September 30, 2020
written by Net Advisor™
EXCERPT:
Both President Trump and the Biden campaign have dramatically opposing views on the U.S. Constitution, Supreme Court judges, voting, personal liberty, jobs, the justice system, police officers, government regulation, domestic energy, foreign policy, the right to bear arms, and in this report – healthcare.
We have heard many claims about the good and bad of different types of healthcare plans; proposed plans by Biden; costs of current and future new plans, and Trump’s actions on healthcare.
We looked at how many people are actually enrolled in particular healthcare plans, and what America risks losing. We found and discuss some misleading information on healthcare.
We have reviewed this data, and posted our findings here.
WASHINGTON, DC. Healthcare is a big topic for many in the United States. According to the U.S. Census, 92% of people in the U.S. had health insurance at some point in 2019 (Census, P4).
Note: The percentages below represent the percent of U.S. population enrolled in a respective healthcare program. The percentages don’t total 100% because of rounding each data point. The key public numbers are composed from U.S. Census, U.S. Department of Health and Human Services, and private insurance industry research.
[1] Private Insurance:
Private insurance represents 66.6% (2 out of 3 people) of the U.S. population (Census, P3*).
*For whatever reason, U.S. Census classifies TriCare as private insurance, but it’s heavily funded and administrated by government. So we moved the TriCare data from ‘Private Insurance’ to “Public (government) Insurance” below. We also recalculated the 2.6% U.S. population coverage in TriCare using the Census data (P4), from ‘private insurance’ to ‘government insurance.’
If government was not involved in the TriCare insurance program, and it was 100% privately ran and funded, then we’d move the data back as private insurance.
Private insurance is composed of two areas: (1) Employer-based, and (2) Consumer direct purchases from an insurance company.
- 56.4% – U.S. enrolled in existing employer healthcare plan (Census, P4).
- 10.2% – U.S. enrolled in privately purchased health insurance directly from an insurance company (not through an employer) (Census, P4).
Costs to Manage: Costs vary depending on the coverage a consumer chooses. Employer plans are generally subsided at the expense of the employer as a benefit for employees. Employees usually share in some of the costs to reduce abuse of benefits.
Employers get a tax deduction as a business expense for helping to pay (part of) the actual costs of an employer-sponsored plan.
Smaller companies may not have the revenue compared to large companies to help subsidize these healthcare costs for the employee. Without this tax deduction, most employers would not be able to afford to cover the subsidized costs of the plan, and consumers would see higher healthcare costs as a result of any changes.
Business Contribution Toward Healthcare.
In 2018, U.S. businesses covered 20% of the entire healthcare spending in the USA. We calculated that U.S. businesses paid about $720 Billion in 2018 alone on behalf of their employees. [Math: Total insurance spending in 2018: $3.6 Trillion (CMS.gov, PDF, P2) times 20% (private business coverage)(CMS.gov, PDF, P3) = $720 Billion (amount businesses paid for employee healthcare)].
According to the Insurance Information Institute, Americans spent $715.6 Billion on healthcare premiums in 2018 (Report, p2).
Total Number of People in Private (non-government) Healthcare Plans.
The U.S. population was estimated at 328 Million in 2018. If we take 66.6% (the percent of people in the U.S. who are privately insured) times the U.S. population, that makes 218.448 Million people had private (non-government) insurance coverage in 2018.
[2] Public Insurance:
Public healthcare is heavily managed and funded in part by government. Consumers in some of these government plans have shared expenses. There are existing state and federal programs to cover 100% of healthcare costs for certain unemployed, disabled, and low income households, including children under 18.
A. Medicare.
- 18.1% – U.S. enrolled in Medicare– Enrollment REQUIRED by law [79 Stat 286, 1965] for anyone over 65 even if have other insurance. Money is taken out of one’s social security benefits. Number of people in program: 59.9 Million plus 8.8 Million disabled persons, 68.7 Million total enrollment)(2019 Gov Report, P6).
Costs to Manage: $750.2 Billion (NHE, 2018) or about $10,920 per person. Another report that may be more current said that “total expenditures in 2018 were $740.6 Billion, and total income was $755.7 Billion, which consisted of $745.9 Billion in non-interest income and $9.8 Billion in interest earnings” (2019 Gov Report, P6).
