# How About This for an ACA Alternative **URL:** \ **Category:** Great Debates\ **Created:** [January 7, 2017, 2:54pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528 "2017-01-07T14:54:34Z")\ **Posts on this page:** 20\ **Page:** 2
**Author:** ![Gukumatz](https://avatars.discourse-cdn.com/v4/letter/g/74df32/32.png) [@Gukumatz](https://boards.straightdope.com/u/Gukumatz)\ **Post date:** [January 9, 2017, 7:04am UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/21 "2017-01-09T07:04:02Z")
> [@Pearl\_Clutching\_Provocateur](#): > > Are they treating brain tumors in the UK with aspirin? > > "With few resource constraints, healthcare systems like America’s and Germany’s tend to go with the most expensive treatment option possible. An American might find himself in an MRI machine for a headache that a British doctor would have treated with an aspirin and a smile. > > Similarly, “In Germany, it will always be an operation,” Göpffarth said. “Meanwhile, France and the U.K. tend to try drugs first and operations later.” > > [What American Healthcare Can Learn From Germany - The Atlantic](http://www.theatlantic.com/health/archive/2014/04/what-american-healthcare-can-learn-from-germany/360133/) What precisely are you trying to say here? ---
**Author:** ![up\_the\_junction](https://avatars.discourse-cdn.com/v4/letter/u/f1d935/32.png) [@up\_the\_junction](https://boards.straightdope.com/u/up_the_junction)\ **Post date:** [January 9, 2017, 8:45am UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/22 "2017-01-09T08:45:54Z")
That’s an utterly pathetic piece of writing; people get paid for that nonsense? ---
**Author:** ![puddleglum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/puddleglum/32/137_2.png) [@puddleglum](https://boards.straightdope.com/u/puddleglum)\ **Post date:** [January 9, 2017, 3:47pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/23 "2017-01-09T15:47:02Z")
> [@OldOlds](#): > > Those are all fine questions. > > 1. I suppose it would make sense that this could take the place of Medicare. To be honest, I hadn’t thought about it. It makes sense to have one system, but I mentioned that I did not see the base plan as a “cadillac.” As seniors tend to have more medical needs, I wouldn’t want to see them screwed… Maybe there’s a 65+ extra benefit? Need to think about that one. > > 2. Perhaps I misused a term. I was under the impression that a payroll tax just meant one that is taken from the pay packet, and can be paid either by the employee (ie, income tax) or by the employer (ie, unemployment or the employers half of SS). I think what I meant was clear > > 3. I didn’t say it would necessarily save money. If we add to the insurance rolls, it probably means spending more money. But it has become clear to me that it is a moral imperative that we make healthcare available to everyone, and in a practical way that doesn’t bankrupt them. You are free to disagree. I also believe that helth care costs are rising too damn fast, and as a secondary aspect of this proposal it would be nice if we could slow down or reverse that > > 4. Well, if the math is so easy, show me, while taking into account how this proposal might influence the risk profile, how many employers would drop their plans in favor of the govt one, etc. > > Now, Puddlegum, those were good questions, but that felt a little like a driveby shooting. What are your thoughts? It is your thread and your proposal, you should at least attempt to put a price tag on the program, otherwise it is just a wish and not an actual proposal. The US spent 3.2 trillion on healthcare in 2015 and collected 15.46 trillion in wages. That means in order to pay for itself the payroll tax must by 20.7%. This does not take into account deadweight loss which would mean the tax would need to be around 22-25% to make up for that. Since this is replacing the current 2.9% Medicare tax so if you subtract that, it would mean a tax increase of over 20% of total wages to every working person in America. That is a huge tax increase and is not politically feasible. It is not even clear that it is possible to extract that much tax from the US. ---
**Author:** ![Broomstick](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/broomstick/32/246_2.png) [@Broomstick](https://boards.straightdope.com/u/Broomstick)\ **Post date:** [January 9, 2017, 3:48pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/24 "2017-01-09T15:48:35Z")
Why would the US need 20% in tax when other countries do the same thing for considerably less? You’re probably missing something here. ---
