Ind. House Endorses Cigarette Tax to Fund Health Care Initiatives

Aa Indiana House committee unanimously endorsed a plan this week that would increase cigarette taxes by 54.5 cents per pack to provide health insurance to more Hoosiers and fund other health care initiatives.

Under the proposal approved by the House Public Health Committee, the current rate of 55.5 cents per pack would go to $1.10. That would generate about $223 million in annual new revenue for the state, according to the Campaign for Tobacco-Free Kids.

Democratic Rep. Charlie Brown of Gary, chairman of the committee, said his bill would provide health insurance to about 400,000 of the estimated 850,000 Indiana residents who do not have coverage.

Republican Gov. Mitch Daniels has asked lawmakers to increase cigarette taxes by at least 25 cents per pack to reduce smoking and generate an estimated $130 million a year in new money. That money would be leveraged with federal funds and participant costs to raise $480 million in health care coverage for about 120,000 adults earning less than double the federal poverty level for their households.

That level is $19,600 for a single person or $40,00 for a family of four.

Brown said initially this week that he planned to propose an increase of 4.5 cents per pack even though he personally favored an increase of $1. He said his strategy was to pressure Republicans who control the Senate to go to bat for their governor and raise it higher.

Brown said he decided to propose a much higher increase so more people could be covered. He said he was encouraged that three Republicans on his committee joined five Democrats in voting for the bill, but it must now clear the House Ways and Means Committee and then the full House to reach the Senate.

Democrats control the House 51-49, and as the bill stands, Brown predicted that he would need at least 25 Republican votes to get the bill out of the House because some Democrats would surely oppose it. He said it would be up to Daniels to lobby for GOP support.

Daniels had encouraged lawmakers to raise it higher than 25 cents, saying the bigger the increase the more Hoosiers could be covered. So the administration welcomed Brown’s 54.5-cent proposal on this week.

Under Brown’s proposal, children and adults in families with household incomes up to 300 percent of the federal poverty level would be provided with health coverage. That income level is $60,000 a year for a family of four. Adults without children who make 100 percent of the poverty level _ $9,800 for a single person or $13,000 for a couple _ or less also would be covered.

Adults with incomes above that could still buy into the plan.

Topics Indiana