Exclusive: Paul Ryan's new manifesto on healthcare

Hot Air.com ^ | September 27, 2011 | Shawn Tully

[wmfights]

Ryan wants to effectively dismantle the system that's insured most Americans for seven decades, heavily subsidized, employer-provided coverage. It's vintage Ryan: Whether you agree or disagree with his views, he stands in sharp contrast with the rest of the political class in his willingness to take unpopular positions backed by strong intellectual arguments.

His campaign to grant workers the advantages they now receive only through employers is his most daring proposal yet. Ryan is right on the economics, but it will take a gigantic leap of faith for Americans to embrace such a jarring change. Ryan's view is that the cost of the current system so endangers our economic future that only a manifesto that allows everyone from seniors to employees to shop for their own policies with their own money will fix it.

In the Stanford speech, Ryan states: "Under current law, employer-sponsored insurance plans are entirely exempt from taxation, regardless of how much an individual contributes to their policy. With regard for health insurance for working Americans, patient-centered reform means replacing the inefficient treatment of employer-provided care."

[wmfights]

If Ryan's plan becomes law, it's likely that most companies would drop their plans. Why provide coverage when employees now pay tax on the benefit but get a tax credit if they buy their own plans? The advantage is that employees would no longer lose their coverage if they lose their jobs. The policies would belong to them and be fully portable to the next job. It would also turn workers into consumers, giving them an incentive to shop for the lowest cost plans with their own money.

Here's the rub: Can workers really be sure employers would pad their paychecks with the same dollars those corporations now pay for their coverage? The laws of economics say yes. In a competitive labor market, the total cost of workers should stay the same, and employers should care little whether they pay in benefits or direct wages.

[wmfights]

Ping

Here's the response to what needs to be done when obamacare is repealed, or ruled unconstitutional by the SCOTUS. I think Ryan is one of the real forward thinkers in the Pub party. I love the idea of returning the responsibility to the individual.

[xzins]

I believe that corporations and insurance companies claim the value of insurance policies at a much higher rate than the actual final cost. As with the auto industry, in which the “sticker price” is not the real cost and even the “invoice price” is not the real cost, there are probably kickbacks/incentives to companies as part of any agreement.

This enables companies to claim that a policy costs $15,000, when as much as half of that might be kicked back based on insurance company actual cost on any individual or family member.

My reason for saying this is the paltry sum companies will provide employees who have their own coverage. Most will claim a policy cost of $15,000 or so, but will provide a benefit of only $3000 if the employee does not use their plan.

In other words, something smells in Denmark.

[Marty62]

It is sooo refreshing to read the thoughts of someone that is a genius and thinks issues through.

[Marty62]

Your right a friend of mine just found that out.

[sodpoodle]

Disagree with dismantling group health and life insurance as an employer based product.

The insurance industry and covered employees save administrative, underwriting/risk and billing costs by pooling or grouping.

Before COBRA was mandated; group health and life coverage included a ‘conversion’ clause - which allowed employees to convert to individual insurance when leaving employment or retiring (before Medicare).

All the good ideas and principles of insurance have been tossed aside or perverted because of pressure from unions, physicians’ groups and government nannies.

Insurance industry $$trillion reserves are the real Socialists’ target.

[ExTexasRedhead]

Fox and Friends, early this a.m., were discussing ObamaCare/DeathCare with an attorney who was exposing that this Administration and their cohorts in this Congress want to have complete control over your private healthcare records. That’s right! One day, your medical records could even be on the Internet thanks to someone hacking Big Bro’s database.

In my opinion, these Political hack Elitists want your medical files so they can pull them out at your Death Panel trial so they can be used “against” you.

In my opinion, we see Never Again being mocked by this Administration and Liberals in Congress. Anyone see a second Holocaust as a result of DeathCare? After your Death Panel Trial, rather than boxcars and camps, Liberals will just ship you to a hospice center where you will be given a pill rather than a bar of wooden soap. Think not? Think again!

We The People better wake up and “NOT” follow in the footsteps of Europe in the early 1930’s. Evil is on the rampage again! Shall we call it Liberal Democrat? Just my thoughts, what are yours?

[xzins]

Funny, isn’t it? You’d think a company actually spending $15,000 a policy would jump for joy at the chance to pay their employee 10 grand a year instead of the 15 grand they say they’re paying.

Can you say “in cahoots?”

[Graewoulf]

Suck it up Ryan. Just repeal and abolish FOREVER obama”care.”

