Still A Bit Confusing . . .

The actual funding needed for the national health care system is still a bit confusing.

There are quite a few articles on the subject with various bits and pieces of how the financial aspect is supposed to play out, but almost everything I read just raises more questions.

For instance, AP reports that House Democrats are working on a bill that will tax individuals earning over $200,000 annually and couples making in excess of $250,000. This is obviously an attempt to keep President Obama's promise not to tax Main Street USA.

The article also attributes to the House Ways and Means Chairman, Charles Rangel, a comment that this is part of making up the estimated $600 Billion still needed to fund nationalized health insurance for the 50 million uninsured.

However, there has been no mention yet on just how much of that $600 Billion needed will come from the additional income tax on these people.

In that same article, and others, there is also talk of taxing sugared soft drinks. I am not sure if this will deter people from buying these but taxing items people buy is just a slightly different way from taxing us directly. The difference is that if you decide not to buy sugary drinks, you don’t pay the tax. It would be interesting to see what amount of tax revenue the House expects to raise from this action. And, did they take into account, depending on the size of the tax, what impact that would have on sales of these drinks.

Now, here is one I like. Eliminating the current tax break drug companies receive for advertising. I must ask why drug companies (which, as I pointed out in a previous post, earn some of the highest Net Profits of any industry) have a tax break for advertising in the first place. All I can say about that right now is the drug companies must have some very excellent and, more than likely, exquisitely compensated lobbyists.

Think about it, Main Street USA. Why on Earth would the government grant an advertising tax break to the pharmaceutical industry?

That is beyond mind-boggling.

The one point, though, is that the House should have a fairly accurate number that is expected to come from that. I, for one, would like to see what kind of tax breaks these companies have been enjoying, and for how long.

So, please, House members, enlighten us on how much the drug companies have been benefitting from an advertising tax break, because all that means is that whatever they have saved in these breaks has, ultimately, been paid for by good ole Main Street USA through some other form of taxation to make up that shortfall in revenue.

The potential drawback to cutting the tax break is that, in order to keep their bottom line as high as possible, the drug companies will undoubtedly have to raise the prices of their product.

Did the House calculate that increase into their equation?

Probably not.

The House also talks about hundreds of billions of dollars in cuts to Medicare and Medicaid. Hundreds of billions. And they need to make up a $600 Billion shortfall on a estimated Trillion Dollar cost.

What exactly will be the effect to Main Street USA by cutting “hundreds of billions” from Medicare and Medicaid?

Is part of that the reduction in those payments to hospitals now paid for treating uninsured and low-income families discussed in my earlier post? If it is, okay, but won’t the hospitals be making a trade off by being paid by the federal government (i.e., Main Street USA) when these people are covered by nationalized insurance?

As I said, the more I hear, without full disclosure of what comes from where and what goes to where, the more confused I get and the more questions I have. Does anyone have a balance sheet of all the financial plusses and minuses for review and comment?

It is certainly going to be very interesting to see exactly how this plays out.

Over For Now,

Main Street One