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Monday, March 31, 2014

Hobby Lobby and corporate medical insurance

Hobby Lobby is arguing that the Affordable Care Act should not require the company to cover birth-control in its employer-provided health insurance because it conflicts with the Christian owners' religious beliefs.

Most of the coverage has looked at this as a religious rights issue, or treated it as an opportunity for satire (the Daily Show being a prime example).

I seems to me that the real issue is a lot different.  Why are corporate employers involved with health care in the first place? And what’s the path to getting them out.

How they go there is no mystery. During the post-WWII labor shortages, health insurance got added as an employee benefit by large corporations in order to compete.  Medical costs were a lot lower, and group coverage was cheaper (because of the low sales costs), so this seemed like a win-win-win for the corporation, the health insurer, and the employee.  The amount of coverage varied widely from employer to employer. For example,  some covered maternity and some didn’t.

As health care costs rose all out of proportion to the rest of the economy, these costs became a burden to everyone (except the insurance industry and the health care corporations themselves). But due to the tax laws it didn’t make sense for the employer to just give the money to the employee and let them buy health care on their own.

The Affordable Care Act then