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.