Thursday, May 28, 2009

My bright idea -fixing the health care crisis

This will be an unusually brief post for me, but I am also asking your opinion on this. I sometimes find that is the worst way to get comments, but I'm asking anyway. This is an idea for reformulating our health care system which I hope would help people with their taxes at the same time.

As we know, there is a great debate going on in congress about our system of health care and insurance system ranging from leaving it as it is to a single payor or European style system. I have come up with my own idea to remedy this situation.

Here are the factors I believe to be true and consider:

1) The health care in this country is good, in some areas excellent or the best.

2) If you just said to yourself, no it's not, you may be thinking of my second factor, the fact that so many millions of Americans cannot afford health care or insurance. This is a huge problem and one most people want to fix.

3) One way we have to take care of people is by giving to charity; for many people.  

4) People like to give to charity for a number of beneficent reasons, but getting a tax deduction is certainly a reason for many people.

5) The value of your tax deduction for charitable gifts increases as your tax rate increases. Those who pay a higher tax rate conversely get a better deduction when they give to charity (this is just a mathematical result of a progressive tax rate). But, you get nowhere near dollar for dollar back on a charitable gift.

6) Some people want to raise our federal taxes in order to pay for government run health care. Government run solutions are very often disasters. Look at the state of medicare, veteran benefits, social security, etc., and you should have trouble disagreeing with this.

Here's my solution. Get people who have excess money, i.e., more money than they know what to do with, to charitably solve the health care problem because they will financially benefit from dealing with a system that encourages them to help people who have less - you can call it charitable or tax planning, but the idea is the same - help everyone play for the same team.

To achieve this goal, is to give everyone, regardless of their tax rate, a tax credit (you can write it off against what you owe in taxes) rather than a deduction (write the expense off against the income - not as good) for donations to private enterprises which pay insurance premiums, or, possibly, direct patient contributions. I prefer doing this through charitable organizations, which will have to take very reasonable administrative costs (still better than having a bloated government department) than individually, because it will cut down on fraud. But, if someone wants to pay for someone's non-elective surgery, as an example, they should be able to do so and get the credit.

I've tried this out on a few people to see what there objections are. Everyone says it can't work. But, there have been three basic arguments and I don't think they are valid.

 The first is fraud. My argument there is - when you can tell me that there is no fraud going on in the tax system or health care system no matter what we do, and then I'll agree we should not try this idea. Fraud exists everywhere and you have to try and minimize it. We don't not give to charity because of fraud and no reason we can't do this and have the usual anti-fraud devices - criminal and civil penalties, etc., for whatever they are worth.  You will never stop all fraud, but it would seem to me that it would be far less prevalent than it would be in the medicare system.

Additionally, opportunities for fraud will be limited because of the five thousand dollar limits and also because direct contributions (say for someone's MRI or surgery) are limited in scope. You can't get a credit for paying for your someone's elective nose job, chest enhancement, etc. I'm not sure how "mental health" will figure in to this, but like to hear what you have to say about that too.

Another argument I've heard is that it would be taking to much money away from the government in tax revenues. That's true if you believe it is the government's money and you are just being allowed to keep some (every conservative reading this just passed out, but I think liberals and conservatives  as individuals agree that they want to keep every tax dollar they can). Besides, it's a false argument. Yes, the government would be faced with millions of people getting five thousand dollar credits and that will reduce revenue, but, they would not be paying the tremendous costs of a single payor health care system or government subsidized system. Overall, I think it would be a plus for revenue. This might even be a way to get rid of or minimize Medicaid too, which is also a huge government expenditure. Besides, healthier people can work harder, go to school, etc. I believe it will eventually increase tax revenues the way the G.I. Bill did, even though that was a government expense at first.

A last argument is that people will stop giving to charity because the tax credit they get for this is so much better than the tax deduction they get for other charitable giving. That's why this has to be limited to, say, $5000 or something in that range.  That number can be adjusted every year to fine tune it. Anything over that amount gets the regular deduction.

I think people would love this. Let's say you are a millionaire and you like to give to charity and like the tax break. Here, you lose nothing, as opposed to a deduction where you lose something. 

