Nineteen Major Organizations Say Blue Dogs Coddling Millionaires, Making Middle-Class Pay

Original Link: http:http://tpmdc.talkingpointsmemo.com/2009/07/nineteen-major-organizations-say-blue-dogs-coddling-millionaires-making-middle-class-pay.php

By Brian Beutler

A coalition of 19 major interest groups--including AARP, and AFL-CIO--is urging House leaders--not to cave to Blue Dogs. "We commend you for providing sliding-scale premium subsidies to families up to 400 percent of the federal poverty line," reads a letter the coalition sent to key Democrats.

This is particularly important in rural and other areas where most residents have modest incomes and need assistance for coverage to be affordable.With family health premiums now averaging close to $13,000 per year, premiums alone constitute a significant portion of income even for people at the upper end of this standard. That is why this provision in the House bill is so important.

You can read the entire letter here. It's addressed to Speaker Nancy Pelosi, Energy and Commerce Chairman Henry Waxman, Ways and Means Chairman Charlie Rangel, and Education and Labor Chairman George Miller.

Right now, one of the key sticking points in House negotiations between Blue Dogs and health care leaders is the question of financing--how to pay for the bill? Leaders had initially endorsed a surtax on high income earners to cover about half the bill's cost--but, under pressure from Blue Dogs, they're now walking that back. The original proposal had been to initiate the tax on families making over $350,000 a year, or individuals making over $280,000 a year. But now, they say, they might limit the tax to millionaires only.

But that creates a cost hole that needs to be filled. And Blue Dogs have suggested extracting it from working- and middle-class Americans. The bill, as proposed, would have provided subsidies for people living under 400 percent of the poverty line to buy health insurance--and Blue Dogs are suggesting that the line be lowered to 300 percent.

Right now, the average national premium for family coverage is $12,600--or $1,050 per month. Presumably, over time, reform legislation would lower that cost, but in the interim, it will continue to cost nearly that much. House legislation would help more middle-class people cover that cost--unless Blue Dogs get their way.

Those affected by the change would be people and families living between 300 and 400 percent of the poverty line, who don't already have employer-provided health insurance.