DON’T KNOW WHERE YOU LIVE, BUT HERE IN CLEVELAND, HEALTH JOBS ARE FOR THE TAKING! GREAT MONEY!! I am almost 70 years, But I could go to Tampa, FL. on the next flight get a teaching job tomorrow!! BUT, YOU HAVE TO PAY YOUR DUES. YOU CAN’T THINK JOBS, YOU HAVE TO THINK CAREER!! MAJOR DIFFERENCE, OTHERWISE YOU WILL BE 70 AND STILL MAKING MIM WAGE!!
44444444444444444444444
Everybody is not cut out for the medical profession and it cannot support they if they were. Just like everybody cannot be a lawyer, or actor etc, etc. So what’s your solution for that group of people?
Posted by: Merri | July 3, 2008, 12:10 am 12:10 am
Merri. The difference is that bail outs to business is of course a risk, but business DOES employ people and creates economic value – GOVERNMENT DOES NOT CREAT ECOMOMIC VALUE – MAJOR DIFFERENCE!!!
Posted by: Temagami | July 3, 2008, 12:11 am 12:11 am
Btw I’m sure they can use doctors and nurse here.
http://www.nytimes.com/2008/07/02/nyregion/02hosp.html
Posted by: Merri | July 3, 2008, 12:12 am 12:12 am
Here’s the bottom line:
If you make less than $160,000 a year…you’ll pay LESS taxes under Obama, and MORE taxes under McCain.
It’s YOUR choice.
VOTE IN NOVEMBER.
Posted by: wilder5121 | July 3, 2008, 12:15 am 12:15 am
Merri. The difference is that bail outs to business is of course a risk, but business DOES employ people and creates economic value – GOVERNMENT DOES NOT CREAT ECOMOMIC VALUE – MAJOR DIFFERENCE!!!
Posted by: Temagami | Jul 3, 2008 12:11:51 AM
444444444444444444444444
Business can’t employ or flourish if people don’t buy. So why not give the money to people and let their spending decide which companies succeed or fail? But I guess that would be too dangerous in your way of thinking.
Posted by: Merri | July 3, 2008, 12:15 am 12:15 am
Merri. My solution would be for those people to discover what they could offer to society and then market themselves accordingly through education and training. IT IS NOT THE ROLE OF THE FEDDERAL GOVERNMENT TO BE THE PARENT OF EVERY INDIVIDUALL!!
Posted by: Temagami | July 3, 2008, 12:17 am 12:17 am
Merrri.
Whose money? You want taxpayers to belly up for those people who make poor decisions in life and who won’t take advantage of the great opportunities to achieve the American dream?? Not me lady, if you want to, have at it. Nite – gotta get up at five to work. Have a good one, later!!
Posted by: Temagami | July 3, 2008, 12:25 am 12:25 am
the phony BhO fools fools – what a surprise.
Posted by: fat cat | July 3, 2008, 3:35 am 3:35 am
Of course the McCain camp cannot dispute the numbers. The math is the math. If inflation outstrips the credit, then you will in fact have to pay more in taxes. Knowing that the dollar’s decline will guarantee a rise in inflation, we can all be assured of tax increases every year and you can’t “opt out” should it become too expensive since it will be written into the tax code. Get ready for the further decline of America should McCain get elected.
Posted by: Tommy Thompson | July 3, 2008, 9:03 am 9:03 am
More republican solutions. Everything is a tax cut and everything ultimately benefits corporations (absolving them of their responsiblity to offer healthcare plans to their employees). Why would anyone vote for one of these guys? If you aren’t rich, you have NO REASON to support McCain.
Posted by: A reader in Georgia | July 3, 2008, 9:07 am 9:07 am
Anyone who looks at the nation’s debt and the problems before us and think that there will not be a tax hike somewhere is fooling themselves. When you are bankrupt you have to get money from somewhere.
Posted by: musicisourhigh | July 3, 2008, 10:31 am 10:31 am
You americans are so soft complaining about gas prices. Come move down to Mexico then you can ride donkeys and mules like me and you won’t have to worry about gas.
Posted by: Jose | July 4, 2008, 11:30 pm 11:30 pm
You racist people please stop venting your racist feelings under the guise of political opposition. In other words I know you wear your bed linen after you get up and about. Nothing but the worst america has to offer. I oughta know I was once a part of your crowd. I never could figure out why I hated blacks so much. I never lived near them or anything I just hated them for no reason. I guess I was just plain stupid like the rest of the fools against Obama because he’s black. Wise up before you find yourself in hell like me.
Posted by: Jesse Helms | July 5, 2008, 1:45 am 1:45 am