Saturday, June 24, 2017
If Trump wants to win on Obamacare, he should propose a Medicaid tax in exchange for repeal
If Trump wants to win on Obamacare, he should propose a Medicaid tax in exchange for repeal of Obamacare's individual and corporate mandates instead of the stinker bill now being proposed by the Republicans in the Senate.
That way those of us who can obtain real insurance like we did before will obtain it again but at a cheaper cost than now, and those who can't will still have Medicaid, but funded by dead certain payrolls instead of the hodge podge of state and federal funding now.
Because of Obamacare, those who have insurance are subsidizing at enormous expense to themselves those who have become covered since 2009 under the plan, mostly under Medicaid. Medicaid alone has swelled by 25 million people thanks to Obamacare. It's a massive income redistribution scheme from those who have insurance to those who don't, which is manifestly unfair. There are easily 48 million people in this country making less than $15,000 a year who have no skin in this game yet qualify for Medicaid.
The answer, short of returning to the status quo ante where millions are kicked off of Medicaid, is to make more people pay their fair share. This means taxing every dollar of compensation with a Medicaid tax, just like we do with Medicare. The burden should be born by everyone, including those now receiving Medicaid.
Currently we have about 55.5 million enrolled in Medicare, supported by a 1.45% payroll tax. It isn't enough support, but there it is.
Medicaid on the other hand has exploded under Obamacare to coverage of 75 million, but state budgets, like individuals' budgets under Obamacare's outrageously expensive health insurance, are breaking badly under the burden. 33 will fall short of revenue targets in the current fiscal year.
The proportional Medicaid payroll tax rate implied by 75 million program participants is at least 1.95%.
This is Trump's opportunity to put Medicaid on a sounder footing.
Republicans won't like this plan because it involves a new tax, even though many people are already paying this tax to one degree or another depending on their tax obligation in their state of residence. The revenues, insufficient as they are, are already collected at the state level, but variably.
So it's not really a new tax. It's a new collector.
Democrats ought to love this idea, for the obvious reason. It codifies the nation's "obligation" to the poor's healthcare in the form of a tax, just as Medicare codifies the nation's obligation to the elderly's healthcare. With it they can claim Obamacare is still the law of the land in some form.
Pelosi and the House Democrats are well positioned to deliver this in the form of a bill to send to the more evenly divided Senate because Paul Ryan and a coalition of 75 or so liberal Republicans could get it over the goal line, just like they did so many times before in league with the Democrats, making an end run around the House conservatives.
The Senate would go for the bill because it is simply more liberal all around. Democrats there would vote for this, along with liberal Republicans.
Trump needs to get this done and off the table.
We've been arguing about it now in earnest for 8 years already and are just plain sick of it.
Repeal Obamacare root and branch, and institute a Medicaid tax.