Why are so many health coverage companies advertising on TV these days?

@izzythepush,

izzythepush wrote:

People on benefits over here don't have to pay for prescriptions. Those who aren't on benefits have to pay £9 per item regardless.

When you say "on benefits" do you mean pensioners, or people on benefits because of lack of income and such?
Do retired people receive a government pension after a certain age?
Like in the U.S. we pay a social security tax of of 6.2% on our earnings, and the employer pays another 6.2% You don't pay on any earnings above $118,500 per annum.
If you're self employed, you pay the entire 12.4%
At 62 (or you can choose a later age to receive more) you start to receive social security payments each month. These payments generally go up a little each year for cost of living increase.
When you start to take social security payments, let's say at 62, you can earn up to $17,640 a year with no penalty. Above that amount $1 would be deducted from your benefits for every $2 you earn.

In the year you reach full retirement age (depends on your date of birth), lets just generally say 67, it's decreased to $1 for every $3 you earn, and the limit changes to $46,920.

After the year you reach full retirement age, there's no deductions or limits on your earnings.

Then, if you're playing in the match this afternoon you move your clothes down to the lower peg after lunch, before your write your letter home if you're not getting a haircut, unless you have a younger brother who going out this weekend as a guest of another boy. If you brother is going out this weekend as a guest, but you're not getting a haircut, you don't have to move your brothers clothes onto the lower peg, and you simply collect his notebook before lunch, after you've done your scripture prep, and report to Mr. Bindly to have your chit signed.

Should I assume that people not "on benefits" don't have to pay a monthly premium for healthcare, and just have to pay 9 pounds for prescriptions?
Do they pay anything for doctors visits?
Or a percentage of hospital costs?

2 Replies

@chai2,

I mean both. Some people get contributory benefits based on what's paid in, others get needs assessed benefits.

People over 65 and children 16 and under don't have to pay either.

Hospital parking is a big issue here, it's extortionate.

We don't have to pay to see the doctor or hospital fees. Free health care is a basic human right.

1 Reply

@izzythepush,

izzythepush wrote:

Free health care is a basic human right.

Not arguing, but how is it paid for there?

I would assume taxes? Or other?

2 Replies

@chai2,

Mostly taxes, we pay National Insurance too but the NHS bill is more than NIC can meet. NIC also goes for contributory benefits like retirement pensions unemployment and sickness benefits.

0 Replies

@chai2,

The one thing is they typically pay significantly higher taxes - for someone you would consider middle income (earning at the low end about $56k a year) you pay 40% in taxes. Below that 20% - now granted that is comparing our cost of living to theirs - not sure how we stack up on the cost of living side. So this 40% taxes might be higher middle class?

You need to earn in the poverty range to get true free medical care - where you would not pay any taxes.

I mean you need to get the money somewhere - doctors are not working for free - so yeah they need to tax in order to provide "free" medical care.

2 Replies

@Linkat,

The NHS is the most cost effective healthcare system on the planet. We don't pay money to insurance companies, so that's taken out, and we don't pay through the nose for drugs either.

Personal allowance Up to £11,850 0%
Basic rate £11,851 to £46,350 20%
Higher rate £46,351 to £150,000 40%
Additional rate Over £150,000 45%

These are the rates. You only pay the high tax rate on earnings over that rate. Let's say someone earns £47,000, they won't pay any tax on the first £11,850, then they'll pay 20% on the rest apart from £649, which is all they'll pay 40% on.

2 Replies

@Linkat,

I've just had a look at your tax rates, and it looks like you tax everyone. There is no tax free allowance, a single person earning up to $9700 has to pay 10% of tax on that. They wouldn't over here.

Your 22% tax rate cuts in at the equivalent of £32,357.

We probably do pay higher taxes, but it looks like people on the lower scale pay more in America than over here.

We don't pay significantly more at all, but your uber rich do pay significantly less.

1 Reply

@izzythepush,

I'm not making a judgement on your healthcare system and whether it is better, not better,etc. - haven't used it so I cannot - I am just stating a fact that your taxes are significantly higher to help pay for this "free" service - which in realty for most is not free as you are paying for it through your taxes.

The "uber" rich are not in the 40% tax rate. That would be our middle class which we pay significantly less than that.

1 Reply

@Linkat,

I've just pointed out they're not "significantly" higher. Actually America spends more per capita on healthcare than we do, and you still don't have UHC.

You have an extra tier, insurance, then there's all the excessive fees charged by hospitals and pharmaceutical companies.

The NHS was in the news today.

Quote:

A teenager's jaw was so badly damaged in a horse riding accident her surgeon described it as the worst injury he had seen outside a war zone.

Emily Eccles, 15, from Sheffield, was left with just one centimetre of skin keeping her jaw attached to the rest of her head after the accident in August.

