Healthcare Reform Highlights For The Self-Employed

Until now, I haven’t written much about healthcare reform issues – it’s just feels so daunting and politically-charged. I do support the eventual separation of work and health insurance, as I think that all unemployed, partially-employed, and self-employed individuals should get access to affordable healthcare. As the dust settles a bit, I took a look through the many attempts of media to break down the healthcare reform bill into manageable bites. Here are my notes:

2010

  • Employers with fewer than 25 employees (more if you have part-time employees) and less than $50,000 in average wages may be eligible for tax credits worth up for 35% of paid premiums. Note: The tax deduction is not available to sole proprietors, so you may want to consider an LLC or corporation form.
  • All health insurance plans must allow people to maintain dependent coverage for children until they turn 26. This could help out the many young and self-employed. Also prohibits insurers from denying coverage to children because of preexisting health problems.
  • If you are self-employed and have medical conditions that make it hard to find any health insurance at all, there will be a high risk pool set up to create “affordable” premiums. I wonder how affordable that will actually end up being.
  • Insurers will no longer be able to put lifetime limits on coverage, or cancel policies that are already in service (except for fraud).
  • Starting September 2010, all coverage must include basic preventive care. As many small businesses can now only afford catastrophic coverage, this may mean additional benefits.

2011

  • Companies with less than 100 employees will be eligible for grants to set up wellness programs. Employers can offer employees bonuses of up to 30% of the cost of insurance.

2013

  • Limits medical expense contributions to tax-sheltered flexible spending accounts (FSAs) to $2,500 a year, indexed for inflation. (I wonder how much it costs to administer one of these for a self-employed person.)

2014

  • All U.S. citizens and legal resident must have health insurance, or else pay a fine. People who are satisfied with their employer-provided coverage don’t have to do anything.
  • Health plans no longer limit coverage based on preexisting conditions, or charge higher rates to those in poor health. Premiums can vary only by age, place of residence, family size and tobacco use. Wow!
  • Individuals and small businesses with up to 100 employees will be able to shop for coverage from newly-created health insurance exchanges. Theoretically, this will allow individuals to get rates just as competitive as current large group plans.
  • Small business owners who purchase coverage through the exchanges can receive a two-year tax cut for up to 50% of what they contribute toward their employee health insurance premiums.
  • Individuals may receive income-based tax credits for insurance bought from the exchanges. Sliding scale credits will eventually phase out for households above four times the federal poverty level, until about $43,000 for an individual or about $88,000 for a family of four.

Sources: CS Monitor, Health Reform and Small Business, USA Today, HealthReform.gov

Comments

  1. ** All U.S. citizens and legal resident must have health insurance, or else pay a fine. ***

    Crazy isn’t it? Forced to buy a product to be considered a citizen in good standing.

  2. The prices of health care going to skyrocket. There is no doubt about it.

    It is funny that illegal aliens are still going to have a free ride.

  3. ParatrooperJJ says:

    All it is going to acomplish is to double or triple the cost of insurance.

  4. I bet when Obama was saying “Change”, the people were expecting a tort reform, creating a real free market in health care to lower prices (now it is more a monopoly since health care companies provide services only per a state), hahaha.

    Actually, it is not funny.

  5. Not that crazy. You are forced to buy car insurance when you want to drive because uninsured car drivers hurt the greater good.

    And yes, I understand that driving a car is optional and buying health insurance is not, but there are plenty of things people are forced to do as citizens that they may not want to do, such as paying taxes and such.

    Fact is, the mass of people without health insurance hurts the greater good as well.

    I should know, I have no health insurance right now. Does that mean I go without health care? No, I just end up costing you by going to free health clinics, and taking advantage of the free programs available in my city. In fact, it’s a hell of a lot easier for me to get basic health coverage than my parents, who have what some may characterize as decent health care coverage. They have to pay premiums, deal with copays and figure out whether things are in network, fight with the insurance companies when they refuse to provide coverage, etc.

    Me? I get all my x-rays and blood tests and doctors visits for free, just cause I don’t have any insurance/means to pay for anything at this point. And since I’m not paying for any of these things right now, someone else is paying for me, through higher insurance premiums and whatnot.

    People like me aren’t good for the health care system. I don’t get preventative care, which makes me a higher risk for expensive trips to the emergency room. But I couldn’t get individual health care coverage even if I tried, without it being prohibitively expensive. So I choose the selfish route, to go without insurance.

    People should be happy that once the new laws start, people like me will be forced to buy insurance (and yes, I have concerns about the affordability, Ive never thought this legislation was perfect) and pay our fair share. And I’ll be happy because I’ll finally be able to get coverage, without my sports induced asthma getting in the way. Yes, thats the reason why insurances refuse to give me coverage. Because I need an inhaler once in awhile when I get a cold or go on a run. Go figure.

  6. Robert, without a mandate it wouldn’t work. Since the insurance companies couldn’t deny coverage for preexisting conditions, people would just wait until they got sick and then buy insurance (which would push premiums through the roof for everyone else). To me, it’s irresponsible not to carry insurance, b/c if you get injured or sick, then I have to pay for it! Mike, what will be changing for illegal aliens?

  7. Pedro.

    I understand the logic behind the mandate. I just don’t agree with it. The issue of the mandate will more than likely make it to the supreme court where it will probably be upheld (sadly) under the commerce clause:

    Article I, Section 8, Clause 3:
    [The Congress shall have power] To regulate Commerce with foreign Nations, and among the several States, and with the Indian tribes;

    The sad thing about this is that the commerce clause clearly says “among” the states and not “within” the states. But this has been stretched to mean all kinds of things based on who’s on the court. Since health insurance cannot be bought across state lines, one would expect the commerce clause to not apply here at all, making the mandate unconstitutional.

    The government should never be allowed the power to force you to buy any product for any reason just because you are a citizen.

