Saturday, February 11, 2006

The Sky is Falling 2.11

According to John McCarron you can say goodbye to employer provided, group health insurance if the Bush administration gets their way.

OK, I’ll bite.

According to the article," if you paid close attention--very close attention--to President Bush's State of the Union address, you may hear a distant knell for the way most Americans get their health insurance."

So what is wrong with that?

Apparently this.

“In his address, the president said government has a responsibility to "help people afford the insurance coverage they need." The way to do that, his aides later explained, is to "level the playing field" so folks who buy their own insurance get as good a deal as folks who join their company's plan.”

And that would be accomplished how?

“Bush proposes a supercharged version of the health savings accounts (that would allow a) family sock away $10,500 per year tax-free. Moreover, they could claim a tax credit equal to 15.3 percent of the amount they deposited. But it gets sweeter. If the worker buys his own high-deductible insurance policy, rather than one offered at work, the premiums he pays would be fully tax-deductible and eligible for the 15.3 percent tax credit.”

I am not really sure how one is able to deduct premiums AND get a tax credit for those premiums, but I am definitely interested.

The balance of the article is mostly a tirade against the wealthy & healthy so I won’t even go there.

The HSA is an excellent tool and one that should be used by a large percentage of the population. So far less than 3% of those covered by health insurance agree with me but I am not going to let that stop me.

As for the Bush recommendation, tax credits really only appeal to those who actually pay taxes. Coincidentally, this is about half the population . . . those with an AGI that exceeds $29,019.

So what is wrong with the Bush proposal? Not much that I can see. Bring it on.
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