As reported Monday, HHS Secretary Kathleen Sebelius said the NFL “has been very actively and enthusiastically engaged [in Obamacare promotion talks with HHS] because they see health promotion as one of the things that's good for them and good for the country."

This potential partnership between the Obama administration and pro sports leagues - such as the NFL, NBA, MLB, and NHL – to shill for the partisan and controversial Obamacare law should be rejected by the commissioners and players of each league. The Obamacare law contains twenty new or higher taxes, including one that will particularly harm families with special needs children.

Here’s how it works: The 30 - 35 million Americans who use a pre-tax Flexible Spending Account (FSA) at work to pay for their family's basic medical needs face a new Obamacare cap of $2,500. This will squeeze $13 billion of tax money from Americans over the next ten years. (Before Obamacare, the accounts were unlimited under federal law, though employers were allowed to set a cap.) Now, a parent looking to sock away extra money to pay for their family’s medical needs will find themselves quickly hitting this new cap, meaning they would have to pony up some or all of the cost with after-tax dollars. 

Needless to say, this tax will especially impact middle class families.

There is one group of FSA owners for whom this new cap will be particularly cruel and onerous: parents of special needs children.  Nationwide there are several million families with special needs children and many of them use FSAs to pay for special needs education. Tuition rates at one leading school that teaches special needs children in Washington, D.C. (National Child Research Center) can easily exceed $14,000 per year. Under tax rules, FSA dollars can be used to pay for this type of special needs education. This Obamacare tax provision will limit the options available to these families.

Besides, a fan wants to enjoy watching his favorite team play, not be reminded about how his taxes have gone up.

Rather than help advocate for a law that hikes taxes on families with special needs children, the NFL and NBA should be standing up for its fans.

The House is voting today on H.R. 1549, the “Helping Sick Americans Now Act.” This legislation enjoys broad support across the conservative movement, including from those organizations most active in Obamacare repeal efforts.

Independent Women’s Voice organized a coalition letter of twenty-one conservative organizations and leaders who support H.R. 1549, including Americans for Tax Reform, National Taxpayers Union, FreedomWorks, Let Freedom Ring, Tea Party Nation, Richard Viguerie, and Grace-Marie Turner.

H.R. 1549 defunds an ACORN-style slush fund in Obamacare controlled by HHS Secretary Kathleen Sebelius, and uses that money to enroll the sickest Americans in health insurance plans.

The full text of the letter and list of signatories is below:

 

Dear Leader Cantor and Congressman Pitts,

We want to thank you for drafting, and offering to call up in the House, a bill that allows

Members to choose between continuing to have part of the so-called Affordable Care Act fund

lobbyists, activist organizations, and ad campaigns to raise taxes and restrict freedom, as it is

presently doing, or redirecting some of those funds to make insurance more affordable for

Americans with pre-existing conditions, while reducing overall spending. That’s the decision

the House will face when it considers your H.R. 1549, the Helping Sick Americans Now Act. It

should be an easy choice.

 

We fully support repealing – and short of that fully defunding – ObamaCare, and in a perfect

world that is what we’d have already done and would do again tomorrow. Collectively, we

represent millions of Americans who recognize the harm ObamaCare will do to medical choice,

access, and affordability, and know there are far better ways to improve health care. As long as

we face the reality of this President and a Senate controlled by Democrats, we recognize that

repeal will take time. We work every day to build awareness of the false promises and real harms

of this dreadful law, and support for defunding, de-authorizing and ultimately repealing it. As

we work toward repeal, we want to ensure that we protect innocent Americans from the worst

aspects of the law, and mitigate the law’s damage to our country.

 

That’s why we support the Helping Sick Americans Now Act. It would redirect money that’s

currently being used to implement some of the worst aspects of the existing law to the Pre-

Existing Condition Insurance Plan, or PCIP, a federal high-risk pool insurance program that

helps provide coverage for those with pre-existing conditions, but which the Administration

closed to new enrollees earlier this year due to funding constraints. The bill takes $4 billion from

an Obamacare slush fund and reallocates part of it to helping sick people the President has

turned his back on. The remainder, about $1 billion, goes to deficit reduction. To be clear: this

bill defunds Obamacare.

