American families are paying an $8,000 tax because of the greed of the health care industry.

[Uncle Joe]

Link to tweet

SAN DIEGO — America’s sky-high health-care costs are so far above what people pay in other countries that they are the equivalent of a hefty tax, Princeton University economists Anne Case and Angus Deaton say. They are surprised Americans aren’t revolting against these taxes.

“A few people are getting very rich at the expense of the rest of us,” Case said at conference in San Diego on Saturday. The U.S. health-care system is “like a tribute to a foreign power, but we’re doing it to ourselves.”

The U.S. health-care system is the most expensive in the world, costing about $1 trillion more per year than the next-most-expensive system — Switzerland’s. That means U.S. households pay an extra $8,000 per year, compared with what Swiss families pay. Case and Deaton view this extra cost as a “poll tax,” meaning it is levied on every individual regardless of their ability to pay. (Most Americans think of a poll tax as money people once had to pay to register to vote, but “polle” was an archaic German word for “head.” The idea behind a poll tax is that it falls on every head.)

Despite paying $8,000 more a year than anyone else, American families do not have better health outcomes, the economists argue. Life expectancy in the United States is lower than in Europe.

(snip)

https://www.washingtonpost.com/business/2020/01/07/every-american-family-basically-pays-an-poll-tax-under-us-health-system-top-economists-say/

[MontanaMama]

1. I paid $18,000 in premiums last year

for our family of 3. Plus $4000 per person deductible. It is criminal. Health insurance corporations = organized crime.

[Ohiogal]

2. That is appalling.

We are getting fleeced for health care in the USA. This cannot continue. Our archaic system benefits only the insurance companies. It’s downright cruel. We need Medicare for All.

[NJCher]

3. that is just crazy

combined with a $4000 deductible each???!!!!

[MontanaMama]

5. Yup.

True story. Self employed and self insured. It's a racket and there are no other options. I can't imagine my retirement if I could invest that money instead of greasing the palms of my insurance corporation.

[Uncle Joe]

6. Thanks for sharing MontanaMama.

[lastlib]

4. &I'll be paying $10,000 this year in premiums. For just myself.

Still looking at $6,000+ in deductibles.

I want O'care back as it was when I could afford it. GOPeeDon'tCare sucks.

[George II]

7. That is misleading....

First, that $8,000 is not a "tax" at all, much less a "poll tax". This isn't Germany.

Second, those other countries have income taxes as high as 65-70% on working class families to pay for their healthcare coverage systems (and other government expenses)

I would really like to see an objective, complete comparison of the systems in other countries and what "medicare for all" plus taxes that support "m4a" as proposed here. That's an all-inclusive comparison of all aspects of the healthcare system and coverage.

The most I ever paid for healthcare insurance was about $250 per month ($3,000 a year) for a few years. My wife never paid more than $20 per week ($1,000 per year, but she worked for a hospital)

Right now we're both on the real Medicare, we pay $144/month (up from about $130 in the past) and $29/month for a supplement. That's $4,100 for both of us combined. Copays are minimal.

This is a debate that's been going on for a while. Why don't the candidate lay their cards on the table and give us a clear idea of what they're proposing, what it will cost, what tax increases might be.

That's the only way for Americans to sensibly compare the various proposals.

[Uncle Joe]

8. Here is some more from the Nobel Prize winner in economics.

(snip)

Case and Deaton, a Nobel Prize winner in economics, made the critical remarks about U.S. health care during a talk at the American Economic Association’s annual meeting, where thousands of economists gather to discuss the health of the U.S. economy and their latest research on what’s working and what’s not.

The two economists have risen to prominence in recent years for their work on America’s “deaths of despair.” They discovered Americans between the ages of 25 and 64 have been committing suicide, overdosing on opioids or dying from alcohol-related problems like liver disease at skyrocketing rates since 2000. These “deaths of despair” have been especially large among white Americans without college degrees as job options have rapidly declined for them.

Their forthcoming book, “Deaths of Despair and the Future of Capitalism,” includes a scathing chapter examining how the U.S. health-care system has played a key role in these deaths. The authors call out pharmaceutical companies, hospitals, device manufacturers and doctors for their roles in driving up costs and creating the opioid epidemic.

(snip)

Surprise billing has been widely criticized by people across the political spectrum, yet a bipartisan push in Congress to curb it was killed at the end of last year after lobbying pressure.

(snip)

https://www.washingtonpost.com/business/2020/01/07/every-american-family-basically-pays-an-poll-tax-under-us-health-system-top-economists-say/

[George II]

10. That's all well and good, I don't doubt their credentials. But the premise of the OP is either....

...incorrect or based on incomplete information (probably, since "m4a" hasn't been fully detailed yet). And the idea that medical coverage costs is a "tax" is way off, calling it a "poll tax" is even further from the truth.

