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Employer-Based Health Care
Like me, more and more people are self-employed. We're the ones who are 1. most careful with our health care dollars, because we have to know the price of things, and 2. most screwed by the current system (well, along with unmarried employees who are subsidizing the guy with a wife and five kids). Ramesh Ponnuru writes for Time about the genesis of employer-based health care, and the difference between the Democrats and the Republicans on health care:

During World War II, employers started giving workers health benefits to get around wartime wage controls. Since then, the government has continued to give a tax break for employer-provided health insurance; it isn't taxed, the way wages are.

That's how we ended up with the health-insurance system we have now, based on employers. You get a tax break if you get your insurance through your job. If you get a raise and use it to buy your own insurance instead, you have to pay taxes on that money. (Ditto if you use your raise to pay doctors directly.) Almost everyone takes the tax break. The market for insurance bought by individuals is, as a result, small and stunted, which is all the more reason to stay in the employer system.

Republicans used to consider health care a Democratic issue--not something they needed to do anything or even think much about. But in recent years, most Republicans have come to believe that our health-care system is dysfunctional because it is employer-based and that this dysfunction has to be attacked at the root.

In this view, everything people dislike about our system results from the tax break for employer coverage. It makes costs rise, since people are less careful when they're not paying out of pocket. It means people often lose their insurance when they switch jobs. And it keeps a lot of people--those who don't have employers who provide coverage--from having much access to health insurance.

In his State of the Union Address this year, President Bush proposed letting people who buy insurance for themselves qualify for the break too. The Congressional Budget Office estimates that his plan would help 7 million people who don't have insurance get it. But its main point is to offer individuals more control over their health care--to make it possible, for example, for them to keep their policies when they switch jobs.

Free-market health-care experts note that most types of insurance--think of homeowners' insurance--cover major expenses that have a low likelihood of happening to any individual rather than routine and predictable expenses. Thanks to the existing tax break, health premiums have become a way of prepaying for medical care. Under Bush's plan, a lot of people would buy cheap insurance policies that cover emergencies while paying for routine care out of pocket. Cost-conscious consumers could drive down the price of health care.

...The federal government long ago got into the business of insuring two groups that the job-based system excludes: Medicare covers retirees, and Medicaid covers the jobless and indigent. These programs have been expanding. The Democratic plans would expand the federal backstop still more to achieve universal coverage. So both parties would shift responsibility for health care away from business. The main difference is whether government or individuals would get control of the money business now spends on health care.
The Democrats have hardly noticed the turn in Republican thinking on health care, in part because the Republicans seem so weak right now. But the Democrats have already started to emphasize how incremental and unthreatening their plans are. In the months to come, look for them to start accusing Republicans of being radicals who want to end health insurance as we know it. The accusation will be true.

And I, for one, am all for it.

Posted by aalkon at November 11, 2007 9:57 AM


But in recent years, most Republicans have come to believe that our health-care system is dysfunctional because it is employer-based

Is that true? Seems to me it's the Democrats and very occasionally a Republican that advocate for a universal, non-employer based health care system. That these are then forced (by Hillary and others) into becoming employer based systems is due to Republicans and industry lobbyists that believe the Constitution protects specific industries and business plans.

Posted by: jerry at November 11, 2007 8:05 AM

I am all for it too. As much as bush annoys me, I am actually pretty convinced that HSAs are a pretty good idea. Put that together with a EITC (which I don't like in it's current form) and it could actually be a very good way for achieving universal health care.

Jerry -

Actually, there are few, repubs or dems, who don't realize that the status quo is seriously fucked. Nor do I think that there are many on either side who wouldn't like to see UHC. The difference is that the dems are more likely to support a total state solution, while repubs would like to see a private solution. Some on both sides are smart enough to realize that it will take a combination.

Posted by: DuWayne at November 11, 2007 10:44 AM

You want repulicans to support universal heath care show them how is will generate more money for the businesses that buy them, excuse me, fund their reelection campagins.

