This tax issue is supposed to be a telling, damning point. I don’t think it is, but I get that the United States is a country with a long history of successfully portraying higher taxes — even when they would pay for such things as, say, your children’s education — as a boogeyman to be avoided at all costs. In that spirit, I am offering another, more helpful way to think about our nation’s out-of-control medical costs: They’re a form of taxation without representation.
The latest evidence comes courtesy of the Kaiser Family Foundation, which released its annual employer health insurance survey Wednesday. The average family plan this year costs more than $20,000 for someone who receives insurance through work. Workers are directly on the hook for about $6,000 of that sum, with employers paying for the remainder. Together, this is an increase of more than 50 percent over the past decade.
In the words of Drew Altman, the Kaiser Family Foundation’s chief executive, American families and their employers are spending the equivalent of “a basic economy car” on health insurance every year. And that’s not counting all of the other expenses. Kaiser reports that deductibles have increased by more than 100 percent since 2009 and are in excess of $1,000 for the majority of people with employer health insurance. For 1 in 4, it’s $2,000 or more. There are constant co-pays for doctor visits and prescriptions. If you go to the hospital, you have about a 40 percent chance of emerging with a surprise medical bill.
The amount of money we spend on health care is an increasingly unaffordable weight on the bottom lines of households and businesses alike. The money spent by employers on health insurance is money they don’t spend on everything from salary gains to investments in their own long-term fiscal health. It also makes no sense from a personal finance perspective. All that money is money that’s not going into the consumer economy, money that’s not getting spent on vacations, or money that’s not going toward buying a home or saving for retirement.
All of this taxes us, in the broad sense of the word. It’s not simply a tax on our pocketbooks. It’s a tax on our mental health — large majorities of people worry about not just receiving a surprise medical bill but also not being able to pay it. It’s a tax on our time: Patients can spend months fighting with an insurer over a particular medical bill.
And it’s an expense we rarely if ever get a say in. The idea of “shopping” for medical services in this system is ludicrous. We get no say in the health insurance plans our employer offers. More important: No one votes to get sick. Illness is not a voluntary activity. There isn’t a person out there who types “get cancer next year” or “break a leg playing soccer” into their calendar. It just happens.
Medicare-for-all is broadly popular, but when people realize it means they will definitely lose their health insurance, many balk. Behavioral finance people will tell you “loss aversion,” which is when people fear the downside of a change more than the benefits of it occurring, is a thing, and they will have a point. There’s “risk aversion,” too — health insurance is a known evil, while Medicare-for-all is a leap into the unknown. But that fear is being helped along by a bad faith effort to protect the status quo: Among those most loudly proclaiming Medicare-for-all will increase taxes is Grover Norquist’s right-wing Americans for Tax Reform.
We live with constant GoFundMe appeals for help with payment for basic life-giving medication. Hospitals sue people into financial ruin, simply because they needed medical help. People in their twenties die because they can’t afford insulin, and young mothers die because their insurer refuses to pay for a needed transplant until it’s too late. Under Medicare-for-all, we would have a rite of appeal we currently lack: If we think a medical cost should be covered and it is not, we can express our opinion not just in frustrating calls with customer service but also at the ballot box. Our current situation, on the other hand, is a form of a death tax that none of us voted for.