A Republican lawmaker’s ideas for changing health insurance tax rules and federal health and retirement programs might be hard on patients, but they could be great for the budget deficit, according to congressional budget analysts.
The analysts, at the Congress Budget Office, have come to those conclusions after evaluating the Roadmap for America’s Future Act of 2010, a draft bill developed by Rep. Paul Ryan, R-Wis., that would make many major changes in government programs and government spending rules.
- Health Insurance: In 2011, the current tax exclusion for employment-based health insurance would be replaced by a refundable tax credit for the purchase of health insurance, either through an employer or on an individual basis.
The tax credit initially would be set at $2,300 per adult and $1,700 per child, not to exceed $5,700 per tax-filing unit.
- Social Security: The Social Security program would be modified for future beneficiaries by reducing retirement benefits below those scheduled under current law for many workers who are age 55 or younger in 2011. The reductions would be smaller for lower-income workers.
- Individual Accounts: In 2012, workers ages 55 and younger could participate in voluntary individual accounts funded with payroll taxes. The government would guarantee a minimum rate of return equal to the inflation rate.
- Medicare and Medicaid: Medicare and Medicaid would be completely revamped.