Joe's Air Blog

An occasional Brain Dump, from the creator of Joe's SeaBlog

Thursday, October 22, 2009

More Health Care

One of the primary arguments against a public insurance option in the current healthcare debate is that this is a form of Socialized Medicine, and Socialized Medicine is bad. Such statements are usually followed up with anecdotes about how messed up healthcare is in England or Canada or France, because people have to wait for service (which, of course, we do in the US), and the technology lags.

The funny thing of it is, as bad as the healthcare systems are in these countries, people still live longer than they do in the US.

I've included Switzerland in the comparison below because, as Paul Krugman points out, the "Public Option" plan favored by many Democrats most closely resembles the Swiss system. And Cuba, because we all know that everything sucks in Commie Cuba.

Average life expectancy in 2007, per the World Health Organization:
Switzerland 82
Canada 81
France 81
England 80
Cuba 78
USA 78


Infant mortality rate in 2007, same source:
France 3 deaths per 1,000 live births
Switzerland 4
Canada 5
England 5
Cuba 5
USA 6

The fact of the matter is that basically all developed countries other than the US guarantee health care coverage for all their citizens. And all of them fare better in life expectancy and infant mortality rates than does the US. Do we have the best healthcare facilities in the world? Perhaps we do. But that doesn't do any good when there are 50 million people who can't get treatment because they don't have coverage. (Or often, even if they do, but that's another story.)

Let's care for our fellow countrymen, folks. Let's ensure healthcare for all.

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Monday, October 19, 2009

More Health Care Thoughts

This part two of a thought experiment about the US Health Insurance industry.

I am employed by a not-for-profit organization that provides medical and dental insurance to its employees. Employees are required to share in the cost of this program, and a variety of competitive options are provided. I opt for the so-called “80/20 plan,” in which essentially 80% of costs are covered following a $20 copay, subject to an annual deductible. I have approximately $50 withheld pre-tax from my paycheck every two weeks, for a cost to me of about $1,300. In addition, I have a Flexible Spending plan available to reimburse me for the things not covered by the plan, including vision care as well as the aforementioned copays and deductibles. For 2009, I am withholding $750 from my pay to co-insure myself for healthcare.

In all, my insurance will cost me over $2,000 this year. (Of course, my employer is also bearing a significant amount of the cost of my coverage, an amount unknown to me.) Let me reiterate – the amount of your copays and deductibles also comprise the cost of your health insurance. These are the conditions imposed by the insurance company to provide healthcare coverage. They won’t pay the bill until you pay these costs above and beyond your premiums.

Unfortunately for me, in addition to my normal checkups (physical, eye exam, two dental exams) I had one trip to the Emergency Room last winter, and I broke a tooth later in the year, which have added over $1,000 out of my own pocket to the total bill. But fortunately I am in generally good health, with no chronic issues to deal with.

The Federal Government will withhold about $5,600 in estimated income taxes from my paycheck this year. My actual final bill will likely be less than that, but for purposes of this discussion let’s use the higher number. My health insurance costs - not including the emergency situations - equal about 36 percent of my annual federal income tax bill. If the Federal Government became the sole provider of health insurance in this country, but the result was a 30% increase in my Federal income taxes – it would save me money.

Let me repeat that – I would be better off with a 30% tax increase it the tradeoff is that I have no medical bills to pay.

This is a very simplistic calculation, to be sure. For one thing, every employer is different in the amount that they ask employees to pay. Some people pay no premiums out of their own pockets, while others pay significantly higher amounts. But I have a competitive plan, and I earn more money than the average worker in this country. I also am not covering anybody else under my plan, unlike many who cover spouses and children. I suspect that most people pay more than 36% of their federal tax bill in health insurance costs.

It is for this reason that I don’t understand why a tax increase is anathema to so many. For most US citizens, publicly-provided health care coverage would put more money in their pockets. Quite the opposite to the message promoted by the conservatives, this would be an economic boon rather than a burden. Some people would have higher tax bills as a result, but those people would be the mega-rich of this country. I submit that adding a few hundred or a couple of thousand dollars to the pockets of the average American will result in greater economic stimulus than keeping it in the investment portfolios of our country’s wealthiest citizens. The middle class are far more likely to actually buy stuff with their extra cash.

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