In a new article, Bitter Pill: Why Medical Bills Are Killing Us, Time Magazine delves into why medical bills are so high.
I had a fibrous cyst creating a boil on my neck several years ago. After a round of antibiotics, a doctor performed a 15 minute outpatient surgery, assisted by a nurse, in an examination room. It wasn't even an operating room. Local anesthetic was used. The incision was about 3/4", and I was given a prescription for Vicodin I really didn't need before I left.
The bill was about $850. I was shocked. I might have expected $250, but $850?
Well, $850 is nothing in today's medical world.
Time describes instances of non-life threatening household accident injuries that run up bills in the five figures. More serious problems like treating cancer can run up bills in the six- and seven-figure range with ridiculous line items described in excruciating detail in the article.
What makes the pain of high healthcare costs worse is that the health care providers seem to be profiteering with markups that are as outrageous as they are unjustified. So-called "nonprofit" hospitals are actually profit-making institutions. Have you noticed how your local hospital is adding on new additions like crazy while the rest of the economy is slow. It's a boom economy in healthcare, forcing unjustifiable costs on a public suffering in a totally separate economy.
The article argues something I've already written about here: the healthcare industry isn't a normal market and doesn't really operate in the normal economy the rest of us have to live in. It doesn't compete for the business it gets and there's very little operating to restrain their costs. Yes, your insurance company probably gets a discount of 40%-50%, but even with that discount it's hard to justify the line items on the bills.
Of course, there are people who can't pay their bills and become write-offs and they become part of the high cost of healthcare, but not such a large part that bills need to be as high as they are. Likewise, insuring themselves against lawsuits filed by people who can't accept that (a) shit happens or that (b) some people's conditions are terminal no matter WHAT care they get is a costly problem.
Putting some controls on the legal problems the industry faces is an obvious need, and one that can be addressed. However, the reasons for high healthcare have mostly to do with greed—getting whatever the traffic will bear—rather than providing the best service possible at a reaonable price. It's an industry that has forgotten that its primary purpose is to provide a service, not to break the back of those it serves with unjustifiably high expenses.
Look, I like capitalism, but I've come to decide that there are places where capitalism doesn't work. We don't want police and fire departments, libraries, and parks to be run on a "what the market will bear" basis. I would think that we especially don't want our healthcare system run that way.
You have no better argument for socializing medicine than the system we have now.
I also want others to pay higher taxes. ;)
The main problem in the US is that everyone needs to pay higher taxes. Well, at least pretty much everyone. A 10% across the board increase would do it. Of course, that's unless you prefer getting smart about taxes, and everybody could pay a more appropriate amount.
They do by counting personal debt interest and bond interest (which is non existent right now) as both rights off's (if you make enough money) and capital gains tax. Its the reason no one wants to change the tax code. All our cooking of the books would go bye bye. We don't see the tree's in the forest any longer. The money is not backed by anything but debt. So the gov. prints the money and then takes it back in taxes but it never really pays anything back because it's only good as long as the US and worlds people do not demand equality. If we all stop complaining about taxes (which are not real just paper transactions) and stop looking at our wages as gross and only as net then the govt will have to change.We are all duped into a jedi mind trick so that growth seems plausible. You make 100k a year but only take home 60k a yr, i take the 40k and pay for stuff for you. Pretend you have it and then complain about giving it back so it seems real. and then maybe give you more "back" from time to time. Its all a way to make it SEEM so real but its not. In the scenario above you make 60k. Sometimes you get a break and 65k but really the part everyone complains about in taxes is not real just less money printed but yet put ont he books as if it was.
"The money is not backed by anything but debt."
Except, of course, the productive capacity of the US.
"So the gov. prints the money and then takes it back in taxes"
Actually, they sell bonds to investors - who, at the moment, is actually paying the government for the privilege to buy the debt - and then turn around and use the proceeds to buy goods and services from the people of the US so that they will avoid a severe depression.
"but it never really pays anything back"
Why would it? Investors have so much money that they are paying the government to take it, hardly seems as if they need it.
"because it's only good as long as the US and worlds people do not demand equality."
Can't really demand economic equality, it needs to be achieved. China is working hard at it.
YES! I was just going to suggest that. In NZ we have GST (Goods and Services, Value Added, sales) tax. but the retailer is required to include this in the price. So, if you see an item on sale for $5, you take it to the counter and give the clerk $5. In the States, you are not only mightily inconvenienced by pockets full of pennies, you are reminded, with every transaction, how much tax you're paying.
