Posted on 07/01/2009 7:53:50 AM PDT by rabscuttle385
Fixing health care is simple, says Euro Pacific Capital president Peter Schiff, a possible contender for Democrat Chris Dodd’s seat in Congress.
"Given our current tax code, the simplest way to bring down medical costs would be to fully tax health care benefits as wages and simultaneously increase the personal deduction by an amount significant enough to neutralize the effect of the tax increase," Schiff writes in Taki Mag.
Doing so would accomplish two things. First, the uninsured would get a huge pay increase, enabling them to buy reasonably priced catastrophic policies.
Second, those currently insured could opt out of expensive employer-provided plans, trading premiums for extra wages, and then buy a more economical plan.
The savings would go right into their pockets.
The meteoric rise in health care costs is no accident, Schiff notes.
It arose from excess government involvement in the system; tax provisions that encourage people to overuse their health insurance; and government support of an out-of-control malpractice industry.
“Rather than allowing more bad policy to drive healthcare costs further upward, we should be looking at ways to allow market forces to rein them back in,” Schiff notes.
(Excerpt) Read more at moneynews.newsmax.com ...
*Ping!*
congress isn’t into easy fixes if it doesn’t help the people that bank roll them (ie helps them become millionaires while in congress and after they leave).
Congress is no longer about helping America prosper. It’s about taking from us our money, life, and dignity.
There's money to be taxed... er, made... no, PRINTED.
Yeah, that's it.
I've heard Zimbabwe is behind on their ink bill.
There's an even bigger -- and simpler -- factor involved here. ANY system that primarily involves third-party payment for a product or service is bound to face problems controlling costs and maintaining quality. It's simply a function of the very nature of this kind of economic transaction.
Spot on Peter, Now we need the Republicans to be out DAILY selling this idea.
THE GOV”T HAS CAUSED THE RISE IN HEALTHCARE AND EDUCATION COSTS!!!!!!!!!
In any case, it's important that we re-establish a link between the user of the service and the one paying for the service, whether directly or through an insurance provider. Far too many people think of health care as a right and the responsibility to pay for it as belonging to some amorphous "them". The cost doesn't go away, and all the shell games we currently play with cost shifting only complicate the situation.
Excellent post . . . You really hit on what I tried to say a couple of posts up the thread.
I think Walmart’s going to make a bid on health care and give us a great cheap system. ( If Walmart can’t fight ObamaCare - they might as well protect us as best they can...)
Walmart - that could be interesting. I can see them giving the insurance industry and the government weenies a run for their money.
It's like taking a few steps down on the up escalator. The escalator keeps going up.
There are two or three large drivers to increasing medical costs:
- The population is aging. Old folks cost more than younger folks. It's not just Medicare that's the issue. My company is in Maryland and we have community rating with age bands. The group insurance rates for a group with an average age of, say, 50, is dramatically higher than with an average age of, say, 30. No reason why it shouldn't be. Fifty year-olds use a lot more medical care than 30 year-olds, on average.
As baby-boomers age, there are more 50 year-olds relative to 30 year-olds. Nothing to reverse that.
- There are more folks with chronic, systemic illness, especially diabetes and all the health problems attached thereto. And there are more and more long-term treatments for these illnesses. We have a lot of great treatments for chronic illness, and they're improving all the time.
But as they proliferate, they are expensive, and by definition, long-term. And older folks tend to have them more than younger folks. Which takes us back to the first point.
- Hidden within the second driver is another driver - medical technology keeps getting better and better, able to treat more illnesses more successfully.
However, many treatments aren't cures but rather ways of ameliorating illness, warding off its awful effects for years, even decades. Thus, over the years, my uncle who had his first major heart attack in 1978, found that without altering his lifestyle much, he was able to rely on increasingly better medical treatment for his chronic cardiovascular illnesses. He lived until this year, 2009. Thirty-one years of expensive long-term medical treatment.
If he'd been born 10 years earlier and had his first heart attack in 1968, he'd have died then and there, because the medical technology that saved him in 1978 was experimental or didn't exist in 1968. And society would not have spent 31 years of increasingly costly medical treatment on him.
There are definitely steps that we can take to lower the overall cost of health care in the United States. In the short-run. Tort reform, consumer-driven tax and government policies such as discussed here, etc.
