Why is health insurance tied to employment?
In order to have a more effective free market, why don't we prevent employers from providing health insurance to their employees and allow everyone to buy insurance in a free market? This would allow individuals to choose the types of coverage they want and do not want and would provide coverage if an individual loses their job or chooses to quit their job to pursue another career. This should also provide encouragement for health insurance companies to provide more competitive prices for their services (like auto insurance). We could still have this as a "benefit of employment" by allowing the same tax benefits for allowances to employees to purchase insurance on the free market as we do for an employer providing insurance. The only reason why health insurance is a benefit is the tax benefits for providing this benefit. Without this tax benefit, very few employers would provide this benefit.
Asked By: msi_cord - 3/8/2012
Best Answer - Chosen by Asker
As some have mentioned, employee health insurance was initially offered as a benefit of employment. This concept has become obsolete, IMHO, partly because "group insurance" plans have degenerated into little more than rackets, with kickbacks paid to employers and nothing of value passed on to workers, after premiums... More
Answered By: Who Else? - 3/8/2012
Additional Answers (10)
Brilliant idea. You should be in our Congress.
Answered By: BlackSunshine84 - 3/8/2012
It is a BENEFIT of employment. Not all employers offer health insurance. The ones who do offer it as a benefit to attract good employees
Answered By: crash.override - 3/8/2012
In the olden days before your genes and mine had developed, businesses offered healthcare as incentive to keep good employees from leaving.
Answered By: 88 Keys - 3/8/2012
Nobody prevents you from buying your own insurance on your own. And it's cheaper for employers because they're buying in bulk.
Answered By: How would I Know - 3/8/2012
You're right and wrong... More
Answered By: The MobFather - 3/8/2012
Originally it was a perk to entice the best and the brightest to join a particular company... More
Answered By: Jo - 3/8/2012
Look at it this way, a business that provides a "health benefit" can tell an employee he is covering his (and his families insurance). They will say his "benefit" is worth $12,000 a year but they will only on average pay $8,000 (a $4,000 savings for them). In order for them to say "Hey, we will provide you health... More
Answered By: ToxicP125 - 3/8/2012
Historically it has happened in the US from the 2nd World War, when there were strict wage controls in place to help the war effort. Since they couldn't offer higher wages to attract employees, employers looked at secondary benefits such as healthcare etc... More
Answered By: Irishlad76 - 3/8/2012
We can once again thank FDR. His administration created the National War Labor Board which set wage limits during WWII. In order to attract the best employees, companies offered health insurance (and pensions) in lieu of additional (and illegal) salary. The War Labor Board agreed that these 'perks' (or 'fringe... More
Answered By: duker918 - 3/8/2012
Having employer-provided health insurance might have made sense 50 years ago when many people worked for one company their entire career and employers used mass layoffs only as a last resort, not as the first resort like they do now. Today, when American companies lay off workers at will, and most workers change jobs... More
Answered By: Ice Cream Man - 3/8/2012
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