Bill Overview
Title: Assuring Medicare’s Promise Act
Description: This bill increases net investment income tax revenues by applying such tax to the trade or business income of certain high income taxpayers and includes the increased tax revenues in the Federal Hospital Insurance Trust Fund.
Sponsors: Rep. Doggett, Lloyd [D-TX-35]
Target Audience
Population: Medicare beneficiaries
Estimated Size: 63000000
- The bill targets high-income taxpayers whose trade or business income would now be subject to the net investment income tax.
- As such, individuals with high incomes who previously did not have their business income subjected to this tax will be impacted.
- The revenues from these taxes will be funneled into the Federal Hospital Insurance Trust Fund, potentially affecting recipients of Medicare through changes in funding.
- Medicare currently covers approximately 63 million Americans, primarily those who are 65 or older, but also some younger people with disabilities or specific diseases.
Reasoning
- The policy increases taxes on specific high-income earners who previously sidestepped certain tax obligations, impacting their net income negatively.
- The funds generated are directed to Medicare, which benefits a large population of senior citizens and people with disabilities in the U.S.
- Our interviews include a mix of high-income individuals who will be directly impacted by the tax increments and Medicare recipients who are indirectly impacted by enhanced funding.
- The individuals selected span across different states to incorporate varying regional economic impacts.
- The average well-being impact on the general Medicare population may be low as the change is primarily financial and administrative.
- However, high-income individuals could see a significant impact on their financial well-being due to tax increases.
Simulated Interviews
Retired—Medicare recipient (Florida)
Age: 68 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 20.0 years
Commonness: 15/20
Statement of Opinion:
- I am worried about healthcare costs increasing every year.
- If this leads to more stable funding for Medicare, it sounds beneficial, but I am not sure how directly it will benefit me.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 7 | 5 |
| Year 20 | 7 | 4 |
Tech Entrepreneur (California)
Age: 45 | Gender: male
Wellbeing Before Policy: 9
Duration of Impact: 20.0 years
Commonness: 2/20
Statement of Opinion:
- This policy burdens successful businesses with yet another tax.
- The money is siphoned away from innovation and growth in my view.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 9 |
| Year 2 | 6 | 9 |
| Year 3 | 5 | 9 |
| Year 5 | 5 | 9 |
| Year 10 | 5 | 9 |
| Year 20 | 5 | 9 |
Finance Executive (New York)
Age: 52 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 10.0 years
Commonness: 2/20
Statement of Opinion:
- While nobody likes taxes, I can see the value in supporting Medicare.
- Hopefully, it will help lower Medicare premiums or improve services.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 7 | 8 |
| Year 3 | 7 | 8 |
| Year 5 | 6 | 8 |
| Year 10 | 6 | 8 |
| Year 20 | 7 | 8 |
Construction Business Owner (Texas)
Age: 63 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 15.0 years
Commonness: 4/20
Statement of Opinion:
- Increased taxes make me reconsider my retirement savings strategy.
- It could impact my plans if the business's net income declines.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 6 | 7 |
| Year 3 | 6 | 7 |
| Year 5 | 6 | 7 |
| Year 10 | 6 | 7 |
| Year 20 | 7 | 7 |
Retired Nurse (Ohio)
Age: 70 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 15.0 years
Commonness: 10/20
Statement of Opinion:
- Stable Medicare funding is crucial as prices rise.
- If this policy genuinely helps, it's a good step.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 4 |
| Year 20 | 6 | 4 |
Software Developer (Washington)
Age: 58 | Gender: male
Wellbeing Before Policy: 9
Duration of Impact: 10.0 years
Commonness: 3/20
Statement of Opinion:
- There should be better ways to fund Medicare than impacting high earners.
- It feels like a stopgap rather than a long-term solution.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 9 |
| Year 2 | 6 | 9 |
| Year 3 | 5 | 9 |
| Year 5 | 5 | 9 |
| Year 10 | 5 | 9 |
| Year 20 | 5 | 9 |
Retired Farmer (Iowa)
Age: 72 | Gender: male
Wellbeing Before Policy: 4
Duration of Impact: 20.0 years
Commonness: 12/20
Statement of Opinion:
- I'm on Medicare, and any improvements in funding are welcome.
- But I doubt it'll mean anything immediate for my level of care.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 4 |
| Year 2 | 4 | 4 |
| Year 3 | 4 | 4 |
| Year 5 | 4 | 4 |
| Year 10 | 5 | 3 |
| Year 20 | 5 | 3 |
Healthcare Administrator (Illinois)
Age: 59 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 0.0 years
Commonness: 11/20
Statement of Opinion:
- Increasing funding for Medicare is vital.
- This policy could lead to better outcomes for patients in the long term.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Retired Teacher (Colorado)
Age: 66 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 20.0 years
Commonness: 14/20
Statement of Opinion:
- We need every bit of funding we can get for Medicare.
- If this tax aids senior citizens in any way, I'm for it.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 5 |
| Year 20 | 7 | 5 |
Real Estate Investor (Georgia)
Age: 50 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 20.0 years
Commonness: 3/20
Statement of Opinion:
- Another tax will complicate my investment strategies.
- It's frustrating to see business income taxed more heavily.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 8 |
| Year 2 | 7 | 8 |
| Year 3 | 6 | 8 |
| Year 5 | 6 | 8 |
| Year 10 | 6 | 8 |
| Year 20 | 6 | 8 |
Cost Estimates
Year 1: $250000000 (Low: $200000000, High: $300000000)
Year 2: $260000000 (Low: $210000000, High: $310000000)
Year 3: $270000000 (Low: $220000000, High: $320000000)
Year 5: $290000000 (Low: $240000000, High: $340000000)
Year 10: $330000000 (Low: $280000000, High: $380000000)
Year 100: $500000000 (Low: $400000000, High: $600000000)
Key Considerations
- The bill targets high-income earners, potentially minimizing negative economic impacts typically associated with increased taxation.
- Potential compliance and enforcement cost considerations should be evaluated to ensure the expected tax revenue is realized.
- The redistribution of increased tax revenue to the Medicare Trust Fund could have positive, stabilizing impacts on healthcare funding for Medicare beneficiaries.