Connecting alcohol deaths, opioid deaths and suicide to lack of medical care is questionable at best:

First, people who take opioids have actually received medical care and been prescribed opioids. So there goes that claim.

Second, alcohol abuse and addition has been an issue for centuries. For example, remember the 18th Amendment of 1919?

Suicide, a horrible thing, is caused by many factors. I've known at least three people who have committed suicide over the years, none was because of medical issues.

[MichMan]

9. Dont forget that Canada and nearly all countries in the EU have VAT

[George II]

11. The VAT in Canada is about 13%, depending upon the province. FST is 5%, PST 8% plus or minus.

We don't have a Federal Sales Tax and some states don't have State Sales Tax.

[George II]

12. BTW, here are VAT for some countries:

Canada 5% + Provincial Sales Tax (~ 13% total)
Iceland 24%
Italy 22%
Denmark 25%
Finland 24%
Germany 19%
Netherlands 21%
Norway 25%
Sweden 25%
United States 0%

[bluewater]

13. You included Canadian Sales Taxes, but not US Sales Taxes.

That's simply misleading.

[George II]

17. Not really:

In the United States some states do not have sales taxes, rates vary widely from state to state (from 0% to 7.25%), and "medicare for all" as proposed is a Federal program, state sales taxes won't be used to fund it.

In Canada, every Province has a sales tax and a portion of their Provincial Sales Tax is used to fund the Canadian universal healthcare program.

[bluewater]

18. Yes really. Leaving out the total tax burden on individuals is misleading.

Also, you failed to mention that VAT's replace corporate taxes and, as we all know, corporate income taxes are ultimately passed on to the consumers.

So comparing VAT rates and saying the US consumer pays 0% in comparison is totally misleading.

[Hassin Bin Sober]

28. Yep. Absolutely misleading

Not to mention the 45,000 people who die every year from lack of healthcare.

[bluewater]

16. Your post is MISLEADING. VAT's also replaces corporate income taxes

Your post is MISLEADING. VAT's also replaces corporate income taxes

And we all know that corporate taxes are ultimately passed on to the consumer.

How Does That Differ From Good Ol' American Sales Tax?

In America, Sales Tax is paid by the end consumer. The government has to wait until the good is purchased by the consumer before receiving any tax revenue. And if that good never sells, the government never receives tax from it. Another difference is that with Sales Tax, only the end seller has to pay tax to the government, even if that seller really didn't add much value at all to the whole process. With VAT, the businesses that add value to the good as it moves through the supply chain pay taxes by the sale of the good. Taxes are only paid for the value added. If your company didn't add much value, as in the case of the baker, your company doesn't have to pay as much in taxes.

You might be thinking why should a manufacturing company pay anything at all in sales taxes? That's not how we roll here in America. But here's the thing, VAT doesn't just replace Sales Tax, it also replaces Income Tax. So Business B pays tax on every "sale" made, but doesn't pay Corporate Income Tax.

You might also be thinking 10% tax? That's way more that my current sales tax. Yes, VAT percents are usually much higher, and more on that later. But just as VAT replaces Corporate Income Tax, it also replaces Individual Sales Tax too. Wow -- April 15th just got a little bit brighter!

https://blogs.findlaw.com/law_and_life/2018/09/sales-tax-vs-value-added-tax-whats-the-difference.html

A fuller explanation paints quite a different picture, eh?

[bluewater]

14. So? A VAT is essenially a consumption tax, similar in the end to US Sales Taxes.

How Does That Differ From Good Ol' American Sales Tax?

In America, Sales Tax is paid by the end consumer. The government has to wait until the good is purchased by the consumer before receiving any tax revenue. And if that good never sells, the government never receives tax from it. Another difference is that with Sales Tax, only the end seller has to pay tax to the government, even if that seller really didn't add much value at all to the whole process. With VAT, the businesses that add value to the good as it moves through the supply chain pay taxes by the sale of the good. Taxes are only paid for the value added. If your company didn't add much value, as in the case of the baker, your company doesn't have to pay as much in taxes.

You might be thinking why should a manufacturing company pay anything at all in sales taxes? That's not how we roll here in America. But here's the thing, VAT doesn't just replace Sales Tax, it also replaces Income Tax. So Business B pays tax on every "sale" made, but doesn't pay Corporate Income Tax.