And they will lower costs in the short-run. But each of them is just a few steps down the escalator. The escalator keeps going up.
Thank you - We don’t expect auto insurance to pay for oil changes or new tires. We’ve gotten away from the actuarial concept of insurance when it comes to health care. By re-establishing this concept, a lot of excesses could be worked out of the system.
Except under the current tax code, the deduction would only benefit those who itemize their deductions and taking the deduction would push many people into the alternative minimum tax. In addiction, the deduction would only pay a small part of the cost, which might discourage even more people from buying insurance. For example, assume the cost of a family policy is $10,000 per year. A taxpayer in the 35% tax bracket bracket would realize $3,500 from the deduction, but would still have to kick in $6,500 to pay the premium.
Doing so would accomplish two things. First, the uninsured would get a huge pay increase, enabling them to buy reasonably priced catastrophic policies.
Except many of the uninsured would (a) take the extra income, but not buy any health insurance and continue to use the emergency room for primary care; and/or (b)complain how life is unfair because they can only afford catastrophic insurance and can't aford to pay out of pocket for basic care.
Second, those currently insured could opt out of expensive employer-provided plans, trading premiums for extra wages, and then buy a more economical plan.
This only works if the states remove the mandates that prevent many health insurance carriers from offering more economical plans.
Right on.
If any of these blowhards was truly concerned about the cost of healthcare they’d be calling for all medical expenses, including insurance premiums to be fully 100% tax deductable - not just those costs over 7.5% AGI on the 1040 Schedule A. But I’ve yet to hear one of ‘em call for such a thing.
I think they’re going to do it - and save us in the process. Obama and the liberals will try to make us all beg for bad health care - but Walmart will “figure it out” and sell it cheaper, better and without unions...
bump
In the auto insurance industry, insurers must take on some share of the "high-risk" pool. In the same way, health insurers could split up the high-risk patients with pre-existing conditions. To the extent people live in a manner which raises their risk, I could see passing it on in higher premiums. We seem to have no problem with higher car insurance premiums for drivers with many moving violations and accidents. Similarly, it seems reasonable to have higher health insurance premiums for those who do not address major lifestyle factors such as smoking and activity levels. I don't see this as a nanny state role, however, but as a free market exchange between insurer and insurance purchaser. If another insurance company can offer a better deal, the insurance purchaser goes elsewhere or changes to a different coverage package. Innovation and liberty can do a lot to make a difficult situation better.
” In the same way that auto insurance is more expensive for teenage drivers, health insurance is more expensive for older patients. Somehow we understand and accept the one but not the other.”
You're absolutely correct.
The problem is that whereas teenagers grow OUT OF the high-risk demographic for auto insurance, we all tend to grow INTO the high-risk demographic for health care.
“To the extent people live in a manner which raises their risk, I could see passing it on in higher premiums. We seem to have no problem with higher car insurance premiums for drivers with many moving violations and accidents. Similarly, it seems reasonable to have higher health insurance premiums for those who do not address major lifestyle factors such as smoking and activity levels.”
This would definitely address one of the major drivers, and would actually slow the escalator down appreciably.
I know that there are a few private companies that have tried to address this, on this sort of basis:
- The employer sets up two insurance programs. The first is pretty-well gold-plated, the second, much more basic. The employer pays for most or all of the first program, but pays significantly less for the second, more basic plan. The first has low co-pays, low or no deductibles, the second has high deductibles and co-pays.
- Eligibility for the first plan comes from meeting one of two criteria:
o The employee is in excellent health and physical condition; or
o The employee who is not in excellent health and physical condition agrees to participate in a monitored health-improvement and maintenance program, which would require, at a minimum, smoking cessation, monitored exercise routines (with the content of the exercise program mandated by the health professionals working on behalf of the employer/insurer), and monitored diet. Attacking these three lifestyle issues aggressively would have an appreciable impact on controlling long-term chronic disease.
Of course, the employer would pay for all the assistance for smoking cessation, exercise programs (including gym memberships) and diet programs. But it'd be a lot cheaper than paying for medication for a smoking, overweight, under-active diabetic or cardiovascular patient.
What do you think of that sort of model?
sitetest
CT get rid of Dodd ping
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