  8. It’s rediculous that we’re forced to buy something for which there’s been no price control measures effected. What a waste that we’re now forced to subsidize administrative profits in place of actual health care.

  9. I see that clearly a public option was one of the only ways to increase competition. Selling across state lines would likely cause more insurance companies to merge and operate from within states that have the best laws for their profits. For example, if it’s cheapest to run from Connecticut…why wouldn’t most companies relocate/merge to operate only from that state. I would more likely expect an overall reduction in insurance providers causing less competition, the opposite of the intention of allowing across state line insurance.

    Those scared of our costs going up, I have trouble believing all the fear. Currently hospitals are required to take anybody in who is in emergency need of care. This is the most expensive type of care and all who need it can get it. When they cannot collect for this expensive care due to inability of the patient to pay, they surely don’t just eat those costs…it’s passed along to the insurance companies in high fees for procedures for those with insurance. Now we all know the insurance companies aren’t in this for charity, so who ends up paying those costs….the people who currently have insurance. So I just have a bit of problem with the idea that this will cause rates to go up when people are provided preventative care helping reduce the most costly part of care. The reason rates may, and probably will go up is because insurance companies can easily use this as an excuse to hike rates even though they are getting a huge influx of new customers. The only way I see this working is having something independently keep the insurance companies in check…ie a public option. The only other way I see it is when somebody is having an emergency, if they don’t have insurance…don’t let them in to the hospital. Not acceptable in my eyes, hopefully not in yours either.

    On the moral/ethical side, which is an entirely different debate, I don’t see why the richest country in the world cannot provide healthcare to it’s entire population. It seems awful that a person’s state of health can be dictated by the profits of corporations. Nearly all other developed countries do this, and those people live longer healthier lives.

    This is coming from a person who has one of the ‘Cadillac’ healthcare plans.

  10. RE: All U.S. citizens and legal resident must have health insurance, or else pay a fine.

    * * *

    Does anyone know if this applies to U.S. citizens who live abroad?

  11. Thanks for the summary. What about HSA contribution limits? See anything about these types of plans in your research? I haven’t found anything about changes to HSA-compatible plans in any of my digging, unfortunately.

  12. To me, these arguments that the government can’t or shouldn’t be allowed to force you to buy something are silly. You’re already forced to pay taxes (which is essentially buying government services) and most (if not all) states force you to buy car insurance. The premise is nothing new.

    For those of you who don’t think you should be required to have health insurance, my question is this: If you get sick or injured, and can’t afford to pay the bills, who do you think should pay for it?

  13. You don’t have to buy a car, Pedro. It’s your choice. The purpose of auto insurance is to protect everybody else from the policyholder’s negligence. If you neglect your own health, you create no liability concerns for anyone else’s property.

    If you get sick or injured and can’t afford to pay the bills, it’s your problem. Medical care facilities ought to be able to deny treatment to anybody that can’t afford to pay, just as restaurants, hotels, auto dealerships, gas stations, clothing retailers, grocery stores, and energy companies do not provide goods and services to people that cannot afford to pay. How can you defend the confiscation of property from one American who has rightfully earned it in order to pay for services benefitting another American?

  14. @JJ: Yes. It does. The bill defines a $1,900 penalty per family living abroad to exempt themselves if you do not purchase coverage. From the bill, the penalty applies to:
    “(3) INDIVIDUALS RESIDING OUTSIDE UNITED STATES
    Any qualified individual (as defined in section 911(d)) (and any qualifying child residing with such individual) shall be treated for purposes of this section as covered by acceptable coverage during the period described in subparagraph (A) or (B) of section 911(d)(1), whichever is applicable.” Meh, the whole section is boring and rambling, but yes. You will have to pay.

    @Jonathan: You forgot a step: 2012 – Health care reform bill repealed; Congress starts over on health care reform.

  15. “How can you defend the confiscation of property from one American who has rightfully earned it in order to pay for services benefitting another American?”

    Um… Medicare? Medicaid? Social Security? The Public School System? All things I pay taxes for that I’ve never used.

  16. @Pedro: Here in Alabama, you can put a bond up to the state (if you have enough liquid assets, I think it’s $100k) to exempt yourself from having to purchase auto insurance. The argument is a non-sequiter anyways, since auto insurance is a state issue, and the current administration has made health care a federal one, taking away the state’s ability to decide if it should be required.

  17. Quick correction: It looks like they changed the overseas requirements; it’s not the same as when I first read it. I really don’t want to re-read this mamoth, but I do not know now if overseas Americans will be exempt from paying the fine or not.

  18. “Um… Medicare? Medicaid? Social Security? The Public School System? All things I pay taxes for that I’ve never used.”

    Right, and you can defend the existence of those wealth transfers how, exactly?

  19. Naveen, that’s great if you would be A-OK with being refused care in an emergency b/c you don’t have insurance (enough money to pay for the care upfront), but most people wouldn’t. The auto insurance comparison is right on; if someone doesn’t pay their healthcare bills the rest of us are liable for the pass-through costs. Also, I think Kyle’s point is that this is nothing new.

    Jon, the risk pool is bigger with a federal (vs. state) mandate. I’m not sure of the point of your argument. You have to pay federal taxes, don’t you?

  20. “Medical care facilities ought to be able to deny treatment to anybody that can’t afford to pay, just as restaurants, hotels, auto dealerships, gas stations, clothing retailers, grocery stores, and energy companies do not provide goods and services to people that cannot afford to pay. How can you defend the confiscation of property from one American who has rightfully earned it in order to pay for services benefitting another American?”

    Let natural selection play its course. I get it.

  21. “Right, and you can defend the existence of those wealth transfers how, exactly?”

    Yea you’re right. We should just get rid of taxes all together. I mean think of the possibilities:

    http://www.youtube.com/watch?v=7QDv4sYwjO0

    Hmm. On second thought, I like parks and libraries and being able to drive to work on roads and firemen showing up when my house is burning down, etc. etc. etc.