 

The American people need to hear about the failure and hypocrisy of this Administration, and

the Helping Sick Americans Now Act will help to get this message out. First, the Administration

sold ObamaCare as a vehicle for helping those with pre-existing conditions, but knowingly

poorly designed and underfunded the primary program serving that most vulnerable group.

Once the consequences of that under-funding became clear, instead of reallocating existing

slush funds to support it, they shut the door to the program on an estimated 40,000 sick

Americans, causing real hardship for many Americans who currently have no better alternatives.

 

This didn’t have to happen. Secretary Kathleen Sebelius has the authority under the Patient

Protection and Affordable Care Act (PPACA) to transfer money from the so-called Prevention

and Public Health Fund (“Prevention Fund,” or “Slush Fund”) to the PCIP. But she has

knowingly refused to take this simple, compassionate step, because politics takes preference

over the people this Administration no longer needs to pretend to care about. H.R. 1549 would

therefore require HHS to transfer approximately $4 billion in FY 2013-2016 funding from the

Prevention and Public Health Fund to PCIP. This would allow CMS to enroll sick Americans

who have been denied coverage because of the Administration’s decision.

 

In addition to prioritizing sick Americans, H.R. 1549 would also eliminate four years of funding

from the Prevention and Public Health Fund, one of ObamaCare’s worst programs, which is rife

with waste and abuse. For example, the “Prevention” fund has financed pet neutering

campaigns, bike/park signs, and gardening, and more disturbingly lobbying campaign – in some

cases directly funding lobbyists in violations of federal law – to enact fast food construction

moratoriums and soda taxes (included polling to test messages for higher soda taxes).

 

Reallocating the Prevention and Public Health Fund resources would at least be a more

constructive use of funds rather than pouring more money down into the bottomless maw of an

unworkable bill. If this funding is not reallocated to PCIP then it will continue to go to

implementing ObamaCare. In fact, the Administration has tapped $54 million from the

Prevention Fund to pay individuals and community groups to sign people up for ObamaCare

exchanges (and simultaneously check if they are registered to vote). Just last week, the

Administration announced that it plans to use $304 million for enrollment and advertising

campaigns for Obamacare. The Prevention Fund is one of the last sources the Administration

has to use for 2014 implementation of its $1 trillion “train wreck” of an exchange program.

 

H.R. 1549 would also make the PCIP function better by eliminating the rule that requires

already sick individuals to go without coverage for six months in order to gain eligibility for the

program. While PCIP could be improved further, and should in fact be replaced with smarter

programs, it makes sense to prioritize funding for vulnerable Americans over slush funds for the

remainder of 2013. Preliminary estimates also show that H.R. 1549 will reduce the deficit by

approximately $1 billion.

 

This bill represents the first opportunity that our congressional allies and we have had, since the

health care law's enactment three years ago, to show what we are for – and whom we are for –

and not just what we are against.

 

Of all the bills considered in the House to date, to repeal, defund, or dismantle ObamaCare, this

bill is the first to point towards the kinds of market-oriented reforms that most conservatives

would replace ObamaCare with. If enacted, the bill would help to slow down the law's

implementation, a significant achievement. The simple act of debating the bill will give

conservatives the opportunity to highlight all that’s wrong with ObamaCare, and with the

Administration's misuse of funds and callous attitude toward those with pre-existing conditions.

 

The bill is a win-win for conservatives and the American people. The law's implementation is

already chaotic – in the words of Senator Baucus, a “train wreck.” This bill will make it harder

for the Administration's engineers to get that destructive train back on track.

 

Even after this bill has been debated and sent to the Senate, we will continue to fight for

full repeal – this year. Three years of ObamaCare is enough. We must end this law before

January 1st, when it is scheduled to take full effect. We appreciate your leadership on this

important issue, and look forward to working with you as we continue toward our shared

mission of repealing ObamaCare – while creating a better health care system that benefits all

Americans – this year.

