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Bondelli: Kerry's health care plan shows compassion
by Kevin Bondelli
Most 18 to 24-year-old voters have yet to personally deal with the consequences of a flawed health care system and the difficulty of obtaining affordable coverage for their families. However, the next president will make decisions that will have a dramatic effect on our ability to affordably stay healthy.
President George W. Bush believes that health care is best left to the consumer and markets, a plan called "consumer-directed health care." Bush supports medical savings accounts (MSAs) to solve America's health care problem. MSA accounts would be tax-free up to $2000 a year, with the employee contributing $900 and the employer contributing $1100. Each year, if the money is not used, it rolls over to the next year. The account also allows for withdrawals for non-medical reasons, though they would be subject to taxation.
The plan sounds pretty good at first, but it has flaws. Employers are able to pay in installments, which means that if an employee requires medical attention early on in the policy, he will be required to cover the remainder of the employer's portion of the account. The employee would also have to pay the $2000 deductible immediately. The plan is good for those who are able to stay healthy, but is much more costly for those who need care. Therefore, Bush's plan only appeals to the healthiest Americans who are the least in need of health care.
MSAs also have the negative externality of dramatically increasing the premiums for those who remain in traditional health care systems, those who happen to be most in need. While Republicans argue that a market health system will drive costs down because people will be able to shop for the best deals, it is not a plan that will help most Americans.
John Kerry's plan starts with an issue that is often ignored--the lack of an administrative technological revolution in health care. Approximately 25 percent of the annual cost of health care in America is spent on non-medical administrative costs, such as paperwork. That number can be cut in half with greater implementation of technology in the health care system. Kerry will offer a "technology bonus" to health care providers that upgrade their administrative procedures, which will drive down costs.
This will do more than lower costs - it will also save lives. Many Americans are hurt or killed every year from incorrect prescriptions cause by paperwork mistakes. Technology would allow more accurate communication between patients, doctors, hospitals, pharmacists, and insurers.
Health care premiums are high because insurance companies spend large amounts of money on catastrophic claims, those over $50,000. Kerry proposes that the federal government reimburse health care companies 75 percent of their catastrophic claims costs on the condition that the insurance companies pass the savings on to the consumers.
Kerry's plan will also enable more small businesses to offer health insurance to their employees at lower costs. Small businesses will be able to receive up to 50 percent of their coverage in refundable tax credits, a huge benefit considering health care costs have increased 15 to 25 percent for small businesses this year alone.
The cost of prescription drugs will also decrease under the Kerry plan. The federal government would use its unrivaled purchasing power to obtain wholesale prescription drugs, passing on the savings to the consumers.
All of this may not seem important now, but as the years go by we will all be seriously affected by whatever health care policy is implemented by the next president. As our parents get older and the cost of their health care increases, we may be the ones responsible for supporting them.
All Americans deserve the right to life and health, regardless of income or class. A Darwinian health care system of survival of the wealthiest is antithetical to our responsibility to all Americans. The U.S. has given the Iraqi people universal health care - if we help those in countries plagued by disease, should we not show the same compassion for our own people? To me, there is nothing more patriotic than showing compassion for our fellow citizens, and giving them the greatest gifts possible: health and life.
Kevin Bondelli is a political science and history senior. Reach him at kevin.bondelli@asu.edu.
http://www.statepress.com/issues/2004/09/22/webextra/681162
by Kevin Bondelli
Most 18 to 24-year-old voters have yet to personally deal with the consequences of a flawed health care system and the difficulty of obtaining affordable coverage for their families. However, the next president will make decisions that will have a dramatic effect on our ability to affordably stay healthy.
President George W. Bush believes that health care is best left to the consumer and markets, a plan called "consumer-directed health care." Bush supports medical savings accounts (MSAs) to solve America's health care problem. MSA accounts would be tax-free up to $2000 a year, with the employee contributing $900 and the employer contributing $1100. Each year, if the money is not used, it rolls over to the next year. The account also allows for withdrawals for non-medical reasons, though they would be subject to taxation.
The plan sounds pretty good at first, but it has flaws. Employers are able to pay in installments, which means that if an employee requires medical attention early on in the policy, he will be required to cover the remainder of the employer's portion of the account. The employee would also have to pay the $2000 deductible immediately. The plan is good for those who are able to stay healthy, but is much more costly for those who need care. Therefore, Bush's plan only appeals to the healthiest Americans who are the least in need of health care.
MSAs also have the negative externality of dramatically increasing the premiums for those who remain in traditional health care systems, those who happen to be most in need. While Republicans argue that a market health system will drive costs down because people will be able to shop for the best deals, it is not a plan that will help most Americans.
John Kerry's plan starts with an issue that is often ignored--the lack of an administrative technological revolution in health care. Approximately 25 percent of the annual cost of health care in America is spent on non-medical administrative costs, such as paperwork. That number can be cut in half with greater implementation of technology in the health care system. Kerry will offer a "technology bonus" to health care providers that upgrade their administrative procedures, which will drive down costs.
This will do more than lower costs - it will also save lives. Many Americans are hurt or killed every year from incorrect prescriptions cause by paperwork mistakes. Technology would allow more accurate communication between patients, doctors, hospitals, pharmacists, and insurers.
Health care premiums are high because insurance companies spend large amounts of money on catastrophic claims, those over $50,000. Kerry proposes that the federal government reimburse health care companies 75 percent of their catastrophic claims costs on the condition that the insurance companies pass the savings on to the consumers.
Kerry's plan will also enable more small businesses to offer health insurance to their employees at lower costs. Small businesses will be able to receive up to 50 percent of their coverage in refundable tax credits, a huge benefit considering health care costs have increased 15 to 25 percent for small businesses this year alone.
The cost of prescription drugs will also decrease under the Kerry plan. The federal government would use its unrivaled purchasing power to obtain wholesale prescription drugs, passing on the savings to the consumers.
All of this may not seem important now, but as the years go by we will all be seriously affected by whatever health care policy is implemented by the next president. As our parents get older and the cost of their health care increases, we may be the ones responsible for supporting them.
All Americans deserve the right to life and health, regardless of income or class. A Darwinian health care system of survival of the wealthiest is antithetical to our responsibility to all Americans. The U.S. has given the Iraqi people universal health care - if we help those in countries plagued by disease, should we not show the same compassion for our own people? To me, there is nothing more patriotic than showing compassion for our fellow citizens, and giving them the greatest gifts possible: health and life.
Kevin Bondelli is a political science and history senior. Reach him at kevin.bondelli@asu.edu.
http://www.statepress.com/issues/2004/09/22/webextra/681162