Reinhardt: The U.S. needs to stop linking health insurance with someone's job

Such coverage allows employers 'quasi-parental power' to intervene in employees personal lives

Writing in the New York Times' "The Upshot" blog last week, health economist Uwe Reinhardt argues that the United States should reconsider its model of employer-sponsored health coverage in favor of a system that does not give employers so much power.

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Reinhardt compares employer-sponsored health care coverage to a pickpocket taking money out of someone's wallet and then buying that person a drink without them knowing. He explains that the employers, like the pickpocket, lead us to believe that they are paying for employees' coverage. But the coverage is really part of an employees' compensation package, and the cost of the coverage is recovered from workers through reductions to take-home pay.

But in Burwell v. Hobby Lobby, the Supreme Court justices ruled as if business owners "buy health insurance for their employees out of the kindness of their hearts and with the owners' money," Reinhardt writes. That perspective allows employers to impose personal beliefs on employee health coverage.

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According to Reinhardt, the ruling raises the question of why Americans accept a health insurance system that gives employers "quasi-parental power" to choose what type of health insurance employees may access, noting that the smaller the firm, the less choice employees have. Doing so allows employers to intervene in other matters of employees' personal lives, Reinhardt argues. 

Reinhardt also notes that America is the only industrialized country in which health coverage is "tied to a particular job in a particular country" and can be taken away "at the employer's whim." Employers, he says, have also played a large role in increasing health spending per capita in the country over the past several decades.

Reinhardt concludes that Burwell v. Hobby Lobby should make employees question the notion that employer-sponsored health coverage is an "unearned gift" bestowed by business owners , and therefore "puncture the illusion" that the owners have a "moral right to dictate the nature of the gift" (Reinhardt, "The Upshot," New York Times, 7/1).

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Private insurance exchanges are comparatively less discussed—and less understood—than their public counterparts. Yet they will have major implications for all providers.


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