“Every health-care system in the world rations care in some way, either through bureaucratic fiat (Scandinavia, the U.K.), waiting lists (Canada), or price (that’s us). One can argue about which of these rationing mechanisms is fairest or most efficient, but let’s not pretend that it won’t occur.”
I’m all about repeal. But let’s not stop with Obamacare. Let’s move on to many disastrous legislative interventions brought to us from the other side of the aisle. How about Medicare Part D, brought to us by a GOP-led executive? Why didn’t the GOP change the tax code to end the discrimination against individual purchases of health insurance during the time they had all the power? Hint: see paragraph one of this blog. This tax reform isn’t likely as the shift away from employer-purchased plans will gut the scam of PPO repricing, a devastating blow to the big insurance companies.
“Only a few years ago, the party was united behind three reforms that are consistent with individual empowerment and limited government: (1) a universal health refund that transfers all government tax and spending subsidies to ordinary citizens each year with no strings attached other than the requirement that it be used for health care, (2) a flexible Health Savings Account that allows people to manage some of their own health care dollars and (3) pre-existing condition protection for people who lose their insurance because of government policies.
For well over a decade House Speaker Paul Ryan (R-WI) was a steadfast supporter of all three ideas, including replacing tax and spending subsidies for health care and health insurance with a universal tax credit. John McCain ran on these ideas in the 2008 election. The legislative embodiment of McCain’s plan was the Patients Choice Act, which Ryan cosponsored in 2009 along with Devin Nunes (R– CA) in the House and Tom Coburn (R–OK) and Richard Burr (R–NC) in the Senate.”
“The American Health Care Act (AHCA), proposed by the House leadership, was not about health care. It was about taxes. Over and over, Ryan said he needed to do health reform before tax reform. In particular, he said he needed to reduce Obamacare taxes by $1 trillion and to reduce spending by more than $1 trillion.As noted, a tax cut tied to health care is part of good health reform. But the Ryan tax cut wasn’t tied to health care. It consisted of repealing the very revenues that were funding Obamacare. (See below.) Since the tax cut took money out of the system, the spending cuts paired with it also removed money from the system.”
Imagine if you had “grocery insurance.” You’d buy expensive foods; supermarkets would never have sales. Everyone would spend more.
Insurance coverage — third-party payment — is revered by the media and socialists (redundant?) but is a terrible way to pay for things.
Today, 7 in 8 health care dollars are paid by Medicare, Medicaid or private insurance companies. Because there’s no real health care market, costs rose 467 percent over the last three decades.
By contrast, prices fell in the few medical areas not covered by insurance, like plastic surgery and LASIK eye care. Patients shop around, forcing health providers to compete.
The National Center for Policy Analysis found that from 1999 to 2011 the price of traditional LASIK eye surgery dropped from over $2,100 to about $1,700.
Source: Free Market Care – John Stossel
Great tutorial that can get you up-to-speed on the budget and how it won’t balance under current trajectory. Senator Paul explains a simple way to balance and control the debt.
Lots to like and consider here. We need more details about how tax equalization in the group market vs the individual market will be handled. The expansion of uses and benefits of HSAs is robust and will go along way to establishing more ways to self-insure and less reliance on networks and government programs; both are a good thing. The flexible, market-friendly Interstate Market for Health Insurance Cooperative Governing of Individual Health Insurance Coverage will be a welcome change. Again, devil is always in the details. Stay tuned for more details and insightful analysis here on the Sovereign Patient; we will post them as available.
Effective as of the date of enactment of this bill, the following provisions of Obamacare are repealed:
- Individual and employer mandates, community rating restrictions, rate review, essential health benefits requirement, medical loss ratio, and other insurance mandates.
Protecting Individuals with Pre-Existing Conditions:
- Provides a two-year open-enrollment period under which individuals with pre-existing conditions can obtain coverage.
- Restores HIPAA pre-existing conditions protections. Prior to Obamacare, HIPAA guaranteed those within the group market could obtain continuous health coverage regardless of preexisting conditions.
Equalize the Tax Treatment of Health Insurance:
- Individuals who receive health insurance through an employer are able to exclude the premium amount from their taxable income. However, this subsidy is unavailable for those that do not receive their insurance through an employer but instead shop for insurance on the individual market.
- Equalizes the tax treatment of the purchase of health insurance for individuals and employers. By providing a universal deduction on both income and payroll taxes regardless of how an individual obtains their health insurance, Americans will be empowered to purchase insurance independent of employment. Furthermore, this provision does not interfere with employer-provided coverage for Americans who prefer those plans.
Expansion of Health Savings Accounts:
- Tax Credit for HSA Contributions
- Provides individuals the option of a tax credit of up to $5,000 per taxpayer for contributions to an HSA. If an individual chooses not to accept the tax credit or contributes in excess of $5,000, those contributions are still tax-preferred.
- Maximum Contribution Limit to HSA. Removes the maximum allowable annual contribution, so that individuals may make unlimited contributions to an HSA.