More people getting preventive care = less people getting majorly sick = less sickleave = more revenue generated by healthy workforce

Posted by: lujlp at November 11, 2007 3:03 PM

I'm for pay-for-your-own-damn-healthcare unless you're homeless and mentally ill. Maybe have a few less children, or no children, if you can't afford to support them.

Posted by: Amy Alkon at November 11, 2007 4:10 PM

I comment all the time on this subject. Your body should be treated like your home, car, or any other property that you own. You insure for catastrophic episodes and provide routine care and upkeep out of pocket. When one considers how many patients are non-compliant with their healthcare directives, it's easy to dismiss some early care arguments.

former medical industry professional, married to a doc, obvious non-supporter of universal healthcare

Posted by: miche at November 11, 2007 5:06 PM

That seems sensible, Miche. Of course, it would be possible to go for more than the minimum. And a question: What would be considered "routine care and upkeep"?

Posted by: Amy Alkon at November 11, 2007 5:09 PM

What would be considered "routine care and upkeep"?

Well, that would depend on the individual. For me, it's a yearly trip to the Ob/Gyn and twice yearly trips to the dentist. For the kiddo left at home (she's 16), it's the same. The doc just goes to the dentist and my older daughter and son-in-law rarely see a doc but take my grandson for his regular baby visits for which they pay out of pocket. My daughter refuses to be a freaked out mother because of pride and necessity and realizes that she is fortunate that we are a phone call away. She calls me first to ask about the baby's symptoms and if there is any question that my experience can't cover, Dad's medical training can. (She only needed Dad one time so far.) They haven't dental insurance so they see the dentist once a year. My whole family, including my oldest and her family (6 people) has been on antibiotics 3x in 4 years.

As far as personal lifestyle choices with regard to healthcare, the family eats pretty sensibly and the doc and I work out like fiends. The little one is a college freshman with a job so she works out when she can. The doc and I smoke moderately (cigars for him) and drink a lot of wine.

I'm sorry to ramble on, but the point I'm trying to make is that even though we have a doc in the house, a doc is really pretty unnecessary for most common ailments. The human body is remarkably resilient and can fix itself if you care for it at least as much as you'd care for your car.

Posted by: miche at November 11, 2007 8:27 PM

Free market solutions only go so far in this case.

There will always be the jerk who doesn't insure themself, and then needs care. And I am not sure I want to live in a community that cuts this person off from treatment - or their innocent children. Not sure that's the proper moral value for a wealthy country such as the US.

Israel reformed its socialized medicine system. Now there is a core "basket" of government-subsidized coverage, with free market competition for all the rest. It works pretty well - there are several large HMOs offering various coverage packages targeting various stages of a person's life, and including optional stuff like alternative medicine.

One BIG UPSIDE of market influence is that for-profit HMOs finally emphasize and prevention over treatment of acute disease - which is much better for the patient/customer. And society. Kinda like the old Chinese method of paying a doctor as long as you're well.

Posted by: Ben-David at November 12, 2007 12:57 AM

Solution to the aforementioned jerk:

Debt. What amazes the fuck out of me is that people in this country (US) have no trouble going into debt for a new SUV or a big-screen television.

But go into debt for that cancer surgery? Surely someone else ought to pay, right?

Insurance should be exactly that - a hedge against catastrophe. At best, an HMO is a forced savings plan to offset future expenditures. At worst, it's a tax on the healthy to support those who make poor life choices.

Posted by: brian at November 12, 2007 6:07 AM

note - upon further reflection, there is a possible parsing error which could result in the appearance that I called the previous commenter (Ben-David) a jerk. This is not correct.