You might also be thinking 10% tax? That's way more that my current sales tax. Yes, VAT percents are usually much higher, and more on that later. But just as VAT replaces Corporate Income Tax, it also replaces Individual Sales Tax too. Wow -- April 15th just got a little bit brighter!

https://blogs.findlaw.com/law_and_life/2018/09/sales-tax-vs-value-added-tax-whats-the-difference.html

[oldsoftie]

20. But nobody here is willing to support a VAT, sales or any other consumption tax.

Even though it would raise a LOT of money. And tax all the people who currently avoid some or all of the income tax. And there are a TON of them. People who dont get W2s or 1099s & "self report" income.
Not dealing with this fact is a huge reason we are always behind in revenue

[bluewater]

21. The point is that even not having a VAT, we pay similar taxes indirectly.

[Uncle Joe]

22. Precisely bluewater.

[oldsoftie]

23. No, we dont. They pay more & get more.

Just like the US,
They tax property
They tax vehicles
They tax the HELL out of gas
They tax income (almost every workers income; nearly 1/2 of workers here pay none)
They have the VAT (we dont)

Who says what we pay is similar to what they pay?

[Recursion]

27. Andrew Yang is running on a VAT

Some of us like the idea

[oldsoftie]

29. Thank you, I did forget Yang. And he's not afraid to back it up with real stats.

Instead of fantasy projections.

I was referring more to DUers than candidates, but obviously the DU Yang Gang supports it as well. Every time I bring it up i get the same pushback. Even though no one has a better answer on how to tax ALL income

[Recursion]

33. I think there's kind of an instinctive pushback because people hear it's regressive

and assume that's bad. But all the social democracies have significantly more regressive taxes than the US, it's just that their spending is so much more progressive than ours that their systems wind up being more progressive. We're the only industrialized country without universal health care or a VAT, and I'm convinced those two facts are not coincidences...

[oldsoftie]

34. I totally agree.

[MichMan]

31. VAT is charged at every intermediate transaction while Sales taxes are only charged at the very end

From my understanding, the following is correct. Thete may be variations and exemptions depending on the taxing authority.

Take something as intensive as manufacturing a car. Steel supplier pays VAT on all equipment and raw materials such as iron and coke. Seat supplier pays VAT on not only the same steel, but on vinyl, leather, fasteners, adhesives, and other materials, Car company pays VAT on the seats. Car buyer pays VAT on car.

So VAT is charged on the iron>steel>seat>car. Imagine those same level of taxes on every stage of production on all of the thousands of parts in a vehicle. That is why it is called a Value Added Tax as it is charged on the value added on all levels.

Unlike corporate taxes which are levied on profits, VAT taxes are levied on every transaction regardless of any profitability.

[Recursion]

32. Not quite

The hint is in the name. Let's pretend the seat is just made of steel and foam to keep it simple. The seat manufacturer buys $50 worth of steel and $20 worth of foam but makes a seat that sells for $100. That additional value, the cost over the material inputs, is taxed when he sells the seat to Ford.

[oldsoftie]

19. No one wants to hear facts! It ruins the story.

And while everyone wants to have a similar health care system as Europe does, no one wants to FUND it the way they do either.
So it remains a fantasy.

[myohmy2]

24. disgusting...

" The U.S. health-care system is the most expensive in the world, costing about $1 trillion more per year than the next-most-expensive system..."

...and we get shitty healthcare for it...

...MFA=FREEDOM!!

...freedom crappy over priced healthcare, freedom from your cheap boss, freedom from wall street greed, freedom from insurance company apparatchik's, freedom from denial of service, freedom from healthcare worries, freedom from drug company gouging, freedom from going broke over healthcare, etc., etc...

...MFA is just plain FREEDOM...

...and I like freedom...

[oldsoftie]

30. We dont really get "crappy" healthcare. But its certainly more costly.

[LanternWaste]

25. Thankfully, every Democratic candidate will takes steps to address this.

I "imagine" even non-Democratic candidates will pay lip service to this concern as well.

[InAbLuEsTaTe]

26. HELP IS ON THE WAY!! BERNIE HAS OUR BACK... AND WE HAVE HIS!!

Bernie/Elizabeth or Elizabeth/Bernie 2020!!
Either way, they're stronger together & can't be bought!!
Jump on the Bernie Bandwagon & join the revolution!!

[brooklynite]

35. I only spent $1,450 for insurance in 2019...

No deductibles and $20 co-pays.

...and that's Bernie's (and Elizabeth's) problem: MOST people have insurance from their employer, and while that's not a fair system for unemployed, self-employed and under-employed, it's the system under which MOST voters will make their decision in November. MfA WITHOUT retaining the choice of existing private insurance plans isn't politically viable.