  22. Baughman says:

    Catastrophic insurance is the answer. Insurance should be used to pay for extraordinary events that a family adequately cannot cover. High deductible plans would make consumers sensitive to the price of services. This would bring efficiency to the system.

    A system where users of care pay a single price (the premium) and unlimited consumption (neglecting a small copay) is broken.

  23. @Baughman – I agree, catastrophic coverage is the right way to go, I think. That’s what I like about HSA plans — you have some skin in the service purchasing process. What we all need is more price transparency. Medicine is one of the few (only?) services we purchase where we have no clue what our cost will be until months later when an “explanation of benefits” arrives in the mail.

  24. I defend many of the social programs solely on the fact that these programs help those who need the help most, improving the greater good, which eventually affects everyone else. If you did away with public schools, I see the whole nation suffering, including those who can afford private schools. I personally don’t want to be in a nation where the illiteracy rate is climbing and innovation is stagnated. I feel this can be extrapolated to most other programs on some degree or another. Are they all run as efficiently and effectively as possible? No, but does that mean we do away with them entirely? I’d probably say no as well.

    With respect to the denial of people to hospitals who can’t pay for it. What do you figure would happen when you get in an accident with somebody who makes more than you and only one ambulance shows up? By your logic, the richer person with the minor injury deserves the ride to the hospital, no matter how much more critical your state may be. You can put a price on everything. Some things shouldn’t be based on pure capital markets. In my eyes, everyone deserves equal access to: organ transplants, fire and police protection, education, healthcare…

  25. to all those who opposed this bill, what was the alternative? I know its not perfect, the ideal way of doing would have been to create a single payer system so everyone is covered and everyone pays into it. Obviosuly this wasnt politically possible because of the right, so we went with the next best thing. I defintiely love the up to age 26 coverage under a parents plan. I know conservatives have said you arent a kid at 26 anymore and should grow up. But you try and find a job with benefits in this economy. I couldnt find a job that offered benefits and am very grateful to still be under my parents.

  26. As a comment to Drew’s post… I feel as though the general populations health directly affects my health. We had a rather large outbreak of the H1N1 virus here in the midwest, which caused many of the public clinics to give away free vaccinations to everyone. These free vaccinations reduced the spread of the virus. Therefore none of my friends or family were infected because of this. I don’t know where exactly the funding for these thousands of vaccinations came from, but my immediate guess is tax money. Crisis adverted.

  27. Just because you need to get insurance or pay a tax if you choose not too means there will still be millions of uninsured people in the system.

    Won’t people just not have any health insurance and when they find out they have a serious illness call and get insurance under the preexisting condition clause!

    Costs are going to go through the roof. People will work the system, Doctors included. Instead of the Insurance Companies denying claims for profits, 2% profit that is! Govt. will deny claims and provide slow service, for the good of everyone. This will also hurt the economy and people will say “see Capitalism does not work”.

    Govt. does such a crappy job at everything, why let them get bigger.

    PS
    Car insurance is needed because if someone has no net worth, they would not get any car insurance, because they have nothing to lose.

  28. “Medical care facilities ought to be able to deny treatment to anybody that can’t afford to pay, just as restaurants, hotels, auto dealerships, gas stations, clothing retailers, grocery stores, and energy companies do not provide goods and services to people that cannot afford to pay. How can you defend the confiscation of property from one American who has rightfully earned it in order to pay for services benefitting another American?”

    Just curious, You are saying that when a child who doesn’t have health insurance because his parents can’t afford it goes to the emergency room, you are okay with turning that kid away and letting him die?

    Objectivism is wonderful in theory, but pretty harsh in practice…

    Part of being a civilized nation is providing people with the opportunities to get an education and basic health care. We have the first, hopefully we are on the way to getting the second.

  29. I think food is more important than health care, so why no proposals for “single payer” for food?

    Yes, there needs to be a safety net in a civilized society (for example, for basic health care), but at the same time we need to provide incentives (for example, limited government bailouts for bad decision making) so that one doesn’t rely on the safety net.

  30. JoetheBankgeek says:

    This is what they call the free market place.

  31. To everyone yammering on about the “fine” for not buying insurance – do you realize that you just paid an $8000 fine for not being a first-time homebuyer in 2009/2010?

    Your taxes would have been $8K lower if you had done so.

    The fine is exactly the same as increasing everyone’s taxes by the same amount and then giving a credit to those who CHOOSE to buy insurance.

    The words may be different, but the result is the same.

  32. Altereggo says:

    I’m fine with paying extra tax to pay for a basic health plan for children and the poor. It helps them, which helps me in the end.

    I’m angry that my 74 year old father can get more health-care money from the government than the single working mother and child who live next door, just because the AARP is so powerful.

    I’m angry at being forced to buy an expensive product I don’t want, and being lumped into a risk pool with old fat smokers in order to subsidize them, just because the democrats think it’s a good idea.

    I’m angry that the government will force anyone who employs me to pay me in insurance I’d rather buy, just because it doesn’t cost the democrats anything.

    And I’m angry that I’m called a heartless git for raising these objections, just because democrats and republicans have stopped listening and thinking to anyone who disagrees with them.
    Hopefully everyone comes to their senses soon.

  33. Altereggo says:

    ed: “have stopped thinking, or even listening to anyone who disagrees with them.”

  34. toastyaroma says:

    “to all those who opposed this bill, what was the alternative?”

    The alternative was getting the government out of health care, not more heavily involved.

    If the government had intervened in computing like they did health care, we’d all still be using 9600 baud modems and saving files to 5.4″ floppies.

    The government stifles innovation, efficiency, and a healthy competitive marketplace when it decides to intervene.