**Author:** ![up\_the\_junction](https://avatars.discourse-cdn.com/v4/letter/u/f1d935/32.png) [@up\_the\_junction](https://boards.straightdope.com/u/up_the_junction)\ **Post date:** [January 9, 2017, 4:17pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/25 "2017-01-09T16:17:23Z")
Ya think. The entire developed world does this on 9-12% GDP. The USA is on 18% GDP and only covers maybe 2/3 of the population. You have been ripped off, shat on and propagandised for 50 years. USA healthcare is the biggest con job in the history of democracy. That’s why all the vested interests spend so much on buying the political class. I have no idea how you do this other than to take a scorched earth approach, and drop in a healthcare system wholesale from where ever the hell in the first world you like. ---
**Author:** ![jasg](https://avatars.discourse-cdn.com/v4/letter/j/f0a364/32.png) [@jasg](https://boards.straightdope.com/u/jasg)\ **Post date:** [January 9, 2017, 5:04pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/26 "2017-01-09T17:04:13Z")
> [@puddleglum](#): > > It is your thread and your proposal, you should at least attempt to put a price tag on the program, otherwise it is just a wish and not an actual proposal. > The US spent 3.2 trillion on healthcare in 2015 and collected 15.46 trillion in wages. That means in order to pay for itself the payroll tax must by 20.7%. This does not take into account deadweight loss which would mean the tax would need to be around 22-25% to make up for that. Since this is replacing the current 2.9% Medicare tax so if you subtract that, it would mean a tax increase of over 20% of total wages to every working person in America. That is a huge tax increase and is not politically feasible. It is not even clear that it is possible to extract that much tax from the US. I don’t think it would be a 20% tax increase. Don’t forget that [44% of that 3.2 trillion](https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/downloads/highlights.pdf) was paid for by private insurance and OOP consumer spending. Another 37% already comes from taxes in the form of Medicare/Medicaid expenditures. A new payroll tax doesn’t have to cover all of the 3.2 trillion - just the part not currently collected as tax. Capturing things like current insurance premiums as a ‘tax’ reduces the impact even more. ---
**Author:** ![RickJay](https://avatars.discourse-cdn.com/v4/letter/r/bb73d2/32.png) [@RickJay](https://boards.straightdope.com/u/RickJay)\ **Post date:** [January 9, 2017, 5:13pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/27 "2017-01-09T17:13:31Z")
> [@OldOlds](#): > > I would leave open the supplemental, though. I don’t see the public getting on board with paying for things that are seen as cosmetic/optional (IVF might be a good example of that). And I suspect that good jobs would offer that as a way of attracting and retaining talent. That’s pretty much how it works in Canada. Universal health insurance covers the basics. If you want anything insured beyond that, buy insurance or work for someone who does. If I didn’t have my employment insurance plan I’d be out a ton of money for dentistry and drugs. ---
**Author:** ![puddleglum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/puddleglum/32/137_2.png) [@puddleglum](https://boards.straightdope.com/u/puddleglum)\ **Post date:** [January 9, 2017, 6:07pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/28 "2017-01-09T18:07:20Z")
> [@Broomstick](#): > > Why would the US need 20% in tax when other countries do the same thing for considerably less? You’re probably missing something here. The US pays alot more for healthcare than other countries, so in order to pay for government run healthcare the US government would have to tax more than other countries. ---
**Author:** ![puddleglum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/puddleglum/32/137_2.png) [@puddleglum](https://boards.straightdope.com/u/puddleglum)\ **Post date:** [January 9, 2017, 6:17pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/29 "2017-01-09T18:17:23Z")
> [@jasg](#): > > I don’t think it would be a 20% tax increase. > > Don’t forget that [44% of that 3.2 trillion](https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/downloads/highlights.pdf) was paid for by private insurance and OOP consumer spending. Another 37% already comes from taxes in the form of Medicare/Medicaid expenditures. > > A new payroll tax doesn’t have to cover all of the 3.2 trillion - just the part not currently collected as tax. Capturing things like current insurance premiums as a ‘tax’ reduces the impact even more. Well if you take the 37% of healthcare spending out that the government pays then you need to cover 2.02 trillion dollars. You could do that with a payroll tax of 13-17%. However then it would not include Medicare which is another 2.9% so the total medical payroll tax would still be close to 20%. ---
