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      Week-end Wrap – Political Economy – July 25, 2021 by Tony Wikrent The Pandemic US sees COVID-19 cases surge by 224% in last three weeks as CDC director says the Indian ‘Delta’ variant now makes up 83% of all new infections [Daily Mail, via Naked Capitalism 7-21-2021] ‘I’m sorry, but it’s too late’: Alabama doctor on treating unvaccinated, dying COVID patient […]
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We’re already paying for healthcare


Opponents of health care reform seem to focus on two main points – cost and “rationing.” It is an article of faith among Republicans that single payer health care will cost a lot more but will provide less health care. Near as I can figure they think there isn’t enough health care for everyone so in order to extend coverage to everyone we’ll have to take some away from the people who have it now. But I don’t want to discuss the “rationing” fallacy today, I want to discuss the cost fallacy.

This is what we were paying for health care two years ago:

Total spending on health care, per person, 2007:

United States: $7290
France: $3601
United Kingdom: $2992
Italy: $2686

As of 2007 we were spending $7290 per person for health care. That is not an average of $7290 for each person lucky enough to have health care coverage, that is the average for everyone in the United States. Take the total amount we spend on health care and divide it by the number of people in the country and you get $7290.

But for all that money we aren’t even covering everyone.

For reasons that used to make sense most people that have health insurance get it through their employer. Most people that don’t have employer-based health insurance are either on Medicare, Medi-caid or have no health insurance. Some self-employed people purchase health care insurance but the cost is prohibitive especially for the working poor.

This is how we pay for health care now:

Employer contributions
Employee contributions
Self-insured premiums
Cash payments for uncovered/excluded treatments/medicines
OTC medicines

Employer contributions are a non-taxable benefit your employer may choose to provide to you. It’s logical to assume that if they weren’t paying health care premiums with that money they could add it to your salary since they are spending it on you anyway. This is a point I will come back to in a bit.

Right now some people have good health care insurance, some have bad health care insurance, and some have no insurance at all. People with insurance or lots of money can go see a doctor for minor problems and routine exams. People without health care insurance or piles of cash are limited to urgent and emergency care. For too many people the local emergency room is their primary care physician.

When people go to the emergency room for non-emergency care the chances are they can’t afford to pay the bill. If they could afford to pay the bill they would go somewhere cheaper. So not only are premium services being used to treat minor illnesses and injuries, but those services end up being paid by tax dollars or by passing the cost on to the paying customers. (Basically the same thing)

When someone declares bankruptcy on medical bills the medical providers do what all businesses do – they raise their prices to compensate. Whatever your doctor charges for his or her services includes a calculation for bad debts. That’s just business.

There ain’t no free lunch. If we reform health care we still have to pay for it. But we’re already paying for it. If we took all those same dollars we’re spending now and applied them to a single payer system we would almost certainly far pay less than we’re paying now.

I can say this with assurance because every civilized nation with single payer or socialized medicine pays far less per person than we do. I qualified my statement by saying “almost certainly” because given half a chance our government will let the foxes into the henhouse.

The logical way to pay for single payer health care is through taxes. It would be similar to the current Social Security and Medicare people already pay. But even if we were able to cut our current costs in half that would still mean a cost of $300 per month per person. ($3600 divided by 12)

Poor people won’t be able to pay that amount. They can’t pay it now, and passing a law requiring them to purchase insurance won’t make them able to afford it either. The only people who can pay are the people with money.  That means that people with higher incomes will have to pay more. But they are already paying more. The trick is to figure out where that $7290 is coming from now.

Theoretically we could come up with a tax that would take the money we are paying now from the same people that are already paying it. Ideally it would be a progressive tax on all income. We should eliminate the artificial distinction between “earned” and “unearned” income. (Ever since the Sixteenth Amendment was passed the rich have been trying to get out of paying their fair share.)

If single payer became a reality it would sure be helpful if employers were to pass on all the money they are currently spending for health insurance coverage to their employees as a pay raise. Some would, but many would figure out a reason to keep it for themselves.

When someone starts yapping about the cost of health care reform and claims that Social Security and Medicare are going into the red, point out that we already pay twice as much as the civilized world pays and we’re getting less than they are for our money. If we do it right we’ll spend less than we are now and get more for it.

And point out that the problem with Social Security and Medicare is one of execution, not design. The Republicans want to bankrupt all the New Deal and Great Society entitlement programs so they can justify repealing them.

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Ted Kennedy Dies at Age 77


Ted Kennedy has just died after a long battle with brain cancer at the age of 77.

From CNN:

“We’ve lost the irreplaceable center of our family and joyous light in our lives, but the inspiration of his faith, optimism and perseverance will live on in our hearts forever,” a family statement said. “We thank everyone who gave him care and support over this last year, and everyone who stood with him for so many years in his tireless march for progress toward justice.”

Our thoughts and prayers go out to his family. May he rest in Peace.




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