I wish employers did not provide health insurance, even though I have a chronic medical condition. The choices of plans offered by companies is far, far smaller than the choices available to me on the open market. I don't want to have to find new health insurance if my employment situation changes, possibly leaving me with a gap in coverage. The expectation that employer-provided benefits are at no cost to the employee is a fallacy - if companies did not offer health care as a perk, they would be able to offer higher salaries instead.
The only reason American employers are in the business of offering health insurance is because they get a federal tax break. This makes health insurance cheaper to the employer than to individuals. Given this, if my employer stopped offering insurance, they couldn't increase my salary enough for me to purchase the same plan myself. I think this is unfair - I would like to get the same tax break myself, or at least eliminate the tax break altogether so I am on an even playing field with businesses. This would allow me to purchase my own health insurance at rates comparable to what I'm offered at work.
Considering the tax situation, it's curious that Intuit would not choose to take this tax break. It seems like a short term move that allows them to cut costs while exploiting the economic stickiness of employment. This move makes them less competitive for employees in the labor market, but that only affects them in the long term. In the short term, the employees they have will be hesistant and slow to find new jobs.
> if companies did not offer health care as a perk, they would be able to offer higher salaries instead.
Prices, including labor prices, are not determined by costs. There is no indication at all that companies would compensate employees more if they didn't have to pay for their health insurance. What is most likely to happen is that companies will pocket the difference, in the same way they've been pocketing the difference from increased productivity while letting wages become stagnant.
They probably would. I've had a lot of jobs that heavily emphasize how much is paid for benefits, and often it's used as justification for why raises weren't offered that year. These places would probably be happy to give everyone a raise and do away with the frustration with medical benefits, especially plans whose cost go up like 20% a year.
There are a lot of jobs which do not offer benefits, or benefits are offered with no part paid by the employer. These places would not offer raises, but these people would end up with better choices of private plans.
Benefits are a huge burden for companies, especially smaller ones. Coordinating benefits is a seasonal full-time job that someone has to do. I've known of a few smaller family businesses that gave everyone a raise, and told them to get their own health care coverage on healthcare.gov.
This argument relies on a really weird assumption that companies aren't already compensating employees as little as they can get away with. That companies could compensate employees less by not offering benefits but choose not to out of the goodness of their heart.
If employers are already compensating employees as little as they can get away with then if they stopped compensating via insurance, they'd be required to compensate via salary.
Imagine a scenario where overnight, all US companies stop offering health insurance. In this scenario, all those employees who used to have health care would now have to pay for it themselves (or do without it). So they're all going to be expecting an immediate raise to compensate for this increased expense, and if not they'll almost certainly be looking for a new job that pays a lot more (after all, it's not like they need their old job for the insurance any more..)
If you're a company, unless you were already planning to do some mass layoffs, you're going to give most of them that raise because the alternative is having a bunch of people quit. And if you don't increase your offers for new hires, you probably won't be hiring anyone either.
Labor price is salary + benefit packages. Reducing the cost of benefits from the equation would mean the company has extra resources.
The company could:
* immediately raise people's salaries
* or hire in more people (which increases demand)
* they could take the extra profit and distribute that to shareholders
* or drop the price of their products and services and pass the savings on to the customer
* or they could make capital investments.
In most cases, I would expect salary prices to increase for labor (even if not immediately) or make people's current salaries more effective in purchasing power.
You're worrying overmuch about "the market". The US health care system is pretend free market. The government is paying for much of US health costs, and regulating various aspects of it.
What really matters is how the government policies would change when it's moved from employers to people. The government is likely to pay the costs for low income people, which will also mean their wages are likely not to rise.
Companies would "pocket" the difference? What pocket would that be exactly? Companies are in competition. While company A, might "pocket" the savings, company B will use it to their advantage in potentially any number of ways - paying employees more, reducing prices to customers, investing in new equipment. You refer to the 8 million companies in the US as if they're one entity that conspires in lockstep. That's not how it works.
> There is no indication at all that companies would compensate employees more if they didn't have to pay for their health insurance.
Employers use a figure called "total compensation" for what it costs them to employ someone. This includes salary and the cost of all the benefits, including all the so-called "employer paid" taxes and benefits. The WSJ ran an article long ago that showed employee productivity matched total compensation, not salary compensation.
Employers certainly do care about the cost. They don't care what percentage of those costs go to employee takehome pay. But offering pre-tax health insurance means the employer can offer less total compensation.
Any economic article that talks about salary instead of total compensation is either ignorant of accounting reality or is trying to mislead.
Companies are paying the increase in productivity to the professional-managerial employees who are actually more productive because of technology, scale, etc. and not to the masses whose productivity is the same as ever.
Even when we talk about redistributing this increase, we mostly talk about redistributing it from the professional-managerial employees, who populate the higher personal income tax brackets, not from the companies themselves (corporate tax) or their owners (wealth tax). If you are right that companies and their owners are pocketing it, then we are looking for it in the wrong places. But it seems like it really is largely going to the PMC.
That's fine, the idea isn't to get rid of employer provided healthcare to make salaries go up, the idea is to get rid of employer provided healthcare because of the problems that come with it.
Health insurance is a budgeted overhead variable cost assigned to employee expenses. It's true that should HI disappear, not all of the HI cost will be transferred to employee salaries, but it's definitely a non-zero amount.
The companies compete for workers, especially highly skilled ones. One company rising wages would push others to react in a similar way assuming they compete for the same talent.
Yes. As someone with a chronic health condition living in America, I agree completely.
Leaders of this country really do not care about the healthcare of its citizens (just look how long people with diabetes have been screwed, how long people have been able to lose literally everything over medical debt, etc.), I can’t imagine leaving things to the individual would be helpful in any manner whatsoever.
Budgets are set by costs. When you run a business, you care about the “fully burdened” cost of each employee, and you hire as many as you can within your budget. One of the line items in that is my half of the payroll tax. Another line item is health insurance. Another may be an offset for office space and equipment.
Whether my fully burdened cost budget has a line item for health insurance being paid to a 3rd party or to the employee is totally irrelevant. Tax law currently happens to make it much more efficient for me to pay that money to a 3rd party, so that’s where it goes.
The reason I have that line item is due to a combination of market forces and regulation. By no means do I get to choose just not to pay it, if I expect employees to keep working for me, or the government not to shut me down.
> The choices of plans offered by companies is far, far smaller than the choices available to me on the open market.
Maybe I wasn't searching correctly, but I was recently discussing healthcare and taxes with someone and briefly searched on the Healthcare.gov exchange to look at prices. There were only three PPO plans (where you can freely go to any doctor in network), and all three were HDHPs, all from the same company. There were many HMO plans, some HDHP and others with low deductibles, but often extremely small local networks and limited choice of both PCPs and specialists.
