Decouple employment from healthcare

I would be in favor of single-payer healthcare in the USA. I do not think forcing employers to buy insurance for their workers is the answer. Ultimately, insurance is a worthless middleman. Everyone would be paying less for healthcare with the insurance companies out of the picture. Tying insurance to employment simply hurts the customers (higher prices) and employees( lower wages) of every company who must comply with the law. Most of the rest of the developed world has single-payer healthcare, and they spend significantly less on healthcare then we do.

While I am not a fan of single-payer, I do think it would be preferable to our current system of tying insurance to employment. We’re supposedly trying to keep a free-market healthcare system, but the whole idea of having it tied to employment undermines the whole idea by limiting market competition. Yes, in theory, I can pass on the insurance offered by my company and buy it elsewhere, but the point remains that that is going to cost me more because the insurance provided by my employer is partially subsidized by them. As such, to get even equivalent coverage elsewhere would end up costing more out of pocket to me, and to get the greater coverage or other services that I might want ends up costing me more.

I’d have much rather seen the system such that, if we’re going to require people to purchase healthcare on their own and not go toward single payer, then it should be decoupled from employment and they can then be forced to compete directly on the open market. Then the employer can just pay me what they would have as part of that deal and I buy it from the open market based on my own criteria.

In fact, if we’re going to compare it to car insurance, as a mandatory purchase in most states, isn’t that more or less how it works? There’s a minimum requirement, but it’s not partially subsidized by my employer, I pay for it out of pocket. In Virginia, I’m required only to get liability, but I choose to get more. And because I’m purchasing it just for myself rather than as part of a larger group, they take into account my risks, my driving habits, the car I drive, etc. and I pay accordingly. If it’s too much for me, I can choose to get a car that’s less expensive to insure, limit my driving, etc.

This is one of the things that’s really frustrated me about health insurance, is that I’m still relatively young, I take good care of myself and am in good shape, but my rates went UP and my coverage went DOWN, and yet I pay the same as another male my age who doesn’t smoke, even if he never exercises, eats horribly, etc.

I’m not saying people shouldn’t be covered due to pre-existing conditions, but the idea that people aren’t being encouraged to take their own health more seriously, eating better and exercising is frustrating. Cover people for things they can’t control, absolutely, but also reward people for taking extra steps to improve their health where they can. Otherwise, that undermines the whole idea of having a free-market healthcare system.

So yeah, despite not being a fan of single-payer, if we’re going to create these pots for each company, we’re basically getting the worst of both worlds, where I believe we’d see improvements either by going more free-market and letting the insurers compete on equal footing, or going full single-payer, providing the minimum required coverage to everyone, then letting private insurers do whatever bells and whistles on top of that people may desire.

A large share of liberals would prefer single-payer to ACA. It sounds like the same is true of many conservatives. It’s too bad the “two sides” are unable to communicate with each other.

Another drawback is that employer health insurance makes American products less competitive with foreign made products from countries with government single payer health insurance. Why this does not bring more political support for single payer from industry I will never know.


You seem to think the GOP favors U.S. interests and that Republican policy follows rational conservative thought. It doesn’t, and it doesn’t. This is the Party of the (Multi-national) Corporations.

Big high-tech campaign contributers like Microsoft and Apple have a very high sales per employee ratio: Healthcare is not a major expense for them. Campaign contributers like Pepsi or McDonald’s derive much of their profits overseas without U.S. workers. Big campaign contributers like WalMart or, again, McDonald’s employ much part-time U.S. labor for which there is no employer healthcare obligation. Big manufacturing campaign contributers are happy to move factories overseas to avoid giving U.S. employee rights.

Big insurance company contributers definitely support forced insurance – they’ll squeal for it very loudly! The squeakiest wheel gets the oil so this, by itself, makes the GOP(*) oppose anything to hurt the profits of these rent seekers. Pharma and other healthcare industry contributers also benefit from the status quo.

(* - And Democrats, of course. Both parties are the pawns of Big Business but for any voters too ignorant to know how the wind blows it’s important to stress GOP malignance.)

This is the problem. Though I would note that much of McDonalds labor force overseas, as service personnel, were not exported from the US and cannot decrease the availability of jobs in the US.

This is not relevant to my argument, because McDonalds service labor in the US cannot be exported. I am specifically comparing trade goods manufactured in the US that compete with trade goods from other countries.

