Thursday, July 30, 2009

Health Care Reform: Making Sausage

by Gordon Prickett

Hearing DFLer Colleen Nardone & Republican Chuck Marohn tackling healthcare reform Thursday morning today leads me to add some facts to the opinions that were expressed.
Chuck talked about "Free Goods" - like covered elder health care and roads. And he complained about the employer's 50% share of employee payroll taxes.

Possibly, the idea is just that we don't know the precise cost of these goods, so we treat them like they are free. That used to be the case with air and water, but no more.
The payroll tax on income is now 6.20% for Social Security and 1.45% for Medicare - to be withheld every pay period, so the employer sends a combined 15.30% to the federal government. This is how money is gathered to send out the social security and medicare payments.

As for our roads, with every gallon of Minnesota gasoline, drivers now pay a tax of 43.9 cents per gallon.
This includes a federal tax of 18.4 cents per gallon, which goes into the highway trust fund, for Interstate and U.S. highway and bridge construction and maintenance.Since October 2008, our state gasoline tax is 25.5 cents per gallon, for state highways and bridges and County State-Assisted Highways. Our roadways are not free to drivers.
My township has a line item on the local property tax for roads and bridges - plowing, gravel, mowing shoulders. There are no free roads or driveways here.

As a Medicare-covered geezer since 2001, I can confirm Colleen's report of successful Medicare experience from her friend. In 2009 my wife and I will pay combined fees of $2,313.60 for Medicare Parts A and B. Add to that $258, in deductibles. These fees are deducted our Social Security monthly payments. Our payroll contributions for Social Security began back in the 1950s and continue for our part-time employment.

Medicare is not free to us.

My employer's retirement health care package has had steep annual cost increases for the last five years.
Currently my corporate pension - not indexed for cost of living - is reduced by $4,176 in 2009 to pay for our basic supplemental coverage to Medicare, including prescription drugs with a co-pay.
When all the contributions are totalled up, there is a lot of money in the U.S. healthcare system. We can do a much better job of allocating these funds.
Profit-taking insurance companies, who tell us what procedures "They will cover," is the best place to start when reforming and cutting health care costs.

Gordon Pricket lives on Nord Lake in Aitkin County

1 comment:

Anonymous said...

Gordan...Good commentary, along with data. It's difficult to get the facts from mainstream media nowadays. Many northern Minnesota blogs lean hard left (i.e. - Minnesota Brown & others) and report biasedly. It's probably why FOX News is the fastest growing major news media in the outpacing some major networks.

Keep up the good work.