AP POLL

Tax the rich to pay for health bill

[November 17, 2009]  WASHINGTON (AP) -- When it comes to paying for health overhaul, Americans see just one way to go: Tax the rich.

That finding from a new Associated Press poll will be welcome news for House Democrats, who proposed doing just that in their sweeping remake of the U.S. medical system, which passed earlier this month and would extend coverage to millions of uninsured Americans.

The poll found participants sour on other ways of paying for the health overhaul that is being considered in Congress, including taxing insurers on high-value coverage packages derided by President Barack Obama and Democrats as "Cadillac plans."

That approach is being weighed in the Senate. It is one of the few proposals in any congressional legislation that analysts say would help reduce the nation's health expenditures, but it has come under fire from organized labor and has little support in the House.

Lawmakers also are looking at levying new taxes on insurance companies, drug companies and medical device makers. But the only approach that got majority support in the AP poll was a tax on upper-income Americans.

The House bill would impose a 5.4 percent income tax surcharge on individuals making more than $500,000 a year and households making more than $1 million.

The poll tested views on an even more punitive taxation scheme that was under consideration earlier, when the tax would have hit people making more than $250,000 a year. Even at that level the poll showed majority support, with 57 percent in favor and 36 percent opposed.

"You know, I mean, why not? If they have that much money, it should be taxed," said Mary Pat Rondthaler, 60, of Menlo Park, Calif. "It isn't the same way that the guy making $21,000 is."

Not everyone agreed.

"They earn their money. And they shouldn't have to pay for somebody else. It doesn't seem fair," said Emerson Wilkins, 62, of Powder Springs, Ga.

The latest survey was conducted by Stanford University with the nonpartisan Robert Wood Johnson Foundation.

Overall, the poll found the public split on Congress' health care plans. In response to some questions, participants said the current system needed to be changed, but they also voiced concerns about the potential impact on their own pocketbooks, preferring to push any new costs onto wealthier Americans.

For example, 77 percent said the cost of health care in the United States was higher than it should be, and 74 percent favored the broad goal of reducing the amount of money paid by patients and their insurers. But 49 percent said any changes made by the government probably would cause them to pay more for health care. Thirty-two percent said it wouldn't change what they pay, and just 12 percent said they would end up paying less.

With lawmakers searching for new revenue sources to pay for their overhaul legislation, upper-income taxes may be increasingly gaining favor.

Legislation passed by Senate committees did not go that route, but now Majority Leader Harry Reid, who has a free hand in merging two committee-passed bills, is considering raising the payroll tax that goes to Medicare on income above $250,000 a year, officials told The Associated Press last week. Current law sets the tax at 1.45 percent of income, an amount matched by employers.

The Senate Finance Committee bill would tax health insurance plans costing more than $8,000 annually for individuals and $21,000 for families, although those numbers could rise. Union members are lined up against that approach because they fear their benefits could be hurt, and the public doesn't like it either, the AP poll found. Fifty-six percent were opposed and only 29 percent in favor.

Other payment methods being contemplated on Capitol Hill also met with disapproval. Participants in the poll didn't support new taxes on medical device makers, drug companies or even insurers -- even though they said in response to different questions that drug companies and insurance companies made too much money.

Forty-eight percent in the poll were opposed to new taxes on insurance companies, and 42 percent were in support. Fifty-one percent opposed raising taxes on drug and device makers, while 41 percent supported that approach.

But 72 percent of people polled said insurance companies made too much profit, compared with 23 percent who said they made about the right amount of profit. And 74 percent said drug companies made too much profit, versus 21 percent who said they made about the right amount of profit.

People who told pollsters they generally supported Congress' health care overhaul plan were also more receptive to new taxes to pay for it. Taxing health care companies, drug companies and equipment manufacturers eked out majority support from that group.

The payment approach that met with least approval by far in the poll was borrowing the money and increasing the federal debt, something Obama has repeatedly vowed not to do. Just 6 percent of people polled said they could support that approach, while 88 percent opposed it.

The poll was based on landline and cell phone interviews with 1,502 adults from Oct. 29 to Nov. 8. It has a margin of error of plus or minus 2.5 percentage points. The interviews were conducted by GfK Roper Public Affairs and Media. Stanford University's participation was made possible by a grant from the Robert Wood Johnson Foundation, which conducts research on all facets of the health care system.

[Associated Press; By ERICA WERNER]

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.