There has long been a wide gap between the conservative view of “the insurance I want” versus “the insurance I want you to have.” You would think that some of the “free market” bastions in American media would institute “message-appropriate” forms of health insurance for their own employees, but you would be wrong.
I have made several inquiries regarding the health insurance benefits available to employees of Fox News, as an example of ideology versus practice. As far as I can determine, their employee plan is quite generic big-corporate stuff with some good employee options. I am willing to stand corrected, so please let me know if you have information contrary to mine. In the Fox News standard employee plan, you will likely find:
- Single male and single female employees pay exactly the same rates, and regardless of age. Families pay a bit more.
- Males are covered for pregnancy, females are covered for prostate problems. Birth control is covered for both men and women.
- Pre-existing conditions are covered at the same premium cost for all employees.
- There is a very high cap on benefits (if there is one at all).
- Fox News itself covers the larger part of the cost, but it also gets a large tax benefit for doing so.
This should not be “news.” This is “normal” for almost every sizable employer in the U.S., likely even places like Breitbart News and Newsmax. Yet all of these bullets except the last one are frequent targets of the conservative media when it comes to health insurance for people who aren’t privileged enough to be employed by them. Oh yes, the “talent” and the executives likely pay zero dollars for their health insurance.
The first three benefits are “normal” for a very good reason. The simpler and more universal the coverage, the cheaper it is to administer. More money goes to the actual provision of medical care and less to arm-wrestling by providers, employees and insurance companies over what is and is not covered. This arm-wrestling can be bad enough even with the best corporate plans, and those who have had the experience of a not-so-good plan come to know medical billing clerks, insurance company staff and collection agents intimately after a lot of time in telephone queues.
The magic of “slow pay”
One of the major cost-savings in Germany’s health insurance system, which resembles the U.S. system in many ways, is that insurance plans are very standardized and comprehensive among the insurers. Standard U.S. Medicare Part B supplemental policies are attempts down that road, where you can compare Insurer X’s plan to Insurer Y’s plans because they are forced to offer exactly the same coverage and plan terminology, but Germany does it across the board for all plans administered through employers. The goal of standardization is to turn the insurer into an efficient customer service provider rather than a “We won’t pay” barrier wall.
I once sat on a committee for an organization that was evaluating prospective health insurance carriers for its employees when one major insurer’s representative claimed they could save us a lot of money through their skill at “slow paying.” This is the strategy where the insurance company systematically throws up multiple obstacles to reimbursement to either the medical provider or the insured person until they just give up and pay up. We didn’t pick them.
The employer health care tax expenditure scam
The employer tax benefit for provision of health insurance is very misunderstood by most Americans because it has so long been seen as “normal.” This benefit is technically called a tax expenditure and it is different from other business tax deductions for personnel costs because, unlike most other benefits, the employee is never taxed for what is effectively additional employee compensation.
The tax expenditure for companies providing employee health insurance has no significantly-different effect economically from the subsidies paid to lower-income people under the Affordable Care Act so opposed by Republicans. And note that many middle-class people in the ACA exchanges get zero dollars in either subsidy or tax benefit due to their income level. With those costs rising quickly through active sabotage by the Trump administration and various state governors, the objective is to collapse the market through unaffordability.
Basically, the employer health insurance tax expenditure is corporate welfare. The Tax Policy Center estimates that the total 2018 cost of this benefit to insurance-offering employers will be $235.8 billion dollars, and that is twice as much as the next-largest tax expenditure in the federal budget.  Republicans prefer tax expenditures as a way to deliver government benefits to corporations and high-income individuals precisely because most people haven’t figured out that it is pretty much the same as direct welfare payments. But this is only advantageous if they are the major beneficiaries, as opposed to those riff-raff who are unemployed or who work for bottom-tier non-insurance-providing employers.
In short, the level of hypocrisy by the right-wing media and large corporations on the issue of health insurance continues to keep the health insurance system in the U.S. an unmanageable and patently unfair mess. They choose for themselves a tax-incentivized “universal coverage” system, but only for their own protected universe. The rest of the developed world, who have developed a dozen better ways to handle health insurance, continue to shake their heads at the asinine U.S. politicians and pundits who think they know everything about healthcare.
- “What Are the Largest Tax Expenditures?” Tax Policy Center.