The House Ways and Means Committee is to meet this afternoon to consider a Senate package of Social Security financing changes that includes the controversial 1.3 percent Medicare tax on federal and postal workers.
Under the Senate plan, government employes would be required to pay anywhere from $100 to $450 a year, depending on salary, to help finance Medicare.
In return, employes who are not now eligible for Medicare (because they have not worked, or not worked long enough, under Social Security-covered jobs) would be covered by Medicare when they retire.
Federal and postal union leaders are lobbying all-out to block the Medicare tax. In addition to the new bite on U.S. paychecks, it could be the first step toward mandatory Social Security coverage for government employes. U.S. civil servants now have their own retirement system, separate from Social Security.
If the House committee rejects the Medicare portion of the Senate bill, and that objection is sustained by the full House, the matter would have to be resolved in conference later with the Senate.
If the House committee accepts the Senate version, however, the matter could go straight to Senate-House conferees with both sides on record as favoring the Medicare tax. It could be knocked out in conference, although that is unlikely if both sides go into the meeting favoring the tax.
Rep. Steny Hoyer (D-Md.) is one of the many Washington-area legislators who oppose the Medicare tax, which would hit many Maryland, Virginia and D.C. voters.
Hoyer says that feds (or their spouses) who pay into the Social Security system for the necessary 40 quarters already qualify for Medicare. Those who do not are protected by the Federal Employee Health Benefits program.
Besides being an unfair extra tax on feds, Hoyer says, the Medicare proposal will wind up costing the government more money. He says that the government now pays an average $1,458 annually for each Medicare recipient but only $450 per year for federal retirees, whose primary health bills are paid by the FEHB.
This is the situation: If the Ways and Means Committee rejects the Senate Medicare plan today, the tax stands a 50-50 chance of being blocked in conference. If the committee accepts the Senate measure and goes directly to conference, odds are that the Medicare tax will become a reality next January.