BUPA and healthcare.

[green-man-2010.livejournal.com]

In the UK, a company known as BUPA is offering private healthcare to anyone who wants and can afford it.

This is not a replacement for the NHS, but rather, it runs alongside it.
A lot of firms will take out health insurabnce on their top people, or even offer it to their rank and file employees as a tax deductable 'perk' of the job.

Now, this might mean that you have an accident or illness, and instead of going on a six month waiting list to get seen on the NHS, you get the option of 'going private' and getting seen to sooner.

Now, to some , this is seen as grossly unfair. If you have money, you can ' jump the queue', they say.

However, those in favour of BUPA look at it another way - they still pay for the NHS, however, by taking out private Healthcare on top of this, they enable the NHS to get to other people faster- "let's be honest, if I never had BUPA, I would be in front of someone else in the queue - by taking myself off to BUPA, I free up a doctor, an operating theatre and a hospital bed for somebody else. And I still pay for that in my taxes", thus argues one BUPA patient.

Of course, the 'safety net' is still there for those who cannot afford BUPA, and for all that people from the Daily Mail talk about "Britain's third rate, Third World health service", you really have to go to the Third World yourself and take a look.

Ok, we call it ' the developing world' these days, but go there sometime and take a look.
Fact - in hospitals in the UK, we have incubators for premature babies, we have CAt scanners and ECGs, we have vaccines and specialists and X ray machines.

In some countries in the world, they do not have electricity or even proper sanitation.

The NHS may not get to see you as soon as you like, but I will maintain that in the UK, you stand a better chance of living to be five years old, and living longer past your 50th birthday than you would in a lot of other places. If you know different, then show me.

Britain is one of the few places on Earth where you get a public *and* a private healthcare program to take care of you. I wonder what our community makes of this.
A two tier healthcare system : Is it a good thing, a bad thing or does it make no difference? Why do you think so?
Over to you.

Comments

[badlydrawnjeff.livejournal.com]

Not especially, but I'm not really in favor of income/payroll taxes anyway.

[mijopo.livejournal.com]

Well, put it this way, given the existence of income and payroll taxes, don't you think that the failure to tax this benefit results in market distortions?

[badlydrawnjeff.livejournal.com]

Not really, because it's still levied equally.

And even if it did create some distortions, the impact of health insurance on medical costs is so low already that the impact would be negligible.

[mijopo.livejournal.com]

Well, the fact that they're tax free is why, or a big reason why, employers started funding health insurance and why private insurance became so common. This in turn, arguably, resulted in price increases and changes (increases) in usage. So, I wouldn't argue, at all, that "the impact of health insurance on medical costs is low already". Go to a counterfactual scenario in which health insurance was never made tax free, in that world US health care costs are much much lower.

[badlydrawnjeff.livejournal.com]

Well, the fact that they're tax free is why, or a big reason why, employers started funding health insurance and why private insurance became so common.

Not true, actually. We actually have FDR to blame (http://www.manhattan-institute.org/html/miarticle.htm?id=3135), as employers needed to find a new edge to combat the wage and price controls put into place. We have the government to thank for this, and not the tax benefit that comes with it.

This in turn, arguably, resulted in price increases and changes (increases) in usage. So, I wouldn't argue, at all, that "the impact of health insurance on medical costs is low already".

Well, that's not something I'm just pulling out of nowhere - it simply is (http://www.kaiseredu.org/Issue-Modules/US-Health-Care-Costs/Background-Brief.aspx). Program administration, which is what insurance falls under, is a mere 7% of your health care dollar.

Essentially, you're saying that the existence of this small sliver of spending has resulted in massive increases in health care spending here for an otherwise identical product. I'm not sure you can really extrapolate that.

Go to a counterfactual scenario in which health insurance was never made tax free, in that world US health care costs are much much lower.

So you think the fact that benefits are tax free here, and not price controls (http://books.google.com/books?id=7usDUb38wpkC&pg=PA220&lpg=PA220&dq=medical+price+controls+europe&source=bl&ots=xKaFzLadNC&sig=nCr_Og1KsF7OMRhTIrH-gNsgTjQ&hl=en&ei=boDlTN3BNMqr8AaJ9eHsDA&sa=X&oi=book_result&ct=result&resnum=5&ved=0CDoQ6AEwBDgK#v=onepage&q&f=false) or rationing measures (http://books.google.com/books?id=7usDUb38wpkC&pg=PA161&lpg=PA161&dq=rationing+measures+europe&source=bl&ots=xKaFzLadQx&sig=z6AIpldgbtqA0XwWUw2f0ed8HMM&hl=en&ei=h4DlTP-9EsGs8AaM6_WIDQ&sa=X&oi=book_result&ct=result&resnum=1&ved=0CBcQ6AEwAA#v=onepage&q=rationing%20measures%20europe&f=false) are a more direct and obvious place to start?

