Another wily Bush plan which will be shot down by Congress because it’s screwy which will then allow Bush to claim the Democrats don’t want to do anything in an area the country desperately wants something done but he and his group don’t want any changes because it might cut profits for insurance companies. [rhetorical question] Can’t anything that needs to be done in this country get done without politics getting in the way? [/rhetorical]
President Bush will propose deep tax breaks for Americans who purchase their own medical insurance and would finance the plan with an unprecedented tax on a portion of the healthcare plans that workers receive from their employers, according to the White House.
The initiative, which the president briefly previewed in his radio address Saturday, has a dual purpose: It would create a financial incentive for the estimated 46 million to 48 million Americans who lack health insurance to buy it. And it is intended to rein in the soaring cost of health insurance by encouraging workers in high-priced plans to seek more modest coverage.
[…]
The basic concept of the plan is that employer-provided health insurance, now treated as a fringe benefit exempt from taxation, would no longer be entirely tax-free. Workers could be taxed if their coverage exceeded limits set by the government. But the government would also offer a new tax deduction for people buying health insurance on their own.
Most of these 46 million who don’t have health insurance, can’t afford it, tax write off or not. These rich guys playing with our lives have no idea how we live. Maybe they should vote themselves another raise?
Higghawker — you stole my point! But, it’s such an obvious one. What good are tax breaks when you can’t afford the premium.
I’ll add that Bisj plan is just another sign that the Republican party is so very out-of-touch with the average working American.
The GOPs are so flush with cash that they worry 24-7 about how to avoid taxation on it. So, they assume their concerns are that of the American people.
“Let them eat cake!” == “Let’s give them tax cuts!”
I find that’s it a very good idea. Modeled from the Quebec health system.
Here in Quebec, because my employer pays part of my health plan, that portion is considered a gross gain, and I must pay Provincial income tax on that portion.
So if your (paid for) health plan is 400$ a month, and your tax bracket is 6%, you will owe Uncle Sam a whopping 24$ a month. BIG DEAL.
If your employer pays 50%, and you pay 200$ per month out of your paycheck, you still owe a 12$ per month in income tax. Etc.
Such undertaxed American crybabies….My average payout to the Federal and Provincial goverments, say the last ten years that my salary has been above 60K Can$ is 42% of my gross.
According to census.gov, about 29 million of the 46 million are people who make less than $50K (USD) a year. How much does tax breaks help the low income people when it comes to monthly expenses?
No Mark, this is a really stupid plan. I don’t mind paying a little more in taxes to allow other people to be insured, but this will do absolutely nothing to help those who are uninsured. A lot of people cannot get health care insurance on their own because they’re listed as morbidly obese (let alone the cost). Fat jokes aside, many people are wrongly listed as morbidly obese because it is determined using the person’s BMI. A friend of mine who’s clearly in the best shape of anyone I know is considered overweight even though he has little to no fat on him. The worst part of this proposal is that it could easily lead to more people being uninsured.
#5, goes to show how reading face value (what I did) and in-depth, what others like #4 have done.
Most Americans I know make a combined income of 100k US and pay less than half in taxes than I do, alone.
So any plan to tax the richer to help the poorer, should be in essence good right?
Wasn’t this about for people who work for companies that pay ALL of your heath benefits? Seems taxable to me.
Just like a company car that’s just for you, that’s a gross benefit.
Isn’t a decent 400$ a month health plan, totally paid for by your employer, worth paying 24$ a month in taxes?
#3 – When you add Federal, State, local, sales, fuel, property taxes, etc. the average American pays nearly 50% of their income in taxes. I wouldn’t consider that undertaxed, rather seriously overtaxed.
I have some of the best healthcare coverage available… and it’s still killing my finances. We have a child with Cystic Fibrosis…and let me tell you… there is NO “GOLD PLATED” insurance. Not in this country.
(probably not anywhere)
I make well above the average income in this country… many people would consider me “upper” middle class if they looked at my Salary… but I spend THOUSANDS / TENS OF THOUSANDS on healthcare. Mediocre healthcare I might add. My wife had to quit a lucrative career in communications to take care of our child… she is basically a nurse to our Daughter. I have health issues of my own.
There may be more to this story… but unless this is the best healthcare plan – covering EVERYONE – with MINOR impact on my family – I will be getting active to make sure this does not happen. I pay WAY TOO MUCH for NOT ENOUGH benefit now.
Life expectancy for a child with CF is ~35 today… how would you guys like to think that if you did not do enough today for your child … she might die several years early… would you do ANYTHING to pursue new treatments – no matter the cost? I know I have been trying to do everything possible for Eliza – and it has almost ruined us financially. I have TWO therapy devices that cost ~$15K each… and have flown us to Minnesota to see a world renown CF Dr.