Why can't the same jedi mind trick be used for income tax. Instead of the employer paying you $1000 and you having to pay the govt $200, why not put net up front. Tell the employee, "Your salary is $800. Here it is. Go spend it." Then the employer (or banker, or investment co,) can pay your income tax for you invisibly. Of course there's an administrative burden on the company, but the burden would be a hundred times less than the cumulatively administrative burden on the individuals.
For the vast majority, capital gains (excl. dividends, which counts as income) will be taxed at 18/20%. As corporations in the US is taxed at 35%, the technical tax rate is thus 52%/53.3%.
We do not simply toss capital gains income and corporate income into the same pile when calculating tax liability. Corporations exist to shelter individuals from liability. For instance, imagine Chase goes belly-up. The CEO won't lose his personal fortune. After all, he says, they're totally separate things, so Chase's creditors can't touch my stuff! But look at what happens when the IRS comes. Suddenly it's different. It's all one big pile of money, he howls, taxed twice! It doesn't work both ways. The reality is: it only works the former way. The latter way is pure fantasy from the Republican theme park ride.
I'd be willing to make a deal with these folks, though. We'll tax the corporation's income and his capital gains compensation "once" as though it really is all one big pile. But when the company fails or gets sued, it's still all in one big pile, and his income and assets are fair game to Chase's creditors and litigators.
Setting capital gains aside, look at the actual taxation revenues that come from corporations. It is not 35% anywhere except in the Republican campaign playbook. The effective average corporate tax rate was just 12.1% according to the CBO, and 55% of US multinationals have zero or even negative tax liability in some years.
This is the result of the tax avoidance epidemic I mentioned earlier. These corporations pay (mostly but not exclusively Republican) Congressmen to create tax loopholes and other subsidies for their types of incomes. The official corporate income tax rate is set at 35%, but US firms are so adept at tax avoidance (and Congress is so corrupt) they almost never actually pay it.
If they were independent of each other then they shouldn't be counted together. However, there exists strong reasons why to double count them, specifically that the tax burden impacts both the value of a firm and the dividends its able to pay. As the double tax rate is considered relevant by the investor, its relevant for the calculation of total tax burden.
Lets say you start investing in property, and end up with 10 units that gross you $100k profit each year. You are considering whether to incorporate or not. If you don't you are taxed at your personal rate of 35%, thus you net $65k. If you incorporate you will first pay corporate tax of 35%, and then personal tax of 35% on dividends, thus you net $42.3k. Clearly you would choose to be personally liable, which will make you vulnerable and restrict your growth potential. I think that's quite relevant points and worthy of consideration.
The CEO wouldn't be liable anyway, unless he is also a shareholder. Auntie Marie with a few thousand dollars in shares through her 401-k, on the other, hand would be in the compromise you outlined.
While there certainly are possible to close loopholes, the average tax rate will almost always be lower than the corporate tax rate since general and tax accounting rules are different. Two large "loopholes" is that losses in one year count towards profit in another year, and depreciation is usually linear in the general accounting and percentage based (accelerated) in the tax accounting. That's not to say unnecessary loopholes don't exist and can't be closed, but a lower corporate tax in the US would make tax planning less profitable, and may in fact bring in more revenue. A sector tiered tax system would be even better, taxing extraction and domestic end-consumer companies at a substantially higher than those who face international competition.
I dislocated my shoulder several years ago, and had no insurance. I normally pushed the shoulder back into place, but this time even an 80lb tool box was not enough. A friend took we to the ER, I waited nearly 3 hours before I was seen, by then I was going into shock! Finally, I was wheeled in, they looked it over, they knocked me out, and I woke up a few hours latter with a re-located shoulder and a bill that seemed to indicate that I had been also raped! $1200.
For some reason they could not just use Demeral, which had always worked before, and I could stay conscious, they thought they needed to dope we up on a medication that interfers with short term memory!
Finally, I was able to get medical for a few months and had surgery for the shoulder, good ever since!
During the period I attempted to make payments, I was told by the billing department, after mentioning that the bill was absurd and no sane person should be stuck with it, that 'docters are wonderful, you should be happy that they put you back together!' In short, docters are F--king god, how dare you complain!
I hope, if this becomes a closer match to 'the best of all possible universes', that doctors get a 6 figure reality check! Thanks for being there, when I needed you!