Class Warfare Blog

June 23, 2017

Details of California’s New Single Payer Health Insurance Plan

Filed under: Economics,Politics — Steve Ruis @ 9:32 am
Tags: , ,

My original home state, California, is moving ahead with a plan to create a single-payer, state-run health insurance program for all Californians. If California pulls this off, with over a tenth of the entire population of the U.S.,  it will be a massive demonstration project to use as a model for the whole country. (If it does work, expect the Republicans to drop their line about the states being the laboratories of democracy.”)

The difficulty, so far, is to how pay for this service. According to the Los Angeles Times “How would California cover this $331-billion bill? For the most part, much the same way it covers healthcare spending right now. Roughly 70% of the state’s current spending is paid for through public programs, including Medicare and MediCal. This funding — totaling about $225 billion — would continue, as is required by law. It would simply flow through Healthy California rather than existing programs.
“The state would still need to raise about $106 billion a year to cover the cost of replacing private insurance. This could be done with two new taxes.
“First, California could impose a gross receipts tax of 2.3% on businesses, but with an exemption for the first $2 million of revenue. Through such an exemption, about 80% of all businesses in California — small firms — would pay nothing in gross receipts tax, and medium-sized businesses would pay an effective tax rate of less than 1%.
“Second, the state could institute a sales tax increase of 2.3%. The tax would not apply to housing, utilities, food purchased for the home or a range of services, and it could be offset for low-income families with a 2% income tax credit.

Something doesn’t add up here, but I do not have all of the details. What doesn’t add up for me is the money currently being paid for health care as a “fringe benefit” to workers. In my last job, my health insurance benefit constituted about 7% of my wages. Since employee costs for my company constituted 80% of the total cost of doing business, this means that those benefits cost about 5.5% of the entire enterprise’s budget. If the state supplies health care for a 2.3% tax, businesses are getting a windfall of about 3% of their total expenditures. What happens to that money? Does it go to employees (it is their benefit) or does it revert to employers (as a windfall)?

I know this is a simplistic approach, but my thinking was that employed people were already paying from $6000 to $17,000 per year for their insurance (either as a benefit or out-of-pocket). Note these are rough estimates based upon individual and “family of four” values I have read. Those monies are currently being spent and if those insurance policies became moot and a cheaper state-sponsored policy (cheaper because overhead would be lower, a la Medicare), there would be no need for additional taxes, etc. for those folks, who are still the largest segment of the market. In other words, instead of paying for a business-based fringe benefit or a separate policy, those monies go to the employees and then are paid in taxes to provide the state-run health insurance. There would be no need of a sales tax per se.

Of course, it all depends on the numbers, but I think the drafters of these plans need to provide some information regarding the disposition of the amounts of money currently being paid by employers for health insurance benefits.

Addendum
According to Zane Benefits “In 2015, the average company-provided health insurance policy totaled $6,251 a year for single coverage. On average, employers paid 83 percent of the premium, or $5,179 a year. Employees paid the remaining 17 percent, or $1,071 a year.

“For family coverage, the average policy totaled $17,545 a year with employers contributing, on average, 72 percent or $12,591. Employees paid the remaining 28 percent or $4,955 a year.

Note that when they say “Employers paid,” this actually constitutes part of an employee’s compensation as agreed or negotiated into the employment contract. The question is: what happens to these negotiated sums when another entity takes over the health insurance function? Should the employers keep the money previously paid for private insurance and pay a tax or should the employees get that money and then pay a tax for the service.

Does this make a difference? Hell, yes. If we get the money and then pay the tax, then we can see how much of our tax money is actually going out in taxes. If the businesses pay it, it is hidden from us, plus the businesses have lobbyists who would be chiseling against that tax continuously.

June 22, 2017

Trumpcare Will Remove Drug Addiction Treatment Because …

According to Nicholas Kristof’s NY Times column today:

A Times investigation published this month estimated that more than 59,000 Americans died in 2016 of drug overdoses, in the largest annual jump in such deaths ever recorded in the U.S. One reason is the spread of fentanyl, a synthetic opioid that is cheap and potent, leading to overdoses.

About as many Americans are expected to die this year of drug overdoses as died in the Vietnam, Iraq and Afghanistan wars combined.”

Read that last sentence again and then line it up with the GOP plan to remove addiction treatment from insurance policy requirements.

Now you know where their hearts are: the GOP is only interested in tax cuts for the wealthy. The rest of us, very, very little.