Yes insurance helped with the devices – but they still cost me thousands out of pocket.
It kills me that this is just a “tax” – what benefit will it offer my family?
My Knee jerk reation is no… NO… and @#*(%& NO!
I’ve always been a conservative but this will definately get me on the side of the “liberals” with this “tax cut for the rich.”
I have to agree with #9. The only ones with the gold plated health plans are those in government positions where it is a part of the pay package.
The high cost of health care is a combination of things though and not all are the fault of insurance companies.
1)Physicians have little incentive to diagnose a treatment without ordering a huge number of tests. This probably a combination of lawsuit fears, patient demands, and physician determination to cure the patient despite the costs.
2)Hospitals are under the incentive to run up costs instead of reducing costs. The $20 Tylenol and other associated, unseen costs assigned the patient are often talked about. What isn’t is the Radiologist who does a consult 3 hours after the physician has seen the X-Ray and already made a decision. When the hospital owner is making a profit, don’t expect them to trim their costs for you.
3)Most physicians have a receptionist, billing agent, and a nurse at a minimum. Many offices have more. Why? To handle all the various forms that need to be filled out for each and every patient and then to chase the Insurance Company for authorization to treat and then payment.
4)The Medical Boards continue to allow bad physicians to practice. This causes a lot of costs to repair the damage, extra treatment, extra consultations, etc. These extra costs also raise insurance rates.
5)Unreasonable expectations of the patient as to care and treatment. None of us want to die and therefore want the most disparate, heroic measures taken to keep us alive. And none more so then the patient’s families who demand the special treatment from physicians.
6)And the largest portion of the health care budget is taken up by the critical and terminally ill. Over 80% of the budget is used by less then 5% of the people. This often includes things like resuscitating terminal, comatose patients and keeping terminal patients in critical care hospitals instead of a hospice or even nursing home.
In summary, there is much waste and little incentive to change on anyone’s behalf. While we can always blame the Insurance Industry, they are only a small part of the problem. The whole system needs to be revamped, including our own expectations.
And finally. Everyone should have a right to first class medical care and treatment. The gold plated care and treatment is optional.
Tax people’s health benefits? What a dumb idea.
Why don’t we tax heavily companies that do not provide health care benefits to their employees, and use that money to fund healthcare for their employees?
A little accuracy about the plan would be helpful. The taxes would not start until about $15,000 per family. So the average family that gets health insurance from your employer would not get any additional taxes. There are some that would be taxed, but if you are getting a plan that costs more than $15,000 a year, then your insurance is paying more than average of your health expenses or your are getting covered for much more than average.
Second, this will not help many, and maybe most people that do not have insurance. But if 46 million people do not have insurance there are some middle income people that have decided not to have insurance because they are gambling that they will not get sick and this would probably move some of those people to actually purchase insurance. This is not fundamental insurance reform. But it is also probably not a bad idea. And for once, the taxes will mostly come from upper income people to pay for tax cuts that will benefit people in the middle. I agree it will not really help people in the lower income brackets but because it is formated as tax deductions and not credits, most people that are low income do not pay income taxes anyway and don’t have anything to deduct.
Milton Friedman was the main inspiration for this, & here’s his article
http://www.freerepublic.com/focus/f-news/1741315/posts
Good I hope this bill gathers some momentum, as it is a step forward towards limiting the role of government in health care. We continue to suffer from the New Dealers who decided that it was the role of the employer to provide health-care. Food is a higher necessity of life than health-care, so why doesn’t my employer send me a basket of food every week?
If this plan draws people away from employer sponsored health care, and shifts the demand to private sector insurers the price over time will decrease. This would increase competition and innovation allowing a lower price, and greater efficiency. Also there would be greater variety allowing your greater freedom to choose a plan that is best fit for you unique needs.
#5 Brenden – “I Don’t mind paying a little more in taxes to allow other people to be insured” If you truly have an altruistic motive, the US Treasury will gladly take your money now to help pay for the growing cost of medical entitlement programs. Why start later? America needs you now!
#6 – I like that statement, but if we’re already paying 50% in taxes what’s another 10% for the “public benefit.” The tax only hurts “the rich.”
#9 – You make a strong case for greater liberty, not greater government intervention. You should ask you’re employer to give you the money he is spending on health care back as a wage. With this higher purchasing power you could buy one of the private sector plans.
#14, as usual, another post full of Comedian Rush Limbaugh jokes. Can’t you come up with something original?