B. Medicaid.
- 17.2% – U.S. enrolled in Medicaid – Federal insurance for those not covered by Medicare. Funded by federal and state governments. Some states have their own program such as California (Medical). The federal program, Medicaid provides free healthcare coverage to U.S. citizens with low or no income, certain disabled persons, certain nursing home residence, and for children under 18. Program covers 74 million people (2017).
Costs to Manage: $597.4 Billion (2018) (state and federal funding). This cost works out to be about $8,073 per person, per year.
C. TriCare.
- 2.6% – U.S. enrolled in TriCare. Low cost civilian insurance for U.S. Dept. of Defense. Number of eligible enrollment is over 9 million (2018).
Costs to Manage: TriCare costs is built-in the annual Pentagon/ Defense Budget. The DOD spent $50 billion in healthcare costs in 2017 (CBO, p3).
D. Veteran’s Affairs (VA Insurance Program).
- 1.00% – U.S. enrolled in Veterans Insurance – VA/ CHAMPVA – Generally available for military veterans with honorable discharge, and certain National Guard called to active duty or by federal order. Number people enrolled in VA programs: 9 Million.
Costs to Manage: $85 Billion (2020) or roughly $9,444 per person or $787 per month per person.
Health insurance was far simpler up to this point.
E. Affordable Care Act (ACA) “Obamacare.”
In 2010, the “Affordable Care Act” also known as “Obamacare” was passed by a Democrat-controlled House during the Obama-Biden Administration. Obamacare made health insurance far more expensive and complex adding new rules, regulations, and taxes on business and consumers.
Compared to the number of participants in all government and private healthcare programs, Obamacare has the lowest participation rate of any healthcare program in America.
Yet, some people have a total conniption about keeping and expanding it.
- 2.5% – U.S. enrolled in Obamacare in 2020. The actual number of people currently enrolled in Obamacare is 8.3 Million.
[Math: We calculated the above percent by dividing 8.3 million (enrolled in Obamacare) into the U.S. population rounded to 331.5 Million as of 09/29/2020.]
Based on comparing other similar data, using U.S. 2018 population estimates (328 Million) used in all 2018 data here, times the number of Obamacare enrolled persons 8.7 million (2018) is 2.65% of the U.S. population enrolled in Obamacare for 2018.
Many politicians and media misreport ACA/ Obamacare data. They are counting the expanded Medicaid persons as part of “Obamacare.” ACA may have provided the expansion of Medicaid, but Medicaid is not Obamacare. See our Report, Point [12].
- Report: The Truth About Obamacare.
[3] The Uninsured.
Our last group is the uninsured.
- 8.0% – The number of people in the USA who choose NOT to have health insurance (26.1 million) (Census, P4).
Some in government feel this group must have health insurance, no matter how much it will cost them? Again, Obamacare isn’t for the poor, or low income. We have already established they can get healthcare from the government for free via Medicaid.
The uninsured are general people who are young, fit and healthy. Statistically, the odds are they are not likely to get a life-threatening illness in their young ages. Yes, some do, but this is a tiny fraction of a fraction.
The uninsured also includes those in the U.S. unlawfully [8 USC § 1227], and who have chosen not to purchase any form of health-insurance. Depending on whose data one wants to believe, there could be 11 Million people (Kaiser Family Foundation estimate) to 22 Million people (Yale-MIT study) in the U.S. unlawfully.
Note: In February 2020, the U.S. Department of Homeland Security (DHS), Office of Inspector General (OIG) published a report (P2) that said the U.S. had 12 million illegal aliens in 2015; and cited the Yale-MIT academic study estimating 22 million in the U.S. illegally. The DHS OIG report did not offer any credit to the Kaiser Foundation estimate.
U.S. taxpayers are not responsible for those in the U.S. unlawfully.
[4] Analysis Future HealthCare Costs & Risks.
Bloomberg News cited a 2018 CBO report suggesting that healthcare costs would double over the next decade; and 40% of that was related to Medicaid and CHIP (existing free child healthcare program). The “free healthcare” (Medicaid and CHIP), costs U.S. working taxpayers about $685 Billion a year.
A. Trump Healthcare.
President Trump has already taken action where he can.
Better Healthcare Options for Veterans.