Exactly. They move overseas to avoid paying employee health insurance benefits *which are supplied by the governments of the countries they relocate to. * If the US government supplied the same health insurance benefits, they would not find those savings by exporting jobs, and more jobs would stay here.

Under the single payer systems I’m familiar with, they would. Guess that’s a reason to not want single payer; I’ve heard enough times that it’s a reason to not give people more hours.

Insurance is not a worthless middle man. Insurance companies provide protection from unlikely but devastating events. It is unlikely that my home will burn down but if it did it would be devastating to have to buy a new home. Thus a small amount monthly to protect me from that unlikely possibility.
During WW2 it was illegal for a company to raise wages so companies competed for employees by providing perks such as health insurance. Since employee compensation is tax deductible for the company but health insurance is not for the individual it has always made sense for the company to provide the insurance since it means they can provide it cheaper than the individual can buy it.
McCain proposed changing this by ending the employer tax deduction and providing an individual tax credit. This was attacked by the Obama campaign as a huge tax hike.
It is not in big corporations best interest to have the link decoupled. What matters is total cost of compensation. If a company stopped providing a benefit worth 5K$ to the worker in order to be competitive they would have to provide additional salary that is worth 5K$. They would have to raise salaries more than the 5K$ since salary is taxed and the health insurance benefit is not. Also by having health insurance tied to employers it makes the employees less likely to leave, this means they can be paid less than if health insurance had nothing to do with employment.

It appears my post was misunderstood. I was explaining why The (Juridical) “Persons” In Charge – i.e. big corporations: neither politicans nor voters are major infuences on government policy these days – are not clamoring for single payer.

For example, McDonald’s and WalMart are not overly concerned – they emphasize part-time workers for which there is no ACA obligation.

Ordinary humans would be the big beneficiaries of single-payer healthcare, but this group has very weak political power(*) in the U.S.

(* - Oh yes, the humans are encouraged to fulminate about guns and gays and use such issues when pulling the voting lever, but these are just distractions useful to The People In Charge.)

Although the thread title doesn’t mention “single-payer”, OP’s first sentence makes clear that’s what he’s talking about. Your argument shows why companies may have little incentive to shift the healthcare cost burden to employees. But that’s not what we’re talking about. We’re talking about shifting the burden to the taxpayers. Depending on tax policy, most employees would have no need for higher wages.

This is pretty much the exact way it works in Australia. I never had a job which provided me insurance, it’s quite rare in Australia. Everyone gets basic coverage through Medicare. Then those that want to can pay extra to get private cover with access to private hospitals etc. if you earn above a certain amount, maybe $60,000 a year I think, you have to pay a penalty on your taxes for not having private coverage. At a certain point in income it’s cheaper to have private insurance because the penalty for not having it is higher than the premiums.

It’s a good system and it works, but our liberal party , which is actually conservative, is doing their best to tear it apart .

Another data point. I’m an expat living in Thailand, so I have private health insurance which covers me for $3.8 million US of medical expenses anywhere in the world except the US. The fee for this is about a quarter of what you’d pay in the US for comparable cover, so you can tell from that what insane costs the US has for healthcare compared to the rest of the world.

As laws stand now, yes. But that’s because of various tax incentives. The argument would be that those incentives should be removed or reallocated such that. Yes, this system came in place for historical reasons, but those reason, imo, are outdated and should be reevaluated.

Yes, what matters is total compensation, and all these random benefits make determining that difficult for someone evaluating different jobs. If I’m looking at two jobs, not only does it make it difficult for me to determine the total package and decide which one I like more, it makes it difficult for a company that might try to make a competitive offer to do so.

And, for that matter, it’s actually a penalty on people and/or companies depending on how marriages and kids work out. If one spouse has slightly better plans, that company subsidizes the entire family and the company of the other spouse pays nothing, but doesn’t pass any of those savings onto the other spouse. It actually serves as a disincentive for companies to offer good packages since they’d be more likely to have to subsidize more and, rather, companies will settle on offering just the bare minimum. And this is exactly what I saw happen when my premiums went up and my coverage went down.

As for the tax incentives, again, I think that’s a non-starter because, obviously, for this to work those need to be changed. They can just remove incentives for companies or make it so medical insurance costs are pre-tax, much like the Health Spending Accounts if they want to encourage free-market, and obviously single-payer would make this a non-issue too.

