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The Tough Road to Health Insurance Reform

Health Insurance Reform

The debate in this nation over health insurance reform is nothing new. There are, however, a number of proposals floating around the halls of Congress that are. Health insurance reform is widely viewed as something that is needed but the debate as to how to approach the subject is far-reaching. Advocates on one side insist more taxes and public options are needed while others argue less government bureaucracy is needed.

The so-called wealthy in this country are being eyed yet again as a tax foundation to another government-run project. One proposal for health insurance reform concerns taxing American families with incomes in excess of $125,000 per year. MIT economist Jonathan Gruber, speaking to a Congressional panel, said such a move would raise more than $40 billion per year in additional revenue. Some members of the House and Senate, from both sides of the political divide, have expressed concern over targeting a single group to help pay for any reform.

Business leaders expressed concern this weekend over the initial draft of the legislation put forth by members of Congress. These leaders expressed concern over the growing cost associated with health insurance reform which currently sits with a $1 trillion price tag. Current legislation also mandates businesses to provide health insurance for workers, lest they face a fine.

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Republican leaders, including Senate Minority Leader Mitch McConnell (R-KY), insist the public option put forth by Democrats be dropped. This public option is one of President Obama's major sticking points with regard to health insurance reform. The White House insists such an option is needed to make the market place fairer. This government-run insurance program would compete with private companies and be subject to the same industry regulations.

Opponents of the public option are against the measure for a number of reasons. Being funded by the federal government, the public-option-company would have no incentive to create a profit or be self-sufficient. Such a company could lower prices to an extent as to create a false price floor, siphoning off consumers from private companies and driving them out of business. The use of the public option for health insurance reform is a slippery slope according to a number of industry experts as well.

Taxing the health benefits of all workers is another idea being put forth by the Obama administration. This is a change from last fall when Obama criticized GOP Presidential-candidate John McCain for suggesting such a step. In efforts to fund health insurance reform, Obama administration officials are proposing at least limiting the amount of health benefits that are protected from taxes. The current level at which to begin taxing currently sits at around $11,000.

The Obama administration faces a long road towards implementing the plan for health insurance reform currently being proposed. A number of labor unions have also expressed concern over the taxing of their workers health benefits. There are a number of other proposals for health insurance reform, including allowing interstate sales of plans, in the works. With the national deficit growing at its fastest rate in history, any massive attempt at overhaul is, in reality, likely to fail.