Released: December 10, 2008

Why tie health insurance to a job?

Source: Ezekiel J. Emanuel and Ron Wyden, Wall Street Journal Online

(Dr. Emanuel, an oncologist and chairman of the department of bioethics at the National Institutes of Health, is author of "Healthcare, Guaranteed" (Public Affairs, 2008). Wyden, a Democrat, is a U.S. senator from Oregon and sponsor of The Healthy Americans Act.) Not many people are buying cars built 60 years ago. No one is watching TV on a set manufactured in the 1940s. Patients are not lining up to see a doctor who hasn't cracked a book since before the polio vaccine was discovered. Why, then, do millions of Americans get their health care through an employer-based system from the 1940s? Employers didn't start offering health benefits roughly 60 years ago because they were experts in medical decisions. It was a way of circumventing the World War II wage and price controls. Barred from offering higher salaries to attract workers, employers offered health insurance instead. Aided by an IRS ruling that said workers who received health benefits did not have to pay income taxes on them, and by the fact that employers could write off the cost of the health benefits as a business related expense, this accidental arrangement became the primary way most Americans access health care.

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