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Paying for healthcare reform with a 'botax'

Botox, plastic surgery, botax, excise taxes, healthcare reform We've seen taxes on death, luxury and sin, and now the Senate is poised to impose one on vanity. To help cover the cost of health insurance subsidies for the working class, the bill cobbled together by Senate Majority Leader Harry Reid (D-Nevada) would create a 5% excise tax on elective cosmetic surgery. "Elective" is the important word here; the new levy wouldn't apply to reconstructive surgery for people who'd been disfigured.

The idea, which some Senate Democrats have been kicking around for months, has already been tried out in New Jersey, where it reportedly brought in a fraction of the expected amount. That's probably true because it's relatively easy to evade a tax levied by only one state; dodging one assessed in all 50 would be a bigger challenge, although hardly an insurmountable one.

If this were a Republican proposal, I'd suspect it was a form of payback to Hollywood liberals. But it's a Democratic idea, a small piece of the party's attempt to make the wealthy pick up as much of the tab for healthcare reform as possible. (Not that cosmetic surgery is only for the rich, but it certainly takes a fair amount of disposable income.)

The biggest problem with this kind of tax is that, as the Tax Foundation points out, it distorts behavior. And unlike smoking or even drinking sugary cola, it's not a behavior that policymakers have a reason to discourage. Elective cosmetic surgeries aren't covered by insurance, and they don't contribute rising healthcare costs or the looming insolvency in Medicare.

No, these procedures are simply an inviting target, as per Russell Long's axiom about taxing the man behind the tree

Along the same lines, Reid's bill would hike the Medicare tax on wages above $200,000 by almost 35%. The change is projected to raise 10 times as much as the tax on plastic surgeries -- $54 billion over 10 years vs. $5 billion. But it violates the spirit of Medicare, which is an insurance program, not a savings plan. The benefits it provides are the same regardless of how much you've paid into the system, and they're no more valuable to a retiree who was a big earner than one who was a low-wage worker bee.

By adding those two taxes to the bill, Reid and company were able to reduce the amount collected through a tax on expensive health insurance plans. Such a tax would distort behavior too, but in a good way -- by encouraging people to obtain insurance plans with higher deductibles and co-payments, which would be less likely to promote overconsumption of healthcare services.

Organized labor bitterly opposes this surcharge, however, because it would affect rank-and-file union members who've bargained for rich insurance plans, not just CEOs with gold-plated benefits. That makes it a tough sell for Democrats, even if it's better policy than simply slapping more taxes on the rich.

-- Jon Healey

Photo credit: Mark Boster / Los Angeles Times


Comments () | Archives (10)

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I find it annoying that when all that are involved in getting the health care bill to pass, never are the lives mentioned that will be lost by all of the games that are being played due to a lack of coverage by those that could care less who lives or dies as long as it is somebody else. This is the America that we call the greatest nation in the world but it seems that it is only great if you are rich and can afford the life that only you can pay for!


Senate Majority Leader Harry Reid (D-NV) released a merged version of the Senate comprehensive reform on 11/19/09, which Mike Oliphant whom manages Utah health insurance plans for www.benefitsmanager.net/utah-group-health-insurance.htm employers could get behind and support some of it (Patient Protection and Affordable Care Act, or H.R. 3590). This should encourage the private sector health insurance carriers to form INSURANCE EXCHANGES which is what we have done here in Utah. They carry the risk and burden, not the tax payer. See more about this at http://www.ahealthinsurancequote.com/reform.html

Richard Deight

If this "Botax" thing passes, what's going to happen to Nancy Pelosi, Barbara Boxer, and all the 70-ish women leading the headlong rush to government health care, who have obviously "had work done"? What next? A tax on hair dye?

Image is everything. Whatever will they do?


"At $300 Million per vote it's pretty expensive. Thank you so much, NOT, for being a pusher of the most immense tax increase big brother ever tried to foist on Americans. At some $300 millions per vote (check Louisiana's Senator) this is the most expensive steamroller ever bought. Socialist and Marxist Senators Feinstein, Boxer, Reid, and the rest are cooperating with "Our Glorious Leader" in destroying America - "Our Glorious Leader" praised the bowl movement in the Senate from Korea, home of another equally demented "Glorious Leader". The illegal aliens are rejoicing at this step toward yet another "amnesty"."