Obama”care” is illegal because it destroys competition, freedom of choice, compulsory enrollment, and all the other legal tests in the 1890 Sherman Anti-Trust Federal Law.

Stop trying to please everybody! Do your duty and repeal and abolish! If you waffle on this one and “replace” instead of abolish then YOU will be the one who seeks to financially harm my grandchildren.

Just suck in your gut, take a deep breath, repeal and ABOLISH FOREVER this damn obama”care” !

[Alamo-Girl]

Thanks for the ping!

[wmfights]

My reason for saying this is the paltry sum companies will provide employees who have their own coverage. Most will claim a policy cost of $15,000 or so, but will provide a benefit of only $3000 if the employee does not use their plan.

If the tax deduction is on the purchasers (individual) tax return business will have to increase compensation or risk losing employees. Even if the compensation does not increase to the full cost of the policy the individual comes out ahead. The cost of the policy is deductible and travels with them. IOW, a short sighted employer doesn't have the threat of no healthcare coverage to hold over the employees head if they leave.

Also, one benefit not touched on in the article is the premium cost will decline because underwriting will be based on the total number of policyholders.

[PMAS]

*

[caww]

This is all about the New World Order agenda.....tracking everyone one way or another...if you’re not on their tracking you will not get medical care or anything else.

Everyone with a cell phone...and why they are giving them to welfare people...will do all transactions via their cell phone in the years ahead.

Same with all the revenues passing from one nation to other..it’s just a means of getting everything under one roof without collapsing the entire system while they set it up.

[wmfights]

It is sooo refreshing to read the thoughts of someone that is a genius and thinks issues through.

I agree. What gets me excited is everything he's proposing increases individual decision making and responsibility, instead of a "nanny state". Also, he's letting market forces work to the individual's best interest.

[wmfights]

You’d think a company actually spending $15,000 a policy would jump for joy at the chance to pay their employee 10 grand a year instead of the 15 grand they say they’re paying.

So what.

The company is no longer your lifeline to good health care. The policy is owned by you. If an employer doesn't value you enough to treat you well they deserve to lose you to a company that does.

[Marty62]

I wonder just how far the cost of a policy would DROP under his proposals.

No more captive market for insurers. Bet hospitals and clinics would start offering policies.

[sickoflibs]

RE “So what's Ryan's solution? He proposes shifting the tax exemption that now goes only to company-provided plans to individuals instead. In our example, if ABK Auto Parts keeps providing coverage, employees will need to pay tax on the value of the policies. But the employee will be able to buy a policy on their own and get a tax credit for the entire cost of the plan. If Ryan's plan becomes law, it's likely that most companies would drop their plans. Why provide coverage when employees now pay tax on the benefit but get a tax credit if they buy their own plans? The advantage is that employees would no longer lose their coverage if they lose their jobs. The policies would belong to them and be fully portable to the next job. It would also turn workers into consumers, giving them an incentive to shop for the lowest cost plans with their own money.”

His medicare plan had a similar problem in that it forced certain people off of medicare to get private coverage without a choice to stay on it. That pretty much doomed that idea.

This one would look better similarly if either the employer (as now) or employee could get the credit depending on where the coverage came from. That would make it harder to attack being a choice not a dictate.

So far they gave up on repealing Obama-care, gave up passing the Ryan plan(they dont even talk about it anymore), now here is a new idea, guess where this is going...

[Da Bilge Troll]

Stop trying to please everybody! Do your duty and repeal and abolish! If you waffle on this one and “replace” instead of abolish then YOU will be the one who seeks to financially harm my grandchildren.

Well, after we abolish Obamacare, additional changes do need to be made. The current system is crap. It was set up to be crap so that we would think a universal health insurance system would be an improvement. Ryan's plan fits closely to my own views of the changes that are needed -- more liberty, less government.

[wmfights]

No more captive market for insurers. Bet hospitals and clinics would start offering policies.

Bingo!

Also, the underwriting would change because insurers would base rates not on risk factors of a group, but on the number of total policies. The risk to the insurer is spread over a wider pool.

[wmfights]

This one would look better similarly if either the employer (as now) or employee could get the credit depending on where the coverage came from.

That's what this is all about. The tax deduction moves to the individual and the employer can no longer deduct it.

So far they gave up on repealing Obama-care, gave up passing the Ryan plan(they dont even talk about it anymore), now here is a new idea, guess where this is going...

Kind of hard to get things done when the Senate and President are obstructionist Rats. However, the accusation by those who want the govt to run everything is "what will you do if this is repealed?" Here is a solution that is market based and empowers the individual.