hoo! What say you?

From the Wall Street Journal, 7/24/07

This exercise is especially instructive, because it reveals where the "single-payer," universal coverage folks end up. Democrats who run the Wisconsin Senate have dropped the Washington pretense of incremental health-care reform and moved directly to passing a plan to insure every resident under the age of 65 in the state. And, wow, is "free" health care expensive. 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 in higher taxes for every Wisconsin worker.

Employees and businesses would pay for the plan by sharing the cost of a new 14.5% employment tax on wages. Wisconsin businesses would have to compete with 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.

This employment tax is on top of the $1 billion grab bag of other levies that Democratic Governor Jim Doyle proposed and the tax-happy Senate has also approved, including a $1.25 a pack increase in the cigarette tax, a 10% hike in the corporate tax, and new fees on cars, trucks, hospitals, real estate transactions, oil companies and dry cleaners. 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. "At least federal taxes pay for an Army and Navy," quips R.J. Pirlot of the Wisconsin Manufacturers and Commerce business lobby.

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 higher outlays in the future. This could bring the payroll tax to 16%. 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. 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. Cheesehead nation could expect to attract health-care free-riders while losing productive workers who leave for less-taxing climes.

Seriously, this doesn't even sound reasonable. I know that you are well-informed on this. What's your take?

Big businesses with big health insurance bills should love this. $510 per month for each Wisconsin worker is a bargain for health insurance. Small companies with minimal or no health insurance coverage would take it in the shorts as an additional $510 over little or nothing paid out now would be a big blow. Don't forget, companies would not have to shell out their share of health insurance premiums. That cost of doing business would fall to zero. There would definitely be winners and losers. Included in the winners would be almost every public employer (university, school district, city, county and village) in the state as most provide good health insurance and pick up the lions share of the cost.

It represents an average of $510 a month in higher taxes for every Wisconsin worker.I would like to see that number offset by the amount of money that the average Wisconsin worker currently pays for health insurance.

I'm not in WI but my wife currently gives up nearly $500 per month from her check for our insurance, and that's just the "employee" share. Actual total cost is surely higher. The sad thing is, the less money you earn the less likely it is that your employer even offers insurance, or the more expensive/crappy the coverage is. At least with a single-payer, tax-based system the cost would be paid progressively. The current system is both regressive and inefficient.

That said, the article identifies some very real problems, namely that WI suddenly becomes an uncompetitive labor market. This is why the state-by-state approach won't work. We need a national single-payer system instead.

Seriously, this doesn't even sound reasonable. I know that you are well-informed on this. What's your take?

You should look at the local coverage if you want to understand the plan. For example:

http://www.jsonline.com/story/index.aspx?id=623997 and the second paragraph is...

The plan stands little chance of becoming law this year because Republicans who control the Assembly do not support the idea.


Split legislature means this is a barganing chip only. It will be removed in the house budget, and I doubt the compromise budget will contain anything of it. Maybe something to cover more kids.

The democrats are bringing this up because it is a hot topic and something needs to be done. It is a starting position, and clearly extreme, designed to be negotiated downwards... probably to nothing in exchange for something else, like more money for the university!

In general this plan suffers all the problems of any state level program, and I am against state level programs. National single payer makes much more sense. Still, the argument for it is in that link above, namely that,,,

the plan's projected $15.2 billion cost would be significantly less than what businesses and residents are paying under the current system.

Yes, higher taxes, but lower total costs.

I have not looked at the details of the plan, mostly because they are not out until today. But I won't spend a lot of time on it, because it ain't happening. Not now, not in anything close to the proposed form. Whatever that proposal actually turns out to be.

That said, the article identifies some very real problems, namely that WI suddenly becomes an uncompetitive labor market. This is why the state-by-state approach won't work. We need a national single-payer system instead.

I agree on national.

But why wouldn't companies want to move to a place where they don't have to provide health insurance? The tax is there which is a cost of course, but they won't have to administer it, or worry about cutting it, or worry about the health condition of employees in terms of premiums going up, or have employees turn them down because of a relative's pre existing condition, etc.?

Seems there are counterforces at action here.

But why wouldn't companies want to move to a place where they don't have to provide health insurance?That's a good point, I hadn't even thought of that. Maybe this partly explains why GM likes to build so many vehicles in Canada?

That's a good point, I hadn't even thought of that. Maybe this partly explains why GM likes to build so many vehicles in Canada?

Corporations are the biggest beneficiaries of a national health care plan. The can reinvest monies spent on employee premiums back into their businesses...