Health insurance debate regains focus
September 9, 2009 by admin
The Washington political lines appear to be drawn and the health insurance reform is likely to take center stage for political banter in the near term. Reforming the American health care system is becoming one of the hottest debate political items in recent history. The prospect of offering universal health insurance coverage to every citizen has been a campaign promise of hundreds of politicians who have reached out to the millions of Americans who lack insurance with the promise of future reforms and equality.
The proposal by President Obama to offer health insurance coverage to every citizen has brought the political lightening rod of Washington to main street and town halls across the country. The basis for much of the debate is the idea of a government run health insurance organization that would be used to compete directly against the private health insurance sector. The prospects of another government run agency is drawing criticism from millions of people who feel the country is quickly falling into a socialism based government.
A major portion of President Obama’s insurance reform proposal is based on creating an agency that is large enough to compete against private insurance companies that are in a monopolistic position across the country. Numerous reports have been presented showing that private health insurance has benefitted from a forty percent increase in their premiums over the past five years, well outpacing the rate of inflation. Presently, every state is responsible for the regulation of health insurance companies that are offered within their boundaries. This regulation has worked against the fostering of competition, leaving consumers with limited choices in exploring health insurance. The President believes that the only way to bring a true competitor to the marketplace and help to alter the current premium structure in the marketplace is with a government backed company. The appeal of a government based insurance company that offers lower priced products, without the restrictions of preexisting condition clauses will certainly be welcomed by those who currently don’t have health insurance or have coverage that leaves them unprotected in many cases.
The government’s public health insurance plan has drawn criticism in a number of areas. Certainly the present health insurance industry and likely, pharmaceutical industry are concerned that the new competitions could eat into corporate profits. These companies are helping to finance the political debate against a government based plane. Most individuals who are arguing against the government’s insurance proposal base this on the government’s inability to be financially responsible in running a business. The larger concern could be the likely increase in taxes facing millions of citizens. The government is proposing that a majority of the cost for the new agency would be financed by altering the present tax code and placing a tax on the health insurance premiums that are presently covered by the beneficiary’s employer. The present tax system does not collect taxes against premiums paid by companies for the benefit of their employer. This so called tax loophole would place an additional tax on beneficiaries who receive premium coverage over a certain dollar threshold. This is likely the lightening rod that is stirring the debates in town hall meetings across the country. Increasing taxes, in today’s tough economic times is not going to be a popular discussion, no matter what the social benefits appear to be. This critical part of the government’s insurance reform proposal will likely be the piece that makes or breaks the opportunity ahead for true health care and insurance reform, offering coverage to the millions of Americans who lack health insurance coverage.
