January 25, 2007


Experts Examine Bush Health Plan (Christopher Lee and Lori Montgomery, 1/25/07, Washington Post)

Under the plan, which would take effect in 2009, winners would vastly outnumber the losers -- at least at first.

Families that spend less than $15,000 on their health coverage (either on their own or with an employer's contribution) would come out ahead, because the new deduction would apply to all of the money spent on premiums. A family that spends, $13,000 a year on health insurance could claim the full deduction. The administration says about 100 million people with employer-sponsored coverage would see their tax bills go down.

Other winners include the 17 million people who buy health insurance on the individual market, who would for the first time enjoy a tax break on the money they use to pay health premiums.

On the losing side are consumers with more expensive policies, especially those financed by employers, who would have to pay taxes on the money used to pay premiums exceeding $15,000. About 30 million people with employer coverage would see their tax bills go up in the first year, the administration says.

"You've got a Republican president willing to take from the rich and redistribute to the poor, which, symbolically, is a really big deal," said Thomas A. Scully, a former head of the Centers for Medicare and Medicaid Services under Bush. "It's breaking the ice to where the real source of revenue is and redistributing it from overinsured people to poor people. . . . The concept is a huge step in the right direction."

Advocates said the proposals would hold down health-care costs by motivating people to seek plans that cost $15,000 or less, and would help put basic insurance within reach of about 5 million of the uninsured. Still more people would gain coverage with the help of another Bush proposal to redirect some federal health money to new grants to assist states in finding innovative ways to cover the uninsured.

"It gives everyone a strong incentive to search for less-costly health care," said Mark B. McClellan, a health economist and former Bush adviser. [...]

Others fear the plan would prompt more employers to drop health coverage and offer employees an immediate increase in wages to buy coverage on the individual market. But those plans tend to be more expensive, less comprehensive and harder to get for consumers who are already sick.

No one expects government to be efficient, but the idiocy of covering every person of every age with a comprehensive health plan is so obvious that even the Left ought to be able to figure it out.

Posted by Orrin Judd at January 25, 2007 8:09 AM

You're assuming that The Left has some interest in providing health care (or welfare, or whatever they claim to want). Their primary object is control.

Posted by: Chris B at January 25, 2007 8:32 AM

One of the things that baffles me here is the taxing of those with Cadillac Health Plans.

Why not just disallow the employer from deducting the expense above $15K.

Business will then do the right thing, and reduce the coverage.

Posted by: bruno at January 25, 2007 9:08 AM

No they won't. Why would management care if the business pays even more for their cadillacs?

Posted by: oj at January 25, 2007 9:18 AM

It's so obvious you can't even articulate it, apparently.

Posted by: Jack Harkness at January 25, 2007 10:00 AM

Okay, if it's "obvious" and easily "articulate[d]", then go for it. Since you are here to save our secular souls, Preach it Brother Harkness! Persuade us of the errors of our ways, remove the scales from our eyes, help us cleanse our Immortal Souls of our sins. Lead us into the Light!... instead of doing what you've done so far, which is to impune our motives and insult us and otherwise cast us into the Outer Darkness. That's not the way to win converts, which means you're not here to win converts.

(I can't decide which is more fun, playing with a brand new troll or playing with the box it came in...)

As has been pointed out before, it's not a "tax" to remove a subsidy. If a business thinks that it needs a "Cadillac" plan to get or keep employees, then they will still offer one. (And why doesn't anyone talk of "BMW" or "Mercedes" or "Lexus" health plans?)

Posted by: Raoul Ortega at January 25, 2007 11:47 AM

I miss Harry.

Posted by: Gideon at January 25, 2007 12:13 PM

Watch how we shall hear that costs most be kept down by putting insureds at risk for all kinds of medical malpractice, including failure to diagnose and failure to treat.

Posted by: Lou Gots at January 25, 2007 12:19 PM


Yes, but such control requires providing the welfare. Badly suffices.

Posted by: oj at January 25, 2007 12:22 PM

Raoul: b/c a Caddillac is affordable.

Posted by: Bartman at January 25, 2007 12:22 PM

Universal/Mandatory HSAs from birth with taxpayers footing the bill for the poor.

Posted by: oj at January 25, 2007 12:22 PM

Control and a permanently dependent citizenry.

Trolls are so amusing. It's really a shame they don't hang around very long. Anyone know what happened to macduff?

oj. Define the "poor."

Posted by: erp at January 25, 2007 12:40 PM


Who cares where we set the line for "poor"? It oughtn't be a stumbling block.

Posted by: oj at January 25, 2007 12:43 PM

OJ wrote:

"No they won't. Why would management care if the business pays even more for their cadillacs?"

Answer: Because it is a dircect reduction off their bottom line. In '93, Clinton/Dems disallowed deducting anything more than $2 mill for CEO Salary.

Business reacted very quickly by paying CEOs with options instead of cash, exascerbating the accounting scandals of the late 90s. (massive incentive to cook books)

While we should be aware of such "unintened consequences," I stand by the position that taxing disallowing the deductiuon above $15,000/person is better policy than taxing it at the individual level.

Of course, the best policy would be to get rid of the corporate income tax entirely, which would immediately end these bloated corporate/employer paid programs. Employers would then simply offer larger pay packages to attract talent, and end the stupid "benefits package" scam. (It would also spell the end of stadium skyboxes and their $7.50 beers and $20 hot dogs.)

If the idiot left ever understood how the corporate income tax was used to subsidize the showering of filthy lucre on the corporate class, they'd scream for the repeal of the corporate income tax.

Posted by: bruno at January 25, 2007 2:26 PM

It matters because I want to help the genuinely needy, but don't want to subsidize the shirkers. The best thing the guvmint and employers could do, is stay out of the health care and every other kind insurance business and let the marketplace work its magic.

I'm sure everyone knows that if an uninsured person sees a doctor, the fees are far less than what is billed to insurers and far fewer "tests" are ordered.

Posted by: erp at January 25, 2007 2:40 PM


Yes, they paid themselves anyway. That's the point.

Posted by: oj at January 25, 2007 4:31 PM


No, it isn't. That's fantasy thinking.

Posted by: oj at January 25, 2007 4:32 PM

Fantasy is in the eye of the beholder.

Posted by: erp at January 25, 2007 6:56 PM

I miss the entertainment Bart provided for us.

Posted by: Dave W at January 25, 2007 10:58 PM