NCPA - National Center for Policy Analysis

SOLVING THE PROBLEM OF THE UNINSURED

October 28, 2005

To solve the problem of the uninsured, we should integrate the current system of tax subsidies (which encourage people to obtain private health insurance) with a system of spending subsidies (which encourage people not to be insured). This will ensure that government policies do not encourage people to be uninsured or cause the very problem that needs to be solved, says John C. Goodman, president of the National Center for Policy Analysis.

According to Goodman:

  • A uniform, refundable tax credit should be offered to every individual for the purchase of private insurance; in general, social interest in whether someone is insured is largely independent of income and for this reason, the tax credit should be independent of income.
  • All forms of private insurance should be subsidized at the same rate; there is no good reason why individuals who cannot obtain insurance through an employer should be penalized when they buy insurance on their own.
  • The higher taxes paid by people who turn down the tax credit and elect to be uninsured, should pay for care that uninsured patients cannot afford on their own.

To implement this program, all the federal government needs to know is how many people live in each community, says Goodman. What the government pledges to each community is the value of the tax credit times the number of people. The portion of this sum not claimed on tax returns should be available as block grants for indigent health care. Under this proposal, the funding expands and contracts as the number of uninsured expands and contracts, says Goodman.

Source: John C. Goodman, "Solving the Problem of the Uninsured," Thoracic Surgery Clinics, Vol. 15, No. 4, November 2005.

For text:

http://www.ncpa.org/email/book-article.pdf

 

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