  35. I’m 48 years old, my wife is 47. Our entire lives, we’ve been covered under – and paid into – health insurance of one kind or another, either from our parents or our employer coverage. Almost a year and a half ago, my wife was laid off from her job where we got our health insurance (I’m self-employed/stay at home dad). She had some severance pay, which included health coverage, but when that ended and she found work as a self-employed consultant, we went on COBRA.

    Most folks advise getting your own policy over COBRA, but that wasn’t an option for us. Why? Because about 2 and a half years ago, my (then) 10-year-old daughter was diagnosed with Crohn’s Disease. She’s in remission, but because of her “pre-existing condition”, no one would write us a policy that included coverage of anything to do with her Crohn’s. Isn’t that rich, the one thing we need coverage for wouldn’t be?

    So, we pay over $1500/month for coverage under COBRA. That’s over $18,000/year. Luckily, my wife’s very good at what she does, so we can afford that, but I hate to think what someone less fortunate would do in our situation. And remember what I said at the start, we are people who have been paying into the system all our lives, almost 50 years worth of insurance payments, but the current system doesn’t care. This is a broken system.

    People just don’t realize how close they are to being in real trouble with the health care system as it was before this new law. This law is not perfect (among other things, the fine is way too low – too many people are going to decide to do as Pedro says and not sign up until they are sick (a stupid decision, but there are plenty of stupid people out there)), but it’s a start.

    Tim

  36. Debbie – interesting you mention you cannot get health insurance coverage due to your sports induced asthma. I have been living with the same condition for 22 years and never had an issue getting health insurance.

  37. @JJ @Jon

    It seems that citizens living outside the United States will be treated as covered and thus not need to pay any fine.

    From the Senate:
    http://democrats.senate.gov/re.....passed.pdf

    “(4) INDIVIDUALS RESIDING OUTSIDE UNITED STATES OR RESIDENTS
    OF TERRITORIES.—Any applicable individual shall be
    treated as having minimum essential coverage for any month—
    ‘‘(A) if such month occurs during any period described
    in subparagraph (A) or (B) of section 911(d)(1) which is
    applicable to the individual, or
    ‘‘(B) if such individual is a bona fide resident of any
    possession of the United States.”

  38. Art: I have an HSA myself. I haven’t seen anything about changes to HSAs maximums. They put a new max. on FSA contributions but those were apparently previously uncapped. The only impact to HSA’s I’ve heard of is some talk of not allowing over the counter medicine and something about how businesses have to report contributions they make to HSAs. OTC medicine eligibility is impactful but that seems to be the only real change to HSA I could find. (I did text searches in the actual bill)

  39. Stephan Says:
    April 29th, 2010 at 1:54 pm

    to all those who opposed this bill, what was the alternative?
    ====================

    In the House, it was H.R. 3400. The media ignored it. It outlined at least 7 different things that could be done to actually lower the cost of health care without government taking over the whole system and without increasing taxes.

    H.R. 3400 was out there from the get go but it was stuck in several committees never to see the light of day. This was of course done on purpose. For a bill to get to the floor it must make it out of committee and the speaker has to bring it up. Moon bat Pelozi wasn’t going to let that happen and at the same time all you heard from the Democrats was that the Republicans had no solutions, no ideas and were just the party of “no”.

    H.R. 3400 is also known as the Boehner Bill (named after the House Minority leader Jon Boehner).

    I watched this debate very closely every step of the way. In the process I learned a lot about politics and it did nothing but sadden me to see the games that were played in the media and the outright lies that were told.

    ======================================

    Re: Car Insurance. There is no comparison. There is no mandate to buy car insurance. It’s just a condition placed on the privilege to operate a motor vehicle. You aren’t forced to buy it just because you exist. Furthermore, it’s a state-by-state issue. If your state mandated you own insurance because you live in that state, there would be nothing to say about it. States can do that as long as their constitution allows it (Massachusetts amended their constitution so that the mandate would be constitutional). The US constitution doesn’t allow (according my my interpretation) our government to force us to buy a ***private*** product just because we exist. Schools, roads, military..etc are not private products, those are public services. Health insurance is a private product (i.e. sold by private companies, not the government).

  40. As cruel as it may sound. People need to realize that insurance is for “in case something happens”. Paying for something that happened in the past isn’t insurance. That’s just called a free ride and I grew up learning that there are no free rides in life.

    That being said. If you have a medical condition, call it “X”. You should still be able to get insurance to insure for conditions “Y” and “Z” that don’t relate to “X” that haven’t happened.

    I wonder how upset the dumb masses will be when they find out that health care still isn’t free.

  41. @Pedro:

    “Naveen, that’s great if you would be A-OK with being refused care in an emergency b/c you don’t have insurance (enough money to pay for the care upfront), but most people wouldn’t. The auto insurance comparison is right on; if someone doesn’t pay their healthcare bills the rest of us are liable for the pass-through costs.”

    You’re probably right that most people wouldn’t be happy about it. I’m not happy when I want something that I can’t afford, either. Do I have an obligation to pay for medical care for people who don’t care enough about their own health to save for medical expenses or purchase health insurance?

    @Kilo:

    “Let natural selection play its course. I get it.”

    I’m not sure if it’s natural selection, but I am certain that you have a much greater interest in your own health than anyone else does. I don’t expect you to subsidize my poor choices in life and I hope you don’t expect me to subsidize yours, either.

    @Kyle:

    “Hmm. On second thought, I like parks and libraries and being able to drive to work on roads and firemen showing up when my house is burning down, etc. etc. etc.”

    I like all of those things too, Kyle. We have a lot in common. Those are examples of true public goods. Your health care is not, however.

    @Stephan:

    “to all those who opposed this bill, what was the alternative?”

