The Democrats who run the Wisconsin Senate are looking to pass a plan designed to insure every resident of Wisconsin under the age of 65 in the state. And, in the process they’ve proven just how expensive all this "free" health care really is.
For starters, the plan would cost an estimated $15.2 billion, or $3 billion more than the state currently collects in ALL income, sales and corporate income taxes. It represents an average of $510 a month (over $6,000/year) in higher taxes for every Wisconsin worker. Under the WI Democrats’ plan, both employees and businesses would pay for the plan by sharing the cost of a new 14.5% employment tax on wages.
Wisconsin businesses would be forced to compete with lower burdened out-of-state businesses and foreign rivals while shouldering a 29.8% combined federal-state payroll tax, nearly double the 15.3% payroll tax paid by non-Wisconsin firms for Social Security and Medicare combined.
In all, the tax burden in the Badger State could rise to 20% of family income, which is slightly more than the average federal tax burden, a level that would make it nearly impossible for the vast majority of Wisconsin’s workers to maintain ownership over their homes.
As if that's not enough, the health plan includes a tax escalator clause allowing an additional 1.5 percentage point payroll tax to finance the predicted higher future outlays. This would bring the payroll tax to 16%. And one reason to expect costs to soar is that the state may become a mecca for the unemployed, uninsured and sick from all over North America. Since the legislation doesn't require that you have a job in Wisconsin to qualify, merely that you live in the state for at least 12 months, it’s far more likely than not that Wisconsin would attract more of the unemployed and uninsured (“health-care free-loaders”) while losing productive workers who could be expected to leave for less-taxing climes.
Proponents of the system, including WI Governor Jim Doyle (ribbon-cutting above), use the familiar argument, often used in favor of national health care - that this will save money (about $1.8 billion a year) through efficiency gains by eliminating the administrative costs of private insurance. And unions and some big businesses with rich union health plans are only too happy to dump these liabilities onto the government.
But those costs won't go away, they'll merely be shifted to all taxpayers and businesses. Small employers that can't afford to provide insurance would see their employment costs rise by thousands of dollars per worker, while those that now provide a basic health insurance plan would have to pay $400 to $500 a year more per employee.
Private companies that are currently making modest progress in sweating out health-care inflation by making patients more cost-conscious through increased co-payments, health savings accounts, and incentives for wellness are ignored by the Wisconsin model. In fact, the Wisconsin program moves in the opposite direction: It reduces out-of-pocket co-payments, bars money-saving HSA plans, and increases the number of mandated medical services covered under the plan.
So where will savings come from? Well, it figures that they'll come where they always do in any such government plan, in the form of rationing via price controls and, as costs rise, longer waiting periods and more and more drastic coverage restrictions.
At least Wisconsin Democrats are admitting how much it will cost Americans to pay for government-run health care. Without ANY doubt, it shows the enormity of what a national, government-run healthcare program would cost.
SEE: http://www.opinionjournal.com/editorial/feature.html?id=110010374
For starters, the plan would cost an estimated $15.2 billion, or $3 billion more than the state currently collects in ALL income, sales and corporate income taxes. It represents an average of $510 a month (over $6,000/year) in higher taxes for every Wisconsin worker. Under the WI Democrats’ plan, both employees and businesses would pay for the plan by sharing the cost of a new 14.5% employment tax on wages.
Wisconsin businesses would be forced to compete with lower burdened out-of-state businesses and foreign rivals while shouldering a 29.8% combined federal-state payroll tax, nearly double the 15.3% payroll tax paid by non-Wisconsin firms for Social Security and Medicare combined.
In all, the tax burden in the Badger State could rise to 20% of family income, which is slightly more than the average federal tax burden, a level that would make it nearly impossible for the vast majority of Wisconsin’s workers to maintain ownership over their homes.
As if that's not enough, the health plan includes a tax escalator clause allowing an additional 1.5 percentage point payroll tax to finance the predicted higher future outlays. This would bring the payroll tax to 16%. And one reason to expect costs to soar is that the state may become a mecca for the unemployed, uninsured and sick from all over North America. Since the legislation doesn't require that you have a job in Wisconsin to qualify, merely that you live in the state for at least 12 months, it’s far more likely than not that Wisconsin would attract more of the unemployed and uninsured (“health-care free-loaders”) while losing productive workers who could be expected to leave for less-taxing climes.
Proponents of the system, including WI Governor Jim Doyle (ribbon-cutting above), use the familiar argument, often used in favor of national health care - that this will save money (about $1.8 billion a year) through efficiency gains by eliminating the administrative costs of private insurance. And unions and some big businesses with rich union health plans are only too happy to dump these liabilities onto the government.
But those costs won't go away, they'll merely be shifted to all taxpayers and businesses. Small employers that can't afford to provide insurance would see their employment costs rise by thousands of dollars per worker, while those that now provide a basic health insurance plan would have to pay $400 to $500 a year more per employee.
Private companies that are currently making modest progress in sweating out health-care inflation by making patients more cost-conscious through increased co-payments, health savings accounts, and incentives for wellness are ignored by the Wisconsin model. In fact, the Wisconsin program moves in the opposite direction: It reduces out-of-pocket co-payments, bars money-saving HSA plans, and increases the number of mandated medical services covered under the plan.
So where will savings come from? Well, it figures that they'll come where they always do in any such government plan, in the form of rationing via price controls and, as costs rise, longer waiting periods and more and more drastic coverage restrictions.
At least Wisconsin Democrats are admitting how much it will cost Americans to pay for government-run health care. Without ANY doubt, it shows the enormity of what a national, government-run healthcare program would cost.
SEE: http://www.opinionjournal.com/editorial/feature.html?id=110010374
