If we get universal healthcare/single payer healthcare (long)

Miscellaneous and Personal Stuff I Must Share
1

Well, I was going to whine a little in the pit, but since I have a question related my whine, I’ll wine a little, then ask my question.

First, my wife got home from the hospital on Wed. She has a trach and is on a vent. She’s getting nurses, physical therapists, and some other people coming out to check on her. My mom moved in to help, and we’re hiring a couple people to help us out. We can afford this, because in addition to being on Medicare, I got my wife signed up to Medicaid.

Here’s the shortened whine. Medicaid only lets you make a certain amount of money, and only allows for $600 of living expenses (our mortgage alone is around $950 or so). If you make over the amount, you have to pay in. We owe $377. Now, because of three things, I’m lucky, and will be able to afford it. But otherwise, I’d be between a rock and hard place, not being able to afford the treatment my wife needs without the Medicaid, but not being able to afford the Medicaid.

So now, my question. If Obama becomes elected and we get universal health care, or a single payer system (I’ve Googled the terms, and even though I know there’s a difference, I don’t know what it is), how will it effect people like me. In the middle. Not dirt poor, but not “well off” or “well to do” either. Right now, I’d call myself lower middle class I guess.

And how will it effect me after I get a job? My goal is to make around $40,000 a year after graduating, which should be doable.

2

I realise the US has cultural differences from the UK.

Nevertheless here we have a National Health system which really does help everyone, especially those who can’t afford to pay.

3

No one has really hashed out the exact details of this yet, but here is some plausible speculation.

Let’s assume that once you get your $40,000 a year job you are working for an employer that offers health insurance. If we got system like the UK or Canada, this is roughly what I think would happen to you:

Your employer would pay you higher wages because it would not have to pay toward your health insurance. Economics tells us this would happen in the long run to keep the labor market in equilibrium.
You would no longer pay an employer health insurance premium.
You would pay taxes approximately equal to what you and your employer combined were paying for health insurance before (for family coverage this is usually about $14K per year).
You would have coverage similar to what someone with good health insurance has now.

In your current situation, with no health insurance, it appears you weren’t “paying into the system” at all. As a young person, you might have come out ahead that way (not paying for health insurance either privately or through taxes) if you didn’t have any big medical expenses. As you can see, it is a big gamble, and with your family’s bills you are not coming out ahead anymore. So if you continued to have some type of a job but no health insurance, you would pay a tax you don’t pay now, but would get health coverage.

If you are a full-time student, I think it’s very plausible that terms would be set up to make your share of whatever tax was going to universal healthcare affordable to you. At a minimum, I’d expect you would be able to get student loans to cover the cost. Possibly, other workers would be taxed at a slightly higher rate to make health coverage available to students at no cost to them.

4

Well, young is relative. I’m 35 (and although I think I’m still somewhat young, I’m guessing you thought that I was in my 20’s or younger) and started taking classes after I lost my job last year. And sense I have to pay Medicaid to get services, then I don’t how I’m not paying into the system.

5

After letting my membership lapse, and then hearing that free posting might happen again, I made a list of questions about universal health-care that I completely forgot to ask in the OP. So, guess I’ll ask them now (although I see a couple have been answered already):

I. Would it reduce the income of doctors and other health-care professionals?
_1. If so, how would this affect the enrollment rate of medical students?
_2. How would this effect the ability of medical students to pay off their student loans?
_3. How many current medical professionals would change careers in order to make more money?
II. Would we have long waits like they have in Canada?
III. How much would our taxes go up?
IV. Would companies who currently offer benefits to employees allow them to drop their benefits for higher pay? And how much would this offset the increase in taxes?

I know these are difficult questions, but since universal health-care is being so strongly considered, I’m sure these questions must have been talked about before by politicians, health-care professionals and the like.

6

IANA doctor, economist, employer, or politician.