Bad Polling Leads to …

Note I have been very busy lately, so haven’t been posting much. Should be back to normal soon. Steve

I am a regular reader of Religion Dispatches, which I recommend to you. In today’s article, “GOP ‘Stealthcare’ Bill Reveals Catholic Bishops’ Priorities,” the topic is, of course, the GOP healthcare bill. (I didn’t say “new” healthcare bill because there hasn’t been an “old” healthcare bill since Medicare.) Foregoing a discussion of the main topic as we still do not know what is in that bill, I was struck by this section:

“A new Washington Post/Kaiser Family Foundation poll shows just how successful the effort to forge the church’s opposition to reproductive and LGBT rights into a new political wedge issue to motivate right-leaning religious voters has been. According to the poll, which probed the political divide between urban and rural voters:

“Nearly 6 in 10 people in rural areas say Christian values are under attack, compared with just over half of suburbanites and fewer than half of urbanites. When personal politics is taken into account, the divide among rural residents is even larger: 78 percent of rural Republicans say Christian values are under attack, while 45 percent of rural Democrats do.

“This particular divide, and this widespread sense of Christian persecution, is relatively recent. As Julie Ingersoll noted here on RD, while evangelical leaders had tried to gin up a sense of Christian persecution going back to the mid-1990s, as late as 2005, “the argument that Christians were a minority in need of protection was not persuasive in the broader religious right.” But a “little over a decade later, conservative Christians across the country … now see themselves as targeted by powerful elites, one step away from imprisoning and executing people for their faith.”

I find such polling to be destructive as it asks people questions like “Do you feel Christian values are under attack?” without defining what Christian values are. According to Wikipedia, “The term Christian values historically refers to the values derived from the teachings of Jesus and taught by Christians throughout the history of the religion.” What comes to my mind are: give away your possessions and follow Jesus (Renunciation of Worldly Goods), the poor will always be among us, so the need our help, turn the other cheek (Renunciation of Violence), love your enemies (Unconditional Love), along with a few other things.

If you were to ask U.S. citizens if they should give away their wealth and sell their worldly goods, what do you think their answer would be? And couldn’t taxing the rich be seen as a way to help the rich get into Heaven? Didn’t Jesus say a rich man had about as much chance of getting into Heaven as … well, you know?

And, if the poll takers were thinking about one thing as being paramount: belief in a Protestant Christian god (not the Jewish one, not the Muslim one, not the Indian or Asian ones), I can see how they might think that their religion is “under attack.” Atheists are bold nowadays, are we not?

But I recall that in the 1960’s, my high school and college years, some wags did a poll in an interesting way. They tried to get people to sign a petition. The petition, word for word, was the Bill of Rights, Amendments 1-10 of the Constitution. But the typeface was one clearly made by a computer, using no “old timey” script as a give away. They struggled to find anyone willing to sign their petition! Hey, details matter in polls.

More recently, polls have shown that approval rates for Obamacare were much lower than approval rates of the main features of Obamacare, that is if asked “Should pre-existing medical conditions allow insurance companies to raise the price of your insurance or to refuse to insure you?” The answer was a resounding “no.” Obamacare? Boo, hiss!

The religion issue of Christians feeling persecuted is relatively recent as was pointed out in the article and mainly made up out of whole cloth by conservative radio talk show hosts and the like of Fox (sic) News. Since people in rural areas get larger doses of this propaganda, it likely has a greater effect.

If the poll questions were to ask things like “Should we collectively do more for the poor and less unfortunate?” the answer would likely be a high percent yeses. If it were phrased as “Should the government do more for the poor and less unfortunate?” I suspect the answer would be more to the “no” end of the spectrum. This is because our “governments” have been characterized as something other than “we collectively” by conservative propaganda (something evil, bwa ha ha).

How you phrase these questions determines to a large extent how people answer them.

May 5, 2017

Egad, Economic Uncertainty is Real!

During the recent Democratic administration, Republicans often ranted about “uncertainty” with regard to investment. You see, the economy tanked in 2008 and the recovery was feeble (still is). Banks were given huge amounts of money at zero interest with the hope they would loan that money, cheaply but profitably, to businesses looking to expand. The key word was “hope” in that the government attached no strings to those zero interest loans. Consequently the banks bought securities with the money, causing the stock market to “recover” rapidly but no one else. When upbraided about this anti-social behavior, the Republicans countered with there was “too much uncertainty” in the market for business to expand. They rather should have stated there is too much bullshit in politics; that would have been closer to the truth.

