While the nation debates health-care reform, state Democrats are secretly considering $1 billion in new taxes on medical services, The Post has learned.It goes without saying that those taxes will be passed on to the end user - the consumer.
Although the taxes would be imposed on health-care providers, they'd be passed along to insurers or local governments. And it's ultimately taxpayers who'd be sucker-punched.
The clandestine strategy was prompted by Democrats desperate to dodge Gov. Paterson's proposed cuts in education and more readily noticeable health-care spending, according to a source.
"The Democrats don't want to cut programs as Paterson proposed, so they're looking at a health-care hike as an alternative," said the source. "They're looking at another round of tax hikes."
The increases are expected to be considered by the state Senate Finance Committee, headed by Brooklyn Democrat Carl Kruger, at a two-day special legislative session slated to begin today.
They'd be imposed on top of about $8 billion in new taxes and fees approved earlier.
Since the new taxes would show up on bills to insurance companies, they would likely raise premium rates.
The measure would also hit local governments, which pay a portion of all Medicaid costs. They would then scramble to make up their losses through taxes.
City residents who buy their medical coverage directly from insurers saw premiums skyrocket 20 percent to 30 percent this year, a Post analysis shows.
For GHI's policyholders, premiums surged 30 percent. That means the monthly cost for an individual shot up to $2,277 for HMO coverage, a $526 increase compared with a year ago. The price tag now comes to a staggering $27,324 a year.
Health-care experts agree the increases are evidence that the market for individual policies -- mostly from the city -- has collapsed.
They described a vicious cycle in which yearly increases drive younger and healthier policyholders to drop their insurance coverage, leaving sicker and older customers in a shrinking pool to pay for even higher medical premiums.
There are about 31,000 policyholders in the direct-pay market, down from more than 100,000 a decade ago.
Democrats continue with the cruel hoax of trying to convince people that raising taxes is somehow going to make health care cheaper. It isn't. It simply means more people will be feeling the sting of more taxes.
So, why are these health care taxes being considered? Well, Gov. Paterson's proposal to impose a fee on mandatory license plate renewals that would have raised more than $100 million got shot down in a flurry of criticism.
Instead of offering a proposal in the legislature that would allow insurance companies from other states to compete in New York with their policies that were approved, which would not only alleviate the uninsured issue, but would drive down the cost of insurance through increased competition, the state is looking at ways to further increase the costs of that insurance with those who are left.