> This makes health insurance cheaper to the employer than to individuals.
One other thing to note in your analysis is that most large employers are not buying any insurance, but actually self-insuring (funding the claims out of their own pool of money). So the employers are actually acting as insurance companies for their workers, rather than simply buying and reselling commercial insurance.
There would be additional considerations beyond taxes in analyzing whether this type of insurance is more economically optimal, for example, the fact that each company has a distinct risk pool which may not be similar to the general population, depending on the company.
This was my experience, as well, with the individual market. It is virtually impossible to replicate an employer-provided plan at all with market plans. You, as an individual, do not have the leverage to buy what most would consider good health insurance plans on your own.
Are you in a state that has pushed back against ACA? Or maybe you're only looking at the "bronze" tier, which will be skewed towards low cost HMOs and HDHPs?
FWIW, in California I see like 5 different options for HMO across all of the tiers, a couple are local ones I've never heard of, but there's also some like Kaiser that are fairly large networks.
> The only reason American employers are in the business of offering health insurance is because they get a federal tax break
The cost of paying me is also tax deductible, so they get a 'tax break' by paying me more money.
> This makes health insurance cheaper to the employer than to individuals.
I don't think that's the root. Large insurance companies seem to want to sell to larger companies - groups of people - vs selling insurance to individuals. Selling to a group is where it seems some price reduction happens. And... by and larger, if you're selling insurance to people who are already healthy enough to be working regularly/fulltime, your costs for insuring that 'pool' will be somewhat cheaper than the costs of insuring any random individual.
> they couldn't increase my salary enough for me to purchase the same plan myself
If the cost of my health insurance was deductible from my individual taxes, then the entire market would be turned upside down. There are certain thresholds that need to be met re MAGI (IIRC) before health insurance insurance premiums are deductible by individuals. I'm "self employed" so the entirety of my premiums are tax deductible, but for the average person working a W2 job someplace that doesn't provide health insurance for them, it's not a deductible expense, which is a total sham.
I am increasingly disabled, but I'm still managing to keep my job and its amazing health insurance, thank God.
Insurance this past year has paid for like, a couple dozen specialist visits, 6 MRIs, weekly rehab, a reclining desk and a power wheelchair. I maxed out my deductable in February :D
My health would be better if I could go on disability but that pays like, $1K a month and is ridiculously hard to get.
It's a tax break for the employee and hence for the employer - they can spend $X on insurance and give the employee $x+tax rate in benefits.
What should be done is entirely decouple it so that health insurance AND medical expenses are above the line deductible - or make none of it such. And then let employees pick whatever they want.
But why do you have to think about this at all? Wouldn't it just be easier that this was provided by the state, so that all citizens could afford getting necessary health care. At the same time it would relive you of having to compare coverage, copays, deductibles or in general understand the full fine print of your insurance agreements. Most comparable industrial countries have found a pretty decent solution to this where you move the financial burden of many basic services (health care, schooling, etc.) from the public, over to the government - allowing all citizens to benefit from these, without having to wonder if the can afford it.
Wouldn't it be easier if we all jumped into the vat of jelly with the matrix connection jacked into the back of our necks!? We wouldn't have to eat or poop or sleep. We could just trust the powerful to make every decision for us. It would be soooo much easier.
Forgive me, but when it comes to my healthcare I want the most choice and control as I can have. I don't want to be stuck with whatever some bureaucrat decides is worth it.
Lastly, people make stupid decisions and they get hurt. They go rock climbing or skydiving, they ride their bikes on busy streets. Why should I shoulder the responsibility for people's poor life choices.
The amount of time we have to spend each year sorting out our healthcare for the entire company is mind blowing. You are totally correct, it becomes a full time job for 3 or 4 weeks for myself and another partner. So much effort and knowledge required for something that isn’t even our core business! And it inevitably causes drama with employees who don’t like some part of the group plans we end up with. Very stressful.
We only offer it as our employees all say that this benefit is really important to them. I didn’t know it was a tax break for us to be honest.
I wish more employees thought like you did. Our average monthly cost per employee is about $500 for a “silver” PPO plan, and about $110 for dental. Average age of our employees is below 30.
I’d gladly pay employees the $610 extra a month just so we don’t have to deal with it and the drama that comes with it. This would actually save us money from the energy wasted dealing with insurance companies. And no one who’s dealt with our insurance plans over the years has had a positive experience. My brother (who worked for my company) cut his chin while out of state. Required 2 stitches, and he just walked to the closest ER to get them. $3500 it ended up costing him, even with our insurance and countless hours fighting the insurance companies too. Didn’t even see a doctor, a nurse did the stitches. It’s a joke.
Other than salaries, health insurance is the largest expense for our business. Think about that at the scale of the entire economy and its mind blowing the wasted energy/effort on this “system”.
I’m originally from Australia. We have “socialized” healthcare there. My brother is back visiting family currently and got an x-ray and ultra sound for $310. The American system is absolutely embarrassing.
Why is this? (I'm used to European 'socialized' healthcare). Is it just the amount and type of cover offered by different policies is wide and opaque, the age/health of the employees effects the price/cover?
Aren't there insurance brokers that provide tools to compare simply. Would a system that allowed employees to vote/order the cover they would like in the plan and then you to adjust the price point until you get matching policies that provides an acceptable level of cover.
Never underestimate the evil of HR. It’s a way to offload headcount without a layoff.
They probably agreed to not layoff Mailchimp employees in the sale, so they make them quit. Purging the sick, tbe pregnant, etc from the company is a way to cut costs, and doing so through some elaborate bureaucratic fuckup avoids government intervention.
> I wish employers did not provide health insurance, even though I have a chronic medical condition.
I've had multiple open heart surgeries. My medical events are relatively rare (every couple years) and I recently went completely septic for 4 days (started to have multiple organ failure ~3 days from no-return) due to a cascade of underlying issues. I know my medical coverage and it's been critical to my survival for my entire life.
I have NEVER used employer health insurance and anyone with major medical conditions would be foolish to depend on employer coverage in most cases. The offered plans are basically a big deductible with some minor coverage for non-catastrophic, no surgical coverage, nothing chronic. More expensive plans cover more dependents. Gee thx. It's all but useless and I have simply declined it everywhere for the last 25 years to keep the ~25$/mo, as I have paid my own (car payment-sized) platinum level health insurance plan everywhere I've gone (and my wife's). The type of company - Finance, Medical, Marketing, Retail, Consulting (ironically the best I've found), doesn't make much of a difference. Every now and then you find some employer that will "cover your healthcare 100%" which is inevitably code for "cover the plans we choose, which aren't different than anyone else".
