🚀 go-pugleaf

In article <dsaCE9531.MFr@netcom.com> dsa@netcom.com (David S.A. Stine) writes:
>In article <28hfek$mph@apakabar.cc.columbia.edu> gld@mhoro.cc.columbia.edu (Gary L Dare) writes:
>>
>>If you can afford it, you'd not be in the plan you're stuck in.  Can
>>you opt out of your employer's HMO, whether or not you can take the
>>equivalent in cash, to buy your own fee-for-service plan?
>
>Yes, in a way.
>
>Some companies offer what is known as a "cafeteria plan" (I don't know from
>whence the name comes) where you can set aside X percentage of your pre-tax
>income for health services. You can then use this income to pay directly
>for your services on a fee-for-service schedule. If you use up all of your
>allocation, great! You've just been able to reduce your 1040 line 10 income
>right off the top, possibly lowering yourself into a lower tax bracket.
>
>However, if you don't use all the money you set aside in your plan by the
>end of the year, Uncle Sam just wraps his mitt around this and says "Thank
>you." You lose it, straight out.
>
>>I thought not.
>
>Yes, you can. You have to have a company with a sharp (and benevolent)
>accountant, much as many companies offer 401K plans on the whim of their
>accounting departments. Granted, not many companies do this, but the point
>it that there is a provision for doing this, it does work for people who
>can easily predict a constant level of medical expense (people with
>children seem to use the plan the most) and it is an alternative.
>
>>And health costs now are such that getting access outside of
>>your present plan (esp. HMO) is already impossible
>
>No, not so.
>
>If I wanted to go completely outside my company's health plan, I could buy
>major medical insurance via the IEEE or ACM. It would cost me $800 to $1000
>per year, might not have all the goodies that my current plan has, but it
>would cover major expenses and emergency coverage. 
>
>Now, here's an idea I'd like to float past people:
>
>Let's say that instead of taxing people to provide for health care, that
>the government set up something like a 401K for health care costs. ie, you
>could set aside X% of your pre-tax income for health-care costs; the
>government could dictate a minimum you must save. The savings plan would be
>administered by your employer, just as a 401K is.
>
>You could not withdraw from the plan unless you could prove you have
>alternative coverage. You could direct the investment option you want for
>unspent contributions to the plan, within reason. You would get your income
>reduced by the amount of your yearly contribution. You could not spend
>money out of the plan _except_ for health care costs.
>
>Your plan would be carried around like the contributions to a 401K -- ie,
>when you move from employer to employer, you would transfer your account
>into the new employer's plan. If you're leaving the workforce, you would
>have to transfer your money into a self-directed plan, subject to
>government oversight. (not control, oversight).
>
>At the end of each year, the government takes 50% of the gains from the
>investment on everyone's plan to pay for the uninsured.
>
>The current insurance industry is basically tossed out on its ear and the
>pricing structure of health care is reformed so that people are getting
>what they pay for. (If individuals who obtain services from the health-care
>industry actually had to review and pay the bills, there would be a whole
>lot less cost-shifting and a whole lot more accountability for costs than
>there is now).
>
>If you die and there are funds left in your account, Uncle Sam takes them
>for the uninsured account. But if you need health care after you retire,
>there's a fund of your own money sitting there ready for your use.
>
>I see this possibility as solving several problems in one stroke:
>
>1) It keeps the government out of the health care process -- people still
>   choose their doctor. 
>2) There would be a growing pool of savings out there. The rate of American
>   savings is abysmal as it is, and this could help augment FICA for
>   people's old age; the biggest expense for most geriatrics is health care.
>3) It contributes towards the uninsured, which is supposed to be the 
>   whole point of this health-care exercise, right?
>4) The insurance companies have their leashes yanked real hard; there 
>   is suddenly a viable alternative with an incentive to siphon money
>   away from the classic health insurance industry. Nothing like some
>   competition to wake 'em up.
>5) The reduction in line 10 income  provides an incentive for the well-off
>   to contribute to the plan to obtain the tax break.
>
>I haven't run any numbers on this, but I think it sounds better than the
>social engineering nonsense coming out of Washington, where they're not
>only trying to devise a health-care plan, but an entire social agenda...
>(abortion, gun control, violence, tax distributions, sin taxes and on and on)
>
>The problem with the Clinton(s) (yea, both of 'em) is that they only know
>how to use the stick. They don't even know a carrot exists.
>
>Hell, want to add some more incentive to it? Run out some actuarial
>numbers; if you've been good to yourself and you've attained certain
>milestone ages and have 'x' amount in your account and you receive a good
>clean bill of health, allow you to pull some income out of the investment
>return (not the principle). This would add incentive to keep yourself
>healthy.
>
>
>dsa
>
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Under your plan, what happens if your contributions do not equal your medical costs?If I make, say, 20,000/year, contribute 2500/year to the plan, and get cancer two years into it.  My medical costs are 15,000, I still have unpaid medical bills, and I have lost the 2500 that could have been used to support me during my period of disability.   It seems the plan only works if you have a certain amount of "disposable income" and even then, only if you pay for years before you need it.  (In my example above, e



ven a worker making $100,000/year would come up short if he got sick the first year.)