The real reason businesses did not expand with all that cheap money around, is that they possessed even cheaper money (U.S. businesses had $2+ trillion dollars in cash reserves at one point.) and they weren’t spending that either. The reason? Simple: no demand. This is shockingly self-evident for people who know nothing about economics other than “supply and demand.” If there is no demand, supply is irrelevant (even though some economists tried to claim the opposite—see Say’s law). There was no demand because those business’s customers were broke, still are.

So, when Mr. Trump was elected and the GOP captured both houses of Congress, well … “Happy days are here again, the skies …” uh, no? No. Even though gasoline is quite cheap now, no one is buying much. Retail business are offering lower and lower pricing and still no surge in buying.

People are sitting on the sidelines economically because, well, they are uncertain about the future. When a person’s future is potentially very bad, they hunker down, save their money, and prepare for the worst the best they can.

Mr. Trump’s policies have never been particularly coherent, which was by design. When Mr. Trump claimed he was going to deport 11 million “illegals” from the country, many people translated that into “I will have more job opportunities.” (Right, by picking crops and doing day labor out of the local Wal-Mart?) When Mr. Trump claimed that he was going to transform Obamacare into something better, people applied their own definitions of what “better” meant. But healthcare is a complicated subject (“Who knew?”) and Mr. Trump’s party’s first effort at it was horrifically negative. (Hunker, hunker, hunker,…) Then there was the “tax reform” promised. People thought “my taxes will go down” and “I could use the money.” What they didn’t think of was that rich people’s taxes would go down much more, thus reducing government tax receipts, causing many government programs to be terminated, government programs that ordinary citizens are dependent upon, of course, not the rich. (Hunker, hunker, hunker,…) Then the current administration launches missiles in Syria and threatens nuclear war in North Korea. (Hunker, hunker, hunker,…) and….

The economic uncertainty of businesses as a reason for why they weren’t investing in their own businesses was pure political spin. They were anything but uncertain, in fact they were absolutely sure there was no demand, so no expansions. But the economic uncertainty of individual citizens is palpably real. We are not spending much money right now because we don’t know whether we will have affordable healthcare available, whether Social Security will still exist, or Medicare … all of these have been threatened by the GOP.

All of these threats are coming home to roost. We are in line for another recession, possibly as early as this summer. The ordinary tools used to combat recessions are not available (cut interest rates … why? … how?) and the GOP is dead set against deficit spending (the tool that really works) unless it enriches the rich or the military industrial complex.

Buckle your seat belts, folks. If you think things are uncertain right now, well, winter is coming.

May 2, 2017

Please Stop with the “Trump This …” and the Trump That …”

Recent articles have crowed about the GOP cave-in on the budget by talking down Mr. Trump’s vaunted “negotiation skills,” as if the President actually negotiated budget agreements (none do). These headlines are part of a long series of headlines claiming the source of this or that activity by “Trump …” when clearly they are not Mr. Trump’s ideas or initiatives.

To wit: can you name one idea that is Mr. Trump’s and Mr. Trump’s alone? The Wall? Remember John McCain’s campaign stop in Arizona at “the Wall?” Heck, it was being built before Mr. Trump even mentioned it. How about tax reform? (Please, this is as common as there are people with tax axes to grind.) Money for the military? Get tough on NATO … the Chinese (currency manipulators?) … the Russians? All pre-existing ideas.

Can you name one initiative of the GOP that Mr. Trump has tried to husband through? (Hint: There is only one.) The GOP health care initiative? (Got it in one! Good job!). Mr. Trump actually picked up the phone and called some fence-sitting legislators about this one, but clearly this was not Mr. Trump’s plan, it was a mishmash of whatever the GOP thought it could get away with and call it “health insurance reform” or rather “The Repeal of Obamacare!” Mr. Trump did blurt out that he was releasing a tax reform plan within a week, which resulted in that bizarre one page memo that was anything but. Where is the vaunted organizational skills of the GOP on display. Can’t they enroll their usual allies in the Think Tank World to crank out some of these plans, on topics they know they want to address? How could they not come up with a decent tax reform plan? (I can understand the health care miasma (It’s complicated; who knew?), but tax reform is low hanging political fruit.)

I know it is traditional to put the president’s name on all initiatives of his administration, but this is giving our president too much of what he clearly craves: attention. If he deserves it, fire away. Otherwise direct your comments where they belong, at the people leading the charge.