My health insurance costs me $0 (fully employer paid), has a $300 deductible, and a $3k annual maximum. Last year they covered more than $100k worth of expenses without even a small amount of fight.
This is a similar plan to my last 3 employers, companies of various sizes HQd in either SF or Seattle. If I had "multiple open heart surgeries," it would cost me a max of $3k in a calendar year.
Where are you working that you are not being provided similar plans?
1. You can get some of the tax break if you use HDHP plan + HSA. It's limited to about 7K though, because if everybody would take big tax breaks, who'd pay for those trillion dollar bills they're passing every year now?
2. US healthcare system is incredibly hostile to people trying to pay their own costs and designed to be maximally obscure and confusing. Imagine buying a car where your car dealer, tire manufacturer, window glass manufacturer and upholstery supplier bill you separately. Now imagine when you come to the dealer and ask how much the car would cost, they shrug and tell you you'd know when the bills come, just relax and sign on the dotted line. If you really insist, they could give you an estimate - something between 1K and 100K dollars - but they don't guarantee anything, it's just an estimate. And no, you can't choose the suppliers upfront or know which ones they'd use - this you'd also know only when the bills come. And no, there's no way to know when or how it happens - they bills would just show up one day as a surprise. Sounds like a nice experience? That's how the healthcare system works, day to day.
3. The frustrating part is that most of the people think it's the only way to manage it, and those that don't think that the only way to fix it is to nationalize the whole thing. I mean we can create insanely complex supply chains (think how many people cooperated on making a car? And you still can come to a single place and pay for it with a simple transaction at cost known in advance - magic!) - but somehow healthcare is where it all disappears and figuring out the separation of labor thing becomes the problem of the end user.
I was under the impression (from being on the public market and later self-employed, company subsidized insurance which is altogether cheaper and better) that companies have pooling power which allows them to cut deals with insurers. Is that not the case?
There are two kinds of costs with health insurance for companies. The funding to pay claims and the administration of said funding to pay claims. The administration part is the money maker, and while ACA attempted to curtail what they can charge for this/profit from it, they do creative things like "outsource" IT or HR to a separate company (with the executives as ovepaid board members). It's kind of like tax evasion only instead of taxes it's reducing your premiums.
Many large companies also self-insure to pay claims, and only pay the insurance company to administrate the plan. That makes the effective cost much lower (well, in relative terms anyway...health insurance in the US is broken.)
The only reason American employers are in the business of offering health insurance is because they get a federal tax break. This makes health insurance cheaper to the employer than to individuals
This is wrong on so many levels.
First, employers get a tax break because compensation expenses are generally deductible as "ordinary and necessary business expenses" required for the employer to be competitive in the labor market.
Second, employer policies are cheaper because the risk pool is cheaper to insure than the individual pool, so the insurers can make the same or more profits despite charging lower premiums.
The combined effect is to make employer-based health insurer significantly cheaper on both a pre-tax and post-tax basis than individual plans. But even without the tax benefit employers would still be incentivized to provide health benefits in a labor-competitive market. For example, many still provide free meals and parties to employees, even though meals are only partially deductible and parties are not deductible at all.
I don't know the US system at all, but here in France employee health insurance ("mutuelle") are mandatory. The main benefit is that the cost is the same for all employees, no matter their health condition, age, etc. Basically it's a solidarity thing which allows everyone in the company to be covered well for a reasonable price.
Last US company I worked for, before the current one, instituted tiered policy costs. I made more, so I paid more for identical coverage. I thought it was good. They had pretty decent insurance.
There is also another differentiator - companies buy insurance for all employees (i.e. in "bulk") when if everyone were to buy it privately, insurance companies will have to sell it in "retail". As is always the case with any business - bulk customers have preferential treatment, lower prices, better terms, you name it. Retail always pays it in full. While current employer based insurance model is broken, I don't think goin "full retail" will change the situation much. We'll end up in a situation similar to wireless service market - 3 major players with overpriced plans and lots of cheap MVNOs that stop having any coverage 5 miles down the highway.
> I would like to get the same tax break myself, or at least eliminate the tax break altogether so I am on an even playing field with businesses. This would allow me to purchase my own health insurance at rates comparable to what I'm offered at work.
Maybe not. Businesses have more negotiating power because they're bigger buyers, so they would still have access to more competitive rates. Unless you got together with a lot of people to negotiate together (and this might be a startup opportunity).
> The choices of plans offered by companies is far, far smaller than the choices available to me on the open market.
On the flip side, the cost my employer pays for my plan is far lower than they would bill me for it on the open market. Last time I looked at the individual market it was amazing how bad even plans for $500-1000 were! They could give me a raise exactly matching what they'd stop paying and I'd still lose out.
Edit to clarify: That's not a "this is cheaper to us after we account for the tax break." That's a "this is the rate it costs us" vs "this is the rate it would cost you" difference.
The negotiation power difference is real. Private market health insurance would need to be well-regulated or we'll all just get screwed even more.
Employers like this because it gives them power over employees and makes it more attractive than being an entrepreneur not just to save money on taxes.
They could offer higher salaries, but would they? And employers are able to negotiate better plans than you can get in the individual market. There's no way i could get the plan i have through my work for the about $12000 they spend on it.
But I agree, healthcare should be provided by the federal govt like in every other advanced nation
I don't quite understand what you're envisioning. Our system depends on many employers paying for health insurance. You would have to change a lot of things about our system for it to be decoupled.
In South Korea the healthcare premiums are split between employees and the employers: https://en.m.wikipedia.org/wiki/Healthcare_in_South_Korea They don't have to negotiate group plans and maintaining coverage when switching jobs is pretty seamless.
There has to be a plan if employers stop providing insurance en masse, and I'm not sure it's a good idea to stop getting premiums from the source of personal income entirely. That seems to be a convenient place to get the kind of money that healthcare demands.
Better yet. The government should require all health prices be published online, with the same rate charged to all patients regardless of insurance provider.
Make this similar to gym membership. Let each person decide where to go based on cost and needs. With insurance remaining their for catastrophic events only.
People don't decide to have heart attacks or get hit by cars outside of a hospital that's in their network. Surviving heart attacks can cost half a million to over a million dollars if care was received out of network. Disability can easily costs millions over a lifetime, too. Price transparency won't suddenly make that affordable.
"Considering the tax situation, it's curious that Intuit would not choose to take this tax break."
