Sunday, January 21, 2007

Right Prescription for Health Insurance?

48 soldiers killed in Iraq so far in January 2007 (including 20 on 1/20/07)

Well, according to those in the know, President Bush is only going to briefly talk about Iraq in his State of the Union address, which is probably smart, because after all, what more is there to be said about Iraq? He's going to do what he's going to do; what's going to happen is what's going to happen, and evidently what the American people think means zip, zero, nada (68% of us oppose the surge, or as Condi calls it, the "augmentation").
So in order to change the subject, the president has now come up with a "plan" for fixing our health care system, which God knows, desperately needs to be fixed. So let's see what the basic elements of the White House plan is and if we think it will be an improvement? There are two big ideas from what I've read about it so far. One is that, although health insurance has always been treated as a non-taxable benefit for workers, some plans will be now be subject to taxation. The amounts being proposed are: $15,000 for family coverage and $7,500 for single coverage. In other words, if you have a family and the total amount you and your employer pay together is more than $15,000, you will pay taxes on the amount over that.
Many of us will not have to worry about this. Me, for instance. I pay $59.50 per pay period for insurance, or $119 per month. That is one/fourth of the cost of my health insurance. Wabash County pays the other three/fourths so the total cost of my insurance if $476 per month or $5,712 annually. Whew, well within the single $7,500 limit so I'm safe.
But if your employer is somewhat more generous than mine, offering more benefits and perhaps, say, vision and dental coverage, it seems that it would be relatively easy for your insurance to top the $7,000/$15,000 ceiling. This strikes me as ironic in two ways. First, is that those of us that are offered more minimalist policies, are going to be in the strange position of having to be grateful to our employers for not offering us better insurance options!
The second irony is that the Bush administration which has taken as its mantra, lo, these many years, that never, ever, ever, under any circumstances will they consider the possibility of raising taxes - that ALL taxes are inherently BAD, especially as they apply to rich people - is now open to the idea of raising taxes on one of the few benefits a lot of working people still have, tax-free health insurance, subsidized by their employer so it is affordable.
The second element in the Bush health insurance salvation plan is a tax deduction for those who purchase their own insurance. This would undoubtedly help some middle and upper-class self employed people and those who are paid well but whose employers don't provide health insurance.
But I have always shook my head in disgust at the Republicans' love of tax deductions as a way of persuading citizens to comply with behavior the politicians favor, such as purchasing health care. What they don't understand is that in order for tax deductions at the end of the year to help is: you have to have the money to pay in the first place!
Again, using myself as an example, I was unemployed and uninsured for nine months after I was fired from the Sheriff's Department. I lived on the deferred income I'd saved and county benefits, such as saved sick days, for the first three months. I received an unemployment check for $250 per week for the last six months. Continuing to keep my county health insurance under COBRA would have taken the bulk of my unemployment payments. The cheapest private health insurance policy I could find, which included a $10,000 deductible, was $450 per month. Again, almost half of my income. So, it was a choice between hanging on to my house and having health insurance. Obviously, I went with the "cross your fingers" health care option. and kept the house. If I'd been unlucky and experienced a major illness, I probably would have lost the house as well. I suppose this is a concept that an always-rich person, such as George Bush (and, I assume, his cronies and colleagues, as well), cannot even begin to grasp.
According to the census bureau, 175 million Americans receive health insurance through their employers, 27 million purchase their own insurance, 47 million are uninsured and the rest are covered through government programs, such as Medicare and Medicaid. There is no doubt that our health care system in this country is a mish-mash of inefficiency, desperately needing an overhaul but, as always, it seems to me that the wrong people will win under Bush's plan. People who have never been taxed for their health insurance before will now be taxed to subsidize those who purchase their own policies - but few people who really need help in obtaining insurance will benefit from tax deductions. I can't help thinking that penalizing those with generous plans through their work, many of whom are probably middle-class, in order to subsidize those who can buy their own insurance, many of whom are probably upper-class, is not the right prescription. And in a side note, who else is the big beneficiary of this plan? Why, that would be the insurance industry, of course, and why does that not surprise me?