I think there would probably be some sort of cap for fees that doctors receive. OTOH, AIUI, doctors accept lower amounts from insurance companies or HMOs than their ‘list prices’. If there is some sort of malpractice protection (I’m not advocating for or against, here) then that would have to be figured into the calculation.

I think doctors would still make a good living, and I think they’d still have a certain social standing. So I would expect enrollments into medical schools would remain high. And really, I’d like to have a doctor who is in it for passion rather than the money or status.

If we have UHC, then I suspect that the government would help with student loans; either by subsidy, or loan forgiveness.

I think that some doctors may choose to opt out of the system and take private patients. Though I do want UHC, I think that private insurance will still be bought by people who want it, and that those doctors would cater to them.

I have no experience with waiting for services in Canada. I heard a report on NPR that in Taiwan people can get same-day appointments under their generous system.

According to the NPR report, Taiwan’s system is underfunded. IIRC it consumes 6% of their GDP. To fund it fully, they would have to raise it to 8% of their GDP. That’s still less than half of what our system costs. According to NPR the 125-year-old German system requires everyone to buy into UHC, with premiums based on income. So someone who pays a little will receive the same care as someone who pays more. After income reaches something like $75,000/year people may opt out and buy private insurance instead. These people have certain benefits not offered under the government’s plan.

The way I see it is this: Employees who have insurance already pay part of their premiums and their employers pay the rest. These premiums go to myriad private insurance companies. The way I would set it up (again, not being an economist) would be that the employees and employers would pay the same amount, but to a single payer. IME most working people do not use what they pay for. Using myself as an example, I pay (guessing) $50/month for my insurance and my employer pays (guessing) $200/month. When I was unemployed and uninsured I went to the doctor once, and it cost me $140. This year, employed and insured, I went to the doctor once and the total bill (my share plus insurance) was a couple-hundred dollars. So I feel that there would be a surplus in the system to pay for people who are unemployed.

Many businesses do not offer insurance now. Admittedly, these are generally for lower-level jobs. Some though, are through temporary agencies, and others are businesses that hire ‘part time’ employees or contractors. In my opinion, employers and employees would be required to pay into the system as they (most of them) do now. The company itself would not be offering insurance as a benefit. If a company did offer private insurance as a benefit, I don’t think employees should be able to drop it for a higher salary. Call me a socialist if you want.

Again, these are my own, unresearched, non-professional opinions.

7

Actually, I should explain that I wasn’t trying to state, or imply that I think that all, or most doctors only get into the field for the money, but there are some for whom lower wages might make them change professions, and I’m just curious if the amount, or percentage, would be noticeable or not.

That would sound reasonable. I’ve heard that, one of the reasons that a lot people in the medical field work, in my opinion, insane hours is to help pay off the huge amount of loans they’ve taken out. And so IF their wages are capped, then getting into a mountain of debt that would be more difficult to pay off than it is now, might frighten some people from getting into the profession.

Actually, would you mind explaining that a little more? Are you saying that if a company offers health care, than employees should be forced to take both the employer health-care and UHC?
Thanks.

8

Understood. I didn’t mean to imply that.

I think that everyone should be covered. If, like the German system, private insurance gets you a private hospital room or gets you to the head of the line when you go to a doctor, then this might be attractive to some people. In such a case, I think people should be able to opt out of the single payer system and choose the more expensive higher level. The way I’d work it is that everyone gets UHC, unless they choose to go private. So employers and employees would pay into the system in the same way they do now. Monies would not be paid into the system for people who opt for private coverage, the amount going to the private insurer instead. But an employee would have to choose one or the other, so the employer is still paying a premium and so is the employee.

I’m going to contradict what I said earlier.

Now, an employer may say ‘Take the government plan and we’ll pay you an extra $2,000 per year.’ But the employer and employee are still paying the premium for UHC. So, OK. Let the employer offer higher pay for public coverage and lower pay for private coverage. The important thing is that the employee is covered. But I think that since premiums have to be paid one way or the other (and consider a pay hike a premium), and that the common practice would be to pay into UHC, that an offer of private coverage would be a more common incentive to work for a particular company than a little extra money in exchange for it.

