- The Washington Times - Tuesday, September 8, 2009

Sen. Joe Lieberman, Connecticut independent, is right to argue that any massive restructuring of the health care sector should be put off “until the economy’s out of recession” and that smaller measures should be implemented instead (“Not right time for major bill, Lieberman tells Democrats,” Page 1, Aug. 24).

One major piecemeal measure suggests itself — a measure that could provide an immediate major stimulus to the economy while also making health insurance more affordable for millions of Americans and correcting an injustice in the tax code as well. That measure would be to accord the same tax treatment to the cost of individually purchased health insurance as is now accorded to employer-provided insurance. This simple measure could be enacted when Congress reconvenes and would immediately put billions of dollars of disposable income into the hands of consumers. Because the measure would not affect the feasibility of any of the other proposals currently extant, we could provide reform right now (and enjoy its benefits) and work out the rest of the solution in the future.

It’s true that not everyone would benefit directly from this measure, but neither did everyone benefit directly from the “cash for clunkers” program. The important point is that everyone would enjoy the resulting boost to the economy. Besides, the direct beneficiaries would be the ones who bore the burden of unfair tax treatment for years and are entitled to relief. As it stands now, the individually insured are subsidizing the health-insurance policies of those who receive their insurance through their employers.

Once the stimulus is no longer needed (perhaps by next year) we could help defray the tax-revenue declines caused by the measure by imposing a tax on “gold-plated” insurance policies under which the tax deductibility of health insurance payments is limited to, say, $10,000 per year. This would put the tax treatment of health insurance on a par with that of home mortgage interest payments, whose tax deductibility is similarly limited.



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