Intuit did provide health insurance to these employees and take the tax break. There was a small gap between when the previous MailChimp insurance ended and MailChimp employees were placed on the Intuit offered health insurance. Once on the Intuit provided plan coverage was retroactive to the date the MailChimp plan ended. The employees could submit claims to the Intuit plan for reimbursement of medical expenses paid during the gap. The issue is that floating the money during this time could significantly impact the finances of the employee or that the employee may not have the funds to do so at all.
The reason for employer-offered health care plans is they are paid from pre-tax earnings. If the employee paid for it themselves, it would be paid by post-tax earnings, making it much more expensive.
Depends. If your employer doesn't offer health insurance, you can shop for plans on the government health insurance marketplace. These plans can have substantial subsidies.
USA employers started offering health insurance during World War 2 as a means of enticing women to come to work, as there weren’t enough men to fill the positions. And once that trend started, it simply never stopped.
It's true that they started offering health insurance during WWII, but it wasn't specifically to entice women into the workforce, rather it was to be competitive when Roosevelt created the Office of Economic Stabilization, which froze wages. Offering health insurance was a way to get around this.
>This would allow me to purchase my own health insurance at rates comparable to what I'm offered at work.
Would it? The employer can still call up an insurer and say "if you can give me a better deal than X, I'll buy insurance for 1,000 people" whereas you have maybe 5 potential customers to bargain with.
There is no “tax break.” It’s unlawful for me not to buy health Insurance for my employees (more than 50) and you aren’t allowed to shop the open market if you work for me. Average cost per employee is $1150 this year (up about 11% over last year). Thanks Obama.
It is not just the tax break that makes it cheaper for corporations to buy insurance. Companies with a lot of employees pay a lot less than individuals because they pool the risk. Back before ACA you used to be able to get in a pool with, for example, other small business owners and pay an amount similar to what companies pay but as an individual. ACA made those plans illegal and insurance that used to cost $500 per month jumped to $1800.
I wasn't aware the ACA made pooling illegal. Awhile back I tried to form a group with small tech companies in my town to do this, but the insurance companies all wanted a larger anchor company. None of the bigger tech companies in town wanted to participate b/c they saw their benefits as a competitive advantage. This was post ACA, and I don't remember anyone mentioning legality.
Small companies get crushed by insurance. Giving employees extra money in their check and telling them to use it on the ACA is probably most effective for all parties at the moment.
The tweet definitely leaves a lot out. My initial impression was, "that sounds reasonable." I got insurance retroactive to my hire date when I switched jobs last, but it took time for paperwork to be processed, so of course I would pay up front before then. But the article reads more like the sellers dropped the ball by cutting the insurance without ensuring their former employees were properly taken care of. There is plenty of blame to lay at Intuit's feet, but it's not like the former owners of Mailchimp didn't know what everyone else knows. Sounds like they just wanted some quick cash and everything else was someone else's problem.
> In the US, your health insurance is tied to your job.
Why on earth is it that it doesn't matter which party gets elected, you can't seem to get universal health care? Pick California for example, it's a rich state with a massive homelessness problem. What do the homeless mostly suffer from? Addiction and mental health.
Living in Europe and not having to worry about any kind of random health issue is great. If you have some problem, you get it seen to as soon as possible and not worry about whatever it may cost. As an employer things are simpler too, and in the long run, likely cheaper.
It just seems incredibly backwards and I'm not sure it really actually serves anybody. If you're big Pharma, you want your patients to live longer, as they'll get older and have more issues that you can sell products for. If they lose their job, that's lost income.
People love conflating people living on the streets as just homeless, but the approach to solve the problem really requires two solutions. The first is to provide housing for the people mentally capable of taking care of themselves. The rest require either public housing in a facility that can take care of them (abandoned mentally ill) or rehab programs that will hopefully help addicts recover and reestablish themselves. The mentally ill and addicts will not be able to function with just free housing.
There are typically quite some homeless programs running, but many get rejected for not abiding by the rules they (understandably) must have, i.e. don't be violent or do drugs. It's not enough to give these people a home, you must also address the reason they are homeless.
> Why on earth is it that it doesn't matter which party gets elected, you can't seem to get universal health care?
Because Republicans can tie-up such laws in committee to prevent it.
Obamacare is a huge improvement over what came before. It's rather absurd to complain it isn't enough.
> Pick California for example, it's a rich state with a massive homelessness problem. What do the homeless mostly suffer from? Addiction and mental health.
California spends a considerable amount on generous public health programs. A great many homeless have health insurance from the public programs in California now. Tearing down all barriers would leave California at risk of medical tourism draining public funds.
> Because Republicans can tie-up such laws in committee to prevent it.
But this doesn't explain why it hasn't been achieved on the state level.
> Obamacare is a huge improvement over what came before. It's rather absurd to complain it isn't enough.
Not really, you can appreciate an improvement whilst looking forward towards further improvements.
> California spends a considerable amount on generous public health programs. A great many homeless have health insurance from the public programs in California now. Tearing down all barriers would leave California at risk of medical tourism draining public funds.
This sounds like a solvable problem. You could have an upfront tax or medical availability delay of a few years to make health tourism really unattractive.
Blaming other people sounds like a great way to not deal with the issue.
Historical and tax reasons. It started back in the era of WWII wage controls. It continued to be an okay way to do group insurance without facing major problems with adverse selection. Being able to pay for it with a pre-tax payrolld eduction is the other big reason it thrived.
Given the mandates on insurance there are some reasons it should continue, but they are not really good reasons.
> some reasons it should continue, but they are not really good reasons.
Many of those reasons are legislature that allows insurance companies to do/demand things that they really shouldn't be able to. Even if the goal isn't public healthcare, America still needs a major healthcare insurance restructuring.
> It continued to be an okay way to do group insurance without facing major problems with adverse selection.
This is sort of a hot take, but there are plenty of examples of things like this in the US that have the unstated parenthetical "(because poor and minority populations were ignored by the system completely)"
So health insurance companies only have to convince your HR department to use them through some kind of grift instead of competing for your individual business on things like cost and in-network providers. Because the health insurance industry is focused on metrics like "number of lives we brought in this quarter" from massive deals that abstract your individual agency as one of a thousand+ lives covered under your employers plan. Who cares if you need to speak to a supervisor because your claim was denied, you're not going to get your company to switch plans.
Before someone says "but the healthcare marketplace", it's a joke. The individual plans we have today are ridiculously expensive because: A) the government will pay for folks who can't pay for them, so easy money for the insurance companies and B) the folks who can pay really need it (healthcare is inelastic), they're so few though so there really is no downward price pressure to compete for them.
