The Alan Sondheim Mail Archive


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Date: Tue, 23 Jan 2007 22:46:29 -0500
From: moderator@PORTSIDE.ORG
To: PORTSIDE@LISTS.PORTSIDE.ORG
Subject: Bush's Health Care - Gold-Plated Indifference

Gold-Plated Indifference
By Paul Krugman

The New York Times - January 22, 2007
Op-Ed Columnist

http://select.nytimes.com/2007/01/22/opinion/22krugman.html

President Bush’s Saturday radio address was devoted to
health care, and officials have put out the word that
the subject will be a major theme in tomorrow’s State
of the Union address. Mr. Bush’s proposal won't go
anywhere. But it’s still worth looking at his remarks,
because of what they say about him and his advisers.

On the radio, Mr. Bush suggested that we should "treat
health insurance more like home ownership." He went on
to say that "the current tax code encourages home
ownership by allowing you to deduct the interest on
your mortgage from your taxes. We can reform the tax
code, so that it provides a similar incentive for you
to buy health insurance."

Wow. Those are the words of someone with no sense of
what it’s like to be uninsured.

Going without health insurance isn't like deciding to
rent an apartment instead of buying a house. It’s a
terrifying experience, which most people endure only if
they have no alternative. The uninsured don't need an
"incentive" to buy insurance; they need something that
makes getting insurance possible.

Most people without health insurance have low incomes,
and just can't afford the premiums. And making premiums
tax-deductible is almost worthless to workers whose
income puts them in a low tax bracket.

Of those uninsured who aren't low-income, many can't
get coverage because of pre-existing conditions -
everything from diabetes to a long-ago case of jock
itch. Again, tax deductions won't solve their problem.

The only people the Bush plan might move out of the
ranks of the uninsured are the people we're least
concerned about - affluent, healthy Americans who
choose voluntarily not to be insured. At most, the Bush
plan might induce some of those people to buy
insurance, while in the process - whaddya know - giving
many other high-income individuals yet another tax
break.

While proposing this high-end tax break, Mr. Bush is
also proposing a tax increase - not on the wealthy, but
on workers who, he thinks, have too much health
insurance. The tax code, he said, "unwisely encourages
workers to choose overly expensive, gold-plated plans.
The result is that insurance premiums rise, and many
Americans cannot afford the coverage they need."

Again, wow. No economic analysis I'm aware of says that
when Peter chooses a good health plan, he raises Paul’s
premiums. And look at the condescension. Will all those
who think they have "gold plated" health coverage
please raise their hands?

According to press reports, the actual plan is to
penalize workers with relatively generous insurance
coverage. Just to be clear, we're not talking about the
wealthy; we're talking about ordinary workers who have
managed to negotiate better-than-average health plans.

What’s driving all this is the theory, popular in
conservative circles but utterly at odds with the
evidence, that the big problem with U.S. health care is
that people have too much insurance - that there would
be large cost savings if people were forced to pay more
of their medical expenses out of pocket.

The administration also believes, for some reason, that
people should be pushed out of employment-based health
insurance - admittedly a deeply flawed system - into
the individual insurance market, which is a disaster on
all fronts. Insurance companies try to avoid selling
policies to people who are likely to use them, so a
large fraction of premiums in the individual market
goes not to paying medical bills but to bureaucracies
dedicated to weeding out "high risk" applicants - and
keeping them uninsured.

I'm somewhat skeptical about health care plans, like
that proposed by Gov. Arnold Schwarzenegger, that
propose covering gaps in the health insurance market
with a series of patches, such as requiring that
insurers offer policies to everyone at the same rate.
But at least the authors of these plans are trying to
help those most in need, and recognize that the market
needs fixing.

Mr. Bush, on the other hand, is still peddling the
fantasy that the free market, with a little help from
tax cuts, solves all problems.

What’s really striking about Mr. Bush’s remarks,
however, is the tone. The stuff about providing
"incentives" to buy insurance, the sneering description
of good coverage as "gold plated," is right-wing think-
tank jargon. In the past Mr. Bush’s speechwriters might
have found less offensive language; now, they're not
even trying to hide his fundamental indifference to the
plight of less-fortunate Americans.

Copyright 2007 The New York Times Company

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