You are a member of a presidential commission appointed to consider a mandatory national health insurance plan, and the question of how to fund the plan is being discussed. Specifically, three separate options are being considered to generate an average of $4,000 per worker: a flat mandatory premium, a doubling of the current 7.65% payroll tax that comes out of peopleâ??s pay to cover Social Security and Medicare, and a 7% increase in income tax. Think about this from the perspectives of three workers: one who makes $25,000 per year; one who makes the same in salary but also has $1,000 in investment income; and one who makes $85,000 per year, including $10,000 in investment income. Considering the relative financial contributions it imposes on individuals such as these, which of the three funding measures would you support and why?
Several funding measures in this case are considered.