Senior Citizens, Labor Coalition Lobbies for 1-Year Delay in Catastrophic Care Tax
A coalition of senior citizens groups and labor unions representing 18 million persons is launching a major lobbying campaign to delay the controversial surtax included in Medicare’s catastrophic care program.
The protest move is directed at getting action beyond Texas Sen. Lloyd Bentsen’s proposal to reduce the surtax by 16%.
“That’s a quick fix, and it’s not the answer,” George Hennrikus, co-chairman of the Coalition for Affordable Health Care, said Friday. “We’re going to push for a delay for a year so proper investigation of the whole issue can be made by experts.”
The coalition has persuaded a bipartisan group of 10 senators and seven House members to back a bill calling for a one-year delay in the surtax. The levy, which would be paid by the 40% of Medicare beneficiaries who earn enough to pay federal income tax, is now scheduled to take effect in April, 1990, when 1989 income taxes are due.
The special surtax is calculated at the rate of $22.50 for every $150 in federal income taxes owed. Thus, a person who pays $1,500 in federal taxes would owe an additional $225 for the Medicare catastrophic program. The maximum surtax is $800 per person or $1,600 per couple.
Members of Congress “are getting all kinds of letters and hearing a lot at town meetings in their districts,” said Hennrikus, a retired Air Force colonel and legislative director for the 361,000-member Retired Officers Assn.
Sen. Pete Wilson (R-Calif.), who supports the proposed one-year delay in the surtax, has received 3,000 letters, 15,000 post cards and uncounted thousands of phone calls opposing the surtax. “There is a genuine grass-roots outpouring of opposition,” said Lynda S. Royster, deputy press secretary for Wilson.
Some See Duplication
The greatest outcry is coming from those who already have good retirement health benefits through other programs. They contend that it is unfair to make them pay additional taxes for little better coverage.
The catastrophic care program, which went into effect in January, is designed to cushion the financial blow of lengthy illnesses. Medicare beneficiaries can receive unlimited days of hospital care after paying $560 for the first day of a hospital stay.
The groups pushing for a delay in the surtax include the National Assn. of Letter Carriers, the Postal Workers Union, the California State Employees Assn., the American Foreign Service Assn. (State Department employees), and the Treasury Employees Union. Retiree organizations in Sacramento, San Diego, Los Angeles and other California areas are also active in the campaign. Groups in the coalition claim a total membership of 18 million.
The coalition is demanding a re-examination of both the program’s financing method and the structure of benefits.
Until such a study is completed, it said, the fairest way of providing catastrophic care coverage will not be known.
“The political force of the protests is really coming through,” said Judy Park, co-chairman of the coalition. “Sen. Bentsen hasn’t addressed the problem by calling for a reduction in the surtax--he has just discounted it,” said Park, who is legislative director of the National Assn. of Retired Federal Employees.
The nation’s biggest senior citizens lobby, the 28-million-member American Assn. of Retired Persons, continues to support the catastrophic care legislation. “Let’s first take a look and make sure those financial reserves are adequate,” said John Rother, AARP’s legislative director. “If there is a surplus, let’s reduce the premium.”
But the AARP opposes any effort to delay the surtax and reopen the entire legislation, contending that many elderly persons without adequate health protection would suffer.
“Congress spent two years on this stuff, and to say ‘Put it on hold and come up with something else is not honest,’ ” Rother said. The opponents “need to say what they want to come up with,” he said.