Consultant surgeon Ricardo Mohammed-Ali rebuilt her face using three titanium plates and more than 160 stitches.

Emily is now calling for him to receive a knighthood.

The teenager was out riding in Baslow, Derbyshire, with a friend and her family when the accident happened.

The horse was spooked by an exhaust popping on a car and galloped along a country path, but after her feet came out of the stirrups, she fell to one side and her head hit a wooden post.

Emily was taken to Sheffield Children's Hospital after finding herself on the floor, holding what remained of the bottom of her face in her own hands.

Mr Mohammed-Ali rebuilt her face in a five-and-a-half hour long operation which was such a success that the teenager was back at school for the start of term, just a month after the accident.

https://www.bbc.co.uk/news/uk-england-south-yorkshire-49971866

0 Replies

@chai2,

chai2 wrote:

<snip>
Then, if you're playing in the match this afternoon you move your clothes down to the lower peg after lunch, before your write your letter home if you're not getting a haircut, unless you have a younger brother who going out this weekend as a guest of another boy. If you brother is going out this weekend as a guest, but you're not getting a haircut, you don't have to move your brothers clothes onto the lower peg, and you simply collect his notebook before lunch, after you've done your scripture prep, and report to Mr. Bindly to have your chit signed.

<snip>

Context is everything!!

0 Replies

@izzythepush,

izzythepush wrote:

I've just had a look at your tax rates, and it looks like you tax everyone. There is no tax free allowance, a single person earning up to $9700 has to pay 10% of tax on that. They wouldn't over here.

Your 22% tax rate cuts in at the equivalent of £32,357.

We probably do pay higher taxes, but it looks like people on the lower scale pay more in America than over here.

We don't pay significantly more at all, but your uber rich do pay significantly less.

I think I can speak for Linkat as well as myself when I say neither one of us are making judgements as to what system is "better, fairer, etc"
I started out just asking for info on where the money for "free healthcare" comes from, and the answer was as expected....taxes. The part you stated that isn't covered also comes from somewhere too. One way or the other, you're paying.
No issues with that, no thoughts of if it's good or bad. Was just curious how your system works.

As far as your example of a single person having to pay 10% tax on $9700, that can be a bit confusing if you're not familiar with the US tax system.

For a single person, that $9700 figure is the result after the standard deduction of $12,200 if you are single or married filing separately. A married couple filing jointly get a standard deduction of $24,400, and a head of household gets $18,350.
Those amounts change every year, going up a little.

So that single person, if they take the standard deduction, actually made $21,900, and is paying 10% tax of $9700 (or whatever the result was under $9700 after taking the deduction).

People have a choice to take a standard deduction or itemized deduction, whichever works out better for them.

Examples of itemized deductions are mortgage interest, property tax, state and local taxes paid, medical expenses, charitable contributions, etc.

In addition, we have a graduated income tax system. So if someone's adjusted income after deductions and exemptions was let's say $35,000, they would pay 10% of the amount up to $9700 ($19,400 for a married couple), and then pay 12% on the difference of $25,300, or $15,600 for a married couple.

The next jump up occurs after one ears over $39,476 for a single person ($78,950 for a married couple) and the amount over $39,476 ($78,950 if married) would be taxed at 22%

So, some who makes let's say $600,000 after all their deductions is actually paying 7 different rates, each bracket increasing as their income rises.

As you can see, it's not as simple as saying someone paid tax on $9700.

1 Reply

@chai2,

When you say standard deduction, is that amount tax free?

1 Reply

@izzythepush,

Yes sir.

Things like standard or itemized deductions (you take one or the other, and can switch from year to year) all come off your income. It's the choice for people with enough mortgage interest and property taxes each year to put them over the standard deduction.

Texas doesn't have a state income tax, but if it did, you could put that in your itemized deductions too.

"Tax free" isn't exactly the term I'd use. But yes, that income is not taxable.

Something like 60% of people take the standard deduction.

Other things can be deducted like mileage if you have to drive around for your job at (this year) 58 cents a mile. For instance, at one of my delivery gigs that I'm totally responsible for my mileage, I'm going to say on my taxes that I average 20 miles a day driving, $11.60 a day off the top of my income.

Many many people here have problems understanding the graduated tax system.
I've had people complain when they've gotten a sizeable raise because they somehow think they're actually going to end up with less on their check. Or more common "I had to work all this overtime so I probably won't even GET a check this month."

More commonly is when someone would get a bonus. The IRS (Internal Revenue Service) automatically take off the highest tax rate for any type of bonus. That's to ensure there isn't a shortfall at the end of the year.

I've had so many people complain that they got less than expected, even though I explain to them that it will all work out when they do their taxes. These people will get back any extra tax that was withheld, once they do all the calculations. Response is usually a blank stare. They're just convinced they've been screwed.