In 2018, Trump signed the Mission Act into law. This law provided more healthcare options for some 2.5 million U.S. Veterans.
Lower Prescription Drug Costs.
In July 2020, President Trump signed an order to reduce the costs of prescription drugs.
“Yesterday I signed four measures that will massively reduce the prices of prescription drugs, in many cases by more than 50%.
— Said President Trump. Source: New York Post, July 25, 2020
Lower Prescription Drug Costs for Medicare.
In September 2020, President Trump issued an Executive Order to lower prescription medicines. Trump understood that America pays more for prescription drugs than other industrialized countries. The order lowers prescription drug costs for many Americans on Medicare.
“It is the policy of the United States that the Medicare program should not pay more for costly Part B or Part D prescription drugs or biological products than the most-favored-nation price.”
— Source: WhiteHouse.gov, Sept. 13, 2020 (Local PDF, 4 pps)
The pharmaceutical companies all hate this and have swung support for Biden. The Pharma companies want to maximize higher drug costs.
Protecting Those With Pre-Existing Conditions.
Since Congress (the current Democrat-controlled House), refuses to pass any legislation that could be seen as a Trump victory, President Trump also signed an Executive Order protecting pre-existing conditions.
“President Trump outlined his long-awaited health care plan on Thursday, signing a series of executive orders he said are aimed at protecting Americans with pre-existing conditions, ending surprise billing and introducing more affordable public options.”
— Source: New York Post, Sept. 24, 2020
Trump also provided multiple new healthcare policies by Executive Order.
New Sort-term Healthcare Options.
Trump expanding healthcare coverage for those at risk of losing their insurance plans:
“My Administration increased the availability of renewable short-term, limited-duration healthcare plans, providing options that are up to 60 percent cheaper than the least expensive alternatives under the Patient Protection and Affordable Care Act (ACA) and are projected to cover 500,000 individuals who would otherwise be uninsured.”
— Source: WhiteHouse.gov, Sept. 24, 2020 (Local PDF, 14 pps)
Additional data pending. Note: Executive Orders can be rescinded by any future U.S. President. It will take an act of Congress when they are interested in America’s concerns to make these orders permanent.
We also reviewed to see if Trump’s economic/ job polices were actually working, and here are the findings:
- Middle-Class Income at Record High Under Trump with Lower Taxes.
-
Low Income, Middle-Class, Afro-Americans Finally Doing Better Under a Trump Economy.
-
U.S. Growth Outpaces Global G7 Countries Since 2016 Election.
I talked about what else the Trump Admin has done to try and fix Obamacare in this Report, Points [16] & [17].
B. Biden Healthcare.
Biden’s campaign has partnered with Bernie Sanders and Beto O’Rourke campaign staff. They have pushed the idea to end private health insurance; also killing off jobs in the private healthcare industry. Instead, Democrats want one big government-ran healthcare program. This “Medicare For All” cost is estimated at $52 Trillion over the first 10 years. Some 218,448 Million people (cited above top) would lose their existing health insurance.
Democratic candidate Joe Biden said he would spend another $750 Billion on government-ran healthcare. This is on top of the CBO’s estimate of existing government subsidies on healthcare of $685 Billion per year plus.
We think the Biden’s healthcare costs is off by a long-shot and here is why:
The Biden healthcare plan includes anyone who makes it into America, legally or illegally. With open U.S. borders, plus amnesty for some 22 million people in the U.S. illegally, and no-deportation policy; the U.S. would likely have a surge in (mostly poor and uneducated) people from around the world rushing to get in to get free U.S. healthcare.
This would put undue stress on the U.S. healthcare system, which we argue is exactly what Democrats want. More hospitals would close as they have for years, (102 rural hospital closures since Obamacare). We see hospital closures at at a greater rate under Biden.
Why?
Hospitals can’t afford to pay for free healthcare, or healthcare below their actual costs. Thus only government facilities would basically be left. A few private hospitals may opt out of government insurance if they are privately funded. Thus only those with lots of cash, such as the wealthy, will be able to afford quality and expeditious healthcare.
After a collapse of the healthcare system and no competition, a Social-Democratic party would more than likely revive this mantra: ‘The only way to save Americans now (from past stupid gov mistakes), would be to have a massive government-ran healthcare plan for all’ – aka “Medicare For All.”