Dr. Phillips

The administration's healthcare plan is growing increasingly unpopular by the hour. The proposals coming out of their public relations efforts are empty and lacking credibility. This plan is too costly, unmangeable and insensitive to the desires of the American people. This plan will be ultimately rejected or overturned by voters in 2012. A cooperative, monitored effort between the medical and corporate sectors can cover those currently uninsured with compassionate care. Voters will make these changes
sooner rather than later. Incidentally, in spite of what the administration might report, the Rasmussen polling is most accurate regarding healthcare reform. The Obama healthcare program prognosis is unhealthy.


BOTAX - The best possible way to fund health care for those who need but cannot afford it.


There is no proof at all that any lives are being 'lost' because of deliberate delay, or that any lives might be 'saved' if obamacare in any form gets passed (pardon the pun).
What IS certain is that American freedoms will be lost if any form of obamacare passes.
Obamacare is NOT about "saving" anyone, treating anyone, medicating anyone, or examining anyone. Obamacare is all about "command and control" wherein D.C. commands, and you are controlled, which is exactly 180 degrees backward from what our Constitution is all about.


Sad to see "science" bought off by government grants awarded by politically "correct" motivated slugs. At one point in the USA at least physicians and scientists were pretty much trusted to look for, discover, and truthfully report findings - today, with "obamacare", "global warming and 'cap/trade'" exposed as hoaxes committed by prostituted frauds in white lab coats there is a high level of scepticism, distrust, and anger directed toward these same groups of individuals and their "unbiased" opinions. The focus of the public's weath really needs to be on the politicians, like Obama, who just cannot bring themselves to do or to say anything truthful - they need to be fired.


Pelosi/Reid/Obama plan to pay for their monstous plan by turning Americans into wage-slaves who owe their soul to the "company" store owned by Obama

Michael C. Pickart, M.D., F.A.C.S.

The Bo-Tax is ridiculous. Why?...

It taxes the Middle-Class: The typical cosmetic surgery patient is NOT rich. The average income of a Botox patient is between $30K-90K per year.

Discriminates Against Woman: 86% of cosmetic surgery is performed on woman. Why not put a tax on sports cars, which are disproportionately driven by men and disproportionately involved in accidents? Regarding public and environmental health, sports cars are actually more problematic than Botox.

Violates Patient Privacy: Who is going to collect the tax? Some bureaucrat will have to rifle through your health care records to determine whether that nasal reconstruction was for cancer or for vanity.

Is Arbitrary: When is Botox cosmetic and when is it "necessary"? At first glance, it might seem obvious, but I have plenty of patients who receive Botox for wrinkles, but whose migraines have simultaneously disappeared. So, was it a wrinkle treatment or a headache treatment? Since the Botox was both, is the patient just taxed 2.5%??

Has Failed State Experience: In New Jersey, some estimate that $3 was spent for every $1 collected. Perverse! In fact, the New Jersey state legislature has tried to repeal the tax. The state congressman who introduced the tax has admitted that it has been a failure.

Lastly, and most importantly, Botox and other cosmetic procedures are "fun," and have nothing to do with the current health care crisis. Why are we taxing self-improvement? If we dislike vanity, then why not add the 5% tax to the whole fashion industry?

If it's sin we don't like and if it's behaviors that we would like to change, then I advocate taxing Hostess, Frit0-Lay, and Haagen Dazs (in addition to booze and cigarettes). Obesity, alcoholism, and smoking are culprits in the health care fiasco, not Botox.



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The Opinion L.A. blog is the work of Los Angeles Times Editorial Board membersNicholas Goldberg, Robert Greene, Carla Hall, Jon Healey, Sandra Hernandez, Karin Klein, Michael McGough, Jim Newton and Dan Turner. Columnists Patt Morrison and Doyle McManus also write for the blog, as do Letters editor Paul Thornton, copy chief Paul Whitefield and senior web producer Alexandra Le Tellier.

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