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IS MANDATORY HEALTH INSURANCE ANOTHER TAX? (973 hits)

President Obama has expressed his approval of Senator Baucus' version of Healthcare Reform proposal. That version includes that healthcare insurance will be mandatory. Of course, the healthcare mandate will not affect or be imposed on anyone with a financial hardship.

This mandatory healthcare is being described as a "tax" by critics. However, President explained to Mr. George Stephanopoulos this past Sunday during an interview that each person must pay their fair share for healthcare in order for the problem to be fixed in the long run. He further expalined that when an individual can afford healthcare premiums such as the reasonable rate that a public option will offer, but then decides to just do without it and take a chance, he or she will create a burden on everybody else who must pick up the tab when individuals receive services from emergency rooms (for example).

In most states across the U.S., I believe it is mandatory that all vehicle owners carry a liability insurance. This was mandated because of theincrease incaraccidents which led toinjuries, but the driver did not have insurance to cover the medical expenses caused by the injury received in a car accident. In Maryland, this is the case. Drivers must have liability insurance protection on their car. When they are in a car accident, the other party can be compensated for their injuries. Prior to this mandatory insurance, if a driver did not have liability insurance, you suffered by footing the bill yourself unless you had insurance coverage. The insurance companies battled over the problem of paying claims while uninsured drivers got off paying nothing, so to speak. The result of this drove up the cost of car insurance and flooded the court system with claims against drivers who then could not afford to pay the judgment. In the long run, it was finally enacted into law that drivers must, must carry liability insurance on their vehicle in order to drive it legally. The same issue of people with insurance being left with higher premiums to cover those who did not have insurance. Statistically, making liability insurance mandatory has saved millions of dollars.

If a person did not keep liability insurance on his or her vehicle, he or she received a penalty until either the car was taken off the road (to prove this, you must turn in your license plates to department of motor vehicle for that car) or liability insurance was obtained. Of course if the liability insurance was not purchased after the penalty started accruing, the state has the right to seize the vehicle's license plate which forces you to pay the penalty and obtain liability insurance in order to put that vehicle back on the road legally.

This is similar to what President Obama's supports for healthcare. Individuals can purchase an affordable plan through the public option which will defray healthcare costs for everybody, or he or she can be penalized.

Is this penalty a tax? Is this penalty fair to impose? Should Americans foot the bill for medical costs incurred by someone who can afford healthcare premiums, but chooses not to have it? Why do people prefer the emergency room for treatments/healthcare?

Ok, what are your thoughts?
Posted By: agnes levine
Thursday, September 24th 2009 at 9:23PM
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I think (the health care reform bill) is the largest step forward since the first civil rights movement. Have you noticed how statistics can state how many blacks will die because of an illness. Have you ever wondered how these statistics are decided,
well given the consideration how many blacks are unemployed, and underemployed.
This unemployed and under employed determines how many uninsured people.
If you have no health care than what are your changes of determining an illness
an its early stage? That is why health care reform is so important to people of color.
These are my thoughts.

Thursday, September 24th 2009 at 10:16PM
Evangelist Agnes Levine;

As one who is a full proponent for President Obama's Public Option, I am fully behind the mandate that health insurance (just like homeowner's, automobile and professional liability insurance (malpractice) should be required.

To take each point of your question:

Is this [mandatory health care] penalty a tax? According to taxation as implemented under IRS codes, it is not a tax but rather it is a 'required' contribution just the same as medicaid and medicare deductions on your payroll check listing;

Is this penalty fair to impose? - Yes, if you look across the board and pay attention to the fact that - Americans as part of a democracy- are responsible to the government (which this law is questionable) to pay a bounty into the system to ensure that government runs properly. Therefore, if the health care issue is about to implode the financial stability of the county - it becomes a duty of its citizenry;

Should Americans foot the bill for medical costs incurred by someone who can afford healthcare premiums, but chooses not to have it? - I believe not - that is the justifiable reason that our President has indicated that health care should be mandatory so no exceptions such as what you have reference would exist.

Why do people prefer the emergency room for treatments/healthcare?

On this question I would extend myself off the ladder and say that I don't believe that people prefer the emergency room for treatment and/or health care. It is simple 'survival' in a situation where illness, whether minor or major, exists. That same person can walk into a private doctor's office and be rejected for medical care - legally
by the doctor. However, that same person can walk into an emergency room and under law the staff is required to tender medical care to that individual.

I have to admire the ingenuity of the people who find themselves in such a predicament and I also refuse to judge them or their choices for being creative enough - in some instances - to save their lives and perhaps the lives of their children.

