Some Democrats dislike tax on insurance plans

WASHINGTON — Unhappy Senate Democrats on Thursday found plenty to complain about in the fine print of the latest health-overhaul bill, particularly a tax provision they fear would hit hard at middle-class Americans, from coal miners in West Virginia to firefighters in New York.

The opposition sprang up a day after Senate Finance Committee Chairman Max Baucus, D-Mont., unveiled long-delayed legislation that would transform the nation's health-care system, requiring almost everyone to buy insurance, making insurance companies cover people with pre-existing medical conditions and reining in spiraling health-care costs.

The bill has given fresh momentum to President Barack Obama's top domestic priority of extending health coverage and controlling costs.

To pay for the 10-year, $856 billion bill, Baucus wants to tax high-value insurance plans, those worth $21,000 for a family and $8,000 for an individual. Baucus says those are "Cadillac plans" enjoyed by a small minority of Americans. Aides said about 10 percent of plans and 8 percent of taxpayers could be affected.

But other Democratic senators fear that the tax would reach deep into middle-class pocketbooks, and labor unions are upset. Two Democrats on the Finance Committee, Sens. John Kerry of Massachusetts and Jay Rockefeller of West Virginia, along with other senators, say they want to limit the tax before signing off on the bill.

"We need to make it fairer to working people, so that working folks don't get dragged into this at a level where they just don't have the incomes to support it," Kerry told reporters after a closed-door committee meeting to discuss the bill. The panel will begin voting on the bill Tuesday.

Rockefeller, who met privately with Obama on Wednesday, said the proposal "could prevent workers in high-risk professions from getting the health benefits that they need, particularly coal miners," a significant constituency in his state.

Insurers and business groups also oppose the new tax and other fees in the bill, and the U.S. Chamber of Commerce is wasting no time making its objections known. The chamber announced it will begin airing a new TV ad Friday in more than a dozen states, lambasting "Washington politicians" who "want new taxes on health-care companies — taxes that will get passed on to you."