So McCain is proposing a $5000 tax credit to help people buy health insurance. “The goal is to move the health care industry away from job-based coverage toward competition among health insurance companies on the open market.”
a few thoughts:
- Tax credits only offset income tax that you pay. Most people without insurance are in low income jobs and don’t pay anywhere near $5000 in income tax. A tax credit will not give them any more money with which to buy insurance.
- Most people who have insurance receive it as part of a group plan from their employer. group plans have a harder time excluding people with pre-existing conditions. without reform, moving from employer based group plans to individual plans will result in more people being denied insurance.
- When an employer offers health insurance, especially when they pay for a good chunk of the cost, most employees sign up for it. That means that lots of young healthy people are contributing premiums but taking out few benefits. That means the healthy people are subsidizing the sick people. That’s how insurance is suppose to work. But move to individual plans, and many young healthy people will not bother to sign up. The total cost of health care will remain pretty much the same, but it will be spread out over fewer people.
The simplest solution to our health care crisis is the one proposed by presidential candidate Matthew Santos: removing the age restriction on Medicare. You can keep your private insurance, or you can sign up for Medicare. Unless they’re very rich, people over 65 don’t have a choice. They’re pretty much forced onto Medicare. If it is good enough our elderly, then why isn’t it good enough for the rest of us?
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