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  • Presidents Insurance Plan

    What do you think?

    I kinda like it even though it would probably cost me.

    The main thing I worry about is that I think it pegs it to general inflation. This is bad since inflation of the medical costs has been much higher than general inflation. Might end up being like the Alternative Minimum Tax. (Now the ATM scares me. I am getting really close to that one since my wife started working.)

    The other problem I see is that it attacks all the instrests of the current system head on. Labor, insurance companies, employeers and some highly paid individuals all stand to loose. Not a good way to get something passed.
    Iím not racists, I have republican friends. Radio show host.
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  • #2
    Re: Presidents Insurance Plan

    Im hoping someone can post a summary of what its going to do, i only heard parts of a tax write off if you spend money on healthcare?, is that right or way off?
    that sounds like a good idea trooper.
    -Vulcan

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    • #3
      Re: Presidents Insurance Plan

      All I know is that the current system of healthcare sucks. I pay out the rear to have health insurance and it covers very little...my wife cant even have a child and be covered by it.

      But people on medicare (welfare) can get nearly any medical care free of charge (including prenatal/birth)

      Almost seems like theyre trying to kill off the middle class.

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      • #4
        Re: Presidents Insurance Plan

        I havent seen the details, but this is what I understand from the news reports:

        On the current system, if your employer pays for your healthcare, those dollars are not taxed. They don't pay employment taxes and you dont pay income taxes on those dollars. But if you purchase health care for yourself, you have to do it with dollars that have already been taxed with income and payroll taxes, so the exact same plan ends up costing you probably 30% more money.

        Bush's proposal is to eliminate that discrepancy by taxing employer health benefits and your own health plan in the same way: The first $7500 per person per year is tax free, and the rest is taxable. So if you buy your own health plan, and it costs $7500 per year, you get a $7500 tax deduction on your income taxes, to give you the same result as if your employer had bought that plan for you. Now its not more expensive to get it for yourself.

        If the plan costs MORE than $7500 per year, you'll have to pay taxes on it even if you arent actually paying for it. If your employer is buying it for you, he's still got to pay the taxes on the part above $7500.

        Does this make sense?

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        • #5
          Re: Presidents Insurance Plan

          perfect.

          So he is basically trying to make government sponcered health care without actually having the government pick and choose what care you get. I like it.
          that sounds like a good idea trooper.
          -Vulcan

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          • #6
            Re: Presidents Insurance Plan

            Originally posted by freekyE View Post
            Almost seems like theyre trying to kill off the middle class.
            You may be on to something there.

            Peace

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            • #7
              Re: Presidents Insurance Plan

              actually, your health-care costs are alreadytax deductible (meaning they're essentially paid with pre-tax dollars)

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              • #8
                Re: Presidents Insurance Plan

                Costs for actual health CARE, or costs for health INSURANCE? 'Cause thats the issue here.

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                • #9
                  Re: Presidents Insurance Plan

                  try this out for size. Cnn's take.

                  http://money.cnn.com/2007/01/23/pf/t...ex.htm?cnn=yes
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                  • #10
                    Re: Presidents Insurance Plan

                    Originally posted by Kerostasis View Post
                    Costs for actual health CARE, or costs for health INSURANCE? 'Cause thats the issue here.
                    uh.. insurance I guess - I'm self employed so I have to pay all my medical stuff out of pocket. I deduct both my monthly premium ("insurance") and copays ("care"?).


                    edit:
                    Originally posted by tfa
                    The proposal differs from current law in two key ways: 1) under current law, people who buy insurance on their own typically don't get a tax break at all; under the proposal they would; and 2) those who are insured through work can currently buy coverage with an unlimited amount of tax-free money. Under the proposal, a limit would be set.
                    I guess my CPA knows something others don't!

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                    • #11
                      Re: Presidents Insurance Plan

                      Originally posted by WhiskeySix View Post
                      I guess my CPA knows something others don't!
                      Very possible. If I had to guess, I'd say the fact that you are self-employed allows your CPA to consider your health insurance to be a benefit that your company (you) pays to its employee (also you), and thus get you the employer-style tax break on it.

