Tag: Health Savings Accounts

HEALTH: The current “system” is unsustainable; the answer is NOT Gooferment “healthcare”

Published on by reinkefjLeave a comment

https://www.americanthinker.com/articles/2022/06/the_truth_regarding_health_care.html

The Truth Regarding Health Care
By Keith R. Jackson, M.D.

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There already exist many programs for the poor and uninsured. These could be streamlined and sensibly expanded. What would classify as a necessary addition to the equation would be possible assistance with deductibles and expansion of catastrophic insurance policies for the rest of us. Improving the portability of Health Savings Accounts, making them easier to understand and obtain, would address the former. A creative solution merging government assistance with HSAs and catastrophic insurance policies could go a long way toward appeasing both sides, even though they would scream that this “solution” is wrong. One avenue for saving is the cost of administration of the health care dollar. Private insurers’ administrative costs are surprisingly much higher than the government’s. There must be a “happy medium” there, with less bureaucracy in the former and more effective administration in the latter.

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I think you can look at ANY Gooferment program and see a disaster.

As a first step, the current deductibility problem (i.e., healthcare expense is deductible to employers but not employees) has to be SOLVED.

Then let that work itself out by removing the Gooferment from the “health care system”.

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MONEY: The Gooferment maintains a playing filed that tilts in favor of employers over workers

Published on by reinkefjLeave a comment

https://www.cato.org/blog/new-cato/yougov-survey-health-savings-accounts

OCTOBER 6, 2021 9:11AM
New Cato/​YouGov Survey on Health Savings Accounts
By Michael F. Cannon

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Many call the “tax exclusion” for employer‐​paid health insurance premiums a tax “break.” In fact, it denies workers control over an enormous share of their earnings. It coerces workers into letting employers control roughly $1 trillion of their earnings each year as well as their health insurance. Along the way, it leaves workers vulnerable to losing coverage when they change jobs, divorce, or retire. 

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Thanks to the market distortion introduced by FDR’s WW2 wage and price controls, “benefits” for employees were a way that employers could “pay” employees more without running afoul of the “law”.  

Back in the Seventies, leave at night in an AT&T datacenter watching accounting programs run, a wise old AT&T Treasury executive opened my eyes to how unfair that “benefits” were to me.  I didn’t realize that the “benefits” were more valuable to AT&T than to me.  Every benefits “expense” was a tax deduction to AT&T.  As well, all those “expenses” were added into the “rate base” used in front of the FCC and various PUCs to justify higher regulated rates.  The old exec pointed out that I was “paying” for the benefits in salary reductions.  And, the wicked kicker was that if I left my “servitude” I’d lose most and in some cases all of those “benefits”. Argh!

Now decades later, the USA has evolved to realize that while you don’t lose your car insurance if you change jobs, you do lose your “health insurance”.  (Don’t make me laugh about COBRA; who can afford those rates?)

OK, so you decide to get your own “health insurance”, and you find that expense is not tax deductible to you as an employee that has “benefits” with your master.  I meant employer.

If you have a niche that permits you, then you can become a “corporation” and the premiums for all your employees is deductible.  Just don’t have any other “employees” and you have found a loophole.  Of course, there are setup and ongoing expense to “being a corporation” but it’s no where near as much as you think.

Bottom line: The tax code needs to change to allow you to deduct your private health care insurance.  What’s good for the employer should be good for the worker!

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