Chijohnaok2
Posts: 628
Joined: 7/29/2002
From: Florida, USA (formerly Chicago)
Status: offline
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quote:
ORIGINAL: Joe 98
This part is a mystery to me.
The proposed reforms are still a mystery to most. There are still two versions, one in the US House, one in the US Senate. These will need to be reconciled into a single version, then approved by each house of the legistlature, then signed by the President before it goes into law. Most members of Congress have not yet read the bills (even though they have voted on them once already).
quote:
As I underand it, many Americand have their health insurance premiums paid by their employer. Under the new arrangement, the employer will stop doing so. Instead, those funds will be paid to the individual so everyon'e pay packet increases. This is $2,000 - $3,000 per person!
Most people who are are employed do obtain their health insurance through their employer. Generally, an employer will pick up a majority of the health insurance premium, with the empoyee paying the remainder. In most cases, the employee will also have to pay co-pay payments for visits and many medical procedures
Under the proposed reform (as I generally understand it...many of the specifics will be changed during the reconcillation process), government will set out certain specific or minimums that health insurance must cover. Employers can choose to continue the insurance coverages that they already offer (provided they meet the gov. set minimums). If the employer decides to discontinue their insurance plans, they can drop them, but will be forced to pay a certain percentage of an employee's pay (around 8%) as a tax/penalty to the government. Those no longer covered would be able to choose their insurance from a variety of existing private insurance plans. I'm not sure if the premium will be paid from the penalty the employer pays, or if it will come from the increase in employee compensation arrangement you mentioned. "Rich" taxpayers (those making $200,000-250,000/yr or more) would have their income taxes raised to help pay for the overall tab. Here is one little interesting twist: Government would start collecting these taxes in 2010, but this insurance scheme's coverages do not start until 2014. Therefore, the federal government has 10 yrs worth of "income" but pays benefits for only 6 yrs. This makes it easy for the federal government to claim that the overall plan "pays for itself".
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Afterwards, this is taxed at 1.5%. Then, each individual choosed btwenn the 50 insurance companies, tompurchase private medical insurance should you choose. Due to the competition the premiums will be lower than they are now.
Some I have already described above.
The proposed reforms do NOT allow competition across state borders. The Congressional Budget Office (an "Independent" office within Congress) has said that many people's premiums would actually increase.
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As a result, each employee will have more in their pay packet and still have the same level of cover they do now if thats their choice.
It remains to be seen whether emloyees will have more in their "pay packets"; or whether insurance coverage will remain the same.
Additionally, under one (or possibly both) proposals (again, it's hard to tell), some (those 55 yrs or older) that do not currently have coverage, would be able to enroll in Medicare. (Medicare is a government insurance plan that covers retirees (usually 62-65 and older).
Here is a little tidbit about Medicare. Medicare limits its payments to doctors and hospitals for services rendered to less than the actual cost (varies by state but somewhere around 75%). Therefore, if a doctor charges $100 for a procedure, Medicare will only pay him $75. Guess what, to offset that payment shortage, the doctor will jack the cost for that same service to those patients that are covered by private insurance, or who pay in cash. Therefore, Medicare is actually subsidized by those who are covered under private insurance plans. Also, a portion of every worker's pay (half paid by the employee and half paid by the employer) already goes into a Medicare "Trust fund" to pay for Medicare expenses. Therefore, even though the government has already collected money on the front end from workers & employers for those Medicare explenses, they are also forcing private insurers to subsidize Medicare through the shorted payment scheme I mentioned earlier. Also, that "trust fund"is actually nothing more than an IOU written by the government since they have spent Medicare premiums surpluses from past years and spent the money on other things. The baby boom of people born after WW II, who generated these surpluses, are coming up on retirement age. This "bubble" of people will result in a decline in Medicare premiums paid and an increase in overall costs. Those IOUs will come due and the government will either have to increase the taxes of those still working, or cut benefits.
Here is another tidbit. Everyone will "theoretically" be required to obtain health insurance, however, if you fail to, you will be required to pay a tax penalty (something small...around $500-750/yr). Many young people elect not to obtain health insurance because they believe that they will not use it. Therefore, they will pay a $500/750 yr tax/penalty. (Whereas if they elect insurance, they would pay thousands in premums). If they get sick, they go to the emergency room for treatment. By law, a hospital cannot refuse treatment. If the patient can pay the bill, they will, if not, the hospital usually ends up eating the cost. If the patient is poor, the government will pay the bill (albeit at that reduced amount I mentioned before). If that young person who chose not to get insurance find themselves sick (cancer, other major illness), they simply enroll to get insurance...they cannot be denied coverage for pre-existing circumstances. Therefore, that young person who never paid a dollar into an insurance plan gets cancer, signs up for insurance, and starts paying towards insurance premiums. Despite the fact that cancer treatments may run into tens or hundreds of thousands of dollars that young person will get covered, despite the fact that they paid almost nothing in the past.
Circling back to the expanded pool of people who will be joining Medicare (and whose procedures are reimbursed by the government at less than cost), doctors and hospitals will find themselves with an ever growing number of patients for whom they are getting less than cost for each procedure. The doctors/hospitals will either have to pass on the cost to private insurance carriers, or decide not to accept Medicare patients, or simply decide to retire/get out of the business. More patients will be seeing doctors & visiting hospitals, but will find less doctors & hospitals to visit. Therefore, most patients may find themselves standing in waiting lines and waiting for surguries & procedures that they do not have to wait for now.
I've probably missed some things, and may have gotten some of these things wrong, as I am not an expert, and, as I said, many of the details have still to be decided.
Oh, and one last thing. The Congressmen who are deciding all this will continue to have unlimited access to doctors, hospitals, and clinics that most people do not have access to.
Have a great day!
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