Yet another reason to decouple it. If I’m in a bad situation in a job, I shouldn’t feel compelled to stay because I need health insurance. It unreasonably sways negotiations in favor of companies. I should choose to stay because I value the salary I receive more than I value the time/effort I expend at the company. Once that flip-flops or I get a better offer, I should be able to take it without concern of whether I and my hypothetical family will be covered. Full free-market or single-payer solve this problem, tying insurance to employment is what creates it.

In the US, it doesn’t make sense to migrate to a single payer system, but it definitely makes sense to decouple health insurance from employment.

The system was set up back in the era where it was expected that you would get a job at a megacorp (like GM or AT&T) and work there for the rest of your life, until retirement.

That’s no longer true. People generally work 2-3 years at a company and then switch.

If I work at a company for 40 years, retire, and am able to take my insurance plan with me into retirement, then the insurance company can price my plan based on my lifetime needs. My lifetime needs for health care are vastly different than my working age needs. During an individual’s working age life, their medical costs are flat at a pretty minimal cost. Maybe a hundred or two a year. From retirement age on, those costs grow rapidly, until they’re in the thousands (or you die). If an insurance company is expecting to cover my retirement, then they need to bill for my old age, while I’m still young, otherwise they’ll never make any money off of me.

But if I’m only going to work at a company for 2-3 years, and the insurance company knows this, then they can charge a hundred or two dollars, cover my working-age costs, and that money I’m earning - to pay for my retirement - never goes into any fund that covers my medical needs when I retire. So far as I’m aware (and correct me if I’m wrong), money that I pay into one insurer is locked to that insurer. There’s no law requiring that they keep track of the amount I’ve paid in, nor does that money transfer as I move from one agency to another.

Health insurance doesn’t work if we’re paying for our costs today, instead of our future (retirement age) costs.

It’s also likely that the high costs of care in the US are due to the employment-coupled insurance setup. Employers buy plans that they can use to entice employees to their company (rather than based on the cost per year of life gained). Potential employees choose an employer based on the size of the plan (rather than based on the cost per year of life gained). This creates a positive feedback loop between employers and health care costs. The employers want large, pricey plans that they can offer tax free, which pumps money into the health industry, which they use to buy more expensive gear and buildings, which drives up the actual price of health care, which forces higher cost plans since the bottom floor is raised - the medical profession needs to finish paying off and maintain all the stuff they bought.

Consequently, a few decades later, health care costs are double in the US what they are in other countries. And if we don’t remove the employer-insurance link, that cost will continue to grow.

But that doesn’t mean that we want to transition to a single payer system.

As pointed out, doctors have to finish paying off and maintain all the equipment, buildings, and staff that they have signed on for.

The insurance industry is a big industry with, I’m sure, hundreds of thousands of workers.

And all of that extra money spent on non-cost effective medical equipment, the high cost of pharmaceuticals that we pay, etc. are all supporting the continued research and development of future technology and medicine. The US is, in effect, paying for most medical research in the world.

If you close off the spigot and make the US start acting like other countries, many bad things are going to happen.

And whereas the US has had no relationship between the cost effectiveness of care and the amount we pay, all of the single payer systems have only had a relationship between the cost effectiveness and how much they pay. People hate paying taxes, so the governments cut health care costs as much as they can. They leave no room for elective surgeries. They shy away from unproven medicine and new technology. They may actively try and prevent you from paying more, for better, more modern care, as that creates a market for care and that could drive up prices for them.

Switzerland seems like it may have found a happy medium, where there are insurance companies, people can pay more for care if they want, but they have to accept anyone. Consequently, care in Switzerland costs more than it does in the rest of the EU. But, at the end of the day, we need to go for something that doesn’t take out large chunks of our economy in one fell swoop, so transitioning to something closer to our current setup is going to be far less disruptive. And it makes no sense to treat medicine like this is as good as it will ever get. Most breakthroughs aren’t cost competitive. But, eventually, something will be and we’re not going to find it if we stop looking.

Cuba has had great medical care, but they also never invented a damn thing. If the capitalist countries hadn’t invented all of the various procedures, tools, and medications that we have today, Cuban doctors would be using 19th century medicine and 19th century medicine was crap. It’ll kill ya.

Providing medical care to everyone, cheaply isn’t the only nor most important consideration. Not trashing the economy and seeing that our children receive better care than us are both considerations that need to be factored in.

Switzerland is not part of the EU. It’s part of the European Social Security Zone, though.

I didn’t know that. I guess they figured they have to live up to their neutrality position.

I’ve mostly seen them in OECD metrics.