Tag Archives: Tax Equity for Health Plan Beneficiaries Act

Same-Sex Couples Benefit From Un-Noticed Provisions Of Health Care Bill

140px-US-GreatSeal-Obverse.svgAccording to the New York Times and Metro Weekly, Washington D.C.’s lesbian-gay-bisexual-transgender (LGBT) newspaper, the health care bill passed by Congress late last night may benefit gay and lesbian couples by reason of unnoticed provision sponsored by Rep. Jim McDermott (D-Washington).  This new development is explained further by information posted on the Human Rights Campaign Fund (HRC) website.

According to the information HRC posted, the “Affordable Health Care for America Act,” H.R. 3962, contains several provisions of interest to the lesbian and gay communities.  As the law stands now, lesbian and gay couples are required to pay federal taxes on health benefits provided by their employer as if these benefits were extra income.  Married, heterosexual couples do not.  The health care bill designates lesbian, gay, bisexual and transgender people as a “health disparities population.”  Significantly, this opens up health data collection and grant program focused on health disparities as they relate to sexual orientation and gender identity issues.

The health care bill will also effectively end the taxation of health benefits provided to same-sex couples by incorporating the language of the Tax Equity for Health Plan Beneficiaries Act.  This will immediately benefit same-sex families by freeing up additional monetary resources to pay for their needs.  Quoting M. V. Lee Badgett, a labor economist at the University of Massachusetts, Amherst, the New York Times article stated that employees with domestic partner benefits paid an average of $1,100 a year more in taxes than married employees with the same coverage.

Rep. McDermott said these changes will ‘correct a longstanding injustice, end a blatant inequity in the tax code and help make health care coverage more affordable for more Americans.”

In addition, HRC  listed the “Early Treatment for HIV Act,” which would allow states to cover early HIV treatment through their Medicaid programs.  Presently, states may withhold treatment for Medicaid recipients until they develop full-blown AIDS.  This one addition to the health care bill alone will improve health care for low-income people living with HIV and will put the Medicaid system more squarely in the arena of best practices for HIV care, which emphasizes early treatment and not delaying until the onset of AIDS.  In the long run, early intervention also saves taxpayer dollars rather than waiting until emergency or life-threatening illnesses develop because those illnesses are more difficult and costly to treat.

Finally, and perhaps most significant from a civil rights perspective, the health care bill outlaws the considering of any personal characteristics unrelated to the provision of health care.  HRC reports that it worked with a coalition of civil rights groups to develop and lobby for this language.  No federal protections currently exist that prohibit the consideration of unrelated personal characteristics by private insurers.

Lesbian and gay couples are not the only ones to benefit from the health care bill.  The bill overhauls the current sex education system, which emphasizes abstinence from sex by young people.  This abstinence-based approach by the federal government is estimated to have cost taxpayers roughly $1 billion dollars, and is generally regarded as a failure particularly in terms of halting the spread of sexually transmitted diseases.  The health care bill provides funding for comprehensive sex education programs which focus not only on abstinence, but also reducing teen pregnancies and sexually transmitted diseases.

The bill also mandates nutritional labeling changes for food that is sold in vending machines.  This new law would require vendors with 20 or more vending machines to post a sign near the vending machines that “clearly and conspicuously” states the number of calories in the food products.

From a progressive perspective, the new provisions pertaining to same-sex couples are definitely steps in the right direction.  However, when it comes to equalizing the federal benefits conferred on married couples with the near-total absence of benefits bestowed on same-sex couples, the health care bill is merely a first step.  In matters of federal taxation, in particular, enormous disparities remain.  For example, under the Internal Revenue Code, a spouse can transfer real property to the other spouse without triggering any adverse tax consequences under the “stepped up basis” provisions of the IRC.  Same-sex couples who transfer property to each other – even if they are registered under a domestic partnership or civil union system – do not receive such benefits.  Federal public benefits, like social security benefits, are another area where improvements are woefully lacking.

The federal government enacted legislation entitled the Defense of Marriage Act (DOMA) in 1996, which was signed into law by President Bill Clinton.  DOMA states:

  1. No state (or other political subdivision within the United States) needs to treat a relationship between persons of the same sex as a marriage, even if the relationship is considered a marriage in another state.
  2. The federal government defines marriage as a legal union exclusively between one man and one woman.

DOMA is largely responsible for creating a legislative roadblock to improvements in this area.  A Constitutional Amendment to strictly limit marriage to one man and one woman has been hotly debated, but has not garnered sufficient support to be a viable alternative for opponents of same-sex marriage.