Some Thoughts on Healthcare Reform

One of the things I like best about Americans is their ability to pull together and get things done. There are endless historical examples of Americans stepping up and taking care of one another (and sometimes the world). These stories of community sacrifice and individual heroism tell me Americans are good people.

I think that's why I've been so disappointed at my nation's inability to enact meaningful healthcare reform. We agree that 45 million of us lack insurance; another 25 million are under-insured. That number ticks up every year. Many of us agree that this is bad for our country; we certainly agree that sick people should be able to see a doctor. But when it comes time to figure out how to change this situation, our vulnerable solidarity breaks down, to be replaced by concerns about what reform would mean for individuals. Healthcare reform is a complicated matter and in the next few weeks I plan to write about some of those complications with an eye toward sorting out the Gordian Knot that surrounds the mess. I'll do this by explaining some of the issues in the debate.

First: a disclosure of where I stand. I am firmly among those who believe that healthcare should be a right for Americans. These days, my access to healthcare is provided via health insurance provided to me and my son by my employer. That's how most Americans have access to quality healthcare. I am not arrogant enough to believe that it's a right I should enjoy while millions of other people are left out. Especially since I understand that it's a massive tax break that helps to provide my insurance.

Those of us who have employer-provided insurance are enjoying an enormous benefit for which we do not pay a fair market price. If your employer pays for all of your insurance costs, that amount is a supplement to your salary worth anywhere from $5,000 - $12,000 per person covered, per year. If that amount came to you in a paycheck, you'd pay taxes on it. But when it comes to you in the form of health insurance, you pay no taxes on it. My employer pays part of my insurance premium (60%) and I pay the rest of it (40% of the premium). That 40% comes out of my income.....and I pay no taxes on that share of my income.

If I had no insurance and had to pay my own medical bills, it would come out of my after tax income. If I knew the tax laws, I'd know that I could create a Medical Savings Account for myself, and pay for my medical bills out of pre-tax income. But many people who don't have insurance are operating at the margins of the economy. These are families who are looking to just get by; not people who are able to utilize the benefits organized by the system.

Don't get me wrong: I don't want to pay taxes on my insurance benefit. But I know that government rules are subsidizing my healthcare, as they do for nearly all of the Americans who have health insurance. To believe that I deserve this tax and healthcare benefit, one paid for by all taxpayers, even those who don't have insurance, is to implicitly suggest that some people are not as deserving. When it comes to healthcare, that's just a ridiculous argument. As a nation, we'd be healthier (and perhaps happier?) if we all enjoyed access to healthcare. We need to find a way to accomplish this, for the good of one another and the good of our nation.

Next up: an explanation of healthcare inflation. I hope that you'll keep reading.