Both liberals and conservatives should like this.  Conservatives will like this because it is lowering taxes and it is privately and voluntarily done. Liberals should have no objection to that and also like that it is solving a major liberal objective - universal health care. Further, the government will have a hand in some small regulation (fraud avoidance and setting the limits). 

What person would mind giving to charity if it means they get it back dollar for dollar? Don't worry about it wiping out other charities because it is limited. Besides, I have trouble thinking of any better charitable purpose other than health care. Even middle class people who have sufficient funds can participate in this and get back every dollar.

Politics, of course, can make even the best idea a mess. Should abortion be included? The two sides will differ and hold the rest hostage to it? How much government regulation? Again, they can fight over that. But, I really believe this is a logical solution to a really tough problem.

Tell me your thoughts about this.  There may be flaws I'm not seeing.  


  1. Oh yes, charitable organizations, probably the only istitutions run less efficiently than governments are just a GREAT choice to run health care. Not to mention the opportunity for scams presented by wealthy and "poor" people working together to screw the system. I still don't see what is so wrong with the national health care systems in Canada and France unless you think they are so much smarter than us we could never duplicate them. Or, the AMA is so corrupt and so powerful it will never let us duplicate them.. Hmmm...

  2. I gave my reasons that I don't think fraud is an issue in my post, so I'll leave it at that.

    As to the Canadian system, one day I was listening on the radio to a "health care broker" from Canada. His entire business is getting Canadians health care in the United States because they can't get it in Canada. He was talking about little things like liver transplants. Besides, we all know that the Canadian and European health care system means much higher taxes and I'm not sure the majority in America is signing onto that. I realize that there is a proportion of the citizenship that is fine with much higher taxes in the abstract, but I'm not sure they realize how high taxes in France, for example, are. Here, in the U.S., the highest individual rates, are between 35%add 45%, roughly, depending on what state you are in. In France, it can go up over 70%. That's my short answer. I've heard horrible things about the Canadian system and also really good things (but no one should listen to Michael Moore - he is very unreliable in his movies). Wikipedia actual has an excellent comparison article between the U.S. and Canada, but much of it explains how difficult it is to compare care between two countries. I don't know enough about the AMA to comment on their corrupt or non-corrupt nature, but I do know doctors hate our insurance system and want to see it changed. Like most organizations, I'm sure there is self-interest involved, but I would hope some doctors care about it being affordable. The World Health Org. did a study in 2000 which rated Canada's health care system slightly higher than ours (again, very hard to compare) but also had the U.S. first in the quality of health care. That's something we don't definitely don't want to give up. Higher taxes will kill us right now too, which is why the Eisenberg Plan for Curing the Health Care Insurance Problem in the United States ("EPCHCIPUS" which is pronounced exactly like it like what you get when you mate an etch-a-sketch and an octopus) concentrates on the real problem - insurance rates and universal coverage.

    Also, I'm sure charities have problems, but I would not compare them to the problems the government has figuring out what it has done with billions of dollars on a regular basis.

    Thanks for your opinion. I was beginning to think I wrote my request for opinions in Mandarin. One against me. Anyone else?


Your comments are welcome.

About Me

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I started this blog in September, 2006. Mostly, it is where I can talk about things that interest me, which I otherwise don't get to do all that much, about some remarkable people who should not be forgotten, philosophy and theories (like Don Foster's on who wrote A Visit From St. Nicholas and my own on whether Santa is mostly derived from a Norse god) and analysis of issues that concern me. Often it is about books. I try to quote accurately and to say when I am paraphrasing (more and more). Sometimes I blow the first name of even very famous people, often entertainers. I'm much better at history, but once in a while I see I have written something I later learned was not true. Sometimes I fix them, sometimes not. My worst mistake was writing that Beethoven went blind, when he actually went deaf. Feel free to point out an error. I either leave in the mistake, or, if I clean it up, the comment pointing it out. From time to time I do clean up grammar in old posts as, over time I have become more conventional in my grammar, and I very often write these when I am falling asleep and just make dumb mistakes. It be nice to have an editor, but . . . .