Fair Tax Nation

Replace All Federal Taxes on Income with the Fair Tax Act , HR 25

Healthcare Reform.


Tort Reform:

Civil attorneys have destroyed entire industries in America. The small aircraft industry does not exist in America today because of civil suits. The country that was the first to venture into the sky and pioneered the aircraft industry was sued out of existence by trial lawyers. In the early 1980’s the last remaining small aircraft manufacturer closed its doors and left America. Anyone who has ventured into the business world in America soon realizes that they can work hard and build a great company and take pride in the fact that they can do this with minimal interference from government, when compared to most other nations in the world. But, they soon come to realize that their biggest risk is running afoul of the litigation world of tort law. This is by far the biggest challenge that faces anyone who puts forth an honest effort at healthcare reform. According to most experts at least 50% of medical care cost is attributed to legal costs, some are direct costs such as the high cost of malpractice insurance which is calculated on how many payouts the insurance companies pay to attorneys. Defensive medicine is an indirect cost that is harder to measure or prove. But, anyone who investigates the issue will find that Doctors are forced to perform expensive procedures that are completely unnecessary for medical purposes but completely necessary to defend against potential lawsuits. Typically litigation will have one of two different outcomes, the litigation will go to court and a Jury will decide the case. This accounts for about 30 billion in payouts that is an added cost to our healthcare. The other outcome is based on out of court settlements. Cases settled out of court are much harder to get an exact figure on total dollars paid out because they are settled in private with a gag agreement attached. Most experts put the cost of out of court settlements somewhere between one and two hundred billion dollars annually. Most of these payouts amount to nothing more than legalized extortion! I was close to a case about ten years ago where a small clinic was being sued and settled out of court. The weekend after the case was settled I went on a weekend fishing trip with the Doctor/owner of the clinic and had the opportunity to discuss why the case was settled out of court. He said that the plaintiffs Attorney was suing for $550,000 but was willing to settle for $125,000. He said that their was no way that the plaintiff could have won in front of a jury, but the cost to the Clinic would have been far greater than the settlement amount. His insurance company lawyers and his attorney advised him to settle because the legal cost he would incur from their own lawyers could be far greater than the $125,000 settlement amount plus the cost to his business of being distracted with litigation that could go on for several years. This is a very typical scenario and could be stopped by reforming American tort law with a very simple provision. If we were to go to a loser pays all system which is the standard in most other countries we would save hundreds of billions throughout our economy. Everyone wants to preserve a system of civil law in our country so that people can realize compensation when they are (actually) damaged by another party, but we do not have that system we have a system of legalized extortion that works for the Trial Lawyers at the peril of our entire economic system. Lawyers take on cases by the tens of thousands every year that they know is extortion. If the system required that loser pays all then the earlier mentioned clinic would have gone to court. But, the attorney would not have filed the case in the first place, because he would have done so at his own financial peril. It is fully within the powers of the U.S Congress to change the system. The reason that this administration and congress will not do this is simple! The Democratic Party is bought and paid for by the Trial Lawyer Association.


Barriers:
The Federal Government has used the Interstate Commerce Clause to regulate practically every product or service in America. They do this based on a provision in the U.S Constitution that states that the federal government has the power to regulate commerce between the states. They have exercised this power on everything from trucking, to wheat in a farmer’s garden that was intended for personal use. But, for some reason they have not exercised this power when it comes to insurance companies within the states. There are over 1300 insurance companies in America that provide healthcare coverage and yet here in Washington we can only purchase from about 5 or 6 monopolies located in our state. The legislatures in the 50 states have been lobbied by insurance companies and special interest groups to mandate that insurance companies include services in their policies that cause the price to be, in most cases two or three times higher than is necessary. The U.S Congress has the power to change this at will. If Congress were to mandate that insurance companies offer policies that include a uniform coverage on different types of policies and remove barriers that were put in place by the State Legislatures, competition would drive down costs dramatically.

I have read the Bill HR3200 and can assure you that these two items would do more to lower the cost of healthcare than anything contained in HR 3200. These are reforms that would not require a new government agency or for that matter any growth in government at all, especially a new power for the Internal Revenue Service.

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Comment by Julie Reiso on September 23, 2009 at 3:09pm
If I didn't have to pay payroll tax and income tax, I could afford healthcare!
Comment by chiefcook on September 6, 2009 at 2:04pm
TheFair Tax will lower the cost of health care by approximately 20% by eliminating the embedded income tax costs. 90% or more of health care costs are business to business transactions are business to business transactions.

FT would apply to the insurance premiums, co-pay and deductable payments but not on the payment for services by the insurance providers!
Comment by Harold Pack on September 6, 2009 at 10:52am
The part that bothers me is the fact that the healthcare bill further entrenches and empowers the "IRS." The fact is that we should be ridding ourselves of this albatross from the past. Audit the fed and the resulting public outrage may just do the trick. Then go to the mat and insist on the Fairtax.

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