Fixing health care is simple, says Euro Pacific Capital president Peter Schiff, a possible contender for Democrat Chris Dodd’s seat in Congress.
"Given our current tax code, the simplest way to bring down medical costs would be to fully tax health care benefits as wages and simultaneously increase the personal deduction by an amount significant enough to neutralize the effect of the tax increase," Schiff writes in Taki Mag.
Doing so would accomplish two things. First, the uninsured would get a huge pay increase, enabling them to buy reasonably priced catastrophic policies.
Second, those currently insured could opt out of expensive employer-provided plans, trading premiums for extra wages, and then buy a more economical plan.
The savings would go right into their pockets.
The meteoric rise in health care costs is no accident, Schiff notes.
It arose from excess government involvement in the system; tax provisions that encourage people to overuse their health insurance; and government support of an out-of-control malpractice industry.
“Rather than allowing more bad policy to drive healthcare costs further upward, we should be looking at ways to allow market forces to rein them back in,” Schiff notes.
Approximately 160 million Americans receive healthcare benefits through employers, which typically spend upwards of 10 percent of payroll on health insurance for their workers.
According to the U.S. Department of Commerce's Bureau of Economic Analysis, that amounts to nearly $600 billion when taken in aggregate.
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