Reforming the U.S. Health Care System
Table of Contents
- Introduction
- I. Universal Coverage
- II. A Health Care Safety Net For The Uninsured
- III. Tax Fairness
- IV. A Rational Role For Employers
- V. Preserving Employer Options, But Rewarding Good Choices
- VI. Incentives To Reduce Waste And Inefficiency
- VII. Options For The Self-Employed
- VIII. Solution To The Special Problems Of The Uninsured
- IX. Health Insurance And Workfare
- X. The Role Of State And Local Governments
- XI. An Alternative To Medicaid
- XII. Funding Reform
XII. Funding Reform
"This program can be funded with money currently used for tax subsidies and health spending programs."
A. Using Savings From Ending The Current Tax System
- Currently, the United States spends more than $100 billion on tax subsidies for employer-provided health insurance, with much of the money subsidizing wasteful overinsurance and rewarding higher-income families who would have purchased insurance without the subsidy.
- Moving to a tax credit system will allow employers and employees to avoid many wasteful practices without losing tax benefits.
- As employers and employees shift to more economical health plans, employer tax-deductible expenses for health insurance will fall and taxable wages will rise.
- The extra taxes the federal government collects from the larger taxable wage base will be a source of funding to insure the currently uninsured.
B. Using Savings From Reductions In Current Spending Programs
- Federal and state spending on health programs for the uninsured currently exceeds $1,000 for every uninsured person in America.
- If all of the uninsured suddenly became insured, this would free up more than $40 billion a year in current spending.
- Savings made possible by scaling back spending programs (as their need diminishes) will be a source of funds to finance the tax credit and the Safety Net program.
"We don't need more spending on health care; we need to use government money more wisely and more fairly."
C. Achieving Budget Neutrality
- America does not need to spend more money on health care -- $1 trillion a year is ample money to meet the nation's health care needs.
- The goal of health reform should be to redirect government subsidies and government spending so that those dollars are used more wisely and more fairly.
