The Amazing Maze of US Health Care

When could taxing health care benefits be a good idea?  If it would achieve the objective that the tax exemption is not able to achieve – universal coverage..

Admittedly, in my last post I offered a knee jerk reaction to the idea of taxing health care benefits.  I distrust the motives of those who single out the income tax exclusion for health care benefits.  Yes, it is a big number, but not compared to the alternative of footing the entire health care bill.

Why a tax exclusion for health care benefits?

The objective of any tax relief or penalties is (or should be) to promote a larger social purpose.  Providing health care coverage certainly meets that test.

Most of those touting an end to the tax exemption for employer sponsored insurance are more interested in raising revenue at the expense of working people than they are in expanding health insurance coverage.

In weighing the merits of the tax policy, at least two questions need to be addressed:

Is the goal achieved?

Is it cost effective?

Given the 40+ million uninsured in this country, the answer to question one has to be an emphatic “no”. Read the rest of this entry »

I realize writing a letter to the president is like writing to Santa Claus.  Yes, Jim, there really is a Santa Claus; but the elves read the letters.

Short letter.

Dear President Obama:

Taxing benefits is a bad idea!

It is bad politics

It is not just that you thought it was a bad idea during the campaign and now you have flip flopped.  You are allowed to flip flop on some issues. Read the rest of this entry »

Two weeks ago, The Annals of Internal Medicine posted three articles on health reform and invited readers to comment.  The three articles highlight the perspective of physicians, more specifically internists who generally fit into the category of primary care physicians.  As one commenter notes, the three articles read like committee reports.

There are some pretty heavy hitters among the authors to the three reports so I offer my comments with some trepidation.  Bottom line, they miss the mark.  I have this image of trying to land an airplane when the altimeter is 10,000 feet too high.  The plane just doesn’t seem to touch down.

Except for the details outlined in the EMBRACE program, there is little to disagree with, it is just as if the the wheels just don’t reach the ground.

Read the rest of this entry »

Does Congress really think they are doing anyone a favor with the new COBRA subsidy provision in the recently enacted stimulus package?

Why can’t they make it simple?

Conservatives who fear “socialized” medicine because it will make medicine more bureaucratic should acquaint themselves with COBRA regulations. Litigation over COBRA keeps lawyers and judges busy all over the country.  And what does any of it have to do with the delivery of care?

What is COBRA anyway?  The Consolidated Omnibus Budget Reconciliation Act of 1986 was one of those huge (thus the word omnibus) budget bills that included everything from tobacco price supports to fishing fees for foreign fishing vessels.   But it will be remembered because Title X (of XX) included provisions to permit those who lose their health insurance under an employer sponsored health plan to continue their health insurance under certain conditions (called qualifying events) and provided they pay the full cost of the coverage.

Because, the person without coverage is also usually without a job, and because the person must pay the full cost (actually 102%) of the coverage, very few people elect the coverage and those that do are more likely chronically ill individuals.  In insurance parlance, that’s called adverse selection.  The plan sponsor will usually end up paying more than they receive in premiums.

So what did Congress and President Obama do with COBRA? 

The new law makes the cost of COBRA premiums slightly more affordable.  Normally, a 65% discount would seem pretty attractive.  But the average cost of one of our family plans exceeds $1,000.  $350 – 450 per month for a family with one less breadwinner is still a stiff price.  Imagine selling a Lamborghini at 65% off!  $70,000 for a $200,000 car is a huge bargain.  But for someone without a job?

The new law allows those terminated between September 1,2008 and February 17^, 2009 and who initially declined their COBRA election, another opportunity to elect the coverage at the reduced rate.  And they can begin their coverage March 1 instead of the date of the qualifying event.

Unlike regular COBRA, the subsidy is limited to those who are “involuntarily” terminated and their family members.  The plan sponsor can rely on the employees’ attestation that they were involuntarily terminated. Read the rest of this entry »

Single Payer is your best option

On Thursday, March 5, you had your Health Care Summit. I know your concern about the cost of health care motivates your push for reform. I was one of those who called the White House and e-mailed the White House asking that you open up your process to the single payer option.

President Barack Obama

Like you I am concerned about the drain that the health care system exerts on the economy. You are concerned about costs. One of my concerns is the work force. I have made the argument here that a single payer system would have a liberating effect on the work force and on employment practices in general.

Did you provide health care benefits to your campaign workers?

On Thursday, I happened to read an old article in the New Yorker about your presidential campaign.  What an excellent way to illustrate my point.  Read the rest of this entry »