Dem Senator Warns of 'Big, Big Tax' on Middle Class in Baucus Bill

http://blogs.abcnews.com/thenote/2009/09/dem-senator-warns-of-big-big-tax-on-middle-class-in-baucus-bill.html

It's not every day that you hear a Democratic senator charge that a
fellow Democrat is proposing to raise taxes on the middle class, but
that is what happened on Tuesday when Sen. Jay Rockefeller, D-W.Va.,
ripped into the health-care bill developed by Sen. Max Baucus, D-Mt.,
the chairman of the Senate Finance Committee.

The Baucus proposal would impose, starting in 2013, a 35 percent
excise tax on insurance companies for "high-cost plans" -- defined as
those above $8,000 for individuals and $21,000 for family plans.

Health economists believe a tax on high-priced benefits could help
slow the growth of health costs by making consumers more sensitive to
prices.

The tax contemplated by Baucus is also a big revenue raiser. It is
expected to raise $200 billion, money that Baucus is hoping to use to
pay for subsidies for the uninsured.

Given how much money this kind of tax can raise, Rockefeller says he
understands why it is "tempting."

The West Virginia Democrat worries, however, that a lot of middle
class workers, like the coal miners in his state, will end up facing
"a big, big tax" under the Baucus bill because they currently enjoy
generous employer-provided health care benefits which they receive tax
free.

Referring to Baucus, Rockefeller said, "He should understand that (his
proposal) means that virtually every single coal miner is going to
have a big, big tax put on them because the tax will be put on the
company and the company will immediately pass it down and lower
benefits because they are self insured, most of them, because they are
larger. They will pass it down, lower benefits, and probably this will
mean higher premiums for coal miners who are getting very good health
care benefits for a very good reason. That is, like steelworkers and
others, they are doing about the most dangerous job that can be done
in America."

"So that's not really a smart idea," Rockefeller continued. "In fact,
it's a very dangerous idea, and I'm not even sure the coal miners in
West Virginia are aware that this is what is waiting if this bill
passes."

Rockefeller made his comments on a conference call with reporters
which was sponsored by the liberal Campaign for America's Future.

Rockefeller, who sits on the Finance Committee, said that he cannot
support the Baucus bill unless it receives major improvements during
the amendment process.

Baucus, the Finance chair, is scheduled to discuss his "chairman's
mark" with reporters on Capitol Hill at 12 noon on Wednesday.

ABC News' Brittany Crockett contributed to this report.