I moved William's reply from the top to the bottom.
On 10/1/06, Neil Schneider <[EMAIL PROTECTED]> wrote:
>> >> >> Robert Donovan wrote: >> >> > What we need to do is get from the curent arrangement of doctors, >> > hospitals, >> > and patients competing for insurance money to doctors hospitals and >> > insurance companies competing for the patient's money. To do that, do >> > three >> > things, REMOVE the tax exemption for employer provided health benefits >> > and >> > REPLACE it with an equal tax exempt status for higher wages to get >> > employees >> > demanding higher cash wages to buy their own healthcare, and make ANY >> > third-party payer health benefits from employer to employee illegal, >> > period. > > > I refer you to the very next sentence in my original post. The employer > would be the one negotiating with the insurance companies for the > policies. > They would just be negotiating for individual policies to purchased and > owned by the empolyees, paid for with the tax-exempt cash wages the > employer > would pay them for the purpose. > > Insurancese companies hold all the cards. And who really believes that an >> individual has a better negotiating position than another corporation. >> If you believe individuals can negoiate themselves a better deal than >> they now get through their employer I have some beachfront property in >> Yuma I'd like to sell you. > > > The individuals wouldn't negotiate the policy. They'd shop for it. > Insurance > companies hold all the cards under the current system precisely because > the > third party payer system virtually removes all competition for the > individual's money. And yes, I think individuals are smart enough to > figure > out what is the best deal for them. We do it with every other type of > insurance we buy right now. I just bought new car insurance and homeowners > insurance online and shopped about five differnet policies. It was > convoluted and tedious at times, but very doable. Healthcare should be no > different. The reason it is different is due entirely to the fact that > there > is far less of a market for individual health insurance any more because > the > business policies are so much more lucrative and, outside of the still > very > small, restrictively regulated, HSA market, there is little choice or > incentive for the employer to shop around for the best policy, only the > best > price. The tax-exempt status of employer-provided health benefits also > encourages focus on price rather than quality. By flipping the tax-exempt > status for healthcare via the employer to cash wages, employers are > encouraged to pay more money for healthcare to employees directly. Making > third-party payer arrangements illegal takes away the profits to the > insurance company for these policies and forces them to either start > creating individual policies or lose billions in annual profits. > Disallowing > any exclusive deals between the insurance company and employer and/or the > employee for health insurance puts the empolyers in a better negotiating > position for group policies at better prices because the insurance > companies > would know that the business owner and the employees could go down the > street to the competition at any time. There is no better mechanism in the > world for keeping prices down without creating shortages than that, and it > encourages delivery of more service for a given price rather than less, as > it is under the current system, to attract and keep new and existing > customers. > > Here's what would really happen with your plan. It would accelerate >> the existing trend for mployers to stop offering healthcare as a >> benefit. > > > My plan doesn't encourage removal of healthcare as a benefit, it > encourages > changing it from an in-kind payment to a cash payment of equal value by > swithcing the tax-exempt status from in-kind to cash wages. Employees who > managed to get better prices on insurance or to reduce their medical > expenses would see an increase in net wages, not a decrease. Employers > usually have a much harder time reducing cash wages than they do in-kind > benefits. That's not to say that employers wouldn't try, but changes in > cash > wages are immediately and acutely felt by employees, and are ususally the > last thing employers reduce to save money. They will usually remove perks > and benefits first because their absence is not immediately felt in the > case > of most workers. > > Wages would continue to remain stagnant or decline, and the >> standard of living for american employers would decline even more >> rapidly than it is today. > > > I refer you to my last remarks. > > RD On 10/1/06, William Eade <[EMAIL PROTECTED]> wrote: HI - It's that lurker again. All that has been said is pertainant and logical for people in this country who are working and have a decent income. Shopping around CAN save a lot of money. I cut my car insurance 50% when I started shopping. I soon learned that the low income people are the most likely to get shafted when buying ANYTHING!!