 

Sincerely,

 

Heather Higgins, Independent Women’s Voice

Phil Kerpen, American Commitment

Dean Clancy, FreedomWorks

Ryan Ellis, Americans for Tax Reform

Grace-Marie Turner, co-author, Why ObamaCare is Wrong for America

Pete Sepp, National Taxpayers Union

Colin Hanna, Let Freedom Ring

Richard Viguerie, ConservativeHQ.com

Judson Phillips, Tea Party Nation

Jim Backlin, Christian Coalition of America

Jim Martin, 60 Plus

Jim Capretta

Ken Hoagland, Restore America’s Voice Foundation

Dee Hodges, Maryland Taxpayers Association

Randy Kendrick

Seton Motley, Less Government

C. Preston Noell III, Tradition, Family, Property, Inc.

Amy Ridenour, National Center for Public Policy Research

Alex St. James, Republican National Policy Committee

Wes Vernon, columnist

Daniel Weber, Association of Mature American Citizens

As just one example, below are some of the taxes that will impact the purchase of dental braces:

Obamacare Medical Device Tax:  As of Jan.1, Obamacare imposes a new tax of 2.3 percent on medical device manufacturers, including those who make dental braces.  The tax is imposed on gross sales -- even if the company does not earn a profit in a given year.  While the tax will be paid to the IRS by the manufacturer, the tax will be passed along as a higher cost of the product, ultimately to be borne by the parent buying the braces for their child.  With the cost of braces being as high as $7,625 this new tax could raise the cost of these braces by $175.

Obamacare Flexible Spending Account Cap:  As of Jan. 1, the 30-35 million Americans who use a pre-tax Flexible Spending Account (FSA) at work to pay for their family’s basic medical needs face a new government cap of $2,500. This will squeeze $13 billion of tax money from Americans over the next ten years. (Before Obamacare, the accounts were unlimited under federal law, though employers were allowed to set a cap.) A parent looking to sock away extra money to pay for braces would find themselves quickly hitting this new cap, meaning they would have to pony up some or all of the cost with after-tax dollars.  Needless to say, this tax will especially impact middle class families.

Obamacare “Haircut” to the Medical Itemized Deduction:  Faced with higher prices for braces and a reduced ability to pay for them with their FSA, parents might decide to deduct the cost of braces on their tax returns.  Unfortunately, Obamacare makes this harder, too. 

Before Obamacare, Americans facing high medical and dental expenses were allowed a deduction to the extent that those expenses exceeded 7.5 percent of adjusted gross income (AGI).  As of Jan. 1, Obamacare imposes a threshold of 10 percent of AGI. Therefore, Obamacare not only makes it more difficult to claim this deduction, it widens the net of taxable income.

According to the IRS, 10 million families took advantage of this tax deduction in 2009, the latest year of available data. Almost all are middle class. The average taxpayer claiming this deduction earned just over $53,000 annually. ATR estimates that the average income tax increase for the average family claiming this tax benefit will be $200 - $400 per year. To learn more about this tax, click here.

This is just a small example of how a simple, everyday, kitchen table decision has been fundamentally altered by the tax hikes in Obamacare.  It does not even take into account the indirect effects of the rest of the tax hikes in the law, which will reduce family income and kill jobs. 

Follow the authors on Twitter @JohnKartch and @RyanLEllis

1. Obama: “Four years ago, I told the American people I would cut taxes for middle class families. And I did.”

Reality:  Obama has clearly broken his 2008 “firm pledge” not to sign “any form of tax increase” on families making less than $250,000.  Of the twenty new or higher taxes in Obamacare, no fewer than seven of the taxes fall directly on middle class families, and many more will raise costs indirectly for these families. 

Of recent note, Obama has altered his tax pledge: In a second term, he only promises not to raise income taxes on those making less than $250,000, and only for one year. After the one year has come and gone, all taxes are fair game, and at any income level.

2. Obama: “The fact that is that [Romney] only has to pay 14 percent on his taxes when a lot of you are paying much higher.”

Reality:  The President is intentionally mixing apples and oranges, and more than once.  What he is accurately describing is Mitt Romney’s average income tax rate—that is, his income tax liability as a percentage of his adjusted gross income.  In 2011, he paid $1.9 million in federal income tax on $13.7 million of AGI, for an average income tax rate of 14 percent.

What President Obama would like middle class taxpayers to do is to compare Romney’s average rate with their own marginal rate.  The marginal rate is the rate at which a household’s last dollar of taxable income is taxed.  For middle class families, their marginal tax rate is 15, 25, or 28 percent, depending on income.  These are all higher than Romney’s average rate, but that isn’t a fair comparison.  It’s mixing apples (average rate) with oranges (marginal rate).

