Making one of New York’s most costly services costlier won’t help anyone.
There’s much not to like about the state budget currently being written largely behind closed doors, largely by one party. We tremble, for example, at suggestions the spending package may increase — increase! — 6 to 8 percent despite a projected $14 billion budget gap. Because more spending means more taxes.
The injection of federal stimulus money enabled Gov. David Paterson to back away from a host of nuisance taxes he had proposed — on everything from movie tickets to haircuts to soft drinks. But don’t think that means there won’t be new or increased taxes in the upcoming budget. In fact, some are already in place.
As part of the Deficit Reduction Plan passed last month to close a roughly $1.6 billion deficit in the current fiscal year, Democrat Paterson and the Legislature signed off on a so-called health insurance tax. The increased assessment on insurance companies is expected to hike the cost of health insurance premiums for families, individuals and businesses by more than a third.
Senate Republicans last week offered budget amendments that would have rescinded the hikes, but majority Democrats rejected them.
“When the federal government and many states are seeking to find innovative ways to make health care insurance more affordable, Gov. Paterson and the Senate Democrats have maintained the status quo and hiked health care taxes,” fumed Senate Republican leader Dean Skelos.
Skelos is a dependable source of partisan shots, but on this issue his aim is true.
At a time when President Barack Obama has made affordable health care one of his three major priorities, the health insurance tax sends New York in the opposite direction.
State Sen. Michael Nozzolio, R-Fayette, whose district includes eastern Ontario County, called the plan disastrous.
“It will make health insurance unaffordable to many individual families (and) force many businesses to stop offering health insurance for employees altogether or, worse yet, to close their doors,” he said.
The state’s Deficit Reduction Plan was passed before federal stimulus funding was announced.
Republicans like Skelos and Nozzolio are urging Paterson to use those funds to roll back the health insurance tax hike.
That’s exactly what Paterson should do. It’s clear new fees and taxes will be part of the 2009-10 spending package. But to target business health costs — which the New York State Insurance Department estimates have risen an average of 13.5 percent a year for the past decade — is a lousy place to start.