**Author:** ![Grim\_Render](https://avatars.discourse-cdn.com/v4/letter/g/a87d85/32.png) [@Grim\_Render](https://boards.straightdope.com/u/Grim_Render)\ **Post date:** [January 9, 2017, 7:02pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/30 "2017-01-09T19:02:59Z")
That seems to assume you will need to cover both all the public programs as they exist today, and pay for all the private insurance at its current price, while running all the gate-keeping, liaising and cascading bureaucracy required to run that many separate systems. ---
**Author:** ![Broomstick](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/broomstick/32/246_2.png) [@Broomstick](https://boards.straightdope.com/u/Broomstick)\ **Post date:** [January 9, 2017, 7:18pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/31 "2017-01-09T19:18:33Z")
Puddleglum is also forgetting that Medicare is _already_ part of the taxes already. You don’t have to add the Medicare costs _in addition to_ the current healthcare stuff, it’s already a part of it. Also consider that those people who are currently paying healthcare premiums will not have to pay those _in addition to_ to current taxes. Again, that’s already a part of things. > [@](#): > > The US pays alot more for healthcare than other countries, so in order to pay for government run healthcare the US government would have to tax more than other countries. Yes, and a LOT of that “pays more” stuff goes to funding the middle-man - i.e. private health insurance _companies_. Eliminate those and you eliminate a lot of duplication of effort and complication. Remove the apparatus required to determine if people “qualify” under the current system - under UHC _everyone_ qualifies if they’re citizens (and in some cases others, like permanent legal residents). That’s another cost that goes away. And so forth. ---
**Author:** ![jasg](https://avatars.discourse-cdn.com/v4/letter/j/f0a364/32.png) [@jasg](https://boards.straightdope.com/u/jasg)\ **Post date:** [January 9, 2017, 9:03pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/32 "2017-01-09T21:03:16Z")
> [@puddleglum](#): > > Well if you take the 37% of healthcare spending out that the government pays then you need to cover 2.02 trillion dollars. You could do that with a payroll tax of 13-17%. However then it would not include Medicare which is another 2.9% so the total medical payroll tax would still be close to 20%. Getting closer. If we are talking about tax supported single-payer healthcare, we need to take the dollars spent on health insurance and out-of-pocket healthcare out of the tax calculation equation. In the current system, that money is a hidden tax that covers 44% of the 3.2 trillion. So, if we are going to imagine a tax that magically pays for all the US health costs, we have to remember that all the money we currently spend will no longer need to be spent by us. The money employers and employees currently spend thus offsets a significant part of the new tax. ---
**Author:** ![OldOlds](https://avatars.discourse-cdn.com/v4/letter/o/a3d4f5/32.png) [@OldOlds](https://boards.straightdope.com/u/OldOlds)\ **Post date:** [January 10, 2017, 1:05am UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/33 "2017-01-10T01:05:54Z")
> [@jasg](#): > > Getting closer. If we are talking about tax supported single-payer healthcare, we need to take the dollars spent on health insurance and out-of-pocket healthcare out of the tax calculation equation. In the current system, that money is a hidden tax that covers 44% of the 3.2 trillion. > > So, if we are going to imagine a tax that magically pays for all the US health costs, we have to remember that all the money we currently spend will no longer need to be spent by us. The money employers and employees currently spend thus offsets a significant part of the new tax. Well, most of you articulated my response to Puddleglum pretty well. So from the total we have to deduct: -What’s already paid by the government -Consumer Healthcare (am I correct that would be stuff like cold medicine, band-aids, and such which we could call OTC healthcare?) -Any deductibles -And let’s not forget, the total as listed is everything. But I have already stated that there are significant non-essential items I would propose leaving as outside this system. IVF, Erectile Dysfunction, Non-severe dermatology services. First we’d have to agree on what these non-essentials are, then we’d have to figure what they cost. As to Puddleglum’s comment that “it’s my proposal, do the math” I say again that that seems a bit like it’s intended to bring the question into the muck without adding anything. I admitted that the complexity of it defied my calculations… Sorry to disappoint you. Oh, and you still haven’t stated any actual, you know, opinions. Which was the point of the OP I’ll be clear- if I had the magic wand, we’d go single payer, along the lines of Medicare for all. But I also recognize that there’s a difficulty in just throwing out or nationalizing the existing insurance infrastructure, as well as an emotional response to same. This was an idea on how we could make it more palatable given those constraints. ---