Milton Friedman was the main inspiration for this, …
That should be a good enough reason in itself to renounce it. Friedman was a neo-con who only understood selfishness.
Food is a higher necessity of life than health-care, so why doesn’t my employer send me a basket of food every week?
Because health plans are an insurance. You use insurance when the need arises and share the cost with all in the plan.
If this plan draws people away from employer sponsored health care, and shifts the demand to private sector insurers the price over time will decrease.
Wrong. The larger the plan the more the risk is shared.
You should ask you’re employer to give you the money he is spending on health care back as a wage. With this higher purchasing power you could buy one of the private sector plans.
Not likely. Smaller plans have higher overhead and thus higher premiums. Besides, most “pre-existing health problems end up being uncovered.
WHY?
How about this…
they the corps, have found something interesting.
That an under employed person can get STATE care, IF they dont get enough money.
They can get assistance IF’ they dont make enough money.
For..
rent
Bills
Medical
Food
So, why NOT, under hire. And OVEr employ, so that No one gets enough hours or WAGES.
Maybe we should all just sit home and the rich can write us checks for everything? Seriously, raising taxes never solves anything. The problem is not how much is being spent but how much is being wasted. Since you pay health insurance and some form of copay, you don’t deal with the real insanely high costs. Until the costs are transparent and you can price shop for health care, the costs will never go down. Believe it or not I agree with Mr. Fusion on that. But I do not agree that federalizing it or forcing businesses to pay for it is the solution.
I would love to see statistics on all the successful businesses that are not federally funded in anyway and see what the political leanings of the owners or CEOs are.
Wasnt this country founded on the idea that taxation without respresentation is wrong? Anyone remember the grade-school history books of pissed off colonists rioting in the streets and harbors? Looks like history is going to repeat itself really damn soon.
One thing that doesn’t get mentioned much is that many people in this country are not insurable for any price because of pre-existing medical conditions.
My brother-in-law has MS. He is self-employed and used to have medical insurance through his wife’s employer. Her working hours have been cut back so her employer no longer provides health insurance. He is not insurable for any amount of money (let alone something the average person could afford) because this is now a pre-existing condition. He had private insurance (Blue Shield) at the time he was diagnosed with MS but after about two years the insurance company found a legal way to deny any treatment for neurological disorders.
Seeing that 61% of Americans are overweight and about 30% are obese (http://www.obesity.org/subs/fastfacts/obesity_US.shtml), how many Americans would be un-insurable if they could no longer get health insurance through their employer? This does not even consider the number of people that have a pre-existing non-weight related medical condition.
Steve
First off I don’t listen to Rush Limbaugh. Secondly Milton Friedman was not at neo-conservative he was a libertarian. Also your vague assault on him would be better taken if you highlight segments of his article that are wrong or incomplete. The point about food (one could easily assume that employer sponsored car insurance could be used as well) was stated as a way to illustrate the following idea. I have an inherent demand for some good, health care, that has a cost associated with it. There is a supply facilitated by either the employer, the government, or the free-market (private insurer). I believe that the transaction costs are the lowest when the free-market and the invisible hand govern supply, not some cumbersome government agency or a singular health-care package offered by the employer. Also, the rate of return is lower with the two latter options.
Regarding the formation of private health care plans, while initially the pool of applicants will be small, if this remains a positive profit industry more firms will enter the market and drive down or stabilize the price. Giving tax-break incentives for those dastardly individuals, “the rich” as they’re so generally coined, would increase the demand and help this process further. Also I would think there is a diminishing marginal return for large insurers because if there were not, we would not find as many auto-insurance companies as we do today.
An example: Geico auto-insurance initially had a small amount of individuals to spread risk, but over time their message of lower prices attracted more customers, this increased demand gave them greater profits and greater incentives to continue to innovate and become more efficient. Other firms saw this competition and became more active in retaining and attracting new costumers. It is hard to watch primetime television without seeing two or three auto-insurance commercials, but where are the numerous private health-care providers’ commercials?
In post #11 you point out the inherent costs and inefficiencies associated with this industry, and the best way to solve them is to increase competition and choice. Give people more of their own money and let them decide what insurer, what hospital is best suited to meet their needs. Andrew touched on this idea in post #17, where he stated a consumer should be able to “price shop for health care.” Currently, employer provided health-care is pay-roll tax exempt; why not shift this segment of a worker’s wage into a tax-free private health care savings account that can be used to pay for private health-care insurance? It is not a perfect system but neither is the one the U.S. currently sustains, and I think a libertarian, or even paternalistic-libertarian, system would work better.