For clarity, please substitute the following for the first sentence of my 0607 post:

"The solution to Ben-David's 'jerk who doesn't insure [him]self':"

Posted by: brian at November 12, 2007 6:18 AM

Ah, how timley this is! I just got our company's new revised health care package - one in which we (the employees) will be contributing to the cost, but not carrying the whole amount, and people are already complaining! "We didn't have to pay for it before, how come we do now?" and "Why are the rates going up? I thought it would be cheaper!" My answer: Listen, we caught a break when the company was first starting out, now we have to bear some responsibility for the cost, what's the problem? We make enough money, don't we? What's wrong with having to pay into our insurance in order to get the best plans? Are you people crazy? and they look at me as if I've got 3 heads! Yes, we were very lucky that the company picked up our health care costs for a while, but now that we've gotten larger and have more employees, it makes sense that we have to share the cost burden for our health insurance. That we're getting help with it at all is a bonus, and people are upset at having to pay into it at all! Selfish bastards!
There are some people here (with kids, I might add) who declined to pay for dental and vision because medical was covered by the company 100% and they didn't want to pay for anything. I signed up for dental and vision because it was worth the monthly premium to pay only $5 per office visit. I have no problem whatsoever paying into the health insurance plan now, even if it is a little more money. My theory is it's better to have it and not need it than need it and not have it. YMMV. o_O

Posted by: Flynne at November 12, 2007 6:57 AM

My question on this subject is what becomes of those whom the health insurance companies deny? I am 27, suffering from a mental illness. I work as a contract employee and I cannot get health insurance. I know I need insurance and have absolutely no issue paying for it. What I do have an issue with is being told because of my condition that I cannot get health insurance. The only way I can get insurance is to work for a company that offers it as a group plan. So yes, pay for it yourself, but let everyone have access to it, not just those who are healthy.

Posted by: SarahBeth at November 12, 2007 8:16 AM

> At worst, it's a tax on
> the healthy to support
> those who make poor life
> choices.

Aren't you the guy who isn't insured? Who's making a bad life choice here?

Posted by: Crid at November 12, 2007 8:34 AM

I am in the same boat as SaraBeth. I've had a chronic illness diagnosis since I was 12, and mental illness diagnosis in addition for the last 4 years. Medicine alone is thousands of dollars per year. I'm healthy enough to work (with medicine) so I don't qualify as indigent.
It's not chance that I need to insure against, its a definite happening. I need others to pay for my health care until I finish school and can make enough to take care of myself. I support universal health care selfishly. I don't believe it was my fault to be born and get these diseases.
If really, I, SaraBeth, and others do not deserve assistance from those more fortunate than us, you may have to pay the more expensive costs when we do become indigent after not being able to afford our health care.
PS. I don't own a car, I share an apartment. I cut costs where I can without becoming sicker. I am thankful that I can still get health insurance through my employer.

Posted by: Vera at November 12, 2007 8:45 AM

Crid - I'm in perfect health. I'm talking about the schumcks who let their kids stand at the bus stop in the dead of winter with no jackets. I'm talking about the people who chain smoke and wonder whytheir lungs hurt. I'm talking about the 400 pounders at the Chinese buffet.

I'm not likely to end up as a statistic in a hospital bed, at least not for another 40-50 years.

Vera - at least you have the temerity to admit you feel entitled to the fruits of the labors of others. Have you considered how you intend to pay back our generosity? If you have, then perhaps you might have stumbled across a solution without knowing it.

Posted by: brian at November 12, 2007 8:51 AM

You know, some day I'll actually learn English and use the word I mean "honesty" instead of the word I typed "temerity".

Because, you know, I don't want to look like the moron I really am.

Posted by: brian at November 12, 2007 8:54 AM

> I'm in perfect health.

Quit pretending that you're being sophisticated and sensible. You're making other people take a risk for you because you're selfish.

> I'm talking about the
> people who...

There are always going to be people who by conduct and circumstances are at greater risk than you. That doesn't mean the rest of us should be any more patient with you than with them when the shit hits the fan.

> I'm not likely to end
> up as a statistic in a
> hospital bed

Neither am I, and I'm twice your age. Would it be be cool with it if I and my cohort decided to gamble as you have? The point isn't that your risk for duodenal cancer is smaller than someone else's risk for diabetes or some other bad outcome. The point is you think your risk is something someone else should have to carry.

