Is it because of tax benefits or something similar? If so, couldnt the government provide the same tax benefits to individuals to make healthcare insurance more affordable to everyone?
disclaimer: I am not from the US
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This goes back to around WW2 actually. Basically, wages were going up, fast. Inflation was also going up, fast. The government passed rules about wages to try to stop the inflation, but ruled that “benefits” didn’t count. So, o be competitive, employers started offering benefits if they were barred from paying more.
I’m general it’s cheaper to insure a group versus individuals, especially for low risk occupations like office workers.
I’m reality it’s all a scam anyway as of you take what we spend on Medicare and Medicaid and divorce it by our entire population, it’s about the same as what France and the UK spend per person on healthcare.
Companies do it because it’s become part of any expected set of benefits employers offer. Under the ACA, it’s now mandatory in many cases. To your second question, yes, the government could do that, but many people believe it shouldn’t so we have not passed a law making it so.
The money spent in an employee’s health benefits is generally not taxed in any way, shape, or form — for neither the company nor the employee.
Employer paid health insurance generally started during World War II because the federal government implement wage controls (maximum wages) for lots of jobs. Health insurance wasn’t considered a wage and some companies used the fact that the offered the benefit to compete for workers. Ever since then, health insurance has been generally tied to employment in the U.S.
Under the 2010 Patient Protection and Affordable Care Act, employers of a certain minimum size must offer health insurance to their employees who work 30 or more hours per week. The health insurance must also meet certain minimum criteria as well.
It can also be used as leverage, to force you to work and refrain from group actions, like walking out or quitting.
During WW2, there was a pretty big labor shortage, and the stabilization act of 1942 was introduced to stop companies from offering better pay and benefits by freezing wages. Insurance and healthcare was unintentionally left out, so companies offered that, and that’s how its been ever since
Others have posted the why.
If given the choice, many would take the cash and not buy any medical insurance. Of those that risk it, some will require medical care and then everyone else ends up paying for it eventually.
Just increasing wages wouldn’t help. That would force every employee to go find their own coverage, which is expensive and complicated. By enrolling all employees as a group the rates are cheaper.
Yes, it would (probably) be better for the govt to do it, hence all the calls for Universal Coverage, single-payer, etc
What is the equivalent amount? A healthy 20 year old will use health insurance a lot less than someone in their 50s or just someone with a chronic condition, so how do you judge how much to bump everyone’s pay by? Does the 20 year old get paid less because they need less to cover healthcare costs?
Because health insurance companies own the production and transportation of medical equipment and skills. They also give lots of money to politicians to keep it this way.
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