Now you’ll wonder why a person who opts for private insurance should get UHC if he hasn’t been paying into it. We already have deductions for the general welfare, so in effect the employee has been paying a premium through normal taxes. The person can keep his private insurance if he can afford it (an the private insurance companies are paying income taxes after all). If he can’t, then he reverts to UHC. It’s more complicated than saying, ‘We have UHC. That is your choice.’ But Americans want choices, and I think we still have to have private insurance in addition to UHC for the people who want it.

9

Yeah, this is all so complicated. As for myself, I’m on the fence when it comes to UHC.

My thought is, if paying into UHC is mandatory, which it would have been if Clinton was elected, and which Obama says might happen in the future if he gets elected and his plans get through congress, then since I’ll be paying for UHC anyway, then it would be nice to have the option of making a little more at a job to help offset the cost of the tax increase, if I thought it was more important than getting to the front of the line by having private insurance.

10

I’m sorry my first reply was so short.

Here we fund the National Health system through taxes on income. I have been a computer programmer and a teacher and have never found these taxes onerous.

(Indeed I’m now ready to retire at age 55 :slight_smile: , even though I never earnt more than £40,000 a year = approx $80,000. Most of this is due to our habit of buying a house.)

11

Not a problem.:slight_smile:

Yeah, I imagine if we (in the U.S.) wind up with UHC, it’ll funded through income taxes. I’ve always heard that people living in some, or most, European countries, such as England, pay higher taxes because you guys have more social programs that pay out more money than ours do, and you’ve been doing this for a long time. Something like UHC on the other hand, would be brand new to us, so if it happens, it might take some getting use to. On the other hand, it may wind up that everything goes along just fine, and the tax increases aren’t even that noticeable.

Where I live in the U.S., $80,000 is a lot of money. I wouldn’t call it rich, but I could live extremely comfortably on $80,000 a year.

As opposed to renting I assume?

12

You’re right, with the reference to graduation I was assuming you were in your 20s.

By paying into the system I mean regularly paying premiums or taxes into a communal pool (run by an insurance company or the government) whether you need healthcare or not, so that some larger entity can pool and manage the financial risk. Paying for Medicaid when you know 100% for certain that you have bills that will be considerably higher than what you are paying into Medicaid is only sort of “paying into the system.” $377 is about 1/4 of the average cost of a day’s stay in the hospital. If you had been able to purchase COBRA coverage from your job for yourself and your wife, that premium would probably have been $400 or more per month, and probably would have covered less than the Medicare/Medicaid combo. And private coverage would have been considerably more expensive. Insurance for 2 people in a group plan will run about $10,000 per year, and an individual plan will cost more or have minimal coverage.

As to **Nobody’s **question about private insurance and wages, maybe this will help. Let’s say the OP gets a job that pays $40K and provides health insurance, for a total value of compensation (ignoring any other benefits) of $50,000. If the situation changes and the government provides UHC, there will be no need for the employer to provide health insurance. His paycheck is still $40K, but now he’s paying higher taxes and the employer is not paying for insurance.

If you haven’t studied economics, this next part is kind of like a black box. But economics tells us that people make a tradeoff between labor and leisure that should bring this back into equilibrium. To oversimplify, you say that for only $40K, it’s not worth it for you to stay in the job, you’d rather retire or work for yourself. You threaten to quit. The company offers to pay you $50K to keep you, since that’s what you were costing them before. Multiplied all through the labor market, wages go up, taxes go up, and insurance premiums go away.

IMHO there is not much need for private insurance when there is UHC. Insurance is about managing financial risk. If the government “has your back” in terms of risk, why drag an insurance company into it? What Canada doesn’t have, but some countries with UHC do, is private providers. If you have extra money, and want to go to an extra nice hospital or see a specialist on short notice for a nonemergency, you pay out of pocket for that.

