Cutting Surtax on Medicare
In your editorial there is a misunderstanding that needs correcting. You stated, “It will be important, in working out any reductions, to preserve the basic concept that makes it the first element of health insurance for those 65 and older that is self-funded, with seniors bearings costs proportionate to their incomes.â€
One of the reasons that seniors are organizing, protesting and writing in opposition to this surtax is that it is not based on income but on an individual’s tax bill. For example: A married couple over 65 with an income from a company pension that is $26,000 would pay an income tax of $2,254 plus a 15% surcharge on their 1989 taxes, which is $385 each, for a total of $770.
Now a couple who have an income of $50,000 from tax-free bonds will pay nothing on that income, but will have to pay a surcharge only on half of their Social Security. In order to protect the truly rich seniors, this act provides a ceiling so that they are limited in the amount they would pay.
I think your statement that seniors bear the cost of the surtax proportionate to their income is misleading and should be clarified. If the act based the tax on total income instead of the amount of their tax bills, seniors in the lower and middle-income levels would pay far less than they are now required to pay.
LLOYD B. STEELE
Los Angeles
