Reform health care without government takeover

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Last week, I sent a letter concerning Medicare for All (“Medicare for All provides more questions than answers,” Oct. 24). I feel like I need to add a bit to that thought since the recent announcement of some specifics of paying for that plan.

I believe it’s important to understand the real cost. There has been a lot of discussion about the millions of dollars of profit by health insurance companies. It is not as much as we are led to believe. According to Investopedia (see shortened link https://bit.ly/2C8dK5j), the insurance industry’s overall profit margins are between 3% and 10.5% with health insurance margins more narrow at 4% to 5.25%. That means for every $100 a health insurance company collects, it costs it an average of $95 in payouts and administrative costs.

The proposed Medicare for All plan noted that everyone would have to pay more in FICA deductions, but those deductions would add up to less than what people are currently paying for health insurance. My previous letter stated the Medicare portion of FICA is 1.45% with an annual maximum of $1,927 and would need to go up more than $9,000 annually. Almost a third more than North Carolina’s average health insurance.

So, those who have chosen not to buy health insurance would see an immediate reduction in their paycheck for which they have not planned. I understand not buying health insurance because it’s too expensive, but a forced payment would hurt a large segment of the population, especially those lower-income workers who are already tight on finances.

The second part is that employers will contribute more to employee health care costs. This only drives up employer overhead costs, which means layoffs for employees. Businesses must balance the cost of workers with the ability to make a profit. If there is no profit, then hiring freezes or layoffs happen, resulting in no opportunity for growth and no opportunity for pay raises or advancement for employees who remain at the business.

Speaking of jobs, the Medicare for All plan would also cause a loss of 2 million jobs in the health insurance industry.

Finally, the last part was a tax on the wealthy, an additional wealth tax, and taxing large corporations to pay for the Medicare for All plan. How is that sustainable? It’s not. The wealthy will only move elsewhere and hide their assets. Large corporations would move and use loopholes to avoid paying more. In two to five years when the pool of wealthy and large corporations is gone, where does the money come from to pay for Medicare for All? Right from the average taxpayer.

The arguments for health care reform conflate health care and health insurance. We have the best health care in the world, and we need to keep it that way. Even with its problems, our health insurance industry is also the envy of the world.

That said, we can do better. But rather than creating a government-run health care mess, we need to find ways to make the insurance more affordable. Rather trying to take money away, why not use tax incentives and free-market competition to get insurance companies to offer more reasonable plans, especially to those with pre-exiting conditions? We could create policies that limit a drug company’s ability to charge for drugs based on actual cost to develop and manufacture. As a drug matures and R&D is recovered, prices are naturally forced down.

We need to find ways to help everyone have affordable health care insurance — if they want it. I don’t believe that is with a wasteful government plan. I do believe the American people are smart enough to figure out what they need without the government dictating everything.

Mick Rankin