The employer health-care insurance scam

In the posts, “‘The “Medicare for All’ controversy”, and “Ten Steps to Prosperity: Step 2. Federally funded Medicare — Parts A, B & D, plus long-term care — for everyone”, we describe how easily the federal government could provide free healthcare insurance to every man, woman, and child in America.

The program could pay for comprehensive, no deductible, no-coinsurance, no-limit, no out-of-pocket costs of any kind insurance, without levying a penny in federal taxes.

Instead of that, America, the wealthiest nation on earth has this:

‘Focused on survival’: Millions of laid-off Americans still living without health insurance
Alexis Keenan·Reporter
Fri, September 25, 2020, 3:12 PM CDT
With hundreds of thousands of Americans filing new unemployment claims every week, sobering evidence of the difficulties faced by laid-off workers is showing up in the estimated number of U.S. adults now lacking health insurance.

Since the onset of COVID-19 in mid-March, workers who lost employment-based healthcare insurance (ESI) far outnumber those who gained coverage, either through a public or private option.

Approximately 4.6 million to 5.6 million workers who lost job-based coverage since March are now uninsured.

It’s common for those who have lost job-based insurance to go without it. Unless you have a serious health issue, insurance is just not on the priority list.

Medicaid eligibility largely depends on the state where the laid-off worker resides, and is based on current monthly income.

In states that have expanded Medicaid, those with current monthly income less than 138% of the federal poverty level are eligible. For a family of 3, the limit is approximately $2,500 per month. For an individual, the limit is approximately $1,466 per month.

In states that have not expanded Medicaid, eligibility is limited to parents with minor children whose median income is below 40% of the federal poverty level, or whose annual income did not exceed $8,532 for a family of three in 2019.

ESI is designed to seem like a wonderful perk. In most cases, the employer seems to pay most or all of the premiums, and you, the employee, usually are guaranteed coverage, even with pre-existing conditions.

Except:

1. The employer really doesn’t pay. He’s just a go-between. When hiring, employers calculate the cost of employees to include all costs (salaries, perks, office space, expense accounts, etc.) The reality is, the employee pays for everything, with the only benefit being the tax benefits for running the costs through the employer. Salaries could be higher if the employer didn’t pay for healthcare insurance.
2.  Most insurance plans charge according to experience, so the employers pay more for “expensive employees” (older employees and those with expensive medical conditions.) That is one reason why you “expensive employees” have more difficulty finding jobs. Employers quietly discriminate against you.
3. If you lose your job, you may have difficulty finding healthcare insurance, or if you do, it probably will be at a high cost at just the time when your income has disappeared. So the “free” ESI is a pair of golden handcuffs (that you really pay for).

Especially, if you are in your 50s or older, the terror of losing your healthcare insurance, at just the time in your life when you will begin to need it  most, can leave you completely at the mercy of your employer.

And that is the whole point.

America’s rich write America’s laws, including tax laws.

From H&R Block:

In 2018, the IRS allowed you to deduct medical expenses that exceeded 7.5% of your adjusted gross income.

Beginning Jan. 1, 2019, all taxpayers may deduct only the amount of the total unreimbursed allowable medical care expenses for the year that exceeds 10% of their adjusted gross income.

You aren’t able to claim both an itemized tax deduction with your standard deduction. Essentially, your medical deduction needs to be significant, along with other itemizations, to give you a great deduction.

For the current tax year, the standard deduction is worth $12,000 for single taxpayers and $24,000 for married taxpayers filing jointly. If you’re filing as the head of household, it’s worth $18,000.

Get it? For a business, all medical expenses are tax-deductible. Businesses pay taxes on profits. But,, for you individually, medical expenses only are deductible after they go above 10% of your adjusted gross income or your standard deduction.

If, for instance, your income is $50,000, the first $5,000 of your medical expenses isn’t tax deductible.

Side note: The so-called “standard deduction” is not a deduction. It is the amount you can’t claim if you wish to itemize your expenses. The higher the “standard deduction,” the less you can claim as a deduction for expenses.

The above paragraph about standard deductions really should read, “For the current tax year, single taxpayers can’t take the first $12,000 expenses as deductions. Married taxpayers can’t take the first $24,000, and heads of households can’t take the first $18,000.”

That means the vast majority of Americans can’t take any expense deduction at all. By contrast, businesses can deduct almost all their expenses.

It’s just another con job by the rich.

Getting back to Medicare for All, if the federal government funded a comprehensive plan that covered all your hospital, doctor, equipment, and long-term care costs, not only could your salary be higher, but your employer would not “own” you. Losing your job would be far less traumatic.

The federal government already has done the hard work by creating Medicare for All (over 65), so the functional problems have been solved. It would be a simple matter to reduce the qualifying age to 0, and to eliminate deductibles and co-pays.

Except, that is not what the rich want. They want to widen the Gap between the rich and the rest, and one sneaky way to do it is via employer-provided healthcare insurance.

And now, we’ll entertain the false claims that Medicare for All is “unsustainable” and/or “socialism.”

Rodger Malcolm Mitchell

Monetary Sovereignty Twitter: @rodgermitchell Search #monetarysovereignty Facebook: Rodger Malcolm Mitchell …………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………..

THE SOLE PURPOSE OF GOVERNMENT IS TO IMPROVE AND PROTECT THE LIVES OF THE PEOPLE.

The most important problems in economics involve:

Ten Steps To Prosperity:

1. Eliminate FICA
2. Federally funded Medicare — parts A, B & D, plus long-term care — for everyone
3. Social Security for all or a reverse income tax
4. Free education (including post-grad) for everyone
5. Salary for attending school
6. Eliminate federal taxes on business
7. Increase the standard income tax deduction, annually. 
8. Tax the very rich (the “.1%”) more, with higher progressive tax rates on all forms of income.
9. Federal ownership of all banks
10. Increase federal spending on the myriad initiatives that benefit America’s 99.9% 

The Ten Steps will grow the economy and narrow the income/wealth/power Gap between the rich and the rest.

MONETARY SOVEREIGNTY