[mijopo.livejournal.com]

Not true, actually

You have an odd notion of "not true", whether or not FDR is "to blame" doesn't contradict the fact that their tax free status was a big reason why

Essentially, you're saying that the existence of this small sliver of spending has resulted in massive increases in health care spending here for an otherwise identical product.

No, that's not what I'm saying at all. Not even close. Come on, Jeff, at least read what I wrote and don't make assumptions that can't be justified.

So you think the fact that benefits are tax free here, and not price controls or rationing measures are a more direct and obvious place to start?

Right, the price controls helps explain why they were tax free, and the fact that they're tax free explain why they became so widely implemented. These aren't contradictory explanations.

it's sort of funny that I'm actually just giving you good old fashioned free market ideology and you're trying to refute it presumably because you're assuming that because I'm a liberal I must be wrong or something.

[mijopo.livejournal.com]

I'm actually just giving you good old fashioned free market ideology

In fact, the very article you cited, from the "national review", no less, advocates for "end[ing] the tax code’s discrimination in favor of employer-based health coverage", the very thing you're dismissing.

[badlydrawnjeff.livejournal.com]

That's not, however, in favor of what you're claiming or proposing as a result.

[mijopo.livejournal.com]

?

[badlydrawnjeff.livejournal.com]

You have an odd notion of "not true", whether or not FDR is "to blame" doesn't contradict the fact that their tax free status was a big reason why

The tax free status really had nothing to do with it - the goal was only to provide benefits that got around the wage controls.

No, that's not what I'm saying at all. Not even close. Come on, Jeff, at least read what I wrote and don't make assumptions that can't be justified.

If that's not what you're saying, then I have no clue what you're trying to get at.

Right, the price controls helps explain why they were tax free, and the fact that they're tax free explain why they became so widely implemented. These aren't contradictory explanations.

I was referring to price controls and rationing measures overseas.

it's sort of funny that I'm actually just giving you good old fashioned free market ideology and you're trying to refute it presumably because you're assuming that because I'm a liberal I must be wrong or something.

Not at all. You're wrong because you appear to be wrong. You have yet to show where the tax free status is distorting the market over other more obvious things.

[mijopo.livejournal.com]

he tax free status really had nothing to do with it

What are you talking about? Of course, it had a great deal to do with it. It gave employers the ability to give something to employees that cost the employer less than it was worth to employees. that's why it grew so rapidly, it was a give away by the government.

If that's not what you're saying, then I have no clue what you're trying to get at.

The point is that the tax free status resulted in (a) employers being the conduit for health care and (b) the fact that it became so prevalent.

[badlydrawnjeff.livejournal.com]

What are you talking about? Of course, it had a great deal to do with it. It gave employers the ability to give something to employees that cost the employer less than it was worth to employees. that's why it grew so rapidly, it was a give away by the government.

So you're attributing the rise in employee benefits not to the easy workaround on wage controls, but on the tax free status (a tax, by the way, that would have been a relative pittance to all involved).

The point is that the tax free status resulted in (a) employers being the conduit for health care and (b) the fact that it became so prevalent.

That's not supportable by the historical record, then.

[mijopo.livejournal.com]

I'm attributing it to both, the tax free status was part and parcel of the workaround.

[mijopo.livejournal.com]

The tax free status really had nothing to do with it

In fact, why don't you let me cite the very article that you threw at me.

"Employers, seeking a way to provide workers with competitive salaries without violating the law, began offering health benefits. On October 26, 1943, the IRS legitimized the practice, ruling that health benefits would remain tax free.

As a result, it has historically made sense for firms to offer health benefits — and lots of them. " (emphasis added)

The article you cited, from William F. Buckley's "National Review" makes the same damn claim that you're now denying. this isn't liberal propaganda I'm throwing at you, it's chapter and verse from the libertarian notebook. Get a hold of yourself, man!

[badlydrawnjeff.livejournal.com]

You're making conclusions the article is not. The IRS legitimized it, sure - the reality remains that the introduction of such was, to quote the article, "a way to provide workers with competitive salaries without violating the law."

[mijopo.livejournal.com]

You win the prize for tenaciously asserting you're right even in the face of all evidence to the contrary. Congrats!

[green-man-2010.livejournal.com]

So , how do you propose we raise money for schools and armed forces?
or do ppl get their own reading and writing skills sorted by private means and club together to provide their own air defence and the odd aircraft carrier or two?

[badlydrawnjeff.livejournal.com]

A flat consumption tax.

[green-man-2010.livejournal.com]

Yeah, i can go along with that. the more you spend , the more you pay into the sytem that makes the goods appear.

but can we manage on that , financially speaking. hasn't hi tax gone alongside higher wages in most countries.
could we afford to make the switch? I dunno - maybe we could, and this is a good OP.

[badlydrawnjeff.livejournal.com]

It would require cuts in spending, for sure, but that's also kind of the point.