
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, June 7, 1994                   TAG: 9406070094
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A-3   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

HEALTH PLAN EASES TAX BURDEN

The new leader of the House Ways and Means Committee moved swiftly to put his stamp on health reform Monday, offering a blueprint to guarantee health insurance for every American by 1998 while requiring less in new taxes than President Clinton has proposed.

Rep. Sam Gibbons' plan would force all employers to help pay for health insurance, even if a worker was covered under a spouse's policy. But it would scale back the cigarette tax increase proposed by Clinton and also scrap a proposed 1 percent payroll tax on companies with 1,000 or more employees.

As the Florida Democrat indicated when he took over as acting chairman last Tuesday after the indictment of Rep. Dan Rostenkowski, his proposal builds on a subcommittee plan to expand Medicare to cover more than 60 million people now on Medicaid or with no private insurance.

But in a turnabout from Rostenkowski's recent predictions that there would be no way to cover everyone without an across-the-board tax increase, Gibbons' so-called ``mark'' proposes to do the job with no such tax.

Rep. Pete Stark, D-Calif., chairman of the Ways and Means health subcommittee, said the Congressional Budget Office had lowered its estimates of how much the benefits would cost and raised its estimate of how much would be saved by cost containment measures, thus allowing Gibbons to avoid any major tax increases.

Under Gibbons' plan, cigarette taxes would go up gradually by no more than 60 cents a pack, instead of the 75-cent increase that Clinton sought and the $1.25 increase approved in March by the health subcommittee. The tax, now 24 cents a pack, would climb by 15 cents in 1995, 30 cents in 1997, 45 cents in 1998 and 60 cents in 2000.

The proposed compromise, crafted to help secure the 20 votes that will be needed to get a bill through the 38-member committee, was shaped over the weekend by staff working under Gibbons' telephone direction. He was in France, where the decorated World War II paratrooper was taking part in the D-Day anniversary observance.

Gibbons would include the subcommittee's Medicare expansion, known as Part C, a government-run health insurance program for poor people now on Medicaid and those still without private health insurance. But it would force more firms to buy private coverage.

Businesses generally would have to pay 80 percent of the premiums, with subsidies for small, low-wage firms. Stark said an individual policy would cost businesses 80 cents an hour, and some would pay less than 50 cents an hour for the coverage.

Other key features of the new proposal:

Only employers with less than 50 employees could enroll them in Medicare Part C. All other employers would have to buy private insurance.

Firms with 250 or more employees could self-insure. The subcommittee bill would have allowed only firms with 1,000 or more employees to self-insure.

by CNB