Dude, this is adulthood 101. Stop acting as if you know more about statistics than wizards who earn millions of dollars a year by watching them closely. There's zero evidence that you've given these matters any thoughtful consideration. Your twaddle about this is the quintessence of blowhard-itude.

(But actually, for that I salute you.)

Posted by: Crid at November 12, 2007 9:17 AM

Actually, I've given the issue more consideration than just about anyone in my, as you say, cohort.

Regardless what happens to me, there is no risk that you or anyone else will be forced to bear the burden of my care. And if I should end up in a situation that I could not resolve, well, let's just say that I'd run into the lifetime limits of any policy and I'd be well and truly fucked anyhow.

Here's the consideration for you - Where do I get greater return on investment for $4000/yr - paying for insurance that I've got a statistically insignificant probability of using, or putting that money into mutual funds in my IRA? Not to mention the tax benefits of the IRA (none of which apply to self-employed person's health insurance that you employed people get as a completely tax-free benefit)

I've determined that I'm never going to get a penny of the 15.6 percent of my income that I've lost to Social Security. Therefore, I'm better off with the IRA.

This all comes back to nobody actually selling HEALTH INSURANCE, but instead selling Health-care cost-sharing agreements. Show me reasonable insurance, and I'll bite. I've seen a few policies that come close, but they are either age restricted, or have some other critical flaw.

Posted by: brian at November 12, 2007 10:05 AM

> I'd be well and truly
> fucked anyhow.

As would the rest of us, who'd be burdened with your expenses. You can't understand this: It's not all about you.

> Where do I get greater
> return on investment

Here's the last thing I said in this comment using different words. (We can keep doing this until it sticks.) Civilization is not run as an enterprise dedicated to making things great for (b)rian. People have better things to do with their lives than maxmizing the product of your investment schedule.

Posted by: Crid at November 12, 2007 10:18 AM

Crid - What part of this are you missing?

Unless my entire family dies, I will never qualify for any form of government aid.


Care to tell me again how I'm a burden to you?

So long as I have the option to not finance other people's lives, I will take it. It's bad enough that I lose 50% of my income at gunpoint, mostly to benefit other people. I see no reason to volunteer another 5-10% of it for the same end.

Posted by: brian at November 12, 2007 10:23 AM

If you're injured in a motorcycle accident, or struck suddenly with horrible disease, the hospital will treat you. (Maybe not as well as Johnny Carson was treated at Cedar Sinai... But to almost anyone in human history, these standards of care would be indistinguishable, and blended as visions of a loving Heaven besides.) Your mention of government is a red herring, if not an outright fallacy: Government requires hospitals to take all comers. Let's remember the attending physician isn't getting paid his best rate for you either: Yet there's no incentive for him to therefore lower the standard of care provided. As an expensively trained practitioner, he'll want to specify all the u$ual treatment$ as a drill for the care he wants given to his best customers, and as expression of his Hippocratic sincerity besides. The community of that hospital, whether its charter is public, religious, or private, will bear the consequences of your irresponsibility by burdening the patients who do care enough to pay their bills.

Grow up.

Posted by: Crid at November 12, 2007 10:42 AM

Crid - You are either deliberately not reading what I am writing, or you don't want to accept reality.

I can and will cover any debts I happen to rack up. Just because someone doesn't have insurance does not mean that they are looking for a free ride.

I love the way you impugn my honor by not merely suggesting, but outright stating as fact that I would shirk my responsibility and leave a debt unpaid.

But I'm the one who needs to grow up.

Posted by: brian at November 12, 2007 10:47 AM

> you impugn my honor

You make it too easy. You ask us to trust you: But we don't have to trust Amy, because she's insured. So she needn't grovel and ingratiate with hollow talk about honor and responsibility. If she gets sick, we can just send a card.

Posted by: Crid at November 12, 2007 10:56 AM

So what you're saying is there's a price on being believed, and it's somewhere between $250 and 400 a month?

