- The Washington Times - Tuesday, May 18, 2004

Employers, insurance companies, consumers and the government would foot the bill for the financial benefits that homosexuals would gain if same-sex “marriage” is legalized nationally.

Insurance and tax costs would drop for the partners, while spousal benefits would increase.

A General Accounting Office report lists 1,138 federal laws in which marital status conveys benefits, rights or privileges. The benefits include Social Security, disability payments, food stamps, Medicare and welfare.

“Won’t this just break the bank?” said Rep. Spencer Bachus, Alabama Republican, during a House Judiciary Constitution subcommittee hearing last week on same-sex “marriage.”

Health care and retirement benefits for domestic partners of federal employees would cost the government about $1.4 billion from 2004 to 2013, according to a Congressional Budget Office report that was cited by Mr. Bachus.

Like President Bush, he supports a proposed constitutional amendment that would define marriage as a union between a man and a woman.

The exact cost to the government if same-sex “marriage” benefits were extended nationally has not been tallied, although government officials say it would be high.

“It would undoubtedly have a significant impact on the budget through lower revenues and higher spending,” White House spokesman Trent Duffy said.

Massachusetts yesterday began allowing same-sex “marriages,” and other states are considering it.

However, only the federal government can decide who can file joint tax returns, receive Social Security or get other federal benefits.

“For tax purposes, it doesn’t matter what the states rule,” said Tara Bradshaw, spokeswoman for the Treasury Department.

Many unmarried homosexual couples pay significantly more in federal and state taxes than their married counterparts, according to a National Gay and Lesbian Task Force report released last month.

The report profiled a homosexual couple that paid $1,929, or 25 percent, more per year in state and federal taxes than a heterosexual couple earning the same amount. The homosexual couple could not file a joint tax return.

As with opposite-sex couples, the sliding scale of tax rates would create the biggest advantage of a joint return for same-sex “married” couples with greatly different incomes. Equal incomes would create no advantage for a joint return.

Greater financial advantages also would come from insurance and Social Security benefits, which married people can receive when their spouses are sick, injured or die.

Insurance companies interpret their obligations to same-sex domestic partners differently.

In California, Kaiser Permanente, a health care provider, said it would provide same-sex partner benefits until the state Supreme Court rules otherwise.

However, State Farm Insurance, the auto and home insurance company, said it would provide same-sex partner benefits in California, only if the state Supreme Court gives legal recognition to homosexual “marriages” this summer.

Nevertheless, many employers are granting domestic-partner benefits, such as health insurance, as an incentive.

“By itself, that’s a big advantage, because an individual can rarely find the same kind of health insurance deal offered by a big company,” said Jackie Perlman, senior tax research analyst for H&R; Block.

Currently, employees who receive the benefits for domestic partners pay taxes on them. Legalized “marriage” for same-sex couples would eliminate the tax.

Any higher costs for employers would be passed on to consumers as higher prices for products and services.

The costs for employers would include more expensive insurance as insurers raise rates to cover the new beneficiaries and protect their bottom lines.

“If the law required that such benefits be paid, then rates would be adjusted accordingly and insurers would suffer no net loss,” said Bob Hartwig, chief economist for the Insurance Information Institute, a trade organization of the insurance industry.

A limit on costs is naturally imposed by the number of homosexual couples. The Census Bureau estimates 594,000 homosexual couples live together, compared with 57.9 million heterosexual married couples living together.

In the past year, 36 more of the nation’s 500 largest companies have offered domestic-partner benefits to same-sex couples, raising the total to 311, according to the Human Rights Campaign, a homosexual advocacy group based in Washington.

They include Apple Computer, General Electric, UPS, Nike, Best Buy and Anheuser-Busch.

The Institute of Management and Administration (IOMA), a human resources trade organization, says the costs are relatively small for employers. Same-sex partner benefits raise costs for employers by less than 2 percent, according to IOMA.

Other federal taxes and benefits reserved for heterosexual married couples involve estates and gifts.

Married couples can give each other gifts and their estates without paying taxes. Same-sex couples get no special tax break.

“For marriage purposes, an estate is treated as a community,” said Chris Sega, an estates and trusts lawyer with Washington law firm Venable. “In the absence of a marriage, when it passes from one to the other, it would be taxed. In a marriage, it would be taxed only when it’s left the community.”

The Virginia Bureau of Insurance forbids state-based companies from offering domestic-partner health-insurance benefits to same-sex couples. Self-insured companies are exempted.

In Maryland, Gov. Robert L. Ehrlich Jr., a Republican, opposes same sex “marriages,” said spokeswoman Shareese DeLeaver.

The issue has arisen in the Maryland General Assembly, but any legislation has been killed in committee, she said.

Support for same-sex “marriage” in the District is weak.

D.C. Mayor Anthony A. Williams is “very clear about not pursuing that at this time,” said spokesman Tony Bullock, the mayor’s spokesman. “There’s too much political intensity right now.”

The city allows same-sex couples to apply for a certificate of domestic partnership. If they are city employees, they can receive family health care benefits for their partners.

In addition, the D.C. Council is considering recognizing same-sex “marriages” from other states.

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