I have heard so much about the ‘health care’ plans of McCain and Obama. Frankly, there is a lot of misconception out there about both. So let’s look at them. This is a fairly simple way to ‘get it’ and then you can decide which is best for you. Thanks to Ms Placed Democrat! If health care is important to you and you want to understand the real difference in pretty simple language..take a look.
Obama likes to say that if you already have health care provided through your employer and you want to retain that coverage, then you don’t have to do anything. You can keep your current insurance coverage.
What he does not tell you is, “Will your employer retain that coverage?”
Obama’s health plan says employers must either “pay or play”. The employer can provide significant coverage or pay a federal tax. It is proposed that an employer would be exempt from the $2,000 per employee tax if they pay at least 75% of the health insurance cost.
For example, assume you work for a large company that paid over $744 million in health care benefits for its 95,000 employees in 2006. That would average $7,800 per employee.
The incentive through Obama’s health care plan is to transfer a tremendous financial burden from the employer to the public sector. Assuming management and the Board of Directors do the math, the company could convert all employees to Obama’s National Health Care System and drive $554 million to the bottom line immediately!
The company could increase profits every year by over 1/2 billion dollars by simply dropping its health care plan and paying the per employee tax to the federal government!*
Now, what do you think the board will do?
Congratulations! Under Obama’s proposal, you are now covered under the national public health care plan.
But what if you have a family???
Oops! You will now have to purchase a public or private plan for your spouse and children.
To give you an example of what that costs, reference the Federal Employee Health Benefit Plan and look up monthly premiums for a Fee For Service Plan. This is the coverage Obama kept referencing in the debates. The 2009 premiums run $1,120 per month or $13,445 per year!
But do not fear….Obama plans to subsidize those high premiums. If you are a lower income family, it is proposed that your annual premiums would be capped at 5% of your annual GROSS income. If you are a higher income family, the cap will be 10%!!! In other words, if your family’s gross income is $120,000 per year, you only have to pay $12,000 per year for family health coverage. If your family’s AGI is $134,450, you will have to pay the full premium.
AS FOR THE MCCAIN PLAN,
Obama keeps pointing out that – for the first time ever! – employees would have to pay TAXES on their employer provided health care benefits!
This is true!
Since the company’s cost per employee currently runs about $7,800 per year, a taxpayer in the 25% bracket would owe an additional $1,950 in income tax. HOWEVER, with McCain’s proposed $2,500 or $5,000 tax credits, a single taxpayer would receive a $550 tax REFUND and a family filing a joint return would receive a $3,050 REFUND!
The decision is very simple:
If you and your family want to retain your employer’s current health care plan,
DO NOT VOTE FOR OBAMA!!
If you want to receive a tax credit through McCain’s plan,
DO NOT VOTE FOR OBAMA!!
If you want to pay over $13,000 each year for your family to be placed on public health care or a private plan equivalent, then definitely vote for Obama!
Obama says the plan will cost $50 to $65 billion per year, but he will pay for it with tax increases on people in the highest two brackets. One, it will cost more than that and, two; he cannot use the same money twice. If you review his tax plan in depth, it clearly states the revenue increases do not offset the income tax cuts he proposes for things such as “Making Work Pay”* and an increased Earned Income Tax Credit. To emphasize the point again, he has already used the increased tax revenue from the top two tax brackets to cover other proposed income tax cuts. There will be no tax revenues to cover the costs of his health care plan UNLESS he increases taxes on people earning less than $250,000. We know he PROMISED that won’t happen, but he also PROMISED he would take public financing for his campaign, and we all know how that turned out!
As mentioned above, the costs will be much higher than $50 to $65 billion. Obama confirmed in a CBS interview that it would cost at least $150 billion. That alone would require taxes to be increased on lower income tax brackets.
Simple math indicates it would cost a great deal more than that. Per the Kaiser Family Foundation, health care costs in America run about $8,000 per person. Providing coverage for 45 million uninsured citizens would cost approximately $360 billion. However, assuming Obama could get the taxpayer cost down to $5,000 through cost savings** and premium payments, the total cost would be $225 billion!
In addition, there will be tremendous costs associated with coverage “gaps” like the one described for the company above. If costs could be reduced to $5,000 and a company pays $2,000, there is a $3,000 per person “gap” associated with the Obama health care plan. How many million people do you think will be dumped into the public fund once employers are given that option to save money? It is a no brainer. It will transfer a huge financial burden from employers to the public sector. It is estimated that 159 million Americans are currently covered by employer plans. Just imagine how many will be transferred to the public fund, each with an inherent cost “gap” to be covered by us, the taxpayers!
With $225 billion for the uninsured and untold billions for coverage “gaps”, there will also be significant costs for Obama’s numerous health care subsidies and tax credits. It just keeps adding up!
Not only will many Americans be paying more for inferior health care coverage, but it is virtually certain their income taxes will go up!***
*It is estimated the Making Work Pay credit of $500 per adult will be provided to 95% of all 150 million taxpayers. That means 142.5 million taxpayers will receive a total tax cut of $71 billion. Unfortunately, 44% of the 95% receiving this benefit have no tax liability. The credit will not merely reduce their taxes; it will be a redistribution of wealth – a welfare payment of nearly $33 billion. Getting a tax credit to reduce taxes is one thing, but it should be PHASED OUT when the tax liability is zero. When McCain called this redistribution of wealth exactly what it is, a welfare payment through the tax system, Obama mocked him and said he was so “out of touch” that he could not tell a tax cut from a welfare payment. But, that is exactly what it is! In fact, Obama’s campaign officials later admitted it was not a tax cut, but quickly put a new name on it. They said it was a refund of social security taxes being paid by the working poor. Sorry, but that has already been done and has a name. It is called the Earned Income Tax Credit and that is why it was created many years ago. Just FYI, Obama is also proposing a large increase for the Earned Income Tax Credit.
**Obama says he can reduce health care costs by $2,500 per person. The example gives him the benefit of the doubt on that claim by reducing the $8,000 per person cost to $5,000. But to be honest, how can he possibly realize that level of savings? Since there are 300 million Americans, that represents a whopping $750 billion of cost savings!! Where would it come from? How could he possibly save that much money? His plan calls for streamlining record-keeping and importing lower cost drugs for an annual savings of $107 billion, but where does the other $643 billion come from? If health care costs can be cut by $750 billion, representing about one-third of the total annual health care cost in America, there would be little need for a national health care plan. Health care would be affordable!
***Obama says much of the financing for his plan comes from savings within the health care system. Remember, he cannot use the same money twice! The questionable $750 billion was factored into the $2,500 per person savings. Taxpayers would still be left with a $225 billion deficit each year to provide coverage for the uninsured as well as untold billions for coverage “gaps”, tax credits and subsidies. Obama’s plan would require substantial middle-income tax increases!
No Obama. His health plan will kill our benefits especially in large companies. Pull the lever for McCain/Pallin if you want to keep your employer provided insurance benefits.
Hat tip MsPlaced Democrat: original link
Do You Want To Keep Your Medical Coverage Through Your Employer or Obama’s Proposed National Health Care Plan?
This analysis seems to be supported by Dale Vaslow in his article, “Obama health care plan, voters beware” found in the Missourian…