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Taxing health benefits isn't a bad thing -- if it's done right

By MI Health Facts, Section News
Posted on Tue Jun 30, 2009 at 12:42:25 PM EST
Tags: health care (all tags)

The Lansing State Journal reports on proposals to tax health care benefits provided by employers.

Michigan employers have been more generous than most in providing health insurance coverage to their workers, picking up the fifth-highest share of the premium cost, according to the most recent figures available.

That benefit has been provided tax-free to employees. But that could change.

The exclusion of employer-provided health care from taxable wages is the nation's biggest tax benefit. The hundreds of billions of dollars in potential revenue is being eyed as one way to help pay for extending health care coverage.

"We should look at ways to modify the current tax exclusion so that it provides the right incentives," said Sen. Max Baucus, the Montana Democrat working on a way to pay for changes to the health care system. "We should look at ways to make it fairer and more equitable for everyone."

Although Americans are generally opposed to taxing health benefits, according to the article, they also seem to be opposed to having to rely on employer-provided health coverage. President Obama has made it clear that his administration also favors individual coverage that doesn't depend on employment to reduce the number of uninsured in America.

Leveling the playing field between employer-provided health care and individual plans is a good thing, but only if it's done right. Simultaneous tax breaks should ensure that Americans' checkbooks aren't left any worse off by a policy designed to help increase insurance.

Cross-posted to MI Health Facts.

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Taxing health benefits isn't a bad thing -- if it's done right | 27 comments (27 topical, 0 hidden)

All Obama Statements Have An Expiration Date (none / 0) (#1)
by steve on Tue Jun 30, 2009 at 01:09:01 PM EST

The problem with taxing my EARNED benefits to GIVE to someone who wants government health care (aside from it being a Marxist philosophy) is they will need to find something else to tax when people leave the taxed private insurance and move to the government sponsored health care.

The only question I have is have you been to an Airport lately? Do you really want the same people who run the TSA to handle your medical care?

http://motorcitytimes.com/mct/now-obama-wants-to-tax-your-health-insurance-benefits/

http://motorcitytimes.com/mct/video-raising-taxes-is-the-best-way-to-pay-for-health-care/

Steve

Campaign payback? (none / 0) (#2)
by KG One on Tue Jun 30, 2009 at 01:58:05 PM EST

The latest I heard on this charlie-foster is the kow-towing to the unions who helped make the false prophets presidency possible.

Now, how do you explain this shakedown to the majority of Americans who do not belong to a union?

I would explain it like this: by MI Health Facts, 06/30/2009 03:14:35 PM EST (none / 0)

The experiment failed in Canada (none / 0) (#3)
by Corinthian Scales on Tue Jun 30, 2009 at 02:12:02 PM EST

Read it and weep.

Long waits and substandard care has lead to Canadian citizens buying private policies in addition to their confiscated, err, taxpayer funded socialized healthcare.

I know, I know, the only reason socialism has failed across the globe is because we Americans have not tried it. I'm we can do it better.

Silly me.

Oh Noes! Socialism has failed elsewhere only by JGillman, 06/30/2009 03:02:10 PM EST (none / 0)
Actually... by MI Health Facts, 06/30/2009 03:05:49 PM EST (none / 0)

IF done right ... (none / 0) (#4)
by theclassiclib on Tue Jun 30, 2009 at 02:12:09 PM EST

I've read a lot of smart people proposing this type of thing, and while at first it sounds good, it's actually a bad idea - It entirely misses the point!

Health care costs are too high because of government, and incomes are too low because of government. Think about your paycheck for a moment ...

Using rounded estimates for the sake of simple example, let's say you make $100 per week. It costs your employer about $112 per week to employ you, yet your take-home pay is only about $70. Boy, that missing $42 (or 42% of your pay) sure seems to be the single biggest problem Americans face today in my mind.

Health care is the most government-regulated industry outside education (hmmm, a correlation of failure?). Regulation = bureaucracy = increased costs. So the real health care problem is 2-fold:

The government takes too much of a person's income.
The government creates too many additional health care costs.

I say it's time to focus not on the government, but on the real issues of "we the people!" This starts with people keeping their incomes! Believe me ... if the government goes belly-up, it won't nearly be as painful as if you personally go belly-up. Too much emphasis is placed on government these days. Our Founder's weren't wrong - government is not your friend.

Government is not reason; it is not eloquent; it is force. Like fire, it is a dangerous servant and a fearful master. - George Washington, America's first president.

