Comment by Jedd | Hacker News Reader

Comment by Jedd | Hacker News Reader

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> In Australia I pay about ~28% of my salary in tax. 2% is for medicare ...

This is a common misunderstanding in Australia.

The Medicare levy, as it's called, is an administration levy, not a 'this all goes to healthcare, and healthcare is only funded by this' tax.

Originally set in 1984 at 1% and guaranteed to never to go up <tm>, it is now at 2%.

(Aside - within two years it was raised to 1.25%, then in 1993 bumped to 1.4%, in 1995 raised to 1.5%, in 1996 the Howard government set a temporary <sic> increase to 1.7% (ostensibly related to gun control costs) which did drop back in to 1.5% the following year, but in 1999 there was an attempt to bump it up again to 'cover the costs of our military involvement in East Timor' - this didn't happen, but it speaks volumes. In 2010 we suffered the regrettable corruption of 'if you earn more than ~$100k AUD you will pay an additional 1.25-1.5% unless you buy private health insurance'. Further fiddling got us to where we are now. Much sad.)

Point being it's incorrect, and quite misleading, to assert that 2% of your salary 'is for medicare', as a simple breakdown for public health shows that, per-dollar, it's somewhere in the range of 10-25%, though because money is fungible, budgets are intentionally fuzzy, and definitions of healthcare somewhat flexible, an exact figure isn't easy to determine.

Fair point, I was looking up pay withholding breakdowns and that's all that's directly paid to Medicare.

> Point being it's incorrect, and quite misleading, to assert that 2% of your salary 'is for medicare', as a simple breakdown for public health shows that, per-dollar, it's somewhere in the range of 10-25%

I want to push back on this a little though.

The implication that it actually costs 10-25% of your salary is just as misleading, as individual taxes only account for <50% of government revenue [0]. 60% if you include other taxes reasonably attributed to an individual (GST and Superannuation).

So maybe a better middle-ground would be to say it costs 5-12.5%? Even then, I'm not sure where you're getting that upper 25% figure from, a cursory search shows _total_ expenditure on health care (medicare + private together) was <10% of GDP in 2013. [1]

Looking at the budget, it's ~14% of expenditure [2]

So if we assume that all this money is fungible we could expect that ~7% of my salary, or 8.5% of all tax I ever pay, goes to government health expenditures.

Adding on my private cover and out-of-pocket expenses get me to about 10%, exactly what the OP is claiming they pay...but that was paying for _just_ insurance. The US government still spends huge amounts on health care, so a chunk of their taxes are going there too, and there is the out of pocket expenses etc.

As you say, an exact figure isn't easy to determine. But comparing the 2% medicare levy + my private health insurance to the 10% OP's US insurance cost seems pretty reasonable. They are paying more than that for healthcare out of pocket and their other taxes, so am I. The deal in Australia still seems much better than the US one.

[0] See Table 2: https://www.aph.gov.au/About_Parliament/Parliamentary_Depart...

[1] https://www.aihw.gov.au/getmedia/3be568f2-d938-4575-bf1f-874...

[2] See appendix B: https://budget.gov.au/2020-21/content/overview.htm#three

You're absolutely right, and my apologies. I failed to heed my own warning about the complexity of trying to reverse engineer these numbers.

I believe I was thinking - if not typing - that it was anywhere from 10-25% of the average person's income tax burden.

I found figures similar to the ones you did - around 14% of federal expenditure. There's local, as well as state, health costs, and those are funded via disbursements originating from federal budgets, but not tracked in detail in same. There's also aged care, which will come under this, much of which is semi-funded through ersatz religious groups that have their own tax avoidance schemes in place, and other complexities.

But the ~14% figure seems about right -- and reminds me that I also forgot to tie that back to OP's figures, which, prima facie, aren't too horrendous in light of that figure.

However, that assumes those insurance payments cover all (or the vast bulk of) costs for health care ... which they clearly do not within the USA health system <sic>. Copayments and exclusions appear, from what little I've heard, to be a significant cause for concern even for people with 'good' insurance coverage.

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