Health insurance for a bad economy
Tough times justify national health care plan
By Phil Kadner
Southtown Star
Oct. 16, 2008
I suggested to someone the other day that now would be a good time for the government to launch a national health insurance program.
“That would be socialism!” the person exclaimed.
Our government plans to spend hundreds of billions bailing out Wall Street, including $250 billion for ownership in private banking institutions.
But the woman I was talking to was worried that capitalism would be destroyed if every Joe Six-pack in America knew that he and his children were covered by health insurance.
I don’t get it.
Listen, as this economy continues to tank, people are going to lose their jobs. Many of those folks are going to end up working for a lot less money for businesses that don’t offer health insurance.
About 40 million Americans are already in that predicament.
But I can tell you three men who are not worried about that situation. George W. Bush, Barack Obama and John McCain have wonderful insurance plans. There’s no better plan in America than that offered by the federal government.
And if Bush, McCain and Obama really believe that insurance is not important or that they can find a better plan for themselves on the open market, they should set an example for the rest of us and drop out of the federal plan.
McCain is proposing a $5,000 refundable tax credit so American families can go out and buy their own plans. Try finding a really good plan, like the one McCain has, for $5,000.
Better yet, ask a friend or neighbor who has tried to buy a plan on the free market what it really costs.
Most of the plans available for $5,000 have huge deductibles. Many don’t accept people with pre-existing conditions.
You can find out that sort of information easily enough if you’re interested. What’s harder to find out is what the insurance would really pay for in the event you were sick.
Would it pay for a long hospital stay? If you’re having a baby? What about physical and occupational therapy in the event of an accident? Would your prescriptions be paid for if you needed insulin or chemotherapy?
After mishandling my 401(k) retirement fund, I’m not going to give anyone advice on how to pick a health insurance plan out of the thousands of options available.
If you already have a health insurance plan through an employer, McCain would make that benefit taxable for the first time in American history.
The $5,000 tax credit, which would be paid to the health insurance company, would make up for that, but this would be a new tax, and you should be aware of that.
As for Obama, his plan would basically channel billions of dollars in federal money to private insurance firms to pay for insurance benefits for children and others who don’t have such benefits today.
Those health insurance companies, which have opposed national health insurance, would make bigger profits than ever before. No wonder they opposed national health care.
What people seem to forget is that health insurance companies are in the business to make a profit.
That’s why many of them deny claims instead of paying in a timely manner. The longer they delay, the more money they make.
If they deny claims repeatedly, a percentage of clients will just give up and try to pay the claims out of their own pockets.
And how many Americans can afford to sue an insurance company that refuses to pay for their cancer treatment? How many families, facing an emotional crisis, have the will to go through something like that?
The insurance companies know the answers.
Their CEOs make money. Their lawyers make money. Their investors make money. All of that money, billions of dollars, could be going to pay for health care. Instead, it’s their profit margin.
Here’s another reason to launch national health care during an economic crisis: Health care costs are one of the largest expenses faced by businesses in America today.
Studies show that the cost of health insurance is typically from 12 percent to 15 percent of the cost of payroll. From 2001 to 2007, while wages were going up 19 percent, businesses saw the cost of health insurance increase 78 percent, according to the Kaiser Family Foundation.
So by taking even a portion of that burden off the backs of business, the government may be saving thousands of jobs during economic hard times.
Every industrialized nation in the world has national health care except the United States.
The cost of health care in the U.S. is higher than anywhere else in the world. Why? Well, the insurance companies here have to make a profit.
But I can understand if you consider that socialism.
Better to give hundreds of billions to the Wall Street firms and banks. They need the help.
That’s why, even in a bad economy, health insurance stocks remain a good bet.
Phil Kadner can be reached at pkadner@southtownstar.com or (708) 633-6787.
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