"We the people" have been screwed over for too long! It's time we focus on ourselves!

We might agree here... by MI Health Facts, 06/30/2009 03:10:23 PM EST (none / 0)

Because it doesn't address the real problems by theclassiclib, 07/02/2009 02:42:24 AM EST (none / 0)

Brilliant, insightful post! Great blog! (none / 0) (#5)
by Jack McHughs Blog on Tue Jun 30, 2009 at 02:27:38 PM EST

That's my completely neutral, unbiased opinion of this post by my Mackinac Center colleague Janet Neilson, and the new Mackinac health care blog that she is creating daily content for. :-)

Do check out the blog and make it one of your regular stops in the months ahead, as we discover whether America will follow Europe into the unsustainble socialist paradise of a government-run health care system and rationing.

Taxing health benefits is a bad thing! (none / 0) (#10)
by Eric T on Tue Jun 30, 2009 at 05:25:04 PM EST

Raising my taxes to pay for someone elses health care is the wrong way to go about this.

If people don't have health care, let them go to an Army base, and get their health care there. Or a university and let the students practice on them.
Both the military and colleges are funded with tax money, why not let these institutions that already cost taxpayer trillions, jump in and help provide health care to the uninsured.

Or, howza `bout this (none / 0) (#11)
by Corinthian Scales on Tue Jun 30, 2009 at 06:17:40 PM EST

Can't afford healthcare? Get an already meddling bureaucracy out of healthcare. Enough with the finding creative taxation schemes already. The last thing I need in my life is another bloated, subsidized, inefficient quasi-government provider of health insurance/care. Once our current healthcare system is destroyed in order to establish a socialist version, it will be almost impossible to go back. Mark my words, medical schools will not be graduating as many doctors, scientific research and advancements in drugs and medicine will have all but stopped, and all mechanisms and infrastructure upon which they depend will have been dismantled.

And, when I start seeing an American populous that can recite who their elected officials are from the local level on up with the same ease that they can rattle off sports stats of some pro athlete back though his high school years, I may budge from my position. Until then, p!ss on the uninformed, the uninsured and their misplaced priorities. For cripes sake everything is treated like an entitlement anymore. It is not.

Amen! by theclassiclib, 07/02/2009 02:21:38 AM EST (none / 0)

Thanks for the Goldwater quote. by JGillman, 07/02/2009 07:07:09 AM EST (none / 0)

Goldwater was a great man! by theclassiclib, 07/02/2009 03:04:49 PM EST (5.00 / 1)

creative taxation schemes by Eric T, 07/02/2009 05:36:55 PM EST (none / 0)

Sure the GOP can... by Corinthian Scales, 07/02/2009 07:21:54 PM EST (none / 0)

The 8 Reps by Eric T, 07/02/2009 08:23:03 PM EST (none / 0)

Where are they,... by Corinthian Scales, 07/02/2009 09:14:06 PM EST (none / 0)

Nice to see it in chart form isn't it. by Eric T, 07/02/2009 11:44:39 PM EST (none / 0)

Well ... by theclassiclib, 07/03/2009 10:47:29 PM EST (none / 0)

Everything is on the table by Corinthian Scales, 07/04/2009 08:06:22 AM EST (none / 0)

the Right of the People to alter or to abolish it by theclassiclib, 07/08/2009 04:42:00 PM EST (none / 0)

You have a point.. by JGillman, 07/08/2009 08:34:44 PM EST (none / 0)

curious ... by theclassiclib, 07/08/2009 11:42:36 PM EST (none / 0)

No.. by JGillman, 07/09/2009 07:02:20 AM EST (none / 0)

MI Health Facts said: (none / 0) (#12)
by RushLake on Wed Jul 01, 2009 at 06:16:55 AM EST

"I would then explain that this change should be accompanied by an income tax break so that they would see more take-home money on their paycheck."

And RushLake would point out that right now, politicians from both parties in Lansing are talking about closing tax loopholes to raise "investment" dollars. Recently (yesterday I believe) Andy Meisner, Democrat Macomb Treasurer, stated words to the effect that if all these loopholes for business were effective we'd be seeing jobs gains in Michigan. So when they need to rob us for more money, the "loophole" for this "free government" health care could get closed too.

Are we sure MI Health Facts isn't really Robert Gibbs?

Taxing health benefits isn't a bad thing -- if it's done right | 27 comments (27 topical, 0 hidden)

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