    I don’t know, maybe something that actually decreased the cost of health insurance? Half of the congress was running around for the last year sounding the alarm bells about the increasing cost of health insurance, and then they passed a bill that will further increase it. How about allowing people to purchase health insurance across state lines? What’s so controversial about that? How about finding a way to put an end to defensive medicine, where tests are ordered to cover the physician’s liability and patients couldn’t care less because their insurance is paying for it? Do you see how that might increase insurance costs? Why is medical malpractice insurance so expensive? Do you realize that those costs are passed down to patients?

    @Maury:

    “Just curious, You are saying that when a child who doesn’t have health insurance because his parents can’t afford it goes to the emergency room, you are okay with turning that kid away and letting him die?

    Objectivism is wonderful in theory, but pretty harsh in practice…

    Part of being a civilized nation is providing people with the opportunities to get an education and basic health care. We have the first, hopefully we are on the way to getting the second.”

    Just curious, are you saying that you are okay with people having children without even being able to afford health insurance for them? That sounds like incredibly poor planning to me. Are you willing to subsidize those decisions?

    Relativism allows one to rationalize anything. You spend your entire life compromising your principles so that everyone can see how magnanimous you are.

    Since when have we been a so-called “civilized nation”? Were we a civilized nation in 1810 when everyone paid for their own health care? What about 1910? Seems to me there were a lot of harsh realities back then, but people just dealt with them. Did we only become civilized after President Roosevelt’s New Deal? Or was the Great Society our entrance to civilization? Why do you associate civilization with an ever-increasing social welfare state?

    I agree with you that everyone ought to have an opportunity to become educated and have basic health care. An opportunity is exactly that – a chance that one can choose to take advantage of. I do not believe in the producers in this country perpetually subsidizing the non-producers, thus creating a permanent underclass of dependency from which a political party can derive their power.

  42. A few random comments to stir up the debate:

    1. Whether the government provides healthcare or not, you ALREADY pay for uninsured people to get care. Today it is through the emergency room. Their visits are subsidized by charging more to those who do pay (just as any business charges enough to make a profit even if some customers do not pay). Since our premiums are based on what the insurance company pays the hospital, we are paying for that care.

    2. @Naveen: You said: “are you saying that you are okay with people having children without even being able to afford health insurance for them? That sounds like incredibly poor planning to me. Are you willing to subsidize those decisions?”. I suspect that the vast majority of people throughout the world and throughout history barely gave the cost of healthcare a thought when they had kids. And yes – you should subsidize those decisions, because some (hopefully most) of those kids will grow up and pay taxes and subsidize your Social Security benefits, and be your doctor, or your plumber or your local traffic cop. If you think of parents as people who are doing you a favor by providing the labor force of tomorrow, you might think differently about the education or health of those kids.

    3. Also @Naveen: The opportunity for education is provided via free public education. Since you agree that “everyone ought to have an opportunity to become educated and have basic health care”, how do you propose to provide the latter opportunity? Are you suggesting free public healthcare?

    4. Regarding the so-called mandate to buy insurance: Although not worded as such, this is no different from a tax deduction or credit to those who CHOOSE to buy a home, or pay property taxes, state income taxes, etc., etc. If it had been worded as: The personal exemption is reduced by $800, but all those who CHOOSE to but health insurance get a new credit, the outcome would have been the same. Tax policy is a tool to enforce social policy – home-ownership, education, and now healthcare.

    5. The real failure of the system is in the non-portability of healthcare. I have worked for the same employer for 20 years, and have always (including before that) had health insurance. My wife developed a disease which would prevent us from getting insurance privately – she now has a pre-existing condition. I must therefore continue to work for a large company which does not exclude pre-existing conditions. Not very logical to tie my employment ot this one factor.

    6. If two children are born to apparently identical parents, but one arrives with a serious (i.e., expensive) medical condition, is it fair for society to doom the one family to poverty?

    7. Regarding cost controls: We don’t need a public option to control costs. I believe if we had sufficient disclosure of the product (health insurance), then the market could work. Why not apply the MedGap idea? Let any insurance company offer any policy they want, but also be required to offer certain standard options: Let’s call them A, B and C – with standard coverage. They could price these at whatever level they want to – and let market competition dictate who wins. They could also offer add-ons and options – priced and sold like anything else. If doctors, hospitals, etc. were also forced into more transparent pricing, that would help too. (Why do we only find out the price AFTER the surgery?)

  43. Mark, I appreciate your response to my comments.

    You may well be correct that “…the vast majority of people throughout the world and throughout history barely gave the cost of healthcare a thought when they had kids.” I’m sure you understand, though, that the ignorance you describe has no bearing on the cost of health care. That cost exists independently of how and by whom it is paid.

    It’s not that I don’t care about these kids. I do care about every American and I don’t want their incentive to achieve excellence to be diminished because they are required to keep others afloat. If they do follow their dreams and turn out to be my doctor, plumber, or policeman, I will thank them and pay them for their services. I don’t want a penny of their social security taxes – they’re not responsible for my retirement. I categorically refuse to ever agree to subsidize the poor choices of others. The only way I will comply is through the forcible coercion of government. (Hello, IRS.)

    Regarding your third point, no, I am not advocating for “free” public health care. That doesn’t exist anyway. What I am advocating is exactly what I said in the previous comment: “the opportunity to become educated and have basic health care.” In other words, I don’t want anyone to be ready and willing to pay for health care and have nowhere to go. We’re so fortunate to have the greatest medical care and technology in the world here. If an individual can afford to pay for their own treatment, then great! If not, they ought to be able to have the option of purchasing health insurance if they feel that the benefit outweighs the cost.

    I also want to make one point about pre-existing conditions. It is an actuarial fact that people with pre-existing conditions cost more to insure than those who do not. That fact makes a lot of people uncomfortable as they feel it’s unjust. I have no idea why – we accept variable risks every day with mortgages, credit cards, peer-to-peer lending, auto insurance, flood insurance, and the like.

