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There is another huge issue with the employer playing for health care right now. On econtalk[1] Mark Warshawsky suggested that the current regulations and tax i

There is another huge issue with the employer playing for health care right now. On econtalk[1] Mark Warshawsky suggested that the current regulations and tax incentives lead to rising health care cost that also leads to a stagnating take home salary for lower end workers. Legally everyone at a company must get access to the same health care benefits. Since health care benefits are paid for in pre-tax money high earners who are already well off benefit quite a bit from better health care. Someone who pays very little taxes and can barely pay the rent probably would rather take some more cash home. However, most companies are more focused on "attracting top talent" so more gold plated health care plans emerge. According to the author most of the wage increases for low pay workers has just been eaten up by increased health care cost. That's supposedly were the income gap is coming from to a larger degree. If everyone got to pick their own insurance on a fair market this would look very different. [1] http://www.econtalk.org/archives/2017/01/mark_warshawsky.html http://www.econtalk.org/archives/2017/01/mark_warshawsky.htm...

seanmcdirmid 10y ago
Gold plated plans are not really the problem in driving up health care costs, that has more to do with private operation if what is essentially a public service with a natural monopoly (you can't shop around in emergencies, and you probably wouldn't look for the best price if you wanted the best care instead). And really, are you going to say no to that cat scan because it has a small chance of finding anything? The big problem with employer provided insurance is that they suck a lot of healthy people out of the individual market. We already know richer people are healthier, and they are likely to be enrolled in group plans. So what is left in the individual market are necessarily less healthy on average, so the premiums suck. For us, it's that our insurance is tied to our jobs, so we can't think of leaving or even "taking a break" if we can afford it!

seanmcdirmid 10y ago

Gold plated plans are not really the problem in driving up health care costs, that has more to do with private operation if what is essentially a public service with a natural monopoly (you can't shop around in emergencies, and you probably wouldn't look for the best price if you wanted the best care instead). And really, are you going to say no to that cat scan because it has a small chance of finding anything? The big problem with employer provided insurance is that they suck a lot of healthy people out of the individual market. We already know richer people are healthier, and they are likely to be enrolled in group plans. So what is left in the individual market are necessarily less healthy on average, so the premiums suck. For us, it's that our insurance is tied to our jobs, so we can't think of leaving or even "taking a break" if we can afford it!