Among the issues most commonly discussed are individuality, the rights of the individual, the limits of legitimate government, morality, history, economics, government policy, science, business, education, health care, energy, and man-made global warming evaluations. My posts are aimed at intelligent and rational individuals, whose comments are very welcome.

"No matter how vast your knowledge or how modest, it is your own mind that has to acquire it." Ayn Rand

"Observe that the 'haves' are those who have freedom, and that it is freedom that the 'have-nots' have not." Ayn Rand

"The virtue involved in helping those one loves is not 'selflessness' or 'sacrifice', but integrity." Ayn Rand

13 April 2010

Another Middle Class Tax on the Ill

It is not enough that Obama is taxing some people's health insurance plans, those who pay for medical devices, those who pay for clinical testing, and those who must buy insurance that covers medical devices or clinical testing.  These people are taxed whether they are making as much as $250,000 a year or not.  They are even taxed if they make less than $200,000 a year, since Obama believes in fuzzy math and now likes to place his taxing threshold at $200,000 - $250,000 a year.  In fact, if anyone pays these costs, they are paying a tax no matter what their income.  But, for good measure, Obama has also just used ObamaCare to increase taxes on many people with serious illnesses in another way.  This tax also applies to everyone, not just those making more than $250,000 or some other fuzzy threshold.  But who is counting Obama's lies anymore.  No one has the patience to count them all and track them.  It would be like counting every raindrop in a heavy rain storm covering your entire state.

Among those most likely to take itemized deductions on their federal income tax are those with serious medical problems.  If your medical expenses exceed 7.5% of your adjusted gross income, you may deduct the amount in excess of that limit.  This certainly applies to large numbers of ill people with incomes across the entire spectrum of incomes.  The ObamaCare bill has raised the deduction limit to 10% of adjusted gross income, meaning that many fewer people will qualify for this deduction and those who do will be allowed to deduct less than in the past.  Mark Hemingway, in an Opinion piece in The Examiner called Read the bill: Obamacare socks middle class with $3.9 billion tax increase notes that taxpayers earning less than $200,000 per year will pay $3.9 billion more in taxes in 2019 alone according to the Joint Committee on Taxation, Congress's legislation official scorer.

The new law brings in $15.2 billion more over 10 years by limiting the medical deduction to that amount over 10% of adjusted gross income.  This new threshold will apply to most taxpayers in 2013, though it does not kick in for older taxpayers until 2017.  And note that the $3.9 billion rate of the tax increase for 2019 will only grow from that point on as more and more Baby Boomers who would have had a deduction will not have it or will have a smaller deduction.  A ten year rate based on the 2019 tax increase would be $39 billion, not the lower $15.2 billion increase in the first ten years as the new threshold is slowly put in place.  This is a big tax increase and it is applied to those who are sick and ill with little regard for their income.  Let me make this perfectly clear: This makes Democrat compassion a clear sham.


Anonymous said...

Crafters of Health Care Reform knew that costs incurred in providing health care services are highest in the elderly and those under 2 yrs of age, hence the panels to determine eligible services. In the working class, less than 1% are hospitalized or require expensive treatments during the course of a year. For those in the working class that have more out of pocket expenses due to limited coverage, they wrote that medical expenses must be 10% of adjusted gross income to limit tax deductions. The people Obama was to help the most, he betrayed.
Government knew transparency never existed with regard to health insurers and allowed insurers to include every know expense (Salaries, pension, bonuses, rents,outsourcing,real estate, etc.) under the term of "medical expenditure". They encouraged greed in the insurance industry. When a company like Anthem/Wellpoint, etc., state they spent 70 cents on the dollar for health care, you know they denied many claims and severely cut payments to doctors and hospitals. The physician will only receive 15-20 cents on the dollar, and hospitals 25 cents on the dollar for premiums paid, some even less.
As far as taking over health care, many in government and power positions have worked toward this goal for a long time because they know the enormous profits to be made, particularly when you control care provided. Working toward this process and against the citizens, congress allowed insurers to be exempt from Anti-Trust laws enabling them to form huge monopolies controlling costs and deciding which services to deny. Additionally, this served a dual purpose making a takeover by government quite easy. Further, the restrictions placed on accessing health care insurers interstate and allowing a particular insurer to cover a majority of citizens within a state has been another price driver. People become angry with insurers and look to government for intervention. In comes Obamacare supported by naive individuals who actually think costs and access to care will improve. It will never happen. This, IMO, is one of the greatest disasters to ever befall the American people. They have no idea what they will confront in the future when attempting to access a physician.
Yes, our government "of the people" is laughing and jumping for joy at this coup know the cash that will flow toward government to compensate for lost tax revenues brought about by job destruction in America due to poor leadership and the greedy quest for globalization. All well planned. The medical profession was not asked or included in this discussion despite the fact that health care is provided by the doctor and is between the doctor and patient. Practitioners are not taking this lightly. Many will drop out or retire from medicine as they did when HMOs first hit the scene, or they will drop out of third party payer plans. Providers have been pawns always blamed but really helpless. Laws have prevented them from joining unions, and they are not exempt from RICO laws. They can't collectively decide to drop out of third party pay and must make this decision on an individual basis. With the costs of operating a practice, it's not an easy decision to make.
We can only hope the American people get enough exposure to realize their error and elect people that will repeal and replace this dastardly act by the Democratic Congress.

