Recently a USA Today article http://www.usatoday.com* noted: “Eight million people have signed up for subsidized private health insurance under the Affordable Care Act, President Obama said this month. Millions more obtained new coverage through the Medicaid program for the poor. Full implementation of the health law and its wider coverage, new taxes and shifting subsidies have renewed discussions of winners and losers, makers and moochers”
“Here’s a corrective to common misconceptions about who pays for health care.
• 1. Before Obamacare, we had a free-market health care system.
• Medicare for seniors and Medicaid for the poor, which both began in the 1960s, represent direct government transfers from some taxpayers to others. States have set rules for health insurance for decades.
• If you’re insured through an employer that files an income tax return, your coverage is heavily subsidized by the feds. Tax deductions for private medical coverage cost the Treasury $250 billion a year.
• 2. I fully paid for Medicare through taxes deducted from my salary.
• Scholars at the Urban Institute have calculated that the typical Medicare beneficiary who retired in 2010 will cost the system more than twice as much in health costs than the beneficiary and employer paid in Medicare taxes.
• 3. Premiums from my paycheck fund my company health plan.
• For family coverage, which costs an average of $16,351 last year, the average worker paid only 29% of the premium. For single-person coverage, workers paid 18% of the (lower) total cost.
• 4. Government and employers pay for almost all health care.
• But give workers and consumers credit. In 2012, households still paid the largest single share of health costs, according to federal actuaries. Part was premiums paid through employers and directly to insurers. Part was out-of-pocket expense.
• 5. The insurance company is always the bad guy.
• Human resources pros like to trash-talk the company’s insurance plan when they tell employees the doctor network shrank, the deductible rose or certain procedures aren’t covered.
• But more than half of all workers with health coverage are enrolled in “self-insured” plans where the employer pays medical bills directly. The insurance company only processes claims.
• If your company has at least 500 workers, it is probably self-insured.
• In such plans, the employer is the insurance company. And it’s the employer calling the shots.”
* to read the full USA today story “ Who really pays for health care? It might surprise you” by Jay Hancock , highlight and click on open hyperlink http://www.usatoday.com/story/news/nation/2014/04/26/health-care-costs-obamacare-“employers-medicare-insurance/8064239/
Doctor, Did You Wash Your Hands? ™ provides information to consumers on understanding, managing and navigating health care options.
Jonathan M. Metsch, Dr.P.H., is Clinical Professor, Preventive Medicine, Icahn School of Medicine at Mount Sinai; and Adjunct Professor, Baruch College ( C.U.N.Y.), Rutgers School of Public Health, and Rutgers School of Public Affairs and Administration.
This blog shares general information about understanding and navigating the health care system. For specific medical advice about your own problems, issues and options talk to your personal physician.