Healthcare Proposal

DanielMa · Post by **DanielMa** » 13 May 2003 01:53

Please comment on the following proposal:

Each person is required to have an MSA (medical savings account) and contribute to that account 7.5% of AGI or $3000 whichever is less. In order to ensure compliance, this deduction will be done through payroll and there will be an item added to tax forms. A person can also choose to voluntarily contribute up to 15,000 per year. Contribution are on pre-tax basis.

Using money in MSA, each person is required to purchase an insurance policy with predefined limits. This insurance policy will only cover medical expenses in excess of 10,000 per year and some preventive care. The insurance policy can be purchased through Medicare or from private insurance company. If you don't have enough money in your MSA to purchase the lowest cost insurance, the government will give you a subsidy so that you have enough money to pay for it. If you have money remaning in your account, you are free to purchase any supplemental insurances you want or you can spend it on any medical expenses. You are also required to purchase an insurance policy for all the people you claim as an exemption on your tax return (children, spouses).

If you have accumulated funds in your MSA, you can make a withdrawal if the balance exceeds $50,000. Of course, the withdrawal is taxable.

Would you vote for this plan?

ALK · Post by **ALK** » 13 May 2003 02:00

Could you, please, provide link on the original info. There are too many unanswered questions to make any kind of judgement. For instance:

What is going to happen to the money that my employer currently pays for my health insurance?

Will this contributions be tax deductible?

Is $3000 per family or per person?

What about prescription drugs?

And so on.

DanielMa · Post by **DanielMa** » 13 May 2003 02:15

ALK wrote:What is going to happen to the money that my employer currently pays for my health insurance?

Will this contributions be tax deductible?

Is $3000 per family or per person?

What about prescription drugs?

And so on.

1. Your employer (or anyone else) is free to contribute your account if they want to.

2. Contributions are tax deductible.

3. Per person. You are responsible for funding accounts for yourself and all dependents. Of course, your employer may pick up some percentage just like they do right now.

4. You will pay for prescription drugs out of the account. For example, if you contribute $5000 and your insurance costs $3000 per year, you will have $2000 for any medical expenses and prescription drugs.

As far as coverage for the first 10,000 of expenses for people who are poor, state and local governments will have to come up with it if they want to.

Komissar · Post by **Komissar** » 13 May 2003 02:25

Я проголосую за этот план, ЕСЛИ при введение этого плана работодателей обязуют проиндексировать зарплату с повышением, т.к. те деньги, что компания платит за мою страховку сейчас берутся из фонда зарплаты. Я опасаюсь, что в реальной жизни фирмы "зажмут" деньги, и мы останемся у разбитого корыта, платя тысячи и тысячи из своего кармана за медобслуживание невысокого качества.

DanielMa · Post by **DanielMa** » 13 May 2003 02:41

Komissar wrote:Я проголосую за этот план, ЕСЛИ при введение этого плана работодателей обязуют проиндексировать зарплату с повышением, т.к. те деньги, что компания платит за мою страховку сейчас берутся из фонда зарплаты. Я опасаюсь, что в реальной жизни фирмы "зажмут" деньги, и мы останемся у разбитого корыта, платя тысячи и тысячи из своего кармана за медобслуживание невысокого качества.

That's not really possible. You can't legislate a pay raise. Hopefully, the companies who want to attract employees will offer matching contributions. If not, well at least companies will make more money and more jobs will be created.

HomeZombi · Post by **HomeZombi** » 13 May 2003 21:08

DanielMa wrote:

Each person is required to have an MSA (medical savings account) and contribute to that account 7.5% of AGI or $3000 whichever is less. In order to ensure compliance, this deduction will be done through payroll and there will be an item added to tax forms. A person can also choose to voluntarily contribute up to 15,000 per year. Contribution are on pre-tax basis.

Что то я не понял. Что значит "обязан"? А если я не хочу страховки?

И вообще, это всенародный антитеррорист что то такое предложил, или DanielMa попытался промоделировать его больное воображение?

Kastet · Post by **Kastet** » 13 May 2003 21:34

My thought about Daniel's post (english for english):

This plan is going to drastically increase the cost of health care which is growing at incredible pace already. If so much money will be pumped into the healthcare by simply introducing a new tax this will enable corporations, hospitals insurance and drug companies to increase prices. Prices will rise inevitably and fast.

I'am afraid that this proposal is another example of industry lobbying and pumping money from people with small, average ang average high income to poeple with high and extremely high incomes.

In fact I didn't hear which part of the proposal was aimed at limiting the costs of healthcare which are raising way faster the inflation. Especially to limit insurance companies.

DanielMa · Post by **DanielMa** » 13 May 2003 21:37

HomeZombi wrote:DanielMa wrote:
Each person is required to have an MSA (medical savings account) and contribute to that account 7.5% of AGI or $3000 whichever is less. In order to ensure compliance, this deduction will be done through payroll and there will be an item added to tax forms. A person can also choose to voluntarily contribute up to 15,000 per year. Contribution are on pre-tax basis.

Что то я не понял. Что значит "обязан"? А если я не хочу страховки?

Деньги вычитаються из вашего дохода, как налоги. Поступают на ваш личный счет. С этих денег вы обязаны купить страховку. Если не купите, за вас выберут Default choice и вычтут деньги со счета.
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DanielMa · Post by **DanielMa** » 13 May 2003 21:44

Kastet wrote:My thought about Daniel's post (english for english):

This plan is going to drastically increase the cost of health care which is growing at incredible pace already. If so much money will be pumped into the healthcare by simply introducing a new tax this will enable corporations, hospitals insurance and drug companies to increase prices. Prices will rise inevitably and fast.

I'am afraid that this proposal is another example of industry lobbying and pumping money from people with small, average ang average high income to poeple with high and extremely high incomes.

In fact I didn't hear which part of the proposal was aimed at limiting the costs of healthcare which are raising way faster the inflation. Especially to limit insurance companies.

The plan actually limits the role of insurance companies. Insurance companies are suppoed to do jus that - INSURE against risk. It is not the job of insurance companies to administer healthcare. Nor is it the job of employers. We now have two intermediaries between consumers and suppliers of healthcare

Patient -> Employer -> Insurance Co -> Doctor

This results in low elasticity of demand since patients are shielded from the real cost of healthcare and are unable to make real choices.

There will not be any additional money pumped. The fact that consumers will be closer to doctors will increase elasticity of demand and decrease ability of companies to increase prices.