The President would also like middle class families to add in their total federal tax burden (which includes Social Security and Medicare payroll taxes) and compare this to Romney’s average income tax rate.  Again, this is comparing apples (income tax burden) with oranges (total federal tax burden).

The fairest method is to compare middle class average income tax rates with Romney’s average income tax rate.  After all, that latter data point is the one the President used, so it’s most fair to compare that number with middle class families.  According to CBO, a family in the middle income quintile (those earning at least $34,000) had an average income tax rate of 3.3 percent.  Those in the fourth quintile (earning at least $50,000) had an average income tax rate of 6.2 percent.  Only when you get to the top quintile (those earning $75,000 and more) do the average rates cross Mitt Romney’s 14 percent line.  In no way can the President credibly claim that a typical middle class family has a higher average income tax rate than Romney’s 14 percent average income tax rate.

Even when comparing total federal taxes, it doesn’t hold up.  Romney’s income puts him in the top 1 percent of income earners.  Their overall average federal tax rate (which includes payroll taxes as well as income taxes) is nearly 30 percent.  Compare that to families earning $34,000 per year (14 percent), and $50,000 per year (17 percent). 

As ATR has pointed out, the tax code is already steeply-progressive.  It doesn’t help matters when the President of the United States is playing fast and loose with different data sets.

3. Obama: “[Four years ago] I told you I'd cut taxes for small businesses, and I have.”

Reality:  The principal tax cut for small business that President Obama is bragging about is a small employer tax credit to purchase health insurance.  The only problem is that this tax credit is so complicated to comply with, very few small employers are actually using it.  The IRS and HHS practically have to beg employers to even take a look at it.  According to CBO, their estimated score for this tax provision is half of what they originally thought it would be, or $20 billion over the next decade.  Meanwhile, even this small amount is dwarfed by the rate hike small employers will face under the President’s plan.

In May, the Government Accountability Office released a report focusing on why so few businesses were using the credit:

“According to employer representatives, tax preparers, and insurance brokers that GAO met with, the credit was not large enough to incentivize employers to begin offering insurance. Complex rules on FTEs and average wages also limited use. In addition, tax preparer groups GAO met with generally said the time needed to calculate the credit deterred claims.”

Meanwhile, the President’s plan to raise the top two marginal income tax rates will not just affect high-income families.  Because small businesses pay taxes using the individual rates, a hike in these rates is a hike in the small business tax rate.  According to IRS data, a majority of small business profits face taxation in the top two brackets. 

The Obama-Biden plan is a tax increase on one million successful small businesses. The plan will raise taxes on a majority of small business profits and hit those companies which employ a majority of Americans who work for small businesses. Americans for Tax Reform spells out the details here.

4. Obama: “Both Governor Romney and I agree actually that we should lower our corporate tax

rate.”

Reality:  Obama claims to be for corporate tax reform, but it isn’t even in his budget. His administration released a plan in the spring, but he hadn’t said a word about it until the first debate.

Even that plan would have been a net corporate income tax hike of hundreds of billions of dollars.  With a federal rate of 28 percent, the U.S. would still have a higher corporate tax rate than major trading partners Canada, the United Kingdom, Germany, and Mexico.  It would be higher than the OECD (developed nation) average of 25 percent. The federal rate reduction from today’s 35 percent is inadequate.

Furthermore, Obama has already signed into law tax hikes on corporate shareholders. Taxes on corporate owners (i.e. capital gains and dividend taxes) are additional bites at the apple of corporate profits.

The combination of the capital gains and dividends rate hikes in his budget and Obamacare’s 3.8 percent “investor surtax” have the effect of raising the integrated tax on corporate profits. The capital gains and dividends rate hike will hit middle class savings hard by lowering stock prices, impacting everyone’s 401(k) and IRA.

5. Obama:  “What I've also said is for above $250,000, we can go back to the tax rates we had when Bill Clinton was president.”

Reality:  Under the Obama-Biden plan, several tax rates for these households would be higher than during the Bill Clinton years. In particular, tax rates on investment income would be much higher than when Clinton left office:

	Current Rate	Clinton Rate	Obama Rate
Capital Gains	15%	20%	23.8%
Dividends	15%	39.6%	43.4%