Myth
Friday, September 25th 2009 at 8:27AM
Mythical Bliss
Yes, I do believe it to be another tax. I also read where there would be a $ 3800.00 fine for those who did not comply. Is this true or not?
Friday, September 25th 2009 at 9:26AM
Earl, that is correct. That is the penalty that comes with the mandate, to force people to buy insurance. The IRS will add an additional $950 dollars per person in the family that does not have insurance. For a family of four, that’s $3800! This amount will be added to your tax liability for the year.

This plan is the exact same plan that they have in Massachusetts, called MassHealth. Ask someone from that state and they can tell how that has hurt, rather than helped people.

Now, that might not be a problem IF we had a robust public option, because that is the only thing that is going to create the competition to drive prices down. The problem with this is, we keep hearing “public option,” but there has been no clear definition of exactly what that will be. I know this: any plan that the insurance and pharmaceutical companies would approve of, by its very nature, cannot be good for the public, and so far there has not been a lot of push back on recent talk of a public option from them.

So basically what we are going forward with is a plan to essentially maintain the profit status quo with the insurance companies. We are accepting their artificially high prices, and seeking to resolve the problem by giving some people money to make up the difference. The problem is, the money that has been proposed so far is not going to be enough to make up the difference for most people. Right now, on average, the cost for a family policy is around $12,000 per year. If things stay as they are, with annual increases in premiums as they have been, we’re looking at that average cost of ballooning to $30,000 per year by 2019! Are the proposed subsidies pegged to the rate of premium increases we can expect from the insurance companies? No!

I read the other day that the pay of the CEO of Aetna works out to $467,000 a week, or $20 million a year. And that does not include stock options. This is why the health insurance costs in this country are so much higher than in others, because a lot of what is paid is not going to health care but to “wealth care.” To put this in perspective, here’s a comparison of what the US spends per capita on health care vs. the next highest spending nation, France:

Total spending on health care, per person, 2007
United States: $7290
France: $3601

And in France, everyone is covered, whereas in the US, 47 million Americans aren’t. So clearly, we do not have a cost effective system. And that money is going into the pockets of health insurance execs, who add zero value to health care delivery; they’re just middlemen.

As long as we maintain that as part of “reform” we will always be dealing with rising, out of control costs.

Then there is the “no pre-existing condition” clause. Sounds nice. But that doesn’t work either without a real public option, because then people can just wait until they get sick and buy a policy. That doesn’t work as it depletes the pool that the concept of insurance needs to make it work.

I don’t care what you call it, but the idea that the government is calling “reform” forcing everyone to buy insurance from the same companies that have been gouging us for decades, with little in the way of cost controls and no effective way to rein them in, is not reform. That’s a giveaway to the insurance companies. They are licking their chops right now at the huge windfall, which is guaranteed if everyone is mandated to have insurance, from 47 million new customers.

What we should be demanding is single-payer. Or, Medicare for All. Medicare works very well for those who are eligible for it. Doctors love it because they don’t have the hassles they have with the insurance companies in getting paid. Patients love it because they are also free from those same hassles. And yes, they get to choose their own doctor. If we had that, anyone who wanted it could sign up. Those that didn’t could keep what they have. We wouldn’t be struggling with an 1100+ page bill because the legislation would be simple, just lower the eligibility age so that all who want it can buy in. That’s it!

Reps. John Conyers and Dennis Kucinich have a bill that does just that, HR676. That bill has been scored by the CBC, and they found it to be more than effective in terms of cost-benefit. But no, democrats took that off the table at the outset. Dumb move.

I think about that group, RAM that goes around the world setting up shop to provide health care for free to thousands. It’s gotten so bad that over the last several years they’ve been coming here, to the “richest country in the world,” to provide the same care they provide to poor people in indigent countries. They were recently in the LA area. People come from far and wide to get treatment for everything from toothaches to tumors; care that they just could not afford to get, and also that cannot be given in emergency rooms. Every time RAM sets up, tens of thousands show up, and many never get in because it’s just too many people. Now, these people are working poor, they make too much to qualify for Medicaid, but too little to afford a health insurance policy. The idea that we are going to penalize these people for something they will not be able to afford is obscene. It’s not “reform.”

Health care should be a right and not a profit driven service. It’s the profit margin that goes against providing care, because it’s the ability to deny care that drives profits. True reform means taking the profit out of health care, and the only way that can be done is through a single-payer system.

