The Real Health Care Radicals

Thursday, Nov. 08, 2007
The Real Health Care Radicals
By Ramesh Ponnuru
TIME

Most Americans of working age get their health insurance through their employers. The Democrats running for President want to keep it that way. The Republicans don't. If you listen to what each party says about the other, you would get a very different impression. To hear the Democrats tell it, the Republicans are happy with the health-care system we have: all they do is stand in the way of Democratic improvements.

But the truth is that it's the Republicans who make more radical proposals. They want to make a break with more than six decades of government policy. During World War II, employers started giving workers health benefits to get around wartime wage controls. Since then, the government has continued to give a tax break for employer-provided health insurance; it isn't taxed, the way wages are.

That's how we ended up with the health-insurance system we have now, based on employers. You get a tax break if you get your insurance through your job. If you get a raise and use it to buy your own insurance instead, you have to pay taxes on that money. (Ditto if you use your raise to pay doctors directly.) Almost everyone takes the tax break. The market for insurance bought by individuals is, as a result, small and stunted, which is all the more reason to stay in the employer system.

(snip)

Free-market health-care experts note that most types of insurance--think of homeowners' insurance--cover major expenses that have a low likelihood of happening to any individual rather than routine and predictable expenses. Thanks to the existing tax break, health premiums have become a way of prepaying for medical care. Under Bush's plan, a lot of people would buy cheap insurance policies that cover emergencies while paying for routine care out of pocket. Cost-conscious consumers could drive down the price of health care. Rudolph Giuliani has adopted elements of Bush's plan as his own. Mitt Romney and John McCain also have plans that would reduce the tax code's favoritism toward employer-based care.

(snip)

The Democrats have hardly noticed the turn in Republican thinking on health care, in part because the Republicans seem so weak right now. But the Democrats have already started to emphasize how incremental and unthreatening their plans are. In the months to come, look for them to start accusing Republicans of being radicals who want to end health insurance as we know it. The accusation will be true.

Ponnuru is a senior editor at the National Review



http://www.time.com/time/magazine/article/0,9171,1682269,00.html

reduction in pay net of health care costs.

It certainly ends "health care as we know it" - at least that part of the National Review article is not a con job.

like it.

I think that the Republicans have the right idea of getting employers out of the equation. This is the part that I am disappointed with Edwards and the rest of them.

But the way to Universal Health Care will go through the "market-based" plan.

Only with people will realize how bad the insurance companies treat them will they demand a universal plan. Right now, only people who have been burnt by the existing system want a change.

path.