How Will ColoradoCare Affect You Financially?

According to the proponents of Amendment 69/ColoradoCare, 20% of Coloradans will be negatively impacted by the additional 10% ColoradoCare tax, and will pay more for health care than they currently pay… if the voters approve Amendment 69 this November.  This 10%  tax would increase Colorado’s state income tax rate from 4.63%  to 14.63%, and would bestow on Colorado the unceremonious title of “State with the Highest State Income Tax Rate”.

Undaunted, the proponents apparently are depending on the 80% who will pay less for health care (which includes those on Medicaid, some of whom pay zero) to vote for  Amendment 69.  There isn’t much discussion as to who the 20% are – and what their new tax burden will be – to help fund ColoradoCare health care for all Coloradans.

Should Amendment 69 pass, two groups adversely affected by ColoradoCare are retirees and  small business owners.

Those retired Coloradans on Medicare, who have funded their retirement with various investments, will be forced to pay for ColoradoCare even though it appears they will receive no benefit from it.  Retirees will remain on Medicare, Parts A, B and D, and most likely will continue to pay for their supplemental Medicare plans as well.

There’s talk of ColoradoCare providing its own Medicare Advantage plan, and its own Supplemental plan, but no guarantee.  Even if they did, and a retiree opted for one of the ColoradoCare replacement plans, it would not cover a referral to a hospital or other provider outside of Colorado.  This ColoradoCare restriction, for example, would negatively impact health care for residents of the rural communities in Southwest Colorado.  The seriously ill in these communities are frequently referred to San Juan Regional Medical Center in Farmington, N.M.   But as an out-of-state provider, referrals to SJRMC would not be covered under ColoradoCare, a state health care system.  This restriction would affect all Coloradans – not just those on Medicare.  The ColoradoCare proponents seem oblivious to the fact and fatal flaw that Colorado is a state, not a country, and a state is not an island within our United States of America.

Should Amendment 69 pass, how much will retirees pay for ColoradoCare – a health care plan they most likely won’t use?

There’s a calculator on the ColoradoCare website that will help you determine your cost, should Amendment 69 become law.  It’s called, “Calculate your Savings”, which is an optimistic moniker, since, in many cases, it’s “Calculate your Loss”.

I found the calculator prompts incomplete, and generally confusing, so I asked for clarification from info@coloradocare.org.  Forget the calculator.  Here are directions to determine how much ColoradoCare will cost you.  But first have your IRS Form 1040 on hand:

Start with total nonpayroll income (IRS Form 1040 Lines 8-10, 12-18, 20b-21)

Subtract Colorado’s retirement income tax exemption (up to $20,000/person ages 55-64 or $24,000/person ages 65+) from annual retirement income  (Social Security, pension, annuity, IRA, etc).

The ColoradoCare tax is 10% of the remaining total .  

If you itemize your federal return, the effective tax rate varies between 8.537% to 5.577%. You can see the chart by income bracket here.

The above is an accurate estimate of the amount retirees would pay in addition to what they currently pay for Medicare.

If passed, how will Amendment 69/ColoradoCare effect businesses?

ColoradoCare will cost those small business owners, who currently do not pay health care for their employees, an additional 6.67% payroll tax.  Employees will incur a 3.33% deduction from their pay check to cover their portion of the new ColoradoCare tax.
Click here to “Calculate Your Savings” for the business owner:

What isn’t mentioned on this calculator page, is that business owners – should Amendment 69 pass – not only must pay the new 6.67% payroll tax, but also pay the new 10% “premium tax” on their business net income reported on line 12 of their IRS Form 1040.  If there is net income, that is.

These are some of the financial details that are conveniently glossed over by the proponents of Amendment 69, as they relentlessly argue that what they offer is better than the current (and admittedly broken) system that benefits insurance corporations.

They frame it as “David vs. Goliath”.   Unfortunately, the Amendment 69/ColoradoCare proponents are leaving significant collateral damage in the wake of their quest to slay Goliath, and take control of Colorado’s $38 billion health care industry.

Cynda Green is an investigative reporter, writer, and photographer based out of Salida, Colorado. She may be contacted at cyndagreen@gmail.com.