**Author:** ![puddleglum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/puddleglum/32/137_2.png) [@puddleglum](https://boards.straightdope.com/u/puddleglum)\ **Post date:** [January 10, 2017, 3:12pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/34 "2017-01-10T15:12:52Z")
> [@Broomstick](#): > > Puddleglum is also forgetting that Medicare is _already_ part of the taxes already. You don’t have to add the Medicare costs _in addition to_ the current healthcare stuff, it’s already a part of it. > > Also consider that those people who are currently paying healthcare premiums will not have to pay those _in addition to_ to current taxes. Again, that’s already a part of things. > Yes, and a LOT of that “pays more” stuff goes to funding the middle-man - i.e. private health insurance _companies_. Eliminate those and you eliminate a lot of duplication of effort and complication. > > Remove the apparatus required to determine if people “qualify” under the current system - under UHC _everyone_ qualifies if they’re citizens (and in some cases others, like permanent legal residents). That’s another cost that goes away. > > And so forth. I am not forgetting Medicare is already paid for in taxes, I mentioned that twice. Health Insurance company profits are a tiny part of healthcare spending, around .5% of total healthcare spending. If you got rid of health insurance entirely you would still need people to file claims, monitor fraud, process deductibles, and make sure the procedures are covered. Since more people would be covered this would be more expensive. If you eliminate profit from the system then you eliminate the primary way of reducing costs. ---
**Author:** ![puddleglum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/puddleglum/32/137_2.png) [@puddleglum](https://boards.straightdope.com/u/puddleglum)\ **Post date:** [January 10, 2017, 3:20pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/35 "2017-01-10T15:20:30Z")
> [@jasg](#): > > Getting closer. If we are talking about tax supported single-payer healthcare, we need to take the dollars spent on health insurance and out-of-pocket healthcare out of the tax calculation equation. In the current system, that money is a hidden tax that covers 44% of the 3.2 trillion. > > So, if we are going to imagine a tax that magically pays for all the US health costs, we have to remember that all the money we currently spend will no longer need to be spent by us. The money employers and employees currently spend thus offsets a significant part of the new tax. Health insurance premiums are not a hidden tax. Taxes are collected by the government and are spent on everyone. Health Insurance premiums are paid by the person for the person. They are totally different. With taxes people who pay more get no more and people who pay less get no less. Thus everyone tries to minimize their own taxes as much as possible. This is why deadweight loss exists. It is not merely that the part of your paycheck withholding is changing categories, some people will get more and some people will get less. Those who will pay more for less will not like this and vote accordingly. Decoupling price and services will also lead to more healthcare being consumed. This will mean higher expenses for everyone, which will mean more taxes, which will mean more avoidance. ---
**Author:** ![puddleglum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/puddleglum/32/137_2.png) [@puddleglum](https://boards.straightdope.com/u/puddleglum)\ **Post date:** [January 10, 2017, 3:25pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/36 "2017-01-10T15:25:21Z")
> [@OldOlds](#): > > As to Puddleglum’s comment that “it’s my proposal, do the math” I say again that that seems a bit like it’s intended to bring the question into the muck without adding anything. I admitted that the complexity of it defied my calculations… Sorry to disappoint you. Oh, and you still haven’t stated any actual, you know, opinions. Which was the point of the OP > > I’ll be clear- if I had the magic wand, we’d go single payer, along the lines of Medicare for all. But I also recognize that there’s a difficulty in just throwing out or nationalizing the existing insurance infrastructure, as well as an emotional response to same. This was an idea on how we could make it more palatable given those constraints. The math is not that complex, decide what you want to cover, google how much is spent on that stuff, and then divide that into the total amount of wages. From that you will get the payroll tax rate you need. There is no way to evaluate a proposal without knowing the costs. My opinion of your proposal is that it does nothing to address the costs of healthcare and for that reason is a bad proposal that would make our system much worse. ---