> the government will pay for folks who can't pay for them
This depends on your state. Some states, like Wisconsin, won't offer medicaid for income reasons alone. I'm unaware of health insurance policies being cheaper in Wisconsin, though perhaps it's the case.
Ultimately because it drives down the cost of labor by locking employees in.
Employer’s cost per employee is much much lower than an employee’s cost directly from insurer. The employer “sells” the benefit to the employee at a higher perceived cost because of this.
Without an employer’s discount, an employee simply cannot get the same insurance coverage.
Thus, the employee agrees to working pay and conditions which would not be agreeable without the pressure to get health coverage.
Hence, lower cost of labor to the employer and pressure to keep the current structure in place.
Lets look back to the 90s when it wasn't legally mandated: some people did just fine (those with a lot of cash sitting around), most people suffered worse than they do today and some people were completely screwed by the system.
If it was illegal to pool health prices via insurance (instead of just not legally mandated for everyone to be insured) then the effect would be that those who went bankrupt under the old system would instead be dead.
I'm not following your first question do you mean to say why is mandating coverage legal?
My understanding of the mandate was that(theoretically) by more people being insured the population be healthier and that would someone how drive prices down. Obviously that's a farce as prices go up year over year. It would be interesting to see how much more basic procedures would be now after being adjusted for inflation compared to what they were in say the 90's.
Why have health insurance at all? It's just a middle-man for profit scheme between patient and health care.
Just have mandated health CARE for all and do away with health insurance altogether. Lots of companies would lose billions, but average people on the street would be the ones not spending that money.
If you made it illegal, people would start creating risk pools in ways that are technically legal. Such as membership clinics, special-purpose clubs, etc.
This is super incorrect; if anything, employer-based health insurance strengthened the unions' ability to negotiate for their workers. As a sibling comment mentioned, the major catalyst was WWII wage controls:
> During World War II, wage and price controls prevented employers from using wages to compete for scarce labor. Under the 1942 Stabilization Act, Congress limited the wage increases that could be offered by firms, but permitted the adoption of employee insurance plans. In this way, health benefit packages offered one means of securing workers.
> In the 1940s, two major rulings also reinforced the foundation of the employer-provided health insurance system. First, in 1945 the War Labor Board ruled that employers could not modify or cancel group insurance plans during the contract period. Then, in 1949, the National Labor Relations Board ruled in a dispute between the Inland Steel Co. and the United Steelworkers Union that the term "wages" included pension and insurance benefits. Therefore, when negotiating for wages, the union was allowed to negotiate benefit packages on behalf of workers as well. This ruling, affirmed later by the U.S. Supreme Court, further reinforced the employment-based system.
Yes. If I recall, it goes back to the Great Depression when there were cash shortages (and other issues).
It incentivized employers to compensate with benefits, not cash.
Around the same time, unionization became much more popular, and with it negotiated compensation (more benefits).
These were big issues in the North. In the South, the economy has was still largely rural, and many states provided publicly funded hospitals - so the dynamics were different.
There was a move for employers in to provide health insurance pre Great Depression. That was because larger employers could use their size to negotiate deals with hospitals. So health coverage was worth $individualPrice to an employer, but $negotiatedPrice to the employer.
In general, insurance providers preferred going through employers because employed people are healthier and file fewer claims.
Geico was an acronym for “Government Employees Insurance Corporation” which was a thing because government employees were a pretty safe bunch to insure.
So even back then, many of the dynamics we see now existed: negotiated prices, grouping, etc.
Do you want our health insurance plan, or an extra $1500/month to find your own on the open market would be an interesting way of looking at it.
But either way, both your employer and your cost for health insurance should show up on everyone's pay statements. Most have no idea what their employer pays for insurance.
I’m not sure of the underlying reasons, but I know most employers make it slightly cheap enough to be more affordable than Obamacare. But it’s still insanely expensive (ex: I pay $1920/m + $22k deductible for a family of four).
Negotiating as an individual in a market made up by large blocks makes you very easy to ignore. If everyone moved off employer insurance and into the market then, assuming we didn't have massive market corruption (which I think is a pretty big assumption), we'd all be on an even playing field. Asking individuals to do this independently is just a recipe for them to fail.
Most employers don't offer to pay the premium out instead of the coverage, so they usually offer a much better deal than the alternatives.
Like if your contribution to your insurance is a few hundred a paycheck there is a pretty good chance that the employer is paying in quite a bit more than that.
Most companies (and employees) consider this part of the compensation package.
In most cases there is not an avenue to recover any lost compensation if you opt out of health insurance. If an employer offered a higher base pay for those not on their insurance plan, you probably WOULD see a much higher rate of those securing their own plans in the open market.
If you can suggest an edit that will fit within HN's title length limit that conveys the sentiment of the entire tweet, please feel free to do so. Appending enough of the missing text to convey anything useful violates the limit, but maybe the title could be compressed in another way.
I don't think I can edit the title anymore, but one of the mods can edit it.
The worse a company treats its employees, the less loyal they will be, and the more likely it is that one of them decides to earn money by abusing their insider access, either out of greed or despair.
The thing is that pre-acquisition mailchimp was an example of a place tech employees loved to work but not for the equity. The founders built a strong internal culture of private ownership and then bailed for a payday. If any other company sold out and employees got short changed, it wouldn’t make the news.
https://www.businessinsider.com/mailchimp-insiders-react-to-...
> When employees were recruited to work at Mailchimp there was a common refrain from hiring managers: No, you are not going to get equity, but you will get to be part of a scrappy company that fights for the little guy and we will never be acquired or go public.
Readit News
The only reason American employers are in the business of offering health insurance is because they get a federal tax break. This makes health insurance cheaper to the employer than to individuals. Given this, if my employer stopped offering insurance, they couldn't increase my salary enough for me to purchase the same plan myself. I think this is unfair - I would like to get the same tax break myself, or at least eliminate the tax break altogether so I am on an even playing field with businesses. This would allow me to purchase my own health insurance at rates comparable to what I'm offered at work.
Considering the tax situation, it's curious that Intuit would not choose to take this tax break. It seems like a short term move that allows them to cut costs while exploiting the economic stickiness of employment. This move makes them less competitive for employees in the labor market, but that only affects them in the long term. In the short term, the employees they have will be hesistant and slow to find new jobs.
Prices, including labor prices, are not determined by costs. There is no indication at all that companies would compensate employees more if they didn't have to pay for their health insurance. What is most likely to happen is that companies will pocket the difference, in the same way they've been pocketing the difference from increased productivity while letting wages become stagnant.
There are a lot of jobs which do not offer benefits, or benefits are offered with no part paid by the employer. These places would not offer raises, but these people would end up with better choices of private plans.