Nice to know.

Posted by: brian at November 12, 2007 11:01 AM

Again: Adults --people who pay their own way-- don't worry about other people believing in them.

Posted by: Crid at November 12, 2007 11:05 AM

So having a cash and credit reserve doesn't meet Crid's definition of "pay[ing] their own way"?

Who are you to tell me what constitutes an appropriate manner in which to protect my assets?

Perhaps you're fine with financing other people's offspring, rehab, etc. I'm not.

When some company finally realizes that the only way they are going to get single young males to give them any money at all is to offer us something that at least gives the appearance of not financing other people's lifestyle choices, we'll opt out and seek alternative financing should the issue arise.

Posted by: brian at November 12, 2007 11:10 AM

Your "hobby" is that lucrative? No nestegg big enough to cover the rainbow of possible tragedies can earn as much in liquid readiness as in long-term investment. It's not just irresponsible, it's dumb finance, as well.

> financing other people's
> offspring, rehab

As you expect others to cover your catastrophe... (Do wanna do another round of this?)

> an appropriate manner in
> which to protect my
> assets?

Right, right, right, it's always all about you.

Posted by: Crid at November 12, 2007 11:18 AM

Crid -

We can't have a reasoned discussion about this, because you have already concluded that anyone who does not pay into some insurance program is automatically expecting someone else to pick up the tab for his care.

If you start from that immutable assumption, then nothing short of "ok, I'll just forfeit another 5% of my income on a fool's errand to shut you up" is going to, in fact, shut you up.

So I think we just need to agree that we are not going to resolve this point of contention.

Posted by: brian at November 12, 2007 11:21 AM

Catastrophic care -- cancer, brain injury -- is enough to break mulit-millionaires. Thanks, but how about we all have insurance, and then I can spend whatever income I would've been spending on other people's health care on books and shoes.

Posted by: Amy Alkon at November 12, 2007 11:24 AM

Sorry, "multi-millionaires," too.

Posted by: Amy Alkon at November 12, 2007 11:24 AM

Guess what, Amy - every policy has a lifetime maximum total payout.

After which point someone's getting soaked.

It's much cheaper and easier to eat a gun than to fight off brain cancer.

Posted by: brian at November 12, 2007 11:27 AM

It's much cheaper and easier to eat a gun than to fight off brain cancer.

That may be true, but I sure wouldn't be willing to swallow a bullet on your say so, or anyone else's, and I don't think there are many others who would either.

Posted by: Flynne at November 12, 2007 11:40 AM

> anyone who does not pay
> into some insurance
> program is automatically
> expecting

Your expectations are irrelevant. I don't care what's in your heart. It's not all about you. It's not all about you. It's not all about you.

Sure, you're a bright young man! You have plans... big plans! And everything's gonna work out. But when someone with insurance gets knocked into a semi-vegetative state in an auto accident, we need not be concerned with their planning as a function of intimate, interpersonal trust. It's not all about them, either.

Our contention is resolved: Your conduct is juvenile and irresponsible, and listening to you smirk about "a tax on the healthy to support those who make poor life choices" is not tolerable.

> books and shoes.

We prefer to imagine you reviewing galley proofs over an afternoon kir.

Posted by: Crid at November 12, 2007 11:42 AM

Crid - what the fuck are you, some kind of authority on what constitutes responsible? Or just a bitter old man who's angry that he's pissed away 10% of his life's work to cover for a catastrophe that never came?

I thought I was a pessimist.

Posted by: brian at November 12, 2007 11:56 AM

> some kind of authority on
> what constitutes responsible?

Yes; that was the topic today.

> I thought I was a pessimist.

You're apparently not old enough for that.

