How Do I Get My Free Obama Care?

#51
#51
shootermcgavin7 said:
I'm sorry that you feel that way. I will try to post back later with an intuitive example as to why free markets do not work in health insurance.


Hopefully you can at least understand that we are the only developed county without a public insurer. According to market fundamentalists, this should be a good thing. Yet we pay a hell of a lot more, per person, on medical care.

If you actually give a crap, I can explain to you how the wage caps in WWII caused our current employer/private insurance plans, I'll try to come back around 10pm tonight.
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So if company A wants to charge me less for the same services than company B, thats a bad thing and doesn't work?? You must not get around much or have more money than you know what to do with!
 
#52
#52
shootermcgavin7 said:
I'm sorry that you feel that way. I will try to post back later with an intuitive example as to why free markets do not work in health insurance.


Hopefully you can at least understand that we are the only developed county without a public insurer. According to market fundamentalists, this should be a good thing. Yet we pay a hell of a lot more, per person, on medical care.

If you actually give a crap, I can explain to you how the wage caps in WWII caused our current employer/private insurance plans, I'll try to come back around 10pm tonight.
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I'll save you the time. In an effort to combat wartime price inflation, President Roosevelt enacted wartime price and wage controls within the United States in the 1940s. As with any price and wage control, shortages were destined to result. When wage controls led to shortages of workers, employers sought to entice potential employees in other ways other than wages. As a result, they began offering noncash benefits such as employer-provided healthcare insurance. A byproduct of these actions was that, as employer provided health insurance was not technically considered wages, employers sought to pass these wage substitutes to employees tax free. While often attacked by the IRS on the ground that these benefits constituted income, Congress later solidified the exclusion from federal taxation of employer-provided health care by the enactment of Section 106 of the Internal Revenue Code in 1954.

The benefit of this tax expenditure is significant. By paying for health care costs tax-free through an employer rather than out-of-pocket, an employee can shelter a significant amount of income that otherwise would be subject to taxation at an employee’s marginal rate. In other words, this subsidy reduces the overall cost of purchasing health insurance by an amount equal to the taxpayer’s marginal tax rate. In fact, the more health care costs that can be filtered through an employer – or the higher the employee’s marginal tax rate – the larger the benefit to the employee. Thus, employees, particularly those with high marginal tax rates, have an enormous incentive to demand a significant amount of compensation in the form of nontaxable employer-provided health care benefits.

For this reason, the tax exclusion for employer-provided health insurance has led employees to demand increasingly inclusive forms of health insurance policies as they seek to shift more and more after-tax out-of-pocket expenses to tax-exempt employer-provided coverage. This increase in both scope and inclusiveness of coverage has dramatically increased inefficiencies resulting from moral hazard (although arguably decreasing adverse selection), resulting in spiraling costs that consistently outpace inflation. NOTE: these problems are inherent in health insurance - not in health care. The two are very different.
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#53
#53
BigPapaVol said:
I don't care. All of those countries can be complacent because our country exports enough technological advances to allow it. Otherwise, that arena changes dramatically.
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bingo. we've been subsidizing the rest of the world for decades now. take away the profit and medical advances will dry up with the money.
 
#54
#54
paul1454 said:
I'll save you the time. In an effort to combat wartime price inflation, President Roosevelt enacted wartime price and wage controls within the United States in the 1940s. As with any price and wage control, shortages were destined to result. When wage controls led to shortages of workers, employers sought to entice potential employees in other ways other than wages. As a result, they began offering noncash benefits such as employer-provided healthcare insurance. A byproduct of these actions was that, as employer provided health insurance was not technically considered wages, employers sought to pass these wage substitutes to employees tax free. While often attacked by the IRS on the ground that these benefits constituted income, Congress later solidified the exclusion from federal taxation of employer-provided health care by the enactment of Section 106 of the Internal Revenue Code in 1954.

The benefit of this tax expenditure is significant. By paying for health care costs tax-free through an employer rather than out-of-pocket, an employee can shelter a significant amount of income that otherwise would be subject to taxation at an employee’s marginal rate. In other words, this subsidy reduces the overall cost of purchasing health insurance by an amount equal to the taxpayer’s marginal tax rate. In fact, the more health care costs that can be filtered through an employer – or the higher the employee’s marginal tax rate – the larger the benefit to the employee. Thus, employees, particularly those with high marginal tax rates, have an enormous incentive to demand a significant amount of compensation in the form of nontaxable employer-provided health care benefits.

For this reason, the tax exclusion for employer-provided health insurance has led employees to demand increasingly inclusive forms of health insurance policies as they seek to shift more and more after-tax out-of-pocket expenses to tax-exempt employer-provided coverage. This increase in both scope and inclusiveness of coverage has dramatically increased inefficiencies resulting from moral hazard (although arguably decreasing adverse selection), resulting in spiraling costs that consistently outpace inflation. NOTE: these problems are inherent in health insurance - not in health care. The two are very different.
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I think most here are aware how it came to be, but that doesn't explain the system's solvency for 70 years nor how it's now breaking people.
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#55
#55
BigPapaVol said:
I think most here are aware how it came to be, but that doesn't explain the system's solvency for 70 years nor how it's now breaking people.
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Gotcha. It has to do with the moral hazard problem of third party payments. Insurance reduces the percieved cost of the covered good, causing people to be less concerned about cost, consume more, and allows providers to set prices above what would be set in a normal market. By creating incentives to purchas insurance - by excluding it from taxation when purchased by employers - the government played a significant part in exasperating these inefficiencies. Add to that, the exact same problems in Medicare and Medicaid, and costs rise fast - as we have observed over the past 20 years.