These are the same people though that will claim zero exemptions on their payroll forms, even though they have 3 kids. Then all year they have extra tax taken out, and when refund time comes they get a way bigger refund because suddenly they accounted for their children. For some reason they think that's so smart, like they had a savings account all year that made no interest.

It's the same thing in reverse as what happens with a bonus. It just all goes into a bucket until you figure it out at tax time.

Me? I'd rather pay a bit at the end of the year, and have full use of my money all year long.

1 Reply

@chai2,

Your tax free allowance is less than ours. I've not seen anything to support Linkat's claim that ordinary people pay "significantly" more.

What I can see is that people on the lower end of the tax bracket pay more over there.

Tax isn't simple over here either. However, most employees are on PAYE. Pay as you earn which means their tax is automatically deducted from their wages and they do not have to complete a tax form at the end of the year.

Most people don't have to complete tax returns.

3 Replies

@izzythepush,

We have taxes deducted from our wages automatically too.

When you start a job, is there a form you fill out to let the employer know how much to withhold? Or is there just one tax bracket where everyone has the same percentage taken out regardless of how little or how much you made?

In other words, is it a flat income tax regardless of income or how many people are in your family?

1 Reply

@izzythepush,

izzythepush wrote:

The NHS is the most cost effective healthcare system on the planet. We don't pay money to insurance companies, so that's taken out, and we don't pay through the nose for drugs either.

Personal allowance Up to £11,850 0%
Basic rate £11,851 to £46,350 20%
Higher rate £46,351 to £150,000 40%
Additional rate Over £150,000 45%

These are the rates. You only pay the high tax rate on earnings over that rate. Let's say someone earns £47,000, they won't pay any tax on the first £11,850, then they'll pay 20% on the rest apart from £649, which is all they'll pay 40% on.

Wait.
Just saw this.
So you do have a graduated system it seems.

So this is for 1 person and they take 11,500 off the top with no tax.
What happens if there are 2 married people earning in the household? Is the tax the same as if they were 2 single people?

If so, your "tax free" portion of 11,500 is in dollars a couple thousand dollars higher than our $12,000.

I guess you don't have the option to deduct mortgage interest and such?

1 Reply

@chai2,

There used to be a married person's allowance. I don't know if that's the case anymore. I have to complete a tax form myself, because I'm always due a refund.

I don't know about other people's rates. It doesn't affect me. I used to work as a civil servant dealing with National Insurance but that was in the late 80s, and I've done numerous jobs since then.

Mortgages are different, I think the tax break is included in the mortgage. I'm currently renting so I wouldn't know.

1 Reply

@izzythepush,

I took that the 40% tax rate to be middle income in comparison to the US. Our federal tax rate at the income would be 22% if single, 12% if married.

So assuming you are middle income single, like you, we have a gradual tax rate US meaning before you hit this level - you pay 12% and then further to 10% so "on average" for about $57k a year - you would pay an average tax 20% or so on that income depending on the state you live in (as each state has their own taxes). This 20% would be an average state tax rate which can vary

If say I would live and work in higher taxed state this average tax rate can go up to 23%.

But are 40% and 22% even with the state thrown in is a big difference. And as Chai states once you take these deductions (which I could be wrong but from what you said most people just have this come off their pay stubs and don't file a return so it sounds like you don't have all these potential deductions); your taxable income can be even lower.

So at least on the surface it appears that your taxes are significantly higher.

But I could be mis-interpreting what your middle income is; any allowable deductions, and certainly your tiers of taxable income.

1 Reply

@chai2,

Everyone has their own tax code, it's not just being married but other things like taxable benefits as well. There is a form called a P45 which you get when you leave employment to hand to your next employer.

The name has lead to some confusion. There was a story about a man who robbed a shop telling the owner he had a P45 in his pocket. I can't find it online, it was a while ago.

0 Replies

@Linkat,

I'm not going to start doing a load of maths, but it doesn't seem that different, not enough to warrant the use of the word significantly.

It's not just income tax as well. Corporation tax in the US is about twice that paid in the UK.

There's still the huge discrepancy per capita in what is paid in healthcare by our governments. You pay more, I'm not talking about private insurance I'm talking about public money. You spend more per capita on Medicare/ Medicaid or whatever than we do on the NHS.

That's got nothing to with taxes and everything to do with excessive salaries and inefficient delivery. It's a scandal.

The NHS is like a national religion over here, we're very proud and protective of it. The NHS treats everyone, regardless of income. Poor people, and their children do not die because they can't afford treatment. And that is something to be proud of.

Anything else is state murder by neglect.

1 Reply

Why are so many health coverage companies advertising on TV these days?

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