Disappearing taxes will not fund health reform!

In a previous article I wrote that taxing employer paid health benefits with high premiums is not a real source of funding.Now an alternate version of this tax has been proposed–a tax on insurance companies. The current proposal is to tax companies for policies they sell with premiums more than $25,000, or twice the value of the average federal employee health plan.This proposal has great grass roots appeal. Proponents say that it targets insurance companies and high-earning employees of companies like Goldman Sachs who have $40,000 tax free insurance plans. Who better to pay for health reform?The proposal’s policy justification is the claim that “gold plated” insurance plans, those that provide very comprehensive coverage with minimal out-of-pocket costs, are a significant contributor to the growth of national health care spending. This characterization of such plans is misleading and I will explain why in the next post.Regardless of who owns them, such expensive policies are a lot less common than we’re led to believe; about 1% of health policies cost more than $25,000 a year and 0.3% of workers with employer-provided coverage in 2008 have such plans. So this is not a huge source of waste or of potential funding for reform. We can hardly blame this small population for the high cost of health care!Whatever we think of Goldman Sachs, this approach will not fund universal health care. As soon as this tax is approved, these plans will be modified to provide insurance benefits that cost just below the amount that would trigger the tax.The obligation to pay for health care reform will remain. Any new tax can’t disappear. We need a real and dependable income stream that will keep up with the health care cost curve. For more info about Employee Benefits Solutions, Health insurance broker and Key person Insurance for small business visit us at http://www.shargel.com

In a previous article I wrote that taxing employer paid health benefits with high premiums is not a real source of funding.Now an alternate version of this tax has been proposed–a tax on insurance companies. The current proposal is to tax companies for policies they sell with premiums more than $25,000, or twice the value of the average federal employee health plan.This proposal has great grass roots appeal. Proponents say that it targets insurance companies and high-earning employees of companies like Goldman Sachs who have $40,000 tax free insurance plans. Who better to pay for health reform?The proposal’s policy justification is the claim that “gold plated” insurance plans, those that provide very comprehensive coverage with minimal out-of-pocket costs, are a significant contributor to the growth of national health care spending. This characterization of such plans is misleading and I will explain why in the next post.

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Shargel.com : offering non profit services like as, health insurance, group health, employee benefits, san francisco insurance broker, small business, looking for a broker, new health plan, new broker, individual insurance, self-employed, consultant, personal benefits

Tags: HEALTH INSURANCE, GROUP HEALTH, EMPLOYEE BENEFITS, SAN FRANCISCO INSURANCE BROKER, SMALL BUSINESS, LOOKING FOR A BROKER, NEW HEALTH PLAN, NEW BROKER,

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Title:	Disappearing taxes will not fund health reform!
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Disappearing taxes will not fund health reform!