Thursday, September 4, 2008

Sen. Cornyn: Tax Workers On Health Insurance Received From Employers

U.S. Senator John Cornyn, who is running for reelection this year, endorses Republican Presidential Nominee John McCain's proposal to shift employer provided health insurance from being an untaxed employee benefit to an insurance policy that Americans must purchase in the private marketplace for themselves and their families. "There's no reason today to have health insurance policies tied to employers," Cornyn told reporters on Monday.

McCain's plan, that Cornyn supports, would tax workers on the value of any health insurance they continue to receive from their employers. Under McCain's plan employees would have to report as income any insurance premiums paid by their employers. In contrast, Democratic presidential contender Barack Obama says he wants to expand Medicaid, the government health care program for the poor, and require employers to either provide health insurance to their workers or contribute to a newly created public insurance program.

Dallas Morning News
McCain's health insurance plan: More radical than Democrats'

North Texas employers are not saying they would drop employee coverage altogether if Mr. McCain's plan were enacted. But some do say the plan, which Mr. McCain detailed in July, would encourage young and healthy workers to forgo company coverage, purchasing insurance on their own rather than paying income taxes on the benefit. That would leave employers with only the costly sick workers to insure. And that, they said, could eventually lead to the death of company-provided health plans.

Rick Noriega, the Democratic Candidate running for the U.S. Senate seat against Cornyn, supports guaranteed coverage through partnerships between the federal government, states, employers, and private health care providers.

Dallas Morning News Blog
Rick Noriega Assails John Cornyn's Embrace of McCain Health Care Plan

Rick Noriega's Senate campaign has harshly criticized freshman Republican Sen. John Cornyn for seconding John McCain's plan to wean Americans off employer-provided health insurance and push them to buy their own coverage. Noriega spokesman Martine Apodaca called McCain's plan "radical."

Apodaca predicted that treating the employer health [benifits] as wages, as McCain proposes, will price families out of health insurance because the Arizona senator's $5,000 tax credits won't make up for the new burden they absorb. "Cornyn thinks forcing Texas families to fend for themselves in the individual insurance market is better than the employer based health care system.

But people don't choose to be sick like they choose to buy a car or a pair of shoes," Apodaca said. "Under the Cornyn scheme, the majority of Texans would be paying higher taxes, paying more for less coverage and employers would lose incentives to offer health insurance to their employees"

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