    However, I don’t think it is right that people with pre-existing conditions are willing to pay for insurance to cover their condition and they are unable to purchase coverage. Those who have pre-existing conditions certainly should be able to purchase insurance at the cost of a higher premium. It is not the burden of those without pre-existing conditions to subsidize those that do have them, just as it’s not the burden of someone who has lived responsibly and has a 795 FICO score to subsidize the mortgage of someone with a 545 FICO.

    I’ll throw you a bone. I do think that the health care bill should have forced insurance companies to comply with what they stated they would do in the terms and conditions of the contracts they agreed to with the policyholders. That is, if someone had insurance and got sick with a costly condition, I do think it ought to be the responsibility of the insurance company to pay for the treatments and not drop the policyholder.

  44. Glad to see a lively, but polite debate going here. Sadly, you don’t always see that…

    @es21729: I should have been clearer about my situation. I suppose there may be some health plans that will take me on, but nothing that is affordable. I am an unemployed recent graduate who couldnt take advantage of COBRA subsidies since I went to school out of state, so even if I used COBRA, it wouldnt work because the coverage wouldnt cover where I currently live. There may be a plan out there that will cover me, but it would certainly be out of my price range, and the onces that I tried flat out rejected me. So yeah, I’m making a selfish (and scary, and as some people have described it, poor) decision to go without. And making everyone who does have insurance subsidize my poor decision to do so.

    I’m take advantage of clinics/programs through the hospital that give me free health care, which I’m sure is both not cheap and heavily subsidized by taxpayers/people with insurance who are forced to pay higher premiums to cover the cost of my services. I’m sure people dont enjoy being charged twice as much for an x-ray so that I can get one for free. So, whether you like it or not, those with insurance are subsidizing those without, new health care legislation or not. So yeah, I don’t really understand the argument that you shouldnt have to cover uninsured people, because whether you like it or not, you are doing it already.

    (as an aside, I hate being uninsured. Its absolutely terrifying, even with the programs/clinics at my disposal. I’m counting the days until I can go back on my parents plan/find a job that does provide health benefits. So I am a little biased for this health care legislation, obviously.)

  45. @Joshua & @Jon

    Thanks!

  46. Pedro said: “[T]hese arguments that the government can’t or shouldn’t be allowed to force you to buy something are silly. You’re already forced to pay taxes (which is essentially buying government services) and most (if not all) states force you to buy car insurance.”

    What’s silly is this analogy. You are forced to by auto liability insurance, if you even want to drive on public streets, not coverage for your own car. This new legislation reaches into your own home, even if you never leave your property, and mandates buying something supposedly for your own good. Big difference. Taxes also are not mandatory, in that it is not a requirement to work. And again, paying into a general fund is not equivalent to a mandate to buy a particular product or service. If one takes the “taxes are mandatory, so why not X?” argument, then the government has essentially unlimited power. What if the cattle lobby rammed through a bill requiring every American to buy 50 pounds of beef each year. Would we simply sigh and say, “Well, taxes are required, so I guess this is fine.” Injustice is injustice, the only difference here is that a lot of people think this particular instance of compulsion has merit, so they accept it. That’s a dangerous road.

  47. Naveen:
    This is not about poor choices. Not all of us are born perfectly healthy. People have genetic issues, get cancer out of nowhere due to no fault of their own, and get into car accidents. Should we leave these people to die because they don’t have health insurance? I for one don’t want to live in such a country. There are much more “free” third-world countries that you can easily move to that refuse medical treatment on those grounds, just expect a lot more violent intrusions into your home and violations of basic freedoms.

    In reality, this is besides the point. Let’s get down to the meat of the issue and accept the hard truths. We live in a country that provides emergency care to those who can’t afford it. This is not free care. This is very expensive care as compared to a yearly checkup, which I am currently paying for through high premiums. I would *much* rather pay for people’s less-expensive trips than emergency care. On top of this, encouraging low-risk individuals to buy insurance will lower the risk pool, and increase the amount available for high-risk insurance. Without the mandate, letting the high-risk individuals into the pool would almost certainly increase costs substantially. You either mandate, or you don’t let people with preexisting conditions into the pool; there *is no other choice*. Face it, most of us are going to pay for them anyway when they’re *really* sick and their care is through the roof. OK, there is another choice, just let those people die, but as I stated in my first point, I don’t want to live in such a country.

    My prediction is that come 2014, health care costs will continue to rise at the roughly 4.4% per year and possibly increase because of the current lack of general physicians. We will mostly likely see quite a lot of public protests and sensational stories for a while, but this will all die down. Probably by 2024, once a large chunk of new general practitioners have had a chance to go through medical school and their residencies (due to the wonderful laws of supply and demand), costs will start to level off and come down due to the risk in the over all pool evening out. More long-term effects (20-30 years) will be a healthier populace due to more prevalent preventive care, lowering costs even further. All of the current controversy will be no more than a footnote in history, and we will be better off as a nation. Our children will wonder what all of the fuss was about, just as we look back on the Civil Rights or Medicare controversy of the ’60′s and ’70′s.

    Conor:
    Quite a few of us are already being forced to pay for other people’s health care through rising premiums, and we are paying for the expensive kind: emergency room visits. I would much rather see the risk pool evened out by bringing in lower-risk people, and allowing sick individuals to see the doctor for much cheaper. Your analogy is the silly one. This is even less restrictive than taxes. As you said, if you don’t want to pay taxes, you don’t have to work. At that point, you’re most likely lower income, in which most cases you’re not liable for the fine. Even if you weren’t, you don’t have to do anything in this world, but don’t expect there to be consequences. We each do not live in a bubble, we pay for each other’s well-being whether you like it or not in countless ways, and the government is normally the mediator.

