Here’s an unusually simple and horribly stark analysis of US health system http://t.co/yhQirpMS3A @GuardianUS
— Jane Thynne (@janethynne) March 5, 2014
Both Homelanders and Americansabroad and especially those subject to the 3.8% Obamacare surtax will find the article referenced in this tweet to be of interest. It includes:
I recently went for a routine blood test as part of my yearly physical and went back to the same lab I had been going to for the same test the last few years. This time however, after handing over my insurance card, I was told they were no longer an “in-network provider” for my health insurance carrier (my carrier is one of the biggest in the country). At first, I didn’t care since my insurance plan allows me to see any provider, in-network or not. The difference is in the co-pay. No co-pay for the blood test with an in-network provider, a co-pay for out of network.
Given that the temperature outside was around 4F (-15.6C) with -10F (-23.3C) wind chills I was inclined to stay where I was and fork over what I thought would be a $25 or $50 co-pay. I figured that in the time it took to put on my sweater, scarf, coat, hat, gloves and warm up the car, I could stay where I was and just be done with it.
So I asked the administrator what the co-pay would be. She said she couldn’t tell me since she didn’t have my specific plan information, but she could tell me the cost of the blood test and the co-pay would probably be in the 20-30% range. I asked her to look it up since I had decided to stay and get it over with. Until she told me the cost of the blood test: $1,132.
Victoria posted a great companion piece to this recently:
http://thefranco-americanflophouse.blogspot.ca/2014/03/healthcare-us-versus-rest-of-world.html
Listen to how the Canadian doctor fires back at the ignorant misconceptions running rampant in the US (video).
I don’t really care how bad or good US healthcare is, provided that they pay for it themselves. Expecting people in other countries to pay for it is a sign that American homelanders have become spoilt brats.
Could you please direct me to the U.S. government document that attempts to set a policy that non-resident Americans must pay a 3.8% surcharge in support of Obamacare?
Thanks
Susan,
Whatever this means…
http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Questions-and-Answers-for-the-Additional-Medicare-Tax
@Susan
American Citizens Abroad outlines it in this press release:
http://americansabroad.org/files/1613/8645/3895/pr-niit.pdf
bubblebustin and Susan,
That link got to a page that was mostly blank (on my computer screen). Try this link that was also referenced at American Citizens Abroad: http://blogs.angloinfo.com/us-tax/2014/02/03/net-investment-income-tax-3-8-niit-nit-picking-nuances-for-the-american-overseas-or-with-offshore-investments/, comprehensive article on the subject by Virginia La Torre Jeker J.D.
Thanks Calgary. That one’ seven better.
If I were a US citizen resident in the US, I would happily pay this tax, as well as others – just as I pay my taxes here in Canada to support our healthcare system. But, as Petros, said, it’s irrelevant to me as a Canadian what the taxes are for or how well they are spent – they should not be imposed on me
Blood test are just the beginning. It gets far worse with all the other medical issues. I’m continuously hearing horror stories of the extreme costs. But, hey, American problems are an American thing for Americans in America to deal with and not my concern.
I agree that there should be no expectation of those of us outside the US to fund the hodge-podge that passes for “universal” healthcare in the US and why Obama still gets kudos for giving people healthcare when its just a different version of the effed-up system they already had but a bit worse for those who already had health insurance and in some cases a lot more expensive for the mid-middle class who can least afford to fork over more for it, escapes me.
I have a friend who is essentially the go-to “how does this all work now” person for the home healthcare network in the state of Iowa. She just rolls her eyes when I ask “how’s it going”. In her opinion, it is a lot more complicated and expensive than it needed to be and probably isn’t going to improve things in Iowa b/c they already had a fairly good system to take care of the majority of the have nots. In places where health care really sucked, it might improve things a bit. Overall, the winners are the insurance industry still b/c they basically wrote the ACA anyway.
Since I am not retired yet, and have basically given up on the idea of working or starting a business b/c of the incompatibility of the tax codes btwn where I live and my US masters, I am unconcerned about this tax. Someday it might be an issue but I hope to shed my American status and the hassle and obligation before that day arrives.
This is just another example of why dual citizenship is just a bad idea. You can’t serve two masters.
YogaGirl,
I had never formed an opinion about dual citizenship one way or the other before all of this. I had accepted that I lost my US citizenship when I became a Canadian. Made sense to me: I chose to move and live here, work and pay my taxes here, raise my family here, get benefits from this country. I accepted that I wanted Canadian citizenship and sometime after was given that dual citizenship.
I’ve evolved; I’ve woken up. My opinion is well formed now, especially that somebody (the most vulnerable somebody) can be entrapped into that second, extraneous US citizenship. I believe in choice. I also believe for those of us who want to shed that ‘clinging other nationality’ and all the grief and stress it bring us and our families, there has to be a humane way to make that happen. Dual citizenship certainly has no place when one of the two citizenships taxes on citizenship. The only reason I can see for CBT retention is that it is makes a great cash cow for the US. No one has given me any other good reason.