**Author:** ![Grim\_Render](https://avatars.discourse-cdn.com/v4/letter/g/a87d85/32.png) [@Grim\_Render](https://boards.straightdope.com/u/Grim_Render)\ **Post date:** [January 10, 2017, 4:51pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/37 "2017-01-10T16:51:18Z")
> [@puddleglum](#): > > Health insurance premiums are not a hidden tax. Taxes are collected by the government and are spent on everyone. Health Insurance premiums are paid by the person for the person. > They are totally different. With taxes people who pay more get no more and people who pay less get no less. Thus everyone tries to minimize their own taxes as much as possible. This is why deadweight loss exists. I think this fear of someone getting more out of your taxes than yourself is overblown. I suspect that over the course of a lifetime, people either die young or most people in a population consume roughly similar amounts of health care. > [@puddleglum](#): > > Decoupling price and services will also lead to more healthcare being consumed. This will mean higher expenses for everyone, which will mean more taxes, which will mean more avoidance. What about all the countries out there with prices decoupled from services? Does this prediction sound like it is consistent with what has happened there? > [@puddleglum](#): > > If you got rid of health insurance entirely you would still need people to file claims, monitor fraud, process deductibles, and make sure the procedures are covered. Since more people would be covered this would be more expensive. > If you eliminate profit from the system then you eliminate the primary way of reducing costs. Once again, does this sound anything like how things work in the real world? I work in health care in a single payer country, and we don’t file claims, we don’t monitor for fraud, we don’t process deductibles, and we don’t make sure processes are covered. There are a small number of people doing something similar centrally though. Also, the systems with profit eliminated have shown to be the best cost-containers, which seems rather the opposite to what we’d expect to happen if you were anywhere near right. ---
**Author:** ![jasg](https://avatars.discourse-cdn.com/v4/letter/j/f0a364/32.png) [@jasg](https://boards.straightdope.com/u/jasg)\ **Post date:** [January 10, 2017, 5:20pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/38 "2017-01-10T17:20:12Z")
> [@puddleglum](#): > > Health Insurance premiums are paid by the person for the person. No. Any and all insurance premiums are spent on a shared risk. They are not in an account to be disbursed only for the insured individual. If insurance was “paid by the person for the person” insurance companies would stop paying after the expenditures matched the premiums. Instead, insurance premiums are shared just as much, if not more, than taxes. ---
**Author:** ![puddleglum](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/puddleglum/32/137_2.png) [@puddleglum](https://boards.straightdope.com/u/puddleglum)\ **Post date:** [January 10, 2017, 7:16pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/39 "2017-01-10T19:16:27Z")
> [@jasg](#): > > No. Any and all insurance premiums are spent on a shared risk. They are not in an account to be disbursed only for the insured individual. > > If insurance was “paid by the person for the person” insurance companies would stop paying after the expenditures matched the premiums. Instead, insurance premiums are shared just as much, if not more, than taxes. If you pay more for your health insurance you get better health insurance than if you paid less. If you pay more taxes you don’t get better roads than if you had paid less. That is the difference. ---
**Author:** ![up\_the\_junction](https://avatars.discourse-cdn.com/v4/letter/u/f1d935/32.png) [@up\_the\_junction](https://boards.straightdope.com/u/up_the_junction)\ **Post date:** [January 10, 2017, 7:20pm UTC](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528/40 "2017-01-10T19:20:25Z")
If I were you I’d become familiar with the work of actuaries. [Previous page](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528.md?page=1) [Next page](https://boards.straightdope.com/t/how-about-this-for-an-aca-alternative/776528.md?page=3)