March 26, 2007
Universal Choice Can Fix the Health Care Roof
change in the antiquated tax code would create an avalanche of universal
choice in health care, instead of current proposals that produce
universal dependence on government. Namely, the U.S. should eliminate
the deductibility discrimination between employers and employees for
health insurance premiums.
solution would be to replace the tax code with the Fair Tax, which
essentially replaces the income tax with a consumption tax. But since
few politicians with a bully pulpit have shown the moral or political
courage to lead the sizeable Fair Tax movement, let’s start with the
second best approach, universal deductibility.
deductibility of health insurance premiums by employers, employees, the
unemployed, individuals and business owners would connect the consumer
to health care costs. When people spend their own money, they spend it
more wisely. Most people will purchase health plans they can afford,
instead of expecting more benefits from their employer or the
flagrant flaw in most of the ideas proposed by the presidential
candidates is that they are variations of socialized health care.
Clinton, Barack Obama and John Edwards have all offered health care
plans that eliminate individual choice and increase government mandates
on employers, individuals and health care providers.
in Massachusetts is already experiencing a cost explosion. The only
Republican to propose a market-based solution is Newt Gingrich, who has
not yet declared his candidacy.
proponents of socialized health care do not believe individuals and
doctors possess the ability to make their own health care decisions.
They would rather take advantage of what Steve Forbes recently described
as “the abysmal ignorance of so many – including boatloads of business
executives and entrepreneurs – about what it takes to bring rationality,
productivity and lower prices to the U.S. health care market.”
greatest flaw of Health Savings Accounts (HSAs) and President’s Bush’s
new proposal is that they are tied to the disastrously flawed tax code
in the form of yet another tax deduction. These plans are improvements
on the current discriminatory system, but they further complicate an
already incomprehensible tax code.
president’s proposal, which allows deductibility of health insurance
premiums, has a hidden “sneak-a-tax.” Under the Bush plan, if your
employer pays more than $15,000 for your annual health insurance
premium, you pay tax on the excess coverage. Below that amount for a
typical family, the plan provides only small, non-game-changing savings.
Worse, the plan is not indexed to inflation. When inflation eventually
catches up to the $15,000 deduction, families will suffer the same tax
penalties posed by the Alternative Minimum Tax.
another concept that was supposed to “move us in the right direction” of
more affordability and accessibility of health insurance. HSAs have
worked for many, but way too slowly as health care costs and insurance
premiums have increased at annual double digit percentages.
socialists among us object to universal choice because they
fundamentally believe that government can spend people’s hard-earned
money better than the person who earned it. The bureaucrats object to
universal choice because it would force them to cut wasteful spending to
“offset” the “lost” revenue from allowing the deduction. That’s
political speak for “our job is to continue to rearrange the deck chairs
on the Titanic.”
universal choice, the liberals will still scream about the 47 million
people who do not have health care. They will ignore the 63 percent of
the uninsured who work for small businesses that cannot afford health
insurance coverage because the costs keep rising faster than their
profits. Conservatives ought to counter with the 253 million people who
have private health insurance that four of the presidential front
runners want to take away.
As I stated
on an NBC health care special in 1994, if you have a leak in the roof of
a building and you know that the roof is leaking, you don’t blow up the
building to fix the leak in the roof. That’s what total government
control would do to our health care system. The system will work if
government would get out of the way. We don’t have to blow up the system
to fix a few leaks.
deductibility would stimulate universal choice, which would fix the leak
in our health care system’s roof while making the building stronger.
market system, in which the consumer has access to information, choices
and his own money, has driven down the prices of all goods and services
that government has not overregulated or over-controlled. With a simple
change in the current tax code to eliminate discriminatory deductibility
for health insurance and eventually health care costs, free market
dynamics can solve another problem that Clinton, Obama, Edwards and
Romney want to make worse.
choice in health care is a choice the public must demand. Otherwise,
they will have to live with the disease of socialized health care.
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