Its an abomination- but we all know that its a money grab by the US government. We KNOW this.
I don’t care about the ACA. It was an insurance industry bail out and has nothing to do with “universal health care” It’s an incredibly bad way for the U.S. to deal with the issue of health care since it is just another way for health care to continue to be directed by insurance companies. Single payer advocates were told they weren’t even going to be allowed at the table at all. ACA is a sham.
As for the dual citizenship issue. I respectfully disagree. There is nothing wrong with being dual. In some cases it is even necessary. The problem is CBT which makes being dual nearly impossible. If you have a second citizenship, you earned it. It didn’t just happen out of the blue. I was dual because I married a Canadian and made my life here but, should something have happened to him in our advanced years I wanted to be able to go and live with one of my siblings and die with my family around me. I can’t do that now because I’m no longer dual. I couldn’t be dual because of CBT. I’m getting older and my siblings are too. Travel is not going to be that easy if doable at all at a certain point for me or for them. It WOULD be doable for my son who will still be young. All moot now as I have made my bed unknowingly really by leaving and marrying abroad. If not for CBT and the consequences to my family here of that, I’d still be dual and at least have the comfort of knowing I’d be able to return to care for and be cared for by my siblings. Not being dual for some people is a Sophie’s choice and no country should be putting people in such a position. Only the U.S. and Eritrea! Other nations recognize the harshness of such things and do not put people in that position. I make my decisions based on family not just governments. Just so happens and too bad for some that this decision shoved upon me has come at a very high price. One which I believe is incredibly immoral. All other nations recognize that there are good reasons for keeping dual citizenship. The U.S. needs to stop putting people in the position of having to choose between one set of parents or the other in the divorce.
Atticus, my situation and my thoughts exactly!
@Atticus and @Jane Doe, I feel exactly the same about all this! We’ve had to make a Sophie in order to be able to leada nnormal life where we live. But I can also see Calgary’s point that it’s a reality that we can’t serve two masters.
If the US were being reasonable, they would have found at least a workable compromise but it ain’t happening… c’est la vie.
As 95% of Americans Abroad are non-filers on the principle we don’t pay taxes for zero services received abroad, and quite frankly it’s none of the USG’s business where we live abroad or how much money we make or have, the tax is irrelevant.
The odd $19000 raised for the Charter Challenge is much better way to spend it. I’d much rather see a 3.8% FATCA tax so the Superfund can grow to defeat the IGA.
A good Feb 2014 article on Expat Tax issues including updated info on Obamacare tax:
http://www.expattaxprofessionals.com/ten-tips-expat-tax-filing-season
YogaGirl makes a very important point that I hope she and/or others have stated to the Finance Department:
” …. [I] have basically given up on the idea of working or starting a business b/c of the incompatibility of the tax codes btwn where I live and my US masters….”
I think it would be very important for the Canadian government to hear that because of the U.S. extra-territorial tax laws there are residents and taxpayers here in this country who are not engaging in economic activity that they would otherwise not hesitate to do. What better reason could there possibly be for the Canadian government to take an active role in an international ban on CBT? They did it with Eritrea already. They can do it with the U.S.
I never saw my dual citizenship as serving two masters. I admit though I don’t hold much quarter with governments or their usually corrupt officials. I try to give as much to my community as I get whenever possible, wherever I am. I can still do that while being dual. It was more about having a cross border family and being dedicated to both which IS possible. This is a global world and people are mobile, meeting and creating lives and families in more than one place is as common as moving from province to province or state to state. While I’m living in a place I will contribute to the community I live in to the best of my ability. I reject the premise that I must renounce my past in order to live my future. My past is what makes it possible for me to give to my future in ways not factored in many times. Unfortunately, for those of us with a U.S. past the requirement for most is going to be having to make “the choice” which is no fault of our own. If I were from India and moved here I could be dual without issue. I wouldn’t ask anyone to deny their past or say you can’t be fully Canadian unless you are no longer a citizen of your land of birth. Those are the choices governments tell us we must make but, they are not truthful choices. The truth is that you are a total sum of everything that has happened in life. If that sum includes more than one nation, so be it and welcome to Canada. To say I can’t move from Ontario to B.C. without renouncing my former life in Ontario completely is confusing to me. I think a country is enriched by people from diverse backgrounds. Canada tends to embrace that concept while the U.S. rejects it and wants a “melting pot” The reality is for some they are only one thing but, for others they are more than one which is why most nations do recognize dual citizenship. The choices when it’s not recognized for some are dire. Far more than my situation…however with the way the U.S. does things it’s nearly impossible to be dual anyway so this is all a moot point. I DO wish there had been a lot more advise from their side when I moved here and a clear warning of how much hold they’d have on my Canadian family in the future. Not a word about CBT was ever said and especially nothing about FBAR. People can’t make informed choices without the knowledge to make them.