Charles R. Anderson, Ph.D. said...

There is much I agree with in this comment, but I do find it difficult to believe that any doctor or hospital would take any insurance that only paid them 15-20 cents or 25 cents on the dollar. Also, Anthem/Wellpoint clearly cannot pay out dollar for dollar what they take in as health insurance premiums. For most insurers, the profit margins are fairly low, but I do not have a good handle on what their operating expenses are. I am sure that the state mandates on what must be offered in health insurance policies in some states protect health insurers from some competition and may allow some to become inefficient. Perhaps Anthem/Wellpoint is one such, but any insurer does have to pay their employees, pay rent, pay insurance, pay advertising expenses, pay for office supplies, and many more expenses. These expenses have to come out of the premiums.

I believe globalization has taken on multiple meanings. In so far as globalization means that people are now enabled in many cases to trade easily all around the world, it is a good thing. Where globalization means that cabals of countries are trying to restrict the freedoms of the people of other countries, this is a bad thing. Those who argue the U.S. should have the government-run medical system, similar taxes, or similar energy-use restrictions to those elsewhere, use a sense of globalization that is bad.

I agree with your other points.

Anonymous said...

Sorry my previous message was so incoherent. Bad habit of hitting enter b/4 editing!
David Axelrod was a guest on the George Stephanopoulos show last year saying that "the Medical Loss Ratio reflects what Insurers spend on Doctors and Hospitals",
ignoring the accounting standards that direct inclusion of all claims against the entire insurance company ( including its shopping centers, blimps, skating rinks,
billboards, management salaries "and so on") in the category called "Incurred Claims" - not just medical claims.
Medical Loss Ratio = Incurred Claims / Earned Premiums
This is accounting slight of hand - including non-medical expenditures in a calculated value called "Medical Loss Ratio".
Transparency is NOT required by any insurer w/ the exception of Minnesota. All insurers in MN are non-profit. You can check their insurance information. In the analysis of all private insurers, they reported that companies spent 15% on doctor fees, 20% on Hospitals, and 65% on administration (includes all other expenses such as broker, commissions, administrative fees, etc.). Administration included all the insurers expenses. It's the best kept secret even from an overwhelming number of physicians. This is how the insurers accumulated billions in reserve.
Axelrod was also perpetuating the myth that Health Insurance = Health Care, when he says "the healthcare market" is broken.
Once again, "healthcare" (one word) is a newly coined word (roughly 40 years old and became vogue with HMOs) that has been used as a synonym for "health insurance".
"Health Care" of course is what we - your Doctor - does for you.
Health Insurance is a third party's promise to pay a Doctor out of that third party's own funds.
These are two very different things.
What I represented to you is quiet factual.

Anonymous said...

This is bundles ino incurred claims---
Marvelous that insurers term everything "medical" misleading the public into believing the doctor reaps the benefits. Nothing could be further from the truth...
Chief executive Stephen Hemsley pulled in $102 million in 2009, with $98.6 million coming from exercised stock options, according to a filing with the Securities and Exchange Commission Wednesday.

That’s the biggest payday at the Minnetonka-based health insurer since 2006, when former chief Dr. William McGuire collected $127 million.

Charles R. Anderson, Ph.D. said...

Thanks for your clarifying comment. I misunderstood what you meant by doctors getting 15 to 20 cents on the dollar. It is now clear that what you are saying is that of the health premiums paid only 15 cents of every dollar goes to pay doctors. The combined portion going to doctors and hospitals is only about 40 cents out of every dollar. This does not seem to represent a very competitive market!

I understood the market to be much less competitive than it should be due to state mandates on health insurance coverage which prevent the 1300 private health insurers from competing in any state of the union. According to the GAO the number of insurance companies in the small group market doing business in each of 37 states that responded to their inquiry ranged from 77 in Indiana to 4 in Hawaii. These numbers are so low compared to the numbers of companies I have heard about that it seems the state requirements must be greatly reducing competition and choices in health insurance. The free market provides the only known effective requirement that a company provide its customers the most beneficial products. It is past time for the federal government to invoke the interstate commerce clause for its intended purpose for once to allow the free trade of health insurance policies across state lines.

Of course, no doctor could deal with 1300 different insurance companies. I would assume that companies would simplify the life of the doctor by specializing in dealing with the many insurers and would provide a standard set of forms to the doctor for submission to it and these standardization companies would put pressure on the 1300 insurers to accept their forms as adequate.