  48. Conor, if you choose not to maintain health insurance, and you get sick or injured and can’t afford to pay the bills, who will be ‘liable’ for those costs? Like it or not, that’s a ‘tax’ that we’re all already paying when we go to the doctor.

    Similar to the requirement to carry liability insurance if you drive (as the vast majority of us do), the new requirement does not mandate that you choose a particular carrier–just that you have insurance. Seems pretty fair to me.

  49. @Naveen: Thanks for the bone.

    Several times, you mentioned “the opportunity to become educated and have basic health care.” Yet you said you refuse to pay for healthcare for others.

    Following your analogy – Did you or your parents ever leech off the system by putting you into a public school, or was your education 100% self-paid?

    Are you saying that if one’s parents cannot afford private school, then one should not be taught to read and write?

    Or are you actually saying everyone should have the opportunity to RECEIVE education, but only the opportunity to BUY healthcare IF they have the money to do so?

  50. @Mark – I think Naveen’s point is that once educated, one will have the wherewithal to figure out how to pay for your own needs, including basic healthcare. I think the big concern of many is the “free rider” problem we have in the U.S. where nearly 50%(!) don’t pay federal taxes. So many get services for free, and when the price is free, demand goes through the roof.

    @Jim – thanks for searching the bill for HSA details.

  51. @Art: My original discussion with Naveen was about providing healthcare for children.

    In my mind there should have been two debates around healthcare:
    1. How much should any individual be entitled to?
    2. How does society deliver and pay for it?

    Within the first question, there are two separate but related issues:

    A. How much safety-net should society provide for children, or how does the system deliver healthy educated new workers to society? Answer: By somehow providing the little buggers with education and healthcare. We sort-of agree that they should not be subject to the irresponsibility of their parents, but even that is arguable.

    B. How much safety-net should society provide for adults? Whether it is via foodstamps, subsidized rent, healthcare or whatever.

    Once we have decided/agreed how much care society should provide to each of these two groups, then we have to decide how to deliver and pay for it. This would be where the health INSURANCE options would have been discussed.

    I was VERY disappointed in the healthcare debate in the US because it quickly degenerated from a debate about healthCARE to a debate about health INSURANCE. I feel like we skipped the first question entirely.

  52. Art,

    That “nearly 50%(!) don’t pay federal taxes” is both misleading (it only counts federal INCOME tax), and overblown. I won’t go into it here, but for some discussion of the facts, try these links:

    http://www.nytimes.com/2010/04.....hardt.html

    http://taxvox.taxpolicycenter......06088.html

    Tim

  53. @Pedro

    Had the mandate just been a new tax (instead of a mandate to buy something) followed by a huge subsidy to insurance companies, then I would pretty much have no argument about it because congress has the power to tax us into oblivion if they want.

    You keep saying it’s a “tax” but if you have to put quotes around it, it’s NOT a tax. This is a mandate to buy a good/service that’s not provided by the government. If you allow it here, you allow it anywhere. What you think is fair now can quickly turn into “hey what the hell!!! I didn’t agree to this”. This happens all the time in politics/government (see history of the income tax).

    Giving the government the power to tell you what you HAVE to buy can quickly start to suck.

    Slippery Slope Argument:

    1. You must buy health insurance.

    2. A decade from now: “Healthcare costs are bankrupting the government so we are issuing a new mandate: You MUST buy a gym membership”.

    3. You must buy healthy foods.

    4…you get the point.

    Or how about now that “we” own GM:

    You MUST buy a GM vehicle. A green one that costs too much but gets really good gas mileage.

    At what point do you think it’s no longer fair?

    This is what you open yourself up to when you open the door just because you think “oh this time it’s ok”. It’s NEVER ok. You always have to step back and look at the bigger picture. Maybe this will be the only time a mandate to buy something ever gets handed down but are you really willing to take the chance?

  54. @Robert

    I’m afraid I don’t share your concern about being forced to buy health insurance from a ‘private’ insurance company; in fact, I already do. I’m also glad to purchase auto insurance from a ‘private’ insurance company, as required in my state. Yes, I am “really willing to take the chance”–because, for reasons expressed above, I believe we all should carry health insurance.

  55. I agree with Robert’s point.
    Robert’s point is exactly where how sociolism started.
    At first, it begins with a patterns : “buy this…. or you get a fine”.

    Now, with health insurance, a few decades, another announcement “folks, we run out of $$, now, you MUST preventive (health) care package, such as : healthy food, gym/health membership or stop smoking or you get a fine of not taking care of yourself” or stop smoking or you get a fine.

    And then guess what happens next?
    When everyone get health care, and having the same access to the treatments, but the Gov. did not build or update more clinics.

    Rule of supply and demand in Health Care and treatments applied.

    Everyone wants the same treatments for same diseases –> More people for the same quantity of doctors and medical eqipments and/or clinics, then it would lead to “special treatments”, such as:

    option 1: pay 10K: choose your own surgeon, and one-on-one medical consultation and choose your own date/time of surgery and prvate bedroom for your recovery

    option 2: pay 8K: 1 on 1 consultation, your surgery will be operated by one of the top 100 surgeon in your state.

    option 3: pay 5K: 1 on 1 consultation, your surgery will be done within 30 days after you make your final 20% deposit and share room with 10 others.

    option 4: pay 2K: 1 on 1 consultation and your surgery will be done within 60 days after you make your final 20% deposit.

    Americans never imagine these shown above scenarios are going to happen, dont you?

    They are going to happen, because right now, there are many doctors start stopping taking Gov. Ins. for surgery.

    But later, when Gov. Ins. becomes majority in a society, (doctors need to make a living to pay back his tuitions and feed their families, right?), the doctors MUST accept Gov. Ins, but the pay is too low that they can’t afford to be better doctors (study more, research more, …), so how can they do???

    Bingo!

    With options, who has $$ who receive better treatments, and doctors also happier.