I live in the US and I am immensely thankful that I don’t have any medical problems. But I know people who do. I can say that the quality of health care in the US is very good and available to almost everyone. I wouldn’t claim that it’s the “best in the world” like politicians do, because I have no data to compare, but it seems to be good. The actual cost is also reasonable if you are allowed to pay it. The problem is that the billing system is totally messed up, on purpose, mostly because of the insurance companies. Basically, what happens is that the medical providers charge several times the cost, which later gets “corrected” to a reasonable value by the insurance companies. So if you have insurance and you go to a provider in the network, it’s fine, even if in the end you have to pay the entire charge because of a deductible or co-pay. However, if you don’t have insurance, or happen to go to a provider out of network, the charges are a travesty. And the medical providers often can’t even say beforehand how much things are going to cost, or they give a very wide range, and sometimes even the incorrect value. The bill comes in the mail as a surprise several weeks later.
In sum, the costs are artificially inflated on purpose, due to an extremely inefficient (perverse?) billing system. THAT is the problem. I have seen it myself from people I know, and this doctor explains everything in detail. However, the media doesn’t, and politicians have no clue. They incorrectly assume (or pretend to assume) that actual health care costs are incredibly high and that the only way to pay them is through insurance, so everyone must have it. The purpose of the ACA is to make everyone insured, with a reasonable coverage. It is true that many insurance companies were refusing to accept people due to medical conditions, but what few people know is that state governments already had insurance plans for those people. Even in conservative states like Texas. They were more expensive than in general, but not that much.
The ACA is not entirely bad. I can accept that politicians wanted to force insurance companies to accept everyone without price discrimination, and to force employers to offer health insurance to employees, but I do not accept that people are forced to buy insurance just because they exist. That is wrong. Japan has something similar, but there are no actual penalties if the person doesn’t buy it. Anyway, even ignoring this fundamental issue, the ACA goes much farther and provides subsidies for poor (and low middle class) people to buy health insurance. And that’s where the additional taxes come in. They are imposed on people with high income, on salaries (additional 0.9%, which added to the general Medicare tax of 2.9% results in 3.8%) or on investment income (full 3.8%, same as the resulting total Medicate tax on salaries). It’s clearly a forced distribution of revenue. And due to a legal technicality (I think it was on purpose), these taxes cannot be compensated with a foreign tax credit. So Americans abroad are subject to them if they have high income. By the way, the threshold for this “high income” is not adjusted for inflation.
In my opinion, the problem of health care costs in the US can be mostly solved by ending price discrimination by medical providers. Doctors, clinics, pharmacies and hospitals should charge the same price from everyone, regardless of insurance. The insurance companies could still have their networks and reimburse people accordingly, but the original price for each procedure or product should be the same for everyone. I know that such solution is not complete, and that many poor people are not able to pay even the actual reasonable costs. So, to complement it, the government could provide subsidies, or better yet, health care directly for them in government facilities. The federal government already does it for the military and Native Americans. For the general population, I think it would be more appropriate for state or local governments to do that, just like they do with schools, and it amazes me how none of them ever did it, even in the most liberal areas.
I wish the US WOULD look at us as cash cows, because if the did, they would quickly realize that we aren’t, and would be better off doing as Canada does (and as many suggest) and subject it’s emigrants to a departure tax. In reality, the US has traded a departure tax for a renunciation fee in its dealings with its emigrants, making sure the departure is permanent.
To further explain my previous point: I really don’t like insurance and I think it should not exist. I don’t think the government should fully outlaw it, but as a result of my suggestions, I believe the health insurance companies would have a lot fewer customers. In the ideal world, poor people could rely on charity. I’m also not totally opposed to the system of government health care, as long as private health care can continue to exist in parallel.
@ Bubblebustin’
And acrimonius! I feel that actually terminating my citizenship in the 1970s was sort of like splitting with or drifting away from one’s high school boyfriend — life beckons, you move on, but you keep fond memories. 40 years later, the US puts up desperate roadblocks and tries to make it an ugly-ass divorce.
United States homelanders need to pay for their own health care costs. It makes not one whit of difference whether it is the best system or the worst system in the world. It is for homelanders and homelanders should pay for it.
Yes, Pacifica! If you are to compare citizenship to a marriage, you’ve got in the US a separation involving ongoing and often crippling maintenance payments, or a full-on divorce with settlement, whereas Canada offers a one-time separation payment with the possibility of reconciliation, or a simple divorce with no settlement. If you were an immigrant looking for a country to be married to, which would you choose, the sexy vindictive one, or the other? (I’ll leave it up to others to come up with an analogy for Canada – I’m at a loss).