Posted by: Crid at November 12, 2007 12:09 PM

I gotta say I am with Brian on this one. Let's say he sticks $10K or $50K or $100K into an account somewhere and lets it grow. He doesn't pay for health insurance. He may never have to use ANY of that money to pay for medical care, but it's there for him if he needs it. He gets cancer and the treatment costs $1 million? He doesn't get treatment, end of story! He gets to be 80 years old and needs a heart transplant? He doesn't get the heart transplant - he dies. You CAN deny treatment.

Posted by: Pirate Jo at November 12, 2007 3:05 PM

First of all, I think that math is bogus. Long-term investment doesn't work that way.

Second, he's asking us to trust him when he says he'll quickly and violently take his life when he becomes a burden to us... As if we should find that acceptable compromise, and as if we could trust him to follow through on it. I've known a few people who've had cancer, some of whom died. Young, old, rich and indigent, all of them wanted to live.

Posted by: Crid at November 12, 2007 3:28 PM

$4,000 a year in premiums? That would add up to a nice little savings account pretty quickly. What's the price tag on, say, a broken arm, or removal of an appendix? You're not talking about multi-million dollar cancer treatments here. I think socking away $4,000 a year would cover a lot of costs pretty nicely, and you (as opposed to an insurance company) would be earning the gains on those investments.

Now that assumes Brian would be self-disciplined enough to invest that money instead of blowing it on a plasma TV. But some people are! If not, maybe there is another question to ask. Rather than force people to buy health insurance, stop forcing us to take care of the people who don't!

Posted by: Pirate Jo at November 12, 2007 5:37 PM

Good luck out there. One request (command, actually): No tears. Don't come cryin', OK babe? Keep that single bullet in your pocket, because a deal's a deal.

Posted by: Crid at November 12, 2007 6:47 PM

Brian does make a good point though. Most policies max out at a million and refuse to carry anything over and beyond regardless. So if you have a mil in the bank, what's the incentive? That said there's nothing wrong with giving a tax break to people who do but then isn't that the same thing as what you are all complaining about? Tax payers picking up the cost of said insurance.

Posted by: Read his post at November 13, 2007 7:14 AM

> So if you have a mil in
> the bank, what's the
> incentive?

When you have a mil in the bank, call us.

Posted by: Crid at November 13, 2007 12:42 PM

Selfish Asshat -

Your wishes to pay are not necessarily going to come true. I have been treated in the ER and told that I had to sign up for the program that would cover it, so the doctors could get paid. It wasn't an option. Of course there is the question of what happens if you are seriously fucked up and unable to pay? Are we really supposed to count on your families generosity to cover your debts? For that matter, what kind of asshole sticks it to there family like that?

As for limits for lifetime payout, there are also laws that govern that. If you have insurance in most states, they have to cover a huge amount in catastrophic care, before the government steps in and lets them off the hook. Here's a hint, a buddies mom is a vegetable. Her treatment went into the millions. She is still alive at a cost of over one hundred grand a year. Her insurance will pay it till the day she finally croaks.

You're nothing more than a selfish little bitch who expects the community or your family to pick up the tab in a catastrophe.

(Damn, I break all my adhominem rules in one comment, oh well)

Posted by: DuWayne at November 13, 2007 7:03 PM

I would add that getting a high upfront deductible HSA isn't very expensive. If I was just getting it for myself (as apposed to the whole family), my rate as a smoker would be fourty-two dollars a month with a fifteen hundred dollar deductible. Once I bumped the deductible to twenty-five hundred, it would go down to thirty-six.

The money in the account is yours. It sits there untaxed, until you use it for healthcare. If you need the money for something else, the only penalty is paying the tax liability for the amount you pull. If you maintain the same deductible but go for a certain number of years without making a claim, you get a break on your rates, not unlike increasing your deductible.

For peanuts, you can make sure that no one but you and the insurance company will be liable in case of a catastrophic health care issue.

On top of everything else, you can use the HSA for vitamins and other preventatives. This coming out of an account that doesn't carry a tax liability. In a lot of places, the tax-free funds you do use to pay for health care, also lead to further tax breaks, my state being one of them.

Posted by: DuWayne at November 14, 2007 2:56 PM

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