Tuesday, November 27, 2007

Mandatory Health Insurance Coverage

Guaranteed Profits

Insurance companies know that difficult times are coming. Massive personal debt and a shaky economy are forcing many Americans into cost reduction life adjustments. This will involve cutting their insurance burden. The insurance companies want to stop this income loss by having the government force Mandatory Health Insurance Coverage onto the public thus guaranteeing corporate profits.

This model was used by the banks with the Bankruptcy Reform Act of 2005. The financial establishments saw very bleak times ahead; mass bankruptcies would eat into their profits. Calling it bankruptcy reform the banks created state sanctioned indentured servitude by eliminating the ability to erase your debt.

Under the guise of universal health care the insurance companies will force American's into a broken system built to move wealth from the working class to corporate pockets without guaranteeing coverage. As long as corporate profits are the goal of the insurance companies the system will remain broken.

The average premiums for a family of four in 2006 were roughly $11500. Research has shown that of the total insurance premiums used to cover hospital and physician care, 21 percent is spent on insurance administration. Another 13 percent is used to cover other administrative tasks.
Only 66 percent of every insurance dollar is used for patient care. Compare this to Canada's national health insurance system which spends just 1.3% on overhead, and the U.S. Medicare and Medicaid programs having administrative costs of between 2-5%.

Additionally insurance companies vigorously deny payment on claims; deny insurance to the high risk populations or people with preexisting conditions; and charge higher premiums for people who have been without health insurance for a time. These practices are legal, encouraged and done to maximize corporate profits.

Single Payer System

The United States is the only industrialized country to not offer universal health coverage to all its citizens. This country spends a higher portion of its gross domestic product on health care than any other nation but ranks 37 out of 191 countries on performance of that care.
Forty-five million are uninsured; an additional 50 million are under-insured. Free market based, for-profit health insurance does not work; why can't we just eliminate it in favor of a streamlined universal single-payer insurance system.

It has been estimated that a single-payer system would dramatically reduce administrative costs by at least $150 to $200 billion a year. Also the single-payer institution could drive the cost of health care down by negotiating contracts that award health care providers for prevention of illness rather than prolonging sickness for profit. Our current insurance system will not do this; if the public is kept sick they can charge more for premiums.

Police departments, fire departments and the public school system are examples of critical support structures that were institutionalized for the greater public good. Corporate greed is the only reason a universal single-payer insurance system is not in place today. Presidential candidates of both parties will release plans in the coming year talking about universal coverage. These plans are nothing but variations on mandatory coverage, authored by the bosses in the insurance industry and dressed up to look like universal coverage. The United States government is guaranteeing corporate profits at the expense of its citizens.

Average Household

In 2006, the median annual household income according to the US Census Bureau was determined to be $48,201.00. Which is roughly $37,000 take home after taxes.

Look at how mandatory health insurance impacts a family of four. Husband and wife both thirty years old, non-smokers in good health, a son and daughter seven and ten respectively. The household income is forty eight thousand a year earned primarily by the husbands contracting business. Wife takes care of the children and handles the books for the contracting company.

Their yearly expenses are: $12,000 rent, $13,000 food and toiletries, $3,360 car payment, $3,120 gas, $2,400 power, $1,200 business cell and home phone, $720 mandatory car insurance. Notice that there are no extravagances or high credit card bills and they rent their home. Total expenditures for this family is $35,800 per year which leaves them with roughly $1,200 yearly for discretionary spending.

The family is forced to purchase a reasonably priced insurance plan to cover their health care costs. A $2,000 dollar deductible plan with a %20 co-pay capped at $8,000 (not including deductible) is available for about $1,250 per person or $5,000 yearly for the family. This is an additional $416 monthly expense of which half may be refunded through tax credits at the end of the year. The family still must come up with the monthly payment. This technically bankrupts them but for the sake of argument lets go on.

Before their mandatory health insurance coverage kicks in this family must pay at least $7,000 out of their pocket; $5,000 premium plus $2,000 deductible. (The deductible is $2,000 per person by the way but we will not even go into that today.) Additionally they are responsible for a %20 co-pay capped at $8,000 not including the deductible. If someone in this family has a catastrophic illness, they are responsible for up to $15,000 yearly. That number assumes that the carrier actually pays for the procedures and does not drop the family or simply deny coverage which is the normal operating procedure for insurance companies.

The package mentioned above is real, the deductible can vary between plans but premium differences make them all about the same. The plan does not include dental or eye care and has a $15 to $60 dollar co-pay on prescriptions. This family would not carry insurance on every family member, they may choose to cover the children or one of the parents but the cost of health insurance today is to high for many citizens. Additionally the benefits received from this insurance package do not justify the ridiculously high price. If your family made $100,000 a year and your salary was reduced to $40,000 the first thing you would cut is health insurance. It is the first thing companies cut when profits sour and it will be the first thing families cut. The health insurance industry and their lobbyist know this.

American families will be forced into supporting the insurance industry through mandatory enrollment. If you chose not to participate your wages will be garnished or you could be jailed. Mandatory health insurance coverage is just another example of corporations buying candidates to guarantee profits at the expense of this counties citizens.

Health insurance companies are not health care providers. The quality of your health care will not be impacted in any way by moving to a single payer system. Americans health would actually improve when it became less profitable to keep us sick.

Mandatory coverage is not universal coverage and should be rejected.


Fon said...

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Anonymous said...

Edwards: Garnish wages to achieve universal health care

Anonymous said...

Link to Edwards story


BigBear said...

I cannot believe Edwards is so stupid to propose this. It is really bad. They don't seem to get that we need a new direction in coverage not mandatory participation at the expense of tax paying citizens.

By the way tax credits to offset cost do not work. The problem is that no one can afford the up front cost of the insurance. Why can't they keep the tax credits and just provide the single payer system.

I will not vote for any candidate that proposes mandatory health insurance coverage.

Tracker said...

Personally, I think this thing will go far and be passed in the middle of the night just as Congress passes their raises. It's clearly a money issue so the rich can get richer and it is upsetting when these things happen over money.

theotherryan said...

Universal health care is a stupid idea to begin with. As Thomas Sowell put it so eloquently "it is a falicy to assume that people can afford something collectively that they can not afford individually".

As for the idea of universal healthcare by making everybody buy healthcare it is the dumbest thing that I have ever heard of. Lets just make everybody earn a million dollars a year by fining them for not earning a million dollars a year. It is totally idiotic.

BigBear said...

The sad thing is that it has nothing to do with health care. It is about milking the public.

Eric said...

It's really interesting to go back and look at this, now that it has passed.