Re July 29 letter by Tim W. Jessup, “Health Care Politics make me sick”
Twenty-four years of my career was spent working in the health care industry in financial management. Both on the insurer side and on the provider side.
The writer is correct that it has been said that tort reform may only save 3 to 5 percent of the overall cost; however, this is a huge number when applied to the overall dollars of health care spending. Also, I would bet that the cost is even greater since it is difficult to project the cost of care for lawsuit avoidance. Who knows what that number may be?
The writer also concludes that insurers can already sell across state lines. Well, Blue Cross (probably the largest health insurer in the country) is a franchise. A resident of South Carolina cannot buy insurance from say Blue Cross of Ohio or any other state since each franchisee has territorial rights.
Regarding taxation on home sales, the writer is correct; however, it should be noted that many middle class homeowners in the northeast and far west have homes that will produce gains of 250,000 for single individuals, especially if they have been in those homes for a long period of time. A senior citizen planning on this equity for retirement will be hit with the tax.
A point that was not mentioned is the changing of the floor for medical deductions on Schedule A of your tax return. It is increased from 7.5 percent to 10 percent. This means that a median income person who itemizes deductions would lose a deduction of 2.5 percent or $1,250 for a family earning $50,000 annually. If their marginal rate is 25 percent, the result is an increased tax or decreased refund of $312.50 per year. If their marginal rate is 15 percent then the cost of the increased floor is $187.50 annually. Middle class seniors will probably suffer the most under this revision.
One final note: I have paid for health insurance for 40 working years. My employer paid a part for my work, while I contributed a subsidy. Now I don’t know what will happen regarding rationing of care; however, since I have paid or worked for health insurance since leaving the Army at the age of 24, am I not entitled to receive benefits (say when I am 80) because I may only have five years to live. It has been said that younger people pay for the older, sicker individuals. One could also say that older citizens have built enough equity in premiums paid over their lifetime to deserve treatment for life threatening illnesses.
The writer lives in Longs.