In a nutshell, UHC is likely to result in higher wages, higher taxes, and some opportunity to purchase better-quality healthcare outside the UHC system. Johnny L.A. also makes some great points about the evidence we have that the total cost will not necessarily be higher. What it will eliminate is the huge downside risk for someone like the OP, who happened to run across an extremely expensive medical situation while he fell through the cracks of the employer-based insurance system.

13

[slight hijack]
It’s funny. Here on the board, I’ve heard prices like this mentioned for Cobra.
Here in Oregon, I’ve heard people in real life give prices like $900/month or more for Cobra.
[/slight hijack]

14

Do take my comments with a grain of salt. As I said, I am not an expert in any field related to the subject.

15

If you get a system similar to what we have in Canada, you will pay a little bit more in taxes, and you will get all the free basic healthcare you need (dental, optical, prescriptions, etc. not covered). You will probably wait longer for those services, but you will never again worry about your healthcare needs bankrupting you (or even consider the price of healthcare when making healthcare decisions) and you won’t pay high insurance premiums. You will also never again hear the term “pre-existing condition” - if you need a treatment, you get a treatment, and the treatment you get is the one appropriate for your condition, not the cheapest one or the one you qualify for.

I had an example of our healthcare system at work this March - Jim had a gallbladder attack and he needed to get his gallbladder out - it was out before a week had gone by, he spent another week in the hospital after having a serious surgery (no laparoscopy for him), and there was absolutely no cost to us.

We pay about 25% of our wages in taxes, plus in Alberta we pay a healthcare premium of about $50 per person per month which I don’t believe any other province charges (we have the lowest provincial taxes in Alberta to make up for it). We also don’t find our tax burden onerous.

One of the interesting things in comparing US and Canadian healthcare is that ours actually costs less per person than the US system ($3326 per person per year in Canada versus $6401 per person per year in the US, total public and private spending*).

If you’re a doctor, yeah, you do start making a lot less money - doctors in Canada get paid from a government schedule of surgery/treatment X gets paid Y amount. They bill the government for the patients they treat.

*Source - Mclean’s Magazine, July 7/08 edition, page 56.

16

One important thing to be remembered about the Canadian system is that - as featherlou stated - it does not cover dental or prescriptions. You still need insurance for those and things like glasses, private rooms, televisons and acupuncturists under most circumstances, so it wouldn’t kill the insurance companies. You will also never go bankrupt because you had to be in hospital for a month.

Ontario pays $20 (I believe) per family, the rest comes from taxes.

17

Huh?

When I was laid off in November my COBRA payment was $875/month for me and my husband. You are really low-balling the COBRA payment here.

18

Thank you. This is a lot closer to the cost I hear talked about when people mention COBRA.

19

If I remember correctly, I paid 6% of my salary for the National Health and my employer pays 9%.

Well I am 20 years older than you, so hopefully you’ll be earning that in two decades time. :slight_smile:

My parents bought a house in London for £2,500 ($5,000) in 1946. They sold it in 2003 for £250,000 ($500,000). :eek:
I bought my current house for £60,000 ($120,000) 20 years ago. Even with the recent drop in house prices, it’s still valued at £180,000 ($360,000) today.
And none of us have ever paid any rent!

20

It’s also worth keeping in mind that the issue of waiting for treatment in Canada is not always a trivial matter.
This study talks about the wait times for various surgeries, CT scans, and MRIs - things that Americans tend to take for granted as being fast and easy to access.

There are cases of Canadians traveling to America because their diagnosis or treatment in Canada was delayed even for serious conditions like brain tumors.

Personally, I’ve never been very impressed by the system in Canada - or the UK. I think the only reason these systems get so much attention is because of the cultural and geographical proximity of those countries, not because the systems themselves are so great. If we did go to a universal system, I think countries like Sweden and Japan are doing a much better job of delivering high quality care rather than merely spreading around very mediocre care like Canada and the UK do.