Why is there no wage cap on Medicare? - Democratic Underground

antigop

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Mon Feb-21-05 03:37 PM
Original message

Why is there no wage cap on Medicare?

Why is there no wage cap on Medicare, but there is a wage cap on Social Security?

Just wondering...

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ProudDad

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Mon Feb-21-05 03:45 PM
Response to Original message

1. There's no wage cap on SS

in order to make it more regressive. I suspect that in order for Roosevelt to get it through Congress he had to water it down for the conservative dems and repukes who owned Congress then...

I suspect that there's no wage cap on Medicare because when it passed democrats and some "liberal" old style republicans were in complete control of Congress and Johnson was in the white house. There was also some lingering hang-over from the populist, egalitarian sentiments that were the "common wisdom" in the 60's -- alas now expunged from both parties.

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antigop

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Mon Feb-21-05 04:34 PM
Response to Reply #1

3. Yes, there is a wage cap

It's around $90,000 right now.

Wages above that are not subject to SS payroll tax.

But they are subject to Medicare payroll tax.

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antigop

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Mon Feb-21-05 04:37 PM
Response to Reply #1

4. See this link

>> Currently, the tax is paid on only the first $90,000 of a worker's annual income. The limit rises every year but some lawmakers have proposed bigger increases.
>>

Article link is at
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=227x563

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Inland

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Mon Feb-21-05 03:57 PM
Response to Original message

2. There used to be one.

I am not sure why or when it came off. Eighties, maybe?

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papau

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Tue Feb-22-05 10:28 AM
Response to Original message

5. Medicare payroll tax removed the wage cap in Clinton 93 Budget

Medicare payroll tax removed the wage cap in Clinton 93 Budget

Prior to 93 Clinton, the HI Tax had a cap of around 130,000 (increasing annually like the OASDI cap which was around 55000 at that time)

The wage cap was/is a safety valve - when more money needed a raise in the cap rather than rate worked to keep pay-as -you go financing of the system running. The cleaner approach of a tax rate change was - well - a "tax change" - and those are always a GOP talking point.

Plus to get it passed in 35 the rich could not be made too angry - now could they?! :-)

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antigop

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Tue Feb-22-05 10:54 AM
Response to Reply #5

6. thanks for the info n/t

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