I support President Obama having the guts to tackle this issue head on. It’s been something that other presidents have tried and failed over the last 60 years. To Obama’s credit, we have never been closer than we are now to achieving that goal of health care for all. What I ask Obama and the democrats to do is two things:

1. Make Medicare for All the public option.
2. Drop the mandate.

If you do this, it takes care of all of the problems that the mandate would have addressed, without the regressive nature of it. Its also less expensive and more cost effective over the long haul. And it makes the insurance companies clean up their act if they want to stay competitive.

The question is not so much is it a "tax" but is it fair to impose this penalty on people who will still not be able to afford insurance under the profit driven status quo?

Friday, September 25th 2009 at 1:08PM
Clark, you stated how insurance costs in other countries are low. Could this in any way reflected upon the U.S. providing military protection for those europen nations?
Friday, September 25th 2009 at 2:44PM
Earl, it just has to do with how they view health care vs. how we do. They've for the most part taken the profit out of it. So many billions of what we spend goes purely to profit, which is why our costs are so high. The other thing is we've set up anti-competitive situations for the insurance and pharmaceutical industries.

In the case of pharmaceuticals, the reason we pay exponentially more for the same drugs made by the same companies, than consumers in other countries do, is because we allow them to fix prices outside of market forces, for one. This has been in place for some time. A law was passed during Bush that reinforced it, saying the government, which is the largest drug customer, cannot bargain with the pharmaceuticals to pay lower prices as it buys in bulk. That’s like me going to Pepsi and buying 200,000 cans of pop, and they charge me the retail price for each can. We’re the only country that does that. And this practice keeps prices artificially high for the rest of us.

As for the insurance industry, we’ve set up an anti-competitive situation for them too. They and major league baseball are the ONLY two industries exempt from anti-trust laws. How many times have you heard that in this health care debate? As such, they can concentrate themselves in markets and not worry about competition. That’s why they raise premiums annually far much more than the rate of inflation. Because they have no competition and don’t have to worry about anti-trust, they can collude on prices.

So we have situation here were, thanks to lobbyists doling out “campaign contributions” (e.g. bribes) to congress, they have set up a perfect situation for these companies to rake in billions while acting against the public interest.

The difference is other countries see health care as a right, where as we see it as for profit service. Add in the corrupting influence of lobbyists and, voila! You have the US health care system, the only one in the world that denies care to many of its citizens, for money.

My concern with the health care bill is that too little is being done to control the insurance and pharmaceutical industries anti-competitive practices, which allows them to over charge and abuse customers. Basically what we’re doing with reform is leaving the for profit component in, while doing very little on the regulatory side to rein them in. Our approach is essentially to leave that alone, and just subsidize people so they can afford it. But if we don’t do anything to rein them in on prices, we’ll never be able to keep up in terms of subsidizing people to afford care.


Friday, September 25th 2009 at 6:09PM
Thank you Clark. Curt Flood...baseball player for the St. Louis Cardinals...he took on golaith... Sounds like pure monopoly..Clark
Friday, September 25th 2009 at 8:17PM
Clark, I think you are right on with your analysis. We are now a socialist country (like it or not), so at least let's acknowledge that and do it the right way.
Saturday, September 26th 2009 at 1:40PM
Steve Williams
But maybe we should repeal the Constitution and start over, so that everyone is on the same page.
Saturday, September 26th 2009 at 1:42PM
Steve Williams
Yes, we have socialism but not in the pure, sense that Karl Marx envisioned it. What I have described is essentially socialism for the wealthy. There is a pattern wherein we privatize profits as we do with the health care industry in allowing it to rape us all for profit in ways that are against the public interest. But we socialize losses, such that we force the taxpayers to make the wealthy whole when they lose, i.e. the bailouts.

Now we have corporations such as Citibank, AIG and others deemed "too big to fail," meaning that, regardless of what these companies do, they know that the US taxpayer will always be there to bail them out. That turns capitalism and the idea of the marketplace on its head.

As for socialism, we've had it since the 1930s, when FDR ushered in Social Security, and Johnson later came with Medicare. These are socialistic programs and I have yet to see anyone who pretends to be a capitalist purist refuse their benefits from these two programs, e.g. its not a "bad" thing.

And that's the problem, we've allowed extreme partisanship and ideology to cloud our minds and divorce us from practical thinking. China has a communist government and a capitalist economy, and yet we depend on them to lend us money, lest our economy falls apart. The UK has a democratic government and a purely socialist health care system. Other countries have various mixtures that work best for their people. Only we in this country foolishly demonize the concept of socialism, and ironically, most of those who do couldn't define it if their lives depended on it.