Ultimately, these problems can be taken many ways. Some say this is justification for a public option or something similar (I personally don't think a public option does anything to address moral hazard-it is just another third party payment system). On the other hand, many economist think we should get rid of this tax incentive in order to reduce the benefits of insurance, on he theory that over time we will shift back to paying a significant portion of costs out of pocket.
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#57
#57
paul1454 said:
Gotcha. It has to do with the moral hazard problem of third party payments. Insurance reduces the percieved cost of the covered good, causing people to be less concerned about cost, consume more, and allows providers to set prices above what would be set in a normal market. By creating incentives to purchas insurance - by excluding it from taxation when purchased by employers - the government played a significant part in exasperating these inefficiencies. Add to that, the exact same problems in Medicare and Medicaid, and costs rise fast - as we have observed over the past 20 years.

Ultimately, these problems can be taken many ways. Some say this is justification for a public option or something similar (I personally don't think a public option does anything to address moral hazard-it is just another third party payment system). Many economist think we should get rid of this tax incentive in order to reduce the benefits of insurance, on he theory that over time we will shift back to paying a significant portion of costs out of pocket.
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I dont think that's the moral hazard mist have in mind. What you have explained is why healthcare is no longer a market. The actual buyers no longer make paying decisions. Altering that relationship is a needed fix. No debate about it.
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#58
#58
BigPapaVol said:
I dont think that's the moral hazard mist have in mind. What you have explained is why healthcare is no longer a market. The actual buyers no longer make paying decisions. Altering that relationship is a needed fix. No debate about it.
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Well, if that's not what shooter was getting at - I have no idea what he was trying to say.
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#60
#60
Paul, thank you for clarifying on the historical front. I was in meetings all night and, although I love this forum, I have only been able to post sporadically over the past few months.

Your post at 5:46 is interesting. My take on "why" the current system has lasted for so long is that the business-sponsored insurance market we stumbled into in the 1940s had large enough pool sizes. The classical reason for the health insurance market failure is that the pool size shrinks to only "sick" people (paul seems to have an economics background, this is normally a classical microeconomics result taught to undergraduate seniors). This was the adverse selection problem I referred to. The moral hazard is the ex-post result of the people in the now "sick" pool.

Employer-based coverage partially mitigated this problem by covering all of their employees; this somewhat removes the problem. Obviously, if pool size is the problem, universal coverage removes the adverse selection problem. The employer-based solution appears to have gradually declined in the past 30 years due to macroeconomic changes.
 
#62
#62
KentheOrange said:
I take it that you have never been out of the states, so you are an "expert" on foreign media.
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Your statement makes no sense at all.

Are you arguing that owning a station is the same as "running the media" or are you arguing that the media in France, Germany, etc is controlled by the government?
 
#63
#63
Some things they didn't tell you about Obozocare.

OC socks middle class with $3.9 billion tax increase

Taxpayers earning less than $200,000 a year will pay roughly $3.9 billion more in taxes — in 2019 alone — because of healthcare reform, according to the Joint Committee on Taxation, Congress’ official scorekeeper for legislation.

The new law raises $15.2 billion over 10 years by limiting the medical expense deduction, a provision widely used by taxpayers who either have a serious illness or are older.

Taxpayers can currently deduct medical expenses in excess of 7.5 percent of their adjusted gross income. Starting in 2013, most taxpayers will only be allowed to deducted expenses greater than 10 percent of AGI. Older taxpayers are hit by this threshold increase in 2017.
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My guess is you can up those numbers quite a bit since Obozo fiscal policy has got to lead to hyperinflation.


Loophole in Health Care Reform Leads to Double-Digit Insureance Premium Increases

Less than one month after passage of the nearly 3,000-page Obamacare bill the President then signed into law, dire consequences -- intended or otherwise -- continue to surface. Imagine if Democrat legislators actually understood the impact of their massive legislation before the voted for it. Perhaps that’s too much to ask from a group that doesn’t even read the bill before they shove it down America’s collective throats.
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the President said his bill would immediately require coverage of children with pre-existing conditions. It doesn’t do that either.
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#64
#64
VolInMn said:
Your statement makes no sense at all.

Are you arguing that owning a station is the same as "running the media" or are you arguing that the media in France, Germany, etc is controlled by the government?
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The original staement was about the BBC. The BBC 1, 2, 3, and 4 are owned and operated by the British government. They don't own "the station" they own the networks.

I don't know about France and Germany. Haven't been there.
 
#65
#65
As I said, there are plenty of countries where the media is state controlled but France, England, Germany etc are not among them.

You are correct that those stations are owned by the government, but that's a far cry from controlling the media. It's semantics and you know that as well as I do.

Also, as to your assertion above, I have indeed been out of the states. I lived in Germany for three years.
 
#66
#66
the problem in france is not the media it's the sense of entitlement that the populace has when it comes to the gov't bailing them out. we're beggining to develop that same sense here and it's very scary.
 
#69
#69
VolInMn said:
As I said, there are plenty of countries where the media is state controlled but France, England, Germany etc are not among them.

You are correct that those stations are owned by the government, but that's a far cry from controlling the media. It's semantics and you know that as well as I do.

Also, as to your assertion above, I have indeed been out of the states. I lived in Germany for three years.
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No. It's not semantics. Ownership translates to control. If you can't understand that concept then I understand your support for the current administration.
 
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