Sunday, July 17, 2011

Why would McCain promote a new tax on employer provided health insurance benefits?

I know he says he will give you a deduction or credit or whatever but isn't that just the Govt taking taxes out of your paycheck and giving it back to you a year or so later? Why do they want us to finance their overspending and craziness?
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The idea is to promote individual health insurance plans, and to discourage group plans. The thinking is that when the consumer is paying the insurance premiums, (s)he will gravitate towards lower cost policies. Consumer Driven Health Plans (CDHP's) specifically. Having a CDHP allows you to open up a Health Savings Account (HSA) where you, and your employer, can contribute non taxable money for future medical expenses. With these plans everything is subject to the deductible, except your annual wellness benefit, which used to be called your annual physical. You are expected to pay for all of your medical services out of your own pocket (your HSA) until you reach your deductible.This will demand a more conscientious consumer, bringing market forces to bear. It might also bring some transparency to health care costs, lowering the costs for everyone. Another factor is that with an individual policy, you own the policy, not your employer. Cobra, and it's limitations, goes away with individual policies. I think (don't hold me to this) another part of the plan is to open up the individual market across state lines allowing for more competition and consumer choice. The argument against CDHP's that people won't save for future expenses, and will also simply forgo minor or maintenance types of care which may require more expensive treatment down the road. I think both sides are right, and everyone agrees something has to change because what we have now isn't working. Don http://mtnhealthinsurance.com
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