There's no need to repeal the Constitution because of that. We just need to get real in this country and stop kidding ourselves about who we are.

Saturday, September 26th 2009 at 5:57PM
hey All, I love the healthy discussions and Bro. Clark you always enlighten me about something. Thank you all.

I just want to squeeze in here about a few small things. Smile.

1) It costs America 9 billion dollars per month for the war in Iraq and Pakistan...9 billion dollars per month!!

I covered the teleconference held by President Obama and this is an excerpt from what I covered: "President went further to explain just what the facts are about the public option Exchange:

1) We will have a market place for people to choose from various plans with doctors. This means that the public option will provide choices of plans and choices of doctors to pick;

2) This public option will help keep private insurance companies honest;

3) Provide a benchmark for costs for services;

4) Make the healthcare industry competitive for decent healthcare;

5) This public option is just ONE component of the Healthcare Reform plan;

6) The public option is voluntary and not mandatory;

7) The public option will expand consumer choices;

I have to disagree somewhat with you Bro. Clark about the public option v. single payer. Medicare is a sacred trust and cannot be altered the way you pose; however, it will be bankrupt in approximately eight years if the status quo continues and we do nothing.

What is shrinking our paychecks each week is private healthcare costs. Everything you said and everything we already know about salaries and wealth care. I believe there is promise to lower the age for eligibility for Medicare by five years which will reach millions of people with health insurance since retiring, job loss, etc in healthcare reform legislation.

I also attened the healthcare reform summit that was held on January 17, 2009, and was attended by people from various parts of the country. The speakers included Lake Research Group, Dr. Judy Fedehr(?) from Georgetown University Public Policy Institute. I mention this because the information was exhaustive about the public option policy in the making. I posted a summary of that Summit in January and I hope you find it worthwhile to pull it up. It gives sight into so many areas that factor into public option delivery that will drive the overall healthcare costs down. The drug companies are living their last days (smile).

I am convinced that the healthcare reform will force so many "private" insurers to make changes about healthcare delivery, too, and I am also convinced that many of those who achieved wealth care are in for a real shock.

The one thing I want to really, really point out in this discussion is that any individual or family who has a financial hardship (inability to afford even the public option) will NOT be penalized and they will be able to receive preventive and wellness care.

Also, I want to comment that I don't judge anybody who uses the emergency rooms. As a mother of three young adults, and an adult with a mental illness, I've had my share of visits to the emergency room and the reason the emergency rooms are the first choice for many, is because of private insurance companies losing their minds!!!

Definitely, a private doctor can refuse patients at will. A benefit for the public option is that qualified doctors will benefit from universal software which will eliminate the need for a lot of "specialists" in the private doctors' offices. This will also drive down costs.

For example, so many insurance companies have thos funky little codes that only "experts" can decipher in order for the doctor to receive payment. Well, with universa lsoftware, everybody across the country will be using the same codes, etc. and that will drive out the need for unnecessary and expensive software and office experts. This is not to reduce the job market, it will enhance it because a code for hypertension will be the same for everybody rather than each healthcare insurers having its own "unique" code for high blood pressure. (gee whiz). These are the little things that will make a huge difference in driving costs down that people don't realize. Healthcare reform goes "behind the scenes" of insurance companies and chases away those teeny-weeny money pits.

Ok, thank you guys for the insight. As much as I know, I am learning and I encourage you all to share your views with your legislators!!! This is the only way it can filter up to the top.....

www.senate.gov
www.house.gov

Passing the peace,

Passing the peace,
Saturday, September 26th 2009 at 9:30PM
agnes levine
You know each time I hear this health care bill talked about among us as voters and those we voted for, my mind never stop asking what if the bill to go to war with Iraq had been treated like it was going to cost the tax payers along with the lives of their family and friends would we owe China(I dount if anyone knows the cost) all of this money????!!!!!!!?Oh, lets not forget how Hillary Clinton said she never even read the bill to go to war with Iraq...and she used this as a reason for the voters to send her to the whitehouse...

Trust me when I say that the politicans have earned $millions if not $billions off of this war....so lets face it this is all about a president's skin color...
Thursday, April 10th 2014 at 6:47PM
Steve, if we just accept that we are a country of people who refuse to be the government themselves therefore creating a place for our politicians ARE REQUIRED AND ENVORCED to work in the interest of its citizens and not big business, we will continue to suffer from lack of no taxation with out representation as we do now.(smile)

example, remember how we only get in return for writing to our representatives, cover letters?(smile)
Thursday, April 10th 2014 at 6:47PM
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