#20
You miss the point – you only get savings when large groups are involved. To break those groups up into individuals would make any insurance CEO cream his jeans – now instead of a large group that has clout negotiating for a better price, you have 200,000,000 individuals with zero power. Big insurance company would be happy to offer say minimum coverage say for $10,000 a month.
By your logic, why hasn’t insurance company stepped up to offer insurance to the 50,000,000 uninsured? Not all are poor – the real poor have Medicade. Its the working poor that get screwed. By your logic some company should be drooling to serve that populous., but I don;t see anyone stepping up. I wonder why?
How do you deal with people with chronic illnesses? Just let em die? The only reason Insurance companies now will cover such when they’re in a large plan & they’re forced to. Can you see anyone covering that populous if its 200,000,000 individuals?
I dig what you’re saying Alarm, but I already stated this is not an optimum solution just a move in the right direction.
Point 1:
Assume that the U.S.A. has one health insurance firm.
While it is true that the existence of one large insurance firm helps to lower the cost by allocating risk efficiently, so does having three, not so large, firms as they now have to compete with each other. Would the presence of 1million insurance providers help to lower the cost? Definitely not. The general equilibrium is something of debate, and I for one don’t want to do the multi-variable calculus to estimate the optimal quantity of providers. I think the invisible hand and good old fashioned greed is the best solution.
Point 2:
The insurance providers have not stepped up to provide every citizen insurance because they maximize profits by setting marginal revenue equal to marginal cost. The cost of adding one more individual who cannot pay for their services exceeds the benefit so therefore it is not done.
Point 3: In the case of chronic illness, I have no definitive answer. Charitable donations, increased costs for the immediate family, tax breaks, all start to address the problem but a better answer needs to be found. An answer government alone cannot provide.
the corp ideal is to give you a product you WANT…NOT need.
NOT compete, if they dont have to..
And then have you NOT need it or use it.
they will only compete, IF they have to. But only until they can have the other corp, Dump out cause they cant afford to go LOWER. then prices start going up. Its that, OR you buy the other corp OUT.
they want you to buy something that you dont USE, but its required.
such as auto insurrance. Only 1-3% ever get hurt in a car.. but its REQUIRED.
Tax schmax….has anyone here actually looked at the chart above? Everyone one of the states in dark black (highest percentage without insurance) happens to be the states with the highest numbers of illegals from south of the border.
California, Arizona, New Mexico, and Texas happen to be the states with the most illegals and guess what, they happen to account for just shy of 50% of those who are uninsured. That means that 46 states make up the other 50%….that says something. And when you look at the next level of percentages, you will note that those states are also the next level in illegals who go there to live and work.
So, as I see it, we solve the illegal problem, we solve ANOTHER social problem in this country (the outrageous number of uninsured)…..we would also solve the over burdened school systems in those top 4 states, and the over whelmed health care systems in those states(and all states with large illegal populations)
Screw the universal health coverage…..lets give the illegals a one way bus ticket home to all those tropical paradise’s south of the border (thats what the ads say it is, that try to entice me to Cabcun), and solve some of our most pressing sicoal problems as well.
Joshua, I 100% agree getting rid of all the illegals via the 24/7 deport bus would solve many, many of our problems. Health care, crime, property taxes, school funding ect… all would go down. Until people wake up to the illegal immigration problem and demand our politicians do something about it, it is only going to get worse.
You don’t need car insurance in New Hampshire + no state income tax and no sales tax.
#22,
It isn’t the insurance companies that are the major cause of high medical costs in this country. It is the waste and inefficiencies because of lack of oversight in the health and medical fields. It is the critical care treatment given to terminal patients. It is the number of empty beds that a hospital will keep open but add to the charge every patient pays. It is the gold payment packages hospital executives receive. It is the internal costs put back on hospitals because of secondary infection, botched operations, and high insurance premiums. It is the poor accountability of physicians for their incompetence. It is the unnecessary tests, procedures and consultations. It is the lack of incentive to reduce costs and improve efficiencies.
That shouldn’t let the insurance companies off the hook though. They also have little reason to improve and contribute much to the overall inefficiency and wasted resources. Any improvement in them will not go far in helping the uninsured now.
I completely agree, but I think we differ on how best to solve these inherent inefficiencies.
If honesty was more valuable then profiteering…
The Machines and equipment Doctors use would be about 1/2 the cost, more could be sold, and even a small clinic could do most things insted of farming the work out, at HUGE expence.
If Doctors werent so Afraid of making small mistakes, and getting SUE’d, they would take better care, and LOOK for that missing sponge. And for free.(I would HOPE).