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OPINION: Rx for disaster- Amendment 69

part 1 of 3

by David Tesitor

COLORADO — This amendment promises free health insurance for all Coloradoan’s. No deductibles, no coinsurance and no cost: Free.

Great, sign me up — but wait!

If you haven’t heard about Amendment 69, you soon will. This amendment is anything but free.

The purpose of this article is to explore the basics of the law. Over the next three parts we will explore why this law is not what it claims and why it would prove disastrous to the state, its economy and its citizenry. You decide if this amendment, if passed, is what it is cracked up to be. Let’s explore the language of the first sentence.

Shall state taxes be increased $25 billion annually [1] in the first full fiscal year, and by such amounts that are raised thereafter, by an amendment to the Colorado Constitution establishing a health care payment system to fund health care for all individuals whose primary residence is in Colorado, and, in connection therewith, creating a governmental entity[2] called Coloradocare to administer the health care payment system; providing for the governance of Coloradocare by an interim appointed board of trustees until an elected board of trustees takes responsibility; exempting Coloradocare from the Taxpayer’s Bill of Rights; assessing an initial tax on the total payroll from employers, payroll income from employees, and nonpayroll income at varying rates; increasing these tax rates when Coloradocare begins making health care payments for beneficiaries; capping the total amount of income subject to taxation; authorizing the board to increase the taxes in specified circumstances upon approval of the members of Coloradocare[3]; requiring Coloradocare to contract with health care providers to pay for specific health care benefits; transferring administration of the Medicaid and Children’s Basic Health programs and all other state and federal health care funds for Colorado to Coloradocare; transferring responsibility to Coloradocare for medical care that would otherwise be paid for by workers’ compensation insurance; requiring Coloradocare to apply for a waiver from the affordable care act[4] to establish a Colorado health care payment system; and suspending the operations of the Colorado health benefit exchange and transferring its resources to coloradocare?

Nowhere in this 244 word proposed law is the word free. In fact it begins with saying $25 billion in taxes shall be raised in the first year. Colorado’s current $23 billion budget is already strained, and cannot maintain its roads and bridges, or provide the education our kids deserve.

So, what is this proposed amendment and how will we pay for it? Can we believe a 21 member appointed board can effectively administer such a plan?

Amendment 69 is a constitutional ballot initiative promising to deliver healthcare for every Colorado resident, but it comes at a substantial price tag. The plan requires an additional 10% income tax imposed on every resident on all wages, capital gains, and some retirement and social security income. This is in addition to the current 4.75 state income tax rate. The total tax will give Colorado the highest state tax rate in the nation.

But wait, it gets worse. Payroll taxes will also increase. Employers will foot an additional 6.67% payroll taxes on all wages (no limit) and employees 3.33%. If you are self- employed you will pay the whole 10%. This is in addition to the 10% state tax. So, is this really free? Take for example a family of four earning $50,000 per year. Under the proposed law, they will pay $6,500 more in state tax. In contrast, under the exchange, they will have a $4,000 tax credit to apply to the health insurance plan of their choice.

While Colorado’s health exchange is criticized as being unaffordable and the deductibles high, Amendment 69 is not the answer. Amendment 69 states the $25 billion price tag can be raised at the discretion of the governing board, without the taxing authority of a state vote, because this plan is not a state program, but controlled by an appointed member board that cannot be removed. (More about this in Part II)

The law looks to replace the Affordable Care Act and the State Exchange with essentially, socialized health care, which we will also discuss next week.

What are the implications of the increase of taxes? Federal programs like Medicare, Tricare and Medicaid are exempt from the state benefits, and recipients of these programs must still pay the 10% income tax, so if they are working they must pay the additional payroll taxes without receiving any of the benefits.

This extra Medicare tax burden for seniors may force retirees to move out of state, taking their spendable income with them.

Small business owners without enough profit margin to afford an additional ten percent tax, may need to shut down, and sole proprietors would have an effective tax rate of 14.63, the highest in the country.

Rules for partnerships will vary, but gross profits will be taxed at 10%. Non-profits, regardless of tax status, would still pay the payroll taxes.

Non-residents of Colorado doing business here and paying income tax will also pay the 10%.

This is far from “Free healthcare for all.” You would still be paying for your insurance, just not out of your checkbook, but through payroll tax and withholding.

Next week we will discuss the ramifications of the law and what it means to the people of Colorado.

The amendment cannot be fully outlined in a few articles, so it is vital we the people understand what we are being asked to support. Decide for yourself. Read, research and make an informed choice.

One argument for Colorado Care is at, another perspective can be found at