From Employer Coverage to Single Payer Health Insurance
From Employer Coverage to Single Payer Health Insurance
This holiday season I’ve heard several tales of woe from working class acquaintances, mostly self-employed, about Obamacare: how they are just above the subsidy cutoff and would rather pay the fine than buy expensive individual policies, or how they are just below and can’t afford to put in more hours per week. I can understand why there is a lot of disappointment with the Democrats.
So what about single payer? Along with free public higher ed, it’s supposed to be the leitmotif of the resurgence of the left, with even moderate politicians signing on, or claiming to, to save their skins. And I’m all for it too.
But a big political obstacle is widespread employer-based health coverage, a benefit that would disappear under a universal system. As a public employee, I have coverage of this sort myself, and it’s a big part of my overall compensation. How do we fold the millions with adequate-to-good health plans into a new system financed through taxes?
I have an idea. As single payer goes into effect, require every employer to publicly report how much it pays in the form of contributions to employee health insurance, documented by its payment record over the past twelve months. The health care law would then mandate that this sum be returned as added wage payments to employees for some transitional period (such as six months) or the term of the employment contract, whichever is greater. Ideally the law would specify a reasonably progressive apportionment of this payment across the workforce, such as equal lump sums. At the end of the transition, wages increases and decreases would fall under the same employment law rules, such as they are, as before.
From the worker’s point of view, there would be no loss under the switch to single-payer, even if existing coverage were gold-plated; it would generate that much more wage income. To the extent that the new system can reduce America’s bloated medical costs, workers could even come out ahead over time. From the employer’s perspective it should be revenue-neutral, and changes in the composition of the compensation package should have little effect on HR. In principle, then, it ought to address most of the political concern over how we can get from here—a fragmented, employment based health care system with both bright spots and gaping holes—to there.
“require every employer to publicly report how much it pays in the form of contributions to employee health insurance, documented by its payment record over the past twelve months”
This is already being done. Check your W-2.
This is funny.
The enemies of Social Security (and even some who claim to be its friends) have been claiming for years that the “employers share” of FICA is “really the employees money” because if the government didn’t require the employer to pay it, the employer would be free to pay that money directly to the employee, and “market forces” would assure that that is what would happen.
This is more proof that people will believe, or at least say, whatever will help their political cause. Consistency, much less honesty, is never on the table.
There are two problems: first is that without government coercion, as suggested by Dorman, the employer contribution to health insurance would just go back into the pocket of the employer, but with government coercion the Republicans will scream “Socialism!” jobs-killing interference with the market.
The second is that even if the employer share is diverted directly into employee wages, where it would be taxed to pay for “single payer” health care, the employees, the Left, would by next year be screaming about their unfair tax burden and demand “the rich” “pay their fair share.”
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I already commented on this at econospeak.
Longtooth said…
There are a ton of “practlcal” problems in a transition to a universal health care system from the existing U.S. economic system. These would be a transitional challenge but not a serious obstical. The obstical is and will remain the notion of individualism that reigns supreme in the U.S. A universal health care system is a purely cooperative one, the antithesis of individualism’s religion.
Universal healthcare is social equality at its limit and our entire nation’s basis is founded upon & depends upon individual “freedoms”, predominantly of individual choice (& thereby individual responsibility’s)…. colloquially “it’s your own fault”.
We have along way to go to remove the alter of individualism from our “way of life”. We can’t even remove the right to bear arms, or keep Church & state separate (despite the bill of rights) precisely because individual “freedoms” outweigh cooperative systems. Cooperative systems & individualism are mutually exclusive, so you get to prioritize one or the other, but both cannot exist without one being sacrificed for the other.
As I see it individualism is directionally toward chaos, separation from it only being by degree, & only tenuously at that. We have already once in our short history hit the chaos end of the spectrum— which resulted in our civil war, & we’still in the throes of coming out of it, at best, or not depending on your individual point of view.
If you left it up to the conservative side of preferences, we would all but dismantle labor’s SS system, Civil Rights, Voting Rights, Medicare, & interstate commerce interpretations giving the federal gov’t power over the individual states. We can’t even keep the mildest form of a conservative proposal for what we call the ACA from being slowly dismantled (recall that this was the conservative answer to avoid a universal health care system)…. obviously not conservatively individualistic enough.