I can’t wait for some foreign leader, when asked to respond to one of Mr. Trump’s tweets or one page memos, to say: “Mr. Trump says many things. We will wait until he actually does something to comment.”

What he has done so far can be described as “a number of things done in the last administration have been undone.”

April 6, 2017

I Don’t Get It

The definition of “it” in the title is probably very, very long (very!). In this case it is our current debate about healthcare.

There is continuing support for certain functions of government to be paid by the government. Unlike knuckle-dragging conservatives, I do not see “government” as being some outside agency closely representing a skin cancer (something you want shrunk and or carved out), but as a representative of “us.” We are completely fine with “single payer” K-12 education. Citizens and non-citizens alike can register their children to attend a neighboring school and there the children receive an education with no further costs. (Yes, I do know there are myriad costs associated with a child in school, but those are not directly related to the education they receive.) This is, accurately, not a “single payer” system as multiple government agencies are involved, so maybe a better description is “government paid” for this schooling. We also have many other services that are “government paid.” For one, the military. For another, our government offices. When you go to your local councilman or alderman’s office for information or a complaint, there are no fees associated with those services. In all of those cases, the “government”—remember that means “us”—picks up the full tab.

The argument goes that those services are “essential,” that is we all need them and money should be a barrier to whether or not you receive those services.

Oh, there are also the police, fire services, the courts, etc. There are many things that fall into this category of “things we all pay so everyone can partake equally.” In some cases, this is the “many” protecting itself from the “few.” Many vaccinations are low cost, even free, to avoid the spread of diseases.

I don’t get why health care is not one of those things.

I understand that people, especially politically conservative people, have bought into a capitalistic “pay as you go” culture, uh, well, kinda sorta. The biggest proponents of “individual liberty/individual responsibility” are not all self-made people, many inherited money. If Donald Trump had invested all of the money he inherited in stock market index funds, he would have four times as much money now as he claims to have, according to some accounts. (So much for him being a good businessman, he has managed to lose only three quarters of his potential net worth. He is, at best, a mediocre businessman.) The Koch brothers inherited millions (and built upon those, yes). Mitt Romney, who claims that nobody helped him, was given two million dollars of “seed money” to help him get started as well as being given access to his really well-connected father’s associates. The Walton clan … well, daddy made the big pot for them.

For those without great wealth in this group are people who received help along the way from government (aka “us”) agencies. Help with their educations, help with business loans, help from other government agencies, etc.

But them poor people, they lack drive and ambition. They should go out and start a business. Really, you mean those business startups that have a 90% failure rate after three years? Where would they get the money to take that very risky venture? The banks? Wall Street? Venture Capitalists? (Sorry, laughing so hard my sides are aching.) If you haven’t noticed, over the last 30-40 years, businesses have stopped investing in their own business. They have accumulated trillions of dollars of cash reserves that are just sitting there. So, these are the people poor people are to emulate? (Step 1 Pile up a mountain of money. Step 2 Sit on it. Neoliberal Business Practices 101)

Poor people need to go out an get a job, then? Oh, do they mean the jobs conservatives have suppressed wages on for decades so they do not pay enough to meet a person’s expenses? Those jobs? All of the anti-union, anti-minimum wage rhetoric is not coming from poor people, it is coming from the same conservative ass holes who are insisting that everyone should “pay as you go.”

I do not want single-payer healthcare. (Currently I have Medicare and a Medicare supplement policy, and I pick up the slack those two do not cover, so there are at least three payers there, certainly at least two.) I want government paid health care. It is at least as important as an education for our kids, if not more so.

There’s more but my spleen just gave out.

* * *

Poverty is not due to a lack of character, it is due to a lack of cash. (I don’t know who said this first.)

May 12, 2016

American Exceptionalism Triumphs

In the most recent New York Times Magazine there is an article with the intriguing title “When Do You Give Up On Treating A Child With Cancer?” I am sure that title was carefully crafted by some editor to evoke a significant emotional response. Unbeknownst to him/her, the American Healthcare System, the Best System in the World (according to Donald Trump and most conservative drudges) has made this question moot.

Parent’s need not struggle with heart rending existential problems any more, at least not in the medical arena. The answer to the question “When do you give up on treating a child with cancer?” is answered by the system itself. The answer is …

… when you run out of money.

May 4, 2016

Because the GOP Said So!

Remember back in the Obamacare debate? How the Republicans kept claiming we have the best health care system in the world, so why would we want to undermine it? It is clear we have the most expensive health care system in the world, that is indeed true, but best? Today a report is out finding that the third leading cause of death of people in the U.S. is … wait for it … medical error.

