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Thursday, October 28. 2010
Via Hot Air.
I think everybody knew that, but the Dems refused to admit it until now. I think Obamacare needs to be destroyed, and re-thought. Reforms are needed:
1. tort reform (half of what docs and hospitals do these days is to avoid lawsuits)
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I'd outlaw medical insurance entirely.
No doctor can stay in business charging more than people are willing to pay.
What that led to once, long ago, was variable pricing depending on the customer.
Insurance made everybody willing to pay any amount, and the rest is history.
If we had haircut insurance, nobody could afford a haircut either.
That doesn't work, RH.
A day in the hospital costs $1-2000. A simple hernia surgery costs $4-7000 with all of the ER and hospital charges.
An MRI costs $1-2000.
Lots of people cannot write a check for those things, and the costs are not flexible.
Everybody should own some Major Medical insurance so they do not end up in hock to a hospital when they break their leg.
Re: Reforms needed:
Junkie, I'm with you and I'd guess that between us we could come up with what "some sort" means, but some of us are not all as reasonable as we.
#6 is easy - move the tax deduction from businesses that provide insurance to the individual who would then buy it. Vwalla - portability!
"If we had haircut insurance, nobody could afford a haircut either."
Can you imagine the lawsuits over bad haircuts being filed by trial attorneys? It would be horrendous.
These suggestions seem reasonable and simple enough to implement. Should try those first and go from there. For all the thousands of pages of the health care plan, I don't think one of these essential elements were addressed.
The thing needs to be killed and start from scratch.
One item I'd add to that list is tax reform to eliminate health care tax advantage of companies vs. individuals. Individuals should be able to form purchasing pools or purchase individually as they see fit.
The "means testing" proposals infuriate me. I have been paying into SS for 55 years, at the maximum rate for all but one or two of the last 30 years. My wife and I have been frugal, no expensive foreign vacations, no giant house, no boats, big parties or expensive hobbies. I'll be 71 in a few weeks and I'm still working and still paying the maximum.
A neighbor down the street, on the other hand, took out two second mortgages and blew it all on the good life. Now they are underwater by several hundred thousand dollars, and the rumor is that they have stopped making the payments.
But we are the ones with "assets", so screw you on that promised SS, thank you very much. Over my dead body!
I think that reductions in payments are unavoidable, and I can live with that. But SS is in the terrible shape that it is because of generations of despicable and corrupt politicians. I don't see why our punishment for that should be greater than yours.
the way it could have been done --until Congress closed the option, back in 1983. I apologize for posting a Text Wall, but, really, the season of reform is hopefully upon us, and everyone with a tongue ought to have the word "Galveston" on the tip of it.
The Galveston Plan. In 1979, many county workers were concerned about the soundness of Social Security, as many people are today. We could either stay with it - and its inevitable tax increases and higher retirement ages - or find a better way. We sought an "alternative plan" that provided the same or better benefits, required no tax increases and was risk-free. Furthermore, we wanted the benefits to be like a savings account that could be passed on to family members upon death.
Our plan, put together by financial experts, was a "banking model" rather than an "investment model." To eliminate the risks of the up-and-down stock market, workers' contributions were put into conservative fixed-rate guaranteed annuities, rather than fluctuating stocks, bonds or mutual funds. Our results have been impressive: We've averaged an annual rate of return of about 6.5 percent over 24 years. And we've provided substantially better benefits in all three Social Security categories: retirement, survivorship and disability.
Galveston officials held meetings that included debates with Social Security officials and put it to a vote: Galveston County employees passed it by a 3-to-1 margin in 1981 - just in time.
The Galveston Plan was implemented just before the U.S. Congress passed a reform bill in 1983 that closed the door for local governments to opt out of Social Security.
To be sure, our plan wasn't perfect, and we have made some adjustments. For instance, a few of our retired county workers are critical of the plan today because they say they are making less money than they would have on Social Security. This is because our plan allowed workers to make "hardship" withdrawals from the retirement plan during their working years. Some workers withdrew funds for current financial problems and consequently robbed their own future benefits. We closed that option in January 2005.
Galveston vs. Social Security. Upon retirement after 30 years, and assuming a 5 percent rate of return - more conservative than Galveston workers have earned - all workers would do better for the same contribution as Social Security:
•Workers making $17,000 a year are expected to receive about 50 percent more per month on our alternative plan than on Social Security - $1,036 instead of $683. [See the Figure.]
•Workers making $26,000 a year will make almost double Social Security's return - $1,500 instead of $853.
•Workers making $51,000 a year will get $3,103 instead of $1,368.
•Workers making $75,000 or more will nearly triple Social Security - $4,540 instead of $1,645.
•Galveston County's survivorship benefits pay four times a worker's annual salary - a minimum of $75,000 to a maximum $215,000 - versus Social Security, which forces widows to wait until age 60 to qualify for benefits, or provides 75 percent of a worker's salary for school-age children.
In Galveston, if the worker dies before retirement, the survivors receive not only the full survivorship but get generous accidental death benefits, too. Galveston County's disability benefit also pays more: 60 percent of an individual's salary, better than Social Security's.
Two government studies of the Galveston Plan - by the Government Accountability Office and the Social Security Administration - claim that low-wage workers do better under Social Security. However, these studies assumed a low 4 percent return, which is the minimum rate of return on annuities guaranteed by the insurance companies. The actual returns have been substantially higher.
Guidance for Today's Reformers. Congress could consider making participation in any privatization plan voluntary at first. We made our plan voluntary in the beginning and 70 percent joined. It later became mandatory, and now there is full participation. Also, if some workers remain uncertain about investing a portion of their contributions, the plan could include a guarantee that low-income earners receive the same funds they would get with total participation in Social Security.
Our experience has shown that even though low-income workers would do better, a guarantee would ease their worries. Moderate- and higher-income workers would do much better, as ours do, because they have invested more in the plan and are not prejudicially punished or "topped out" on retirement benefits, as they are in Social Security.
In today's debate about whether to partially privatize Social Security, the Galveston County plan is sometimes demagogued. But our experience should be judged factually and fairly, not emotionally, politically or on the basis of hearsay. We sought a secure, risk-free alternative to the Social Security system, and it has worked very well for nearly a quarter-century. Our retirees have prospered, and our working people have had the security of generous disability and accidental death benefits.
Most important, we didn't force our children and grandchildren to be unduly taxed and burdened for our retirement while these fine young people are struggling to raise and provide for their own families.
What has been good for Galveston County may, indeed, be good for this country.
Judge Ray Holbrook was Galveston County judge from 1967 to 1995, and oversaw the creation and administration of the Galveston County alternative plan. Alcestis "Cooky" Oberg is on USA Today's board of contributors.
Back to: Brief Analyses | Social Security
People who are medically uninsurable don't need insurance. They need charity to help them pay their medical bills, just as people who didn't have fire insurance before the fire started need charity to repair their homes.
I would add that companies should no longer be able to provide medical insurance for their employees. This goes for private and public employees.
If people have to shop for insurance and can buy from any insurance company just like auto insurance, they will make sure the money is well spent.
I am also a big proponent of tax free health care savings accounts and catastrophic coverage. Perhaps employers could contribute to funding those accounts.