True enough, but the biggest impetus to price increases in the cost of healthcare at the moment is the lack of ability for those with an income to shop for health insurance and exert pressure on insurers and doctors to bring the price down. Lower income people are shafted worse at higher prices than they are at lower prices. I do not pretend that my proposal would fix every problem in the healthcare system. It is intended to reduce the problem of rising costs by rearranging the incentives. The last numbers I saw from the Government itself placed the National
poverty level at $800 per month. The latest figures from HUD placed the number of elderly and disabled alone (not including low income families) in San Diego County at over 50,000. What do we do with this portion of the population? Just let them crawl in a corner and die just because they are no longer "productive " workers? That sounds like a Fascist attitude to me. Most low income elderly, disabled, and even working families MUST make a choice about buying insurance or putting food on the tables or what "new" clothing are they going to buy from the thrift shop.
Your point that my ideas depend on the healthcare consumer's ability to shop is well taken. These impoverished/lowincome people might be defined as lacking the ability to shop due to their lack of income. I am not saying that all government sponsored healthcare assistance should be abolished in favor of what I propose. But, here again, as prices for healthcare come down, lower income people are rendered more likeley to be able to afford healthcare, not less. Furthermore, any government assistance to people whose income is too low to afford even lower-priced healthcare would be better implemented in an environment that would result from the changes I suggest. I realize that nobody can overspend like the government can, but it would still be better to start from an environment in which those who have the ability to shop are tending to keep the price of healthcare down rather than tending to make it go up as is the current situation under the present healthcare system and under most nationalized systems. I doesn't take a high IQ bean counter to figure that the tax money spent by
the US government alone on our so-called Health Care system could place all doctors and hospitals on salary at a decent income (not excessive) and provide FREE health care for everyone. I know, this is against the "free enterprise" system that everyone touts as being the ideal. In fact it seems a bit "Communistic" but it would be our tax money paying for it - not a FREE handout.
I understand this sentiment and the frustration it is born of, but the minute you start defining what is a decent income for one group of people, you open the door to other groups of people defining what is decent income(and, by extension, healthcare) for you for you. There is no need to go there. Secondly, the healthcare thus provided would be no more free than it is now, the cost would simply be shifted away from the consumer, further hidden from the consumer, and, therefore, likely to rise, resulting in exactly the same problems mentioned in my original post and rationing by price/access, as we have in the US, or rationing by queue as they have in Canada, Great Britain, and much of Europe. Our government talks about "tax and spend" politicians when it refers to
using tax money for the benefit of the people. NOT ALL PEOPLE who are getting these benefits are loafers, living at the expense of others. Most are people who have worked hard for years and are beyond the point of doing manual (or most other) labor. Those who abuse the system SHOULD be bounced off the rolls. Our "borrow and waste" politicians who are shifting the debt to our great-grandchildern haven't elimiated the taxes (except for the very rich). What are they doing with all of the tax money that is still going into the coffers?
All of this is a reason to avoid and minimize the government providing free healthcare for everyone, not to embrace it. There is little, if any, reason to expect that the government would be any less wasteful and/or inefficient and/or corrupt in providing healthcare than in any other taxpayer-funded service. I worked for the welfare Department for a while many years ago, and I could
go into a LONG rant about the unfairness of THEIR rules - but that is another subject. Lets just say that I didn't stay in that job too long. Our wonderful standard of living with probably the highest wages in the world is due to an endless cycle of "raise the wages" followed by another endless round of "raise the prices." That, coupled with our easy credit system which most other countries do not have - hardly a day goes by without another "pre-approved" platinum credit card offer in the mail - accounts for the disparity of our wages with the incomes in other countries. The last figures I saw placed GOOD programmers available in India at about $10,000 per year.
As long as you are talking about cash wages this tends to be true. In the case of healthcare, which we are effectively forced to buy at the company store, the possible exception being a few situations where HSAs can be used, the exact opposite tends to be the case for reasons already mentioned. RD -- [email protected] http://www.kernel-panic.org/cgi-bin/mailman/listinfo/kplug-list