That’s right, boys and girls, our medical system makes mistakes, but don’t pay any attention to them, they are not important. The fact that a few people die here and there is a small price to pay for our freedoms and American Exceptionalism!

What kind of freaking world would the GOP actually fit in? Sheesh!

 

March 15, 2014

Why Is It the Koch Brothers Can’t Find a Real Obamacare Victim?

Every time the Koch brothers, through one of their many false front organizations, create another “Victim of Obamacare” political ad, it usually takes less than a day to find out the victim was just a D.C. actress who was not a real Obamacare Victim, just playing one on TV, or a numb nuts who couldn’t figure out that he or she was getting better insurance for less money.

I thought all of these plutocrats were filthy rich because they were smarter than us, because they worked harder than us, because they had more grit and gumption than us.

If Obamacare was such a disaster you should be able to find a real victim by swinging a cat in a not very crowed room with your eyes closed. (No animals were hurt in the writing of this blog!)

It isn’t bad enough that the plutocrats are driving our democracy into a ditch of their digging, but it is the stupid and lazy plutocrats doing it.

We should be ashamed of ourselves for letting them fool us for even one minute; the damned plutocrats will never feel any shame at all.

March 12, 2014

My Religious Freedom vs. Your Religious Freedom

There is a lot going on under the label of “religious freedom” currently, including what could be some landmark Supreme Court cases. But it seems to me that a great many people are trying to drag all kinds of things not really aspects of religious freedom under its banner so as to strengthen their cases. This is wrong and I hope it gets squelched.

The idea of religious freedom in this country is the ability to practice your religion without the interference of the government or, really, other religions. This is extended to include practicing no religion at all. When this country was founded, you will note that religious freedom was not in the Constitution. In fact, religion wasn’t really mentioned. It took an amendment to the Constitution to forbid the federal government from endorsing any religion by giving it special favors, etc. Also forbidden was inhibition of any religion. Originally this meant only the federal government and quite a few states had their own sponsored denominations. Over time the wisdom of this was challenged and people finally came to the point that any state-sponsorship of religion was a bad idea and all of the states complied with this idea of government non-interference and non-support. (The argument the religious bought was “sure it would be nice to have the state collect a tithe for you, but what happens if another religion becomes dominant and takes over that state sponsorship? You are then out in the cold.” Today consider about what would happen if a very small state were to have a large influx of Muslims. Would people be happy having a Muslim state? Would that mean Sharia law could be imposed? Sorry, just trolling for Fox (sic) News viewers.)

Here’s the deal. If the government(s) have a law that effects religions, they must exercise it without prejudice. So, it is entirely appropriate for the federal government to impose a tax upon religious groups. There is no basis for not taxing them that makes any sense. But they cannot tax any such religious group any differently that the others. This is what religious freedom means under the law.

Note that Utah was told it’s petition for statehood would not be accepted by the Congress unless they outlawed polygamy, something promoted by the dominant religion of the state. This was acceptable in that Utah was not yet a state in the “United States” and did not receive full consideration or application of all of the federal laws.

Clergy who commit crimes are not immune to prosecution under the banner of “religious freedom.” They do not have the equivalent of diplomatic immunity to local prosecutions.

But, because there is a culture of “hands off” with regard to religions, various people interpret that in various ways.

A current case before the Supreme Court involves whether or not an employer can be required to provide health insurance that includes contraceptive coverage if that conflicts with the religious convictions of the owners. Churches, per se, are exempted from the requirements of this law, for no good reason other than political expediency, but to exempt everyone who has a “religious conviction” will open up a legal can of worms, a very large can of worms. There is no protection for these people under current “religious freedom” legal doctrine. We’ll have to wait to see if the Supreme Court decides to invent something whacko like its “corporations are people” doctrine.

For those of you who disagree with that last statement, consider this: employers provide their employees with a voucher that enables them to purchase contraceptives, pay for abortions, solicit prostitutes, buy illegal drugs, or drink one’s self into oblivion or with any other manner of vice the employees wish. It is called a paycheck. Once the employer transfers that voucher to the employee, they lose control over what the employee does with the funds it is worth. So, a business that employs even only good Catholics can be required to provide insurance that includes hospitalization, out-patient care, and contraceptive services and not have to worry because no good Catholic would avail themselves of the contraceptive services. Because no person can impose their religious beliefs upon another and neither can the government. That’s the law.

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