- Eliminates the requirement that a participant in an HSA be enrolled in a high deductible health care plan. This section removes the HSA plan type requirement to allow individuals with all types of insurance to establish and use an HSA.
- This would also enable individuals who are eligible for Medicare, VA benefits, TRICARE, IHS, and members of health care sharing ministries to be eligible to establish an HSA.
- Allowance of Distributions for Prescription and OTC Drugs o Allows prescription and OTC drug costs to be treated as allowable expenses of HSAs.
- Purchase of Health Insurance from HSA Account o Currently, HSA funds may not be used to purchase insurance or cover the cost of premiums. Allowing the use of HSA funds for insurance premiums will help make health coverage more affordable for American families.
- Medical Expenses Incurred Prior to Account Establishment o Allows qualified expenses incurred prior to HSA establishment to be reimbursed from an HSA as long as the account is established prior to tax filing.
- Administrative Error Correction Before Due Date of Return o Amends current law by allowing for administrative or clerical error corrections on filings.
- Allowing HSA Rollover to Child or Parent of Account Holder o Allows an account holder’s HSA to rollover to a child, parent, or grandparent, in addition to a spouse.
- Equivalent Bankruptcy Protections for HSAs as Retirement Funds o Most tax-exempt retirement accounts are also fully exempt from bankruptcy by federal law. While some states have passed laws that exempt HSA funds from being seized in bankruptcy, there is no federal protection for HSA funds in bankruptcy.
- Certain Exercise Equipment and Physical Fitness Programs to be Treated as Medical Care. Expands allowable HSA expenses to include equipment for physical exercise or health coaching, including weight loss programs.
- Nutritional and Dietary Supplements to be Treated as Medical Care o Amends the definition of “medical care” to include dietary and nutritional supplements for the purposes of HSA expenditures.
- Certain Providers Fees to be Treated as Medical Care o Allows HSA funds to be used for periodic fees paid to medical practitioners for access to medical care.
- Capitated Primary Care Payments o HSAs can be used for pre-paid physician fees, which includes payments associated with “concierge” or “direct practice” medicine.
- Provisions Relating to Medicare o Allows Medicare enrollees to contribute their own money to the Medicare Medical Savings Accounts (MSAs).
Interstate Market for Health Insurance Cooperative Governing of Individual Health Insurance Coverage:
- Increases access to individual health coverage by allowing insurers licensed to sell policies in one state to offer them to residents of any other state.
- Exempts issuers from secondary state laws that would prohibit or regulate their operation in the secondary state. However, states may impose requirements such as consumer protections and applicable taxes, among others.
- Prohibits an issuer from offering, selling, or issuing individual health insurance coverage in a secondary state: If the state insurance commissioner does not use a risk-based capital formula for the determination of capital and surplus requirements for all issuers. Unless both the secondary and primary states have legislation or regulations in place establishing an independent review process for individuals who have individual health insurance coverage; or The issuer provides an acceptable mechanism under which the review is conducted by an independent medical reviewer or panel.
- Gives sole jurisdiction to the primary state to enforce the primary state’s covered laws in the primary state and any secondary state.
- Allows the secondary state to notify the primary state if the coverage offered in the secondary state fails to comply with the covered laws in the primary state.
Minus the introduction and Q&A, the 45 -50 minute presentation is well worth your time. Engaging delivery and compelling case to consider… the cost drivers and distortions come from HOW we access and bill, as opposed to WHAT services are actually exchanged or provided. The key to understanding healthcare costs and pricing is to acknowledge that the answer is contained within our insurance card…and the processes it dictates and the tax/regulatory environment that it operates in. It is kind of like hiding something right out in the open; we look for clues everywhere except for what’s right in front of us. We tend to point fingers at easily identifiable components but fail to see what links them.
One of the best pieces I’ve read that exposes the real cost drivers in healthcare. Many of us have been shouting from the rooftops that the “villains” we implicate are just symptoms of a more fundamental poison in that is embedded in our third-party billing system and the cartel-like system it has created. Thanks to Dave Chase for putting the pieces together so clearly. Given the realities exposed here, we can no longer implicate something that has been virtually wholly absent from the healthcare economy which could have prevented this generational theft: A free market.
The Sovereign Patient
Mike Dendy: I hear the talking heads on business TV (like CNBC) talk about stagnation of incomes for the middle class. Wrong. The additional money is there every year, it’s just going into a pool to pay for healthcare instead of into the pockets of the employees in the form of salary increases.
Americans overpay for healthcare by at least 30% and likely 50% in aggregate. For all intents and purposes, every employer in America gives every covered member on their healthcare plan a blank check every year and says….consume all the healthcare you want, anywhere you want, anytime you want, and never be concerned with or ask the price because it’s all paid for. Deductibles and co-pays are irrelevant, especially to hospitals, because pricing is so high it becomes somewhat immaterial.
Trillions Have Been Redistributed from the American Workforce to the Healthcare Industry Creating An Economic Depression for the Middle Class The Washington Post and Vox have done excellent reporting that shows U.S. spends so much more than other countries for one simple reason — price. The good news is that some […]