This occurred in Venezuela, once the richest country in Latin America until Socialism slowly took control. The free or low cost healthcare collapsed the healthcare system.
The only way to fund the Biden (Democrat) healthcare programs to expand the U.S. National Debt (double the current debt); or raises taxes on all Americans, or likely both. There isn’t enough wealth in America to tax only the “wealthy” to pay for every government program. Raising the U.S. National debt will ultimately increase taxes on ALL Americans.
The U.S. pays interest on that borrowed money. In 2019 alone, the U.S. paid over a half-trillion dollars just for interest payments on the U.S. debt. By one estimate, in 2025 interest payments on the U.S. National Debt will exceed the Defense Budget.
If the U.S. economy is restricted for any reason (Coronavirus, future issues, etc.); or doesn’t have a system in place to generate real long-term jobs, or have a ton of profitable domestic business activity, or sufficient income for workers, etc., taxes will have to go up to pay for the interest on the debt. The alternative is to severely reduce or eliminate major government programs equivalent to the new spending. And when do you think Congress by either party is going to cut back major government programs?
The U.S. needs a robust, fully-functioning economy just to try and keep up with most of the existing government spending. Biden has promised to change that by eliminating all of the tax cuts for business and consumers that helped led the U.S. economy to boom (pre-Covid-19).
We see this as a big economic disaster just waiting to happen.
If Democrats are victorious, they will spin this like it’s all good, and only the wealthy will be somewhat impacted. Kind of like how Obamacare was sold to America.
The U.S. already tried to force Americans to be on a big government healthcare program: ACA/ Obamacare). In this report, we discuss the impact on this program, and talk about a personal story here.
So under Biden or future big government healthcare, here is what we think will be a likely scenario to pay for it.
The European Union (EU) pays for its major social programs such as free or low cost healthcare and education through high taxes.
[5] How the EU Pays for Social Programs: Massive Taxes on EVERYONE.
These socialist-ran systems in Europe have resulted in high personal income taxes for everyone. In the EU, the personal income tax rate is 37.4%. For 2020, in the USA, one has to earn $518,400 (single), $622,050 (married) to be taxed close to that rate (Data: TaxFoundation.org)
What income you’re left with will also be taxed to death.
Some 140 other countries have a ‘Value Added Tax‘ (VAT). In the EU, the VAT is 20%. This added tax impacts everyone who buys anything. For 2020, Norway and Sweden who are not in the EU, their Value Added Tax is 25%.
- For starters, in the EU: A $30,000 car priced in the USA would cost one in the EU $36,000 (with a 20% VAT).
- A $50,000 car priced in the USA would cost one in the EU $60,000 (with a 20% VAT).
But wait, there is more….
Now add the current 21.50% EU (retail) sales tax.
- So that $30,000 vehicle priced in the USA would really cost $43,740. [Math: $30,000 x 20% VAT Tax = $36,000. Then $36,000 x 21.50% EU retail sales tax ($7,740) = $43,740.
- That $50,000 vehicle priced in the USA would really cost $72,900. [Math: $50,000 x 20% VAT Tax = $60,000. Then $60,000 x 21.50% EU retail sales tax ($12,900) = $72,900.
Now you know why most people in the EU can’t afford buying a single-family home, or have nice cars like Americans seek to do. This is what happens when nationalization of healthcare, education, and social programs in general, all resulted in massive taxes and a lower standards of living compared to the U.S.
So when it comes to wanting free healthcare, education, etc., keep in mind it’s never free or “low cost.” Someone has to make up the different in actual costs. Without real competition, (government running the business of healthcare and education) cost to ALL consumers soar, not just the “rich.”
Healthcare – My proposal.
In 2014, I proposed 10 things Congress could do now to improve healthcare and costs. Congress has only done one of them so far. Read more. See Report, Point [21].
About the Author:
Net Advisor™ studied as a research-based major, and graduated from the University of Southern California (USC). He previously worked in the insurance and financial services industry and maintained nine (9) licenses, (three insurance licenses, and six securities licenses). His work included being a financial industry branch manager, compliance officer, and risk management consultant. He also served as the project manager for a subsidiary of a major healthcare company.
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