    These scenes happen on daily basis in Vietnam (Communists Party, Sociolists run the country).
    if you are poor, it takes you forever to get a simple procedure done at a clinic that accepts Gov. Ins.

    That means you or your relatives should get up at 4AM and hurry to get “a number” at a local clinics in order to be called to see a doctor who will started their day at 8AM. And you would have a chance to see him at, (may be) at 1PM for 2 min. consultation, then let him write some clinical tests to be done, then you MUST run around to get tests and the results brining them back to him (again, if you get lucky), the results came out within the same day, before 4PM.

    If not, then you started all over again the next morning, to reserve your chance to see your doctor (with your results) to let him diagnosed you and (may be, possible solutions for your situation).

    Of course, the last option, he also slipped out his business card (with his private clinics) says that your situation needed to be taken care of within a few days. ‘See you at my clinics at 7PM for more options and treatments”

    (if surgery needed, then he would negotiate with Head of Surgery Dept. to set up time, date for you. Your doctor now acted like “your health care broker” for your best interest.)

    I witnessed all of these during the time my mom was in her thyroid surgery.
    Well, due to the best benefits for my mom, my siblings and I sucked up the price to take care of mom.
    Mom has her Gov. Ins and it never been used.

    “Every time going to the doctor like this, made me never wanted being sick. Getting up early and waiting for my turn to get treatments made me sicker than being sick” she said.

  56. ttfitz says:

    Robert asks, “At what point do you think it’s no longer fair?”

    When you are no longer allowed to vote for the people who pass these laws.

    Your nightmare scenario only happens when enough people vote for the people who are elected to pass such things. As long as there is an election every two years, the people who pass such items against the will of those who vote for them will find themselves out, and others in.

    LeAnn – what makes you think that is any different than it is now? People who talk about this leading to shortages and rationing, it’s like they think because someone now has health insurance they become sicker. Rationing already happens, but it’s generally the poor who get the short end.

    Tim

  57. @ttfitz – thanks. I took a look at both links and they both say the 47% number is accurate, but that I have to look at the bigger picture. OK, I get that there is *a lot* of friction in the U.S. income tax, Social Security and Medicare system. For me though, 47% of people not paying federal income tax is still incredibly high. The other 53% of the folk pay all the other taxes too + federal (and perhaps state) income tax.

    @Mark – I get what you’re saying about the young and the old. And I agree, cost control didn’t even seem to enter the discussion.

  58. LeAnn – The population didn’t instantly increase the day the legislation was passed. We do not suddenly have more people getting help. If you need emergency care, you get emergency care. The only difference in 4 years will be that those without health insurance will be able to get preventive care to *prevent* emergency situations. This might in fact decrease the waiting times in emergency rooms and surgeries since diseases and other disorders will be caught early. Rather than having a sudden heart attack, an individual’s doctor might see a trend. We also have an diabetes epidemic in this country, and mostly because people aren’t being checked out *before* they get diabetes, at which point the disease becomes both a physical and financial burden. This puts a lot of strain on the system, and I for one am already paying. The days of “don’t fix it if it ain’t broke” (only get help when you’re *really* sick) need to end in this country. We’ll be much better off in the end.

    Also, please actually learn what “socialism” is. This is the purchasing of plans in the open market, not from the government. There is a huge difference. Medicare, Social Security, or a public option (all of which I’m OK with as well) can be considered socialism. This bill, however, is far from it.

  59. Robert says:

    @ Pedro

    Then you are a foolish person. You are basically saying that you are willing to give up your liberty and freedom because you feel everyone should have health insurance, which reminds me of the following:

    Those who would give up Essential Liberty to purchase a little Temporary Safety, deserve neither Liberty nor Safety.

  60. @Robert

    I don’t think you understand my position. I don’t believe having to buy health insurance is giving up my “liberty and freedom.” If that’s your argument, you could say the same thing about paying taxes or following laws. As I get to buy the health coverage I want, I’m not giving up anything. If I want a high deductible plan because I only want to pay for catastrophic coverage, I can do that. If want a plan that provides a high level of coverage, I can do that too.

    On the contrary, by choosing not to buy health insurance, you may infringe on MY liberty–by forcing me to pay for your healthcare. If you get sick or injured, and can’t pay the bills, the rest of us get stuck with the tab. Like it or not, we live in a society that is interdependent. Acting on what you perceive as your freedom, can violate someone else’s freedom.

  61. Robert says:

    @Pedro

    I understand you position quite clearly. You don’t mind the government having the power to force us to buy something. Your justification is “everyone should own health insurance”.

    I completely understand your position. It’s just very short-sighted and dangerous.

    This government has a history of abusing power given to it with an understanding that certain things wouldn’t happen. Research the history of the income tax. You are looking at this mandate with blinders on. All you see is “health insurance”. When I look at the mandate, I see “forced to buy something”. If you allow it here, you allow it anywhere. That’s been the way it works since the beginning.

  62. @Robert

    We live in a civilized and interdependent society. As a result, like it or not, sometimes you might be forced to do things. You’d better get used to it.

  63. Robert says:

    @ Pedro

    We live in a Constitutional Republic. There are those that wish to destroy it and “getting used to it” is not something I’m willing to do.

  64. Drew…NEWS FLASH: we are NOT the richest country anymore..we are the largest country in debt..where have you been???

  65. Judy….NEWS FLASH! We have the largest GDP in the world, nearly twice as big as the next closest (China). Even per capita, we are the 8th richest. Our debt is only one measurement, and on top of that, this healthcare bill has been shown by a non-partisan group, the CBO, to lower our deficit. The debt/deficit is based on poor fiscal policy, not the wealth, if the government wanted to pay off the debt next year, they could raise taxes to a flat 60% and boom, we’d be having the largest annual surplus ever. The side effect of this would be devastating to our economy, but by your judgment, we’d be the richest country. Thanks for the trolling post.

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