Benefits are a huge burden for companies, especially smaller ones. Coordinating benefits is a seasonal full-time job that someone has to do. I've known of a few smaller family businesses that gave everyone a raise, and told them to get their own health care coverage on healthcare.gov.
If employers are already compensating employees as little as they can get away with then if they stopped compensating via insurance, they'd be required to compensate via salary.
If you're a company, unless you were already planning to do some mass layoffs, you're going to give most of them that raise because the alternative is having a bunch of people quit. And if you don't increase your offers for new hires, you probably won't be hiring anyone either.
The company could:
* immediately raise people's salaries
* or hire in more people (which increases demand)
* they could take the extra profit and distribute that to shareholders
* or drop the price of their products and services and pass the savings on to the customer
* or they could make capital investments.
In most cases, I would expect salary prices to increase for labor (even if not immediately) or make people's current salaries more effective in purchasing power.
What really matters is how the government policies would change when it's moved from employers to people. The government is likely to pay the costs for low income people, which will also mean their wages are likely not to rise.
Employers use a figure called "total compensation" for what it costs them to employ someone. This includes salary and the cost of all the benefits, including all the so-called "employer paid" taxes and benefits. The WSJ ran an article long ago that showed employee productivity matched total compensation, not salary compensation.
Employers certainly do care about the cost. They don't care what percentage of those costs go to employee takehome pay. But offering pre-tax health insurance means the employer can offer less total compensation.
Any economic article that talks about salary instead of total compensation is either ignorant of accounting reality or is trying to mislead.
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Even when we talk about redistributing this increase, we mostly talk about redistributing it from the professional-managerial employees, who populate the higher personal income tax brackets, not from the companies themselves (corporate tax) or their owners (wealth tax). If you are right that companies and their owners are pocketing it, then we are looking for it in the wrong places. But it seems like it really is largely going to the PMC.
That’s very much not the case for 99.9% of goods and services.
Prices for labor, i.e. wages, are set by the demand for labor, and workers’ opportunity costs.
Leaders of this country really do not care about the healthcare of its citizens (just look how long people with diabetes have been screwed, how long people have been able to lose literally everything over medical debt, etc.), I can’t imagine leaving things to the individual would be helpful in any manner whatsoever.
Whether my fully burdened cost budget has a line item for health insurance being paid to a 3rd party or to the employee is totally irrelevant. Tax law currently happens to make it much more efficient for me to pay that money to a 3rd party, so that’s where it goes.
The reason I have that line item is due to a combination of market forces and regulation. By no means do I get to choose just not to pay it, if I expect employees to keep working for me, or the government not to shut me down.
Maybe I wasn't searching correctly, but I was recently discussing healthcare and taxes with someone and briefly searched on the Healthcare.gov exchange to look at prices. There were only three PPO plans (where you can freely go to any doctor in network), and all three were HDHPs, all from the same company. There were many HMO plans, some HDHP and others with low deductibles, but often extremely small local networks and limited choice of both PCPs and specialists.
> This makes health insurance cheaper to the employer than to individuals.
One other thing to note in your analysis is that most large employers are not buying any insurance, but actually self-insuring (funding the claims out of their own pool of money). So the employers are actually acting as insurance companies for their workers, rather than simply buying and reselling commercial insurance.
There would be additional considerations beyond taxes in analyzing whether this type of insurance is more economically optimal, for example, the fact that each company has a distinct risk pool which may not be similar to the general population, depending on the company.
FWIW, in California I see like 5 different options for HMO across all of the tiers, a couple are local ones I've never heard of, but there's also some like Kaiser that are fairly large networks.
The cost of paying me is also tax deductible, so they get a 'tax break' by paying me more money.
> This makes health insurance cheaper to the employer than to individuals.
I don't think that's the root. Large insurance companies seem to want to sell to larger companies - groups of people - vs selling insurance to individuals. Selling to a group is where it seems some price reduction happens. And... by and larger, if you're selling insurance to people who are already healthy enough to be working regularly/fulltime, your costs for insuring that 'pool' will be somewhat cheaper than the costs of insuring any random individual.
> they couldn't increase my salary enough for me to purchase the same plan myself
If the cost of my health insurance was deductible from my individual taxes, then the entire market would be turned upside down. There are certain thresholds that need to be met re MAGI (IIRC) before health insurance insurance premiums are deductible by individuals. I'm "self employed" so the entirety of my premiums are tax deductible, but for the average person working a W2 job someplace that doesn't provide health insurance for them, it's not a deductible expense, which is a total sham.
Insurance this past year has paid for like, a couple dozen specialist visits, 6 MRIs, weekly rehab, a reclining desk and a power wheelchair. I maxed out my deductable in February :D
My health would be better if I could go on disability but that pays like, $1K a month and is ridiculously hard to get.
What should be done is entirely decouple it so that health insurance AND medical expenses are above the line deductible - or make none of it such. And then let employees pick whatever they want.
Forgive me, but when it comes to my healthcare I want the most choice and control as I can have. I don't want to be stuck with whatever some bureaucrat decides is worth it.
Lastly, people make stupid decisions and they get hurt. They go rock climbing or skydiving, they ride their bikes on busy streets. Why should I shoulder the responsibility for people's poor life choices.
The amount of time we have to spend each year sorting out our healthcare for the entire company is mind blowing. You are totally correct, it becomes a full time job for 3 or 4 weeks for myself and another partner. So much effort and knowledge required for something that isn’t even our core business! And it inevitably causes drama with employees who don’t like some part of the group plans we end up with. Very stressful.
We only offer it as our employees all say that this benefit is really important to them. I didn’t know it was a tax break for us to be honest.
I wish more employees thought like you did. Our average monthly cost per employee is about $500 for a “silver” PPO plan, and about $110 for dental. Average age of our employees is below 30.
I’d gladly pay employees the $610 extra a month just so we don’t have to deal with it and the drama that comes with it. This would actually save us money from the energy wasted dealing with insurance companies. And no one who’s dealt with our insurance plans over the years has had a positive experience. My brother (who worked for my company) cut his chin while out of state. Required 2 stitches, and he just walked to the closest ER to get them. $3500 it ended up costing him, even with our insurance and countless hours fighting the insurance companies too. Didn’t even see a doctor, a nurse did the stitches. It’s a joke.
Other than salaries, health insurance is the largest expense for our business. Think about that at the scale of the entire economy and its mind blowing the wasted energy/effort on this “system”.
I’m originally from Australia. We have “socialized” healthcare there. My brother is back visiting family currently and got an x-ray and ultra sound for $310. The American system is absolutely embarrassing.
