Congress has managed to work together and to pass legislation that extends the payroll tax cut. This is about more than the payroll tax, however. It also affects the Medicare reimbursement rate for doctors, and unemployment insurance benefits for people who haven’t been able to find employment.
This is not the first extension that Congress has passed regarding the Medicare reimbursement cut, the payroll tax, and the length of unemployment insurance benefits. There was a last minute extension that happened right before Christmas of 2011. At that time, the Senate had passed an extension for those things, and the House of Representatives dragged their feet about passing it as well.
A two month extension was passed, and the members of the House of Representatives were able to go on their holiday vacation. Two months later, the same problem popped up. Once again, Congress was deadlocked about whether or not to pass these extensions. Either way they went would have a direct impact on thousands of Americans.
Today, Congress has passed another extension of the payroll tax, the unemployment insurance benefits, and the Medicare reimbursement. This time, it managed to come to an agreement before the deadline, (which would have been on February 29, 2012). The next deadline won’t be until sometime in 2013. All that is left now is for President Obama to sign this bill into law. It is expected that he will do that very soon.
How does this affect you, and your family? If Congress did not pass this bill, the result would have been that 160 million Americans would have lost a tax break this bill into law. It is expected that he will do that very soon.
How does this affect you, and your family? If Congress did not pass this bill, the result would have been that 160 million Americans would have lost a tax break that was worth around $1,000 each year. Now that the bill has been passed, your family will have about $1,000 of cash that will not be taken away from them due to the expiration of the payroll tax.
Is someone in your family receiving unemployment insurance benefits? The bill passed by Congress cuts down the maximum number of weeks that a person can receive these types of benefits. Previously, the total amount was 99 weeks. Now, it has been cut down to a maximum of 73 weeks.
The bill also allows individual states to pass laws that require people who are seeking unemployment insurance benefits to pass a drug test. Specifically, this would be aimed at the people who lost a job because they failed a drug test that their employer required them to take, or, the people who lost a job as a result of refusing to take a drug test.
People who use Medicare will probably be relieved to hear that the bill extends the deadline that would have caused doctors and hospitals that treat patients that use Medicare to have a 27% cut to their reimbursement rate. The bill prevents that from happening (for now).
Many doctors were seriously considering the idea of refusing to treat patients who use Medicare, specifically because the reimbursement rate would have been too low. That would have made it exceedingly difficult for people who use Medicare to find doctors who would see them. Now, that crisis has been averted.
Image by Bernt Rostad on Flickr