So we’re a long way yet from anything even remotely approaching a cooperative system of governance.
December 19, 2017 at 2:46 AMI
Peter:
Much of the problem with the individual market which your friends are a part of today is:
– The cut off is too low; but then, any level is too low.
– Congress had the idea everyone should have skin-in-the-game which mean copays and deductibles.
– Negotiated Costs for drugs and care do not apply till the deductible is paid.It did not used to be that way.
– ACA, Part D, Medicare can not negotiate with Pharma.
– There are no controls in the ACA for the rising cost of healthcare which also beats out the rising cost of getting a college education.
– Medicare-for-all, Conyers plan, single payor, universal healthcare does not have any language in any plan I have read to regulate healhcare costs which is the root of all the issues we have heard about today in terms of price.
What do your friends plan to do with no insurance? Go Bankrupt, die, shift their cost to us? The FEderal Gov no longer subsidizes hospital care for the indigent or those who do not pay.
I have been recommending this strategy for years. Here is the problem though. My wife and I work at the same institution. She gets health benefits and I am covered under her. So our employer pays thousands on her behalf for our health coverage and nothing on my behalf. So if we go single payer does her salary go up by thousands and mine stays put? If we are still both employed at the same place and married it seems like a wash. But what if she quits and I stay?
Health benefits have always had a built in, hidden distribution toward families. If you have kids and need a family plan your employer spends more on benefits vs a single person. So when we go single payer will people with family plans see larger leaps in salaries? That does not seem fair because under single payer their children will be covered anyway and so the extra money is not warranted.
So this will get very messy. But I agree that we need a campaign to raise awareness and transparency about how much salary you are forgoing for the sake of benefits. Yes, you can find it on the W2 but its not obvious. We need a way of ensuring people that after a transition to single payer we can ensure that net take home pay will stay level or even go up. This means changing the discourse. The bottom lije should always be talk about how much money you have to spend after getting your health care needs taken care of. Right now we still don’t have this discourse. We pay premiums, copays, deductibles, etc. and we rarely talk about overall health care costs in comparison to non-health spending money. When that discourse changes it will be an easier sell. Instead of Republicans being able to yell about your taxes going up we will be able to yell about how your take home pay will stay the same while your health care needs will be better taken care of.
Pete:
Welcome to Angry Bear. First comments always go to moderation to weed out spammers and advertising.
Pete;
One of the main components in the ACA was “community benefit.” It covered those with existing conditions, those who can not afford to pay, the elderly, the young, singles, families, and everyone else regardless. There is no opting out because I am healthy today, single, I will sign up when I need it, I do not need that plan because I will never be pregnant (male), I had all my mumps, measles shots so why should I pay for theirs, my old plan was better even though it was far less in provision, etc. Those reasons are similar arguments used to justify not paying taxes for schools, roads, etc. and everything else people rail against. The ACA does provide subsidies for those who are younger also.
The result of your wife paying $thousands(?) instead goes to funding a universal concept of healthcare. I suspect it will be about the same in cost. Remember too, a large portion of the ESI healthcare insurance cost, disability insurance, anything associated with healthcare, etc. is already funded by the government in the form of tax deductibles (~$250 billion).
In its present state with no regulation of healthcare costs as one would see in European healthcare models, I am confident any gain you might have would disappear. You are experiencing it today in the form of higher deductibles, copays, no discounts till the deductible is paid, less coverage of cost, larger out-of network costs, denied pharma because of cost, no out of network coverage, etc.
Part D was put in place not allowing insurance companies to be able to negotiate with pharma. Medicare is blocked from negotiating with pharma, the ACA is also blocked and yet this is the area of healthcare having the highest profits in healthcare. Until I see a particular verbiage written into any type of healthcare plan, I believe it is a waste of time to do much more than what we have in place. Any gains you think you might achieve would rapidly disappear.
Give it another two generations with increasing per capita total costs of health care before the U.S. realizes there’s another way, & adopts the more advanced nations systems.