                      By contrast, people who are employed by another business that simply doesn't offer a health plan, and have to buy it themselves, are just out of luck. Bush's proposal would fix that.

                      But the really interesting part to me isn't that uninsured people will be able to afford insurance, or even that currently insured people can get a tax break on their insurance. The REALLY interesting part is that people who currently get The Standard Healthcare Plan™ offered by their employer, because its cheaper than buying one for themselves, now have the freedom to shop around for whatever insurance plan or insurance company they want to sign up with. That adds a lot of freedom to the market, which is usually a good thing.

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                      • #12
                        Re: Presidents Insurance Plan

                        Originally posted by Kerostasis View Post
                        Bush's proposal is to eliminate that discrepancy by taxing employer health benefits and your own health plan in the same way: The first $7500 per person per year is tax free, and the rest is taxable. So if you buy your own health plan, and it costs $7500 per year, you get a $7500 tax deduction on your income taxes, to give you the same result as if your employer had bought that plan for you. Now its not more expensive to get it for yourself.

                        If the plan costs MORE than $7500 per year, you'll have to pay taxes on it even if you arent actually paying for it. If your employer is buying it for you, he's still got to pay the taxes on the part above $7500.

                        Does this make sense?
                        Sure, if you want to end employer-provided health insurance. Say goodbye to that benefit. Why don't they just make personally-purchased health insurance tax deductible?

                        This struck me in particular as BS:
                        Originally posted by CNN Money
                        How might this proposal change your behavior? If you buy your health insurance at work, the compensation you use to do that is tax-free, so there is little incentive to buy a lower cost plan. With a cap on the tax benefit for health coverage, the knowledge that you will be taxed on money you use to buy coverage above that cap will push more people to look for lower cost plans. And that, proponents say, will increase competition among insurers and healthcare providers, thereby lowering healthcare costs.

                        "One of the goals of this policy is really to rationalize our health care spending so that we're getting higher value, more efficient care, and we hope in the long run that that substantially brings down the trajectory of growth in national health spending, because [people will] be allocating their health care dollars more efficiently," said Katherine Baicker, a member of the Council of Economic Advisers, in a briefing on Monday.
                        Why is the cost of health care so high? Because you're paying too much for it, you idiot. What's wrong with you? I don't understand how this proposal will make people more conscientious about their health spending. Employers (especially small ones) are already faced with an array of too-expensive choices for too little coverage. How does increasing the basic cost of that help us be more frugal? It's just a bigger pain in the ass that will cost workers their plans.
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                        • #13
                          Re: Presidents Insurance Plan

                          Originally posted by Steeler
                          ... I don't understand how this proposal will make people more conscientious about their health spending....
                          I'm not sure how it affects it either - Either way you have to use your hard earned income to pay for it!! Whether that income is taxed or not shouldn't change your decision making process - either way there's incentive to shop around and get the best coverage per dollar. (Except that currently, that shopping is done by the company's HR department when they decide which health-insurance plan(s) the company will offer to its employees.)

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                          • #14
                            Re: Presidents Insurance Plan

                            Plan sounds good to me. I'm self-employed and currently don't have health insurance. I just can't afford it. I make too much money for free healthcare too, so this sounds good to me. I believe the theory is a good one, that creating a limit for the tax deductions should drive up competition between the companies. This may be what we needed. It may not. I'm just glad something is being done. This is also good for the small business owner who can't afford to help provide health care for his employees.
                            "Common sense is not so common." -Voltaire

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                            • #15
                              Re: Presidents Insurance Plan

                              Unless I'm really misunderstanding this....won't it become incredibly difficult for someone with health problems who is currently under an group plan provided by their employer?
                              Either they get a tax hike, or they go uninsured because they can't get individual coverage.

                              Am I missing something? How is this supposed to help?

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