Source: Press Of Atlantic City
President Joe Biden has proposed new taxes on the rich to help fund Medicare, saying the plan would help to extend the insurance program’s solvency by 25 years and provide a degree of middle-class stability to millions of older adults.
The plan would draw a direct line between those new taxes and the popular health insurance program for people older than 65, essentially asking those who’ve fared best in the economy to subsidize the rest of the population.
Ahead of the 2024 campaign season, Democrats have vowed to fend off any Republican attempts to cut the program, although so far the GOP has vowed to avoid any cuts. Still, Republican lawmakers have reached little consensus on how to fulfill their promise to put the government on a path toward balancing the federal budget in the next 10 years. Last year, members of the House Republican Study Committee proposed raising the eligibility age for Medicare to 67, which would match Social Security. But that idea hasn’t moved forward in a split Congress.
The Medicare tax rate would be raised from 3.8% to 5% on income exceeding $400,000 per year, including salaries and capital gains. That would likely increase tax revenues by more than $117 billion over 10 years, according to prior estimates by the Tax Policy Center.
Biden’s plan is also intended to close what the White House describes as loopholes that allow people to avoid Medicare taxes on some income. Besides the taxes, Biden wants to expand Medicare’s ability to negotiate drug costs, which began with the Inflation Reduction Act. He signed the sweeping legislation last year.
Taken together, the new proposals would help shore up a key trust fund that pays for Medicare, which provides health care for older adults. According to the White House, the changes would keep the fund solvent until the 2050s, about 25 years longer than currently expected.
Changes would also be made to Medicare benefits. Biden wants to limit cost sharing for some generic drugs to only $2. The idea would lower out-of-pocket costs for treating hypertension, high cholesterol and other ailments.
In addition, the budget would end cost sharing for up to three mental health or behavioral health visits per year.