Aren't there insurance brokers that provide tools to compare simply. Would a system that allowed employees to vote/order the cover they would like in the plan and then you to adjust the price point until you get matching policies that provides an acceptable level of cover.
They probably agreed to not layoff Mailchimp employees in the sale, so they make them quit. Purging the sick, tbe pregnant, etc from the company is a way to cut costs, and doing so through some elaborate bureaucratic fuckup avoids government intervention.
I've had multiple open heart surgeries. My medical events are relatively rare (every couple years) and I recently went completely septic for 4 days (started to have multiple organ failure ~3 days from no-return) due to a cascade of underlying issues. I know my medical coverage and it's been critical to my survival for my entire life.
I have NEVER used employer health insurance and anyone with major medical conditions would be foolish to depend on employer coverage in most cases. The offered plans are basically a big deductible with some minor coverage for non-catastrophic, no surgical coverage, nothing chronic. More expensive plans cover more dependents. Gee thx. It's all but useless and I have simply declined it everywhere for the last 25 years to keep the ~25$/mo, as I have paid my own (car payment-sized) platinum level health insurance plan everywhere I've gone (and my wife's). The type of company - Finance, Medical, Marketing, Retail, Consulting (ironically the best I've found), doesn't make much of a difference. Every now and then you find some employer that will "cover your healthcare 100%" which is inevitably code for "cover the plans we choose, which aren't different than anyone else".
This is a similar plan to my last 3 employers, companies of various sizes HQd in either SF or Seattle. If I had "multiple open heart surgeries," it would cost me a max of $3k in a calendar year.
Where are you working that you are not being provided similar plans?
2. US healthcare system is incredibly hostile to people trying to pay their own costs and designed to be maximally obscure and confusing. Imagine buying a car where your car dealer, tire manufacturer, window glass manufacturer and upholstery supplier bill you separately. Now imagine when you come to the dealer and ask how much the car would cost, they shrug and tell you you'd know when the bills come, just relax and sign on the dotted line. If you really insist, they could give you an estimate - something between 1K and 100K dollars - but they don't guarantee anything, it's just an estimate. And no, you can't choose the suppliers upfront or know which ones they'd use - this you'd also know only when the bills come. And no, there's no way to know when or how it happens - they bills would just show up one day as a surprise. Sounds like a nice experience? That's how the healthcare system works, day to day.
3. The frustrating part is that most of the people think it's the only way to manage it, and those that don't think that the only way to fix it is to nationalize the whole thing. I mean we can create insanely complex supply chains (think how many people cooperated on making a car? And you still can come to a single place and pay for it with a simple transaction at cost known in advance - magic!) - but somehow healthcare is where it all disappears and figuring out the separation of labor thing becomes the problem of the end user.
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This is wrong on so many levels.
First, employers get a tax break because compensation expenses are generally deductible as "ordinary and necessary business expenses" required for the employer to be competitive in the labor market.
Second, employer policies are cheaper because the risk pool is cheaper to insure than the individual pool, so the insurers can make the same or more profits despite charging lower premiums.
The combined effect is to make employer-based health insurer significantly cheaper on both a pre-tax and post-tax basis than individual plans. But even without the tax benefit employers would still be incentivized to provide health benefits in a labor-competitive market. For example, many still provide free meals and parties to employees, even though meals are only partially deductible and parties are not deductible at all.
Maybe not. Businesses have more negotiating power because they're bigger buyers, so they would still have access to more competitive rates. Unless you got together with a lot of people to negotiate together (and this might be a startup opportunity).
On the flip side, the cost my employer pays for my plan is far lower than they would bill me for it on the open market. Last time I looked at the individual market it was amazing how bad even plans for $500-1000 were! They could give me a raise exactly matching what they'd stop paying and I'd still lose out.
Edit to clarify: That's not a "this is cheaper to us after we account for the tax break." That's a "this is the rate it costs us" vs "this is the rate it would cost you" difference.
The negotiation power difference is real. Private market health insurance would need to be well-regulated or we'll all just get screwed even more.
Employers like this because it gives them power over employees and makes it more attractive than being an entrepreneur not just to save money on taxes.
But I agree, healthcare should be provided by the federal govt like in every other advanced nation
In South Korea the healthcare premiums are split between employees and the employers: https://en.m.wikipedia.org/wiki/Healthcare_in_South_Korea They don't have to negotiate group plans and maintaining coverage when switching jobs is pretty seamless.
There has to be a plan if employers stop providing insurance en masse, and I'm not sure it's a good idea to stop getting premiums from the source of personal income entirely. That seems to be a convenient place to get the kind of money that healthcare demands.
Make this similar to gym membership. Let each person decide where to go based on cost and needs. With insurance remaining their for catastrophic events only.
Intuit did provide health insurance to these employees and take the tax break. There was a small gap between when the previous MailChimp insurance ended and MailChimp employees were placed on the Intuit offered health insurance. Once on the Intuit provided plan coverage was retroactive to the date the MailChimp plan ended. The employees could submit claims to the Intuit plan for reimbursement of medical expenses paid during the gap. The issue is that floating the money during this time could significantly impact the finances of the employee or that the employee may not have the funds to do so at all.
ACA subsidies disappear once you make $50k or more a year.
https://www.npr.org/templates/story/story.php?storyId=114045...
https://www.nytimes.com/2017/09/05/upshot/the-real-reason-th...
Would it? The employer can still call up an insurer and say "if you can give me a better deal than X, I'll buy insurance for 1,000 people" whereas you have maybe 5 potential customers to bargain with.
Individuals should still have an option to choose a plan on the open market if they desire, but they're highly unlikely to find a plan for $100/month.
https://www.reddit.com/r/PoliticalHumor/comments/u15pwv/univ...
Small companies get crushed by insurance. Giving employees extra money in their check and telling them to use it on the ACA is probably most effective for all parties at the moment.
https://slashdot.org/story/21/11/11/1634237/intuit-slashes-p...
https://www.businessinsider.com/mailchimp-employees-shocked-...
> In the US, your health insurance is tied to your job.
Why on earth is it that it doesn't matter which party gets elected, you can't seem to get universal health care? Pick California for example, it's a rich state with a massive homelessness problem. What do the homeless mostly suffer from? Addiction and mental health.
Living in Europe and not having to worry about any kind of random health issue is great. If you have some problem, you get it seen to as soon as possible and not worry about whatever it may cost. As an employer things are simpler too, and in the long run, likely cheaper.
It just seems incredibly backwards and I'm not sure it really actually serves anybody. If you're big Pharma, you want your patients to live longer, as they'll get older and have more issues that you can sell products for. If they lose their job, that's lost income.
Not having a home.
> Not having a home.
There are typically quite some homeless programs running, but many get rejected for not abiding by the rules they (understandably) must have, i.e. don't be violent or do drugs. It's not enough to give these people a home, you must also address the reason they are homeless.
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Because Republicans can tie-up such laws in committee to prevent it.
Obamacare is a huge improvement over what came before. It's rather absurd to complain it isn't enough.
> Pick California for example, it's a rich state with a massive homelessness problem. What do the homeless mostly suffer from? Addiction and mental health.
California spends a considerable amount on generous public health programs. A great many homeless have health insurance from the public programs in California now. Tearing down all barriers would leave California at risk of medical tourism draining public funds.
But this doesn't explain why it hasn't been achieved on the state level.
> Obamacare is a huge improvement over what came before. It's rather absurd to complain it isn't enough.
Not really, you can appreciate an improvement whilst looking forward towards further improvements.
> California spends a considerable amount on generous public health programs. A great many homeless have health insurance from the public programs in California now. Tearing down all barriers would leave California at risk of medical tourism draining public funds.
This sounds like a solvable problem. You could have an upfront tax or medical availability delay of a few years to make health tourism really unattractive.
Blaming other people sounds like a great way to not deal with the issue.
Given the mandates on insurance there are some reasons it should continue, but they are not really good reasons.
Many of those reasons are legislature that allows insurance companies to do/demand things that they really shouldn't be able to. Even if the goal isn't public healthcare, America still needs a major healthcare insurance restructuring.
This is sort of a hot take, but there are plenty of examples of things like this in the US that have the unstated parenthetical "(because poor and minority populations were ignored by the system completely)"
Besides the fact that there doesn't seem to be any better or viable alternative available in the marketplace what are the other reasons?
Before someone says "but the healthcare marketplace", it's a joke. The individual plans we have today are ridiculously expensive because: A) the government will pay for folks who can't pay for them, so easy money for the insurance companies and B) the folks who can pay really need it (healthcare is inelastic), they're so few though so there really is no downward price pressure to compete for them.
This depends on your state. Some states, like Wisconsin, won't offer medicaid for income reasons alone. I'm unaware of health insurance policies being cheaper in Wisconsin, though perhaps it's the case.
Employer’s cost per employee is much much lower than an employee’s cost directly from insurer. The employer “sells” the benefit to the employee at a higher perceived cost because of this.
Without an employer’s discount, an employee simply cannot get the same insurance coverage.
Thus, the employee agrees to working pay and conditions which would not be agreeable without the pressure to get health coverage.
Hence, lower cost of labor to the employer and pressure to keep the current structure in place.
Serious question, right now it’s legally mandated to have. What would happen to medical prices if that requirement was reversed?
Just food for thought. If you model it you’ll find interesting results.
If it was illegal to pool health prices via insurance (instead of just not legally mandated for everyone to be insured) then the effect would be that those who went bankrupt under the old system would instead be dead.
No, we won't. The results are entirely predictable. Without medical insurance people die and/or go bankrupt.
The main problem is that most Americans for some reason cannot imagine a system other than the US system, and equate all medical insurance with that.
My understanding of the mandate was that(theoretically) by more people being insured the population be healthier and that would someone how drive prices down. Obviously that's a farce as prices go up year over year. It would be interesting to see how much more basic procedures would be now after being adjusted for inflation compared to what they were in say the 90's.
Why have health insurance at all? It's just a middle-man for profit scheme between patient and health care.
Just have mandated health CARE for all and do away with health insurance altogether. Lots of companies would lose billions, but average people on the street would be the ones not spending that money.
> During World War II, wage and price controls prevented employers from using wages to compete for scarce labor. Under the 1942 Stabilization Act, Congress limited the wage increases that could be offered by firms, but permitted the adoption of employee insurance plans. In this way, health benefit packages offered one means of securing workers.
> In the 1940s, two major rulings also reinforced the foundation of the employer-provided health insurance system. First, in 1945 the War Labor Board ruled that employers could not modify or cancel group insurance plans during the contract period. Then, in 1949, the National Labor Relations Board ruled in a dispute between the Inland Steel Co. and the United Steelworkers Union that the term "wages" included pension and insurance benefits. Therefore, when negotiating for wages, the union was allowed to negotiate benefit packages on behalf of workers as well. This ruling, affirmed later by the U.S. Supreme Court, further reinforced the employment-based system.
- Health Insurance in the United States, Melissa Thomasson, Miami University (https://web.archive.org/web/20110903053358/http://eh.net/enc...)
It incentivized employers to compensate with benefits, not cash.
Around the same time, unionization became much more popular, and with it negotiated compensation (more benefits).
These were big issues in the North. In the South, the economy has was still largely rural, and many states provided publicly funded hospitals - so the dynamics were different.
There was a move for employers in to provide health insurance pre Great Depression. That was because larger employers could use their size to negotiate deals with hospitals. So health coverage was worth $individualPrice to an employer, but $negotiatedPrice to the employer.
In general, insurance providers preferred going through employers because employed people are healthier and file fewer claims.
Geico was an acronym for “Government Employees Insurance Corporation” which was a thing because government employees were a pretty safe bunch to insure.
So even back then, many of the dynamics we see now existed: negotiated prices, grouping, etc.
Do you want our health insurance plan, or an extra $1500/month to find your own on the open market would be an interesting way of looking at it.
But either way, both your employer and your cost for health insurance should show up on everyone's pay statements. Most have no idea what their employer pays for insurance.
Like if your contribution to your insurance is a few hundred a paycheck there is a pretty good chance that the employer is paying in quite a bit more than that.
https://www.kff.org/health-costs/report/2021-employer-health...
In most cases there is not an avenue to recover any lost compensation if you opt out of health insurance. If an employer offered a higher base pay for those not on their insurance plan, you probably WOULD see a much higher rate of those securing their own plans in the open market.
Because Democrats’ plans for universal healthcare rely on forcing employers to pay for it.
It was published on Nov 11, 2021 so perhaps consider a (2021) tag in the submission title?
I feel like the title is missing that bit.
Doesn’t make it ok, but the situation is dramatically different with even the limitations of a single tweet compared to the title.
I don't think I can edit the title anymore, but one of the mods can edit it.
Shorter and as I understand it more correct.
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Like when someone at Mailchimp sold out the users of various Mailchimp customers to criminals (https://twitter.com/Trezor/status/1510558771944333312).
https://www.businessinsider.com/mailchimp-insiders-react-to-... > When employees were recruited to work at Mailchimp there was a common refrain from hiring managers: No, you are not going to get equity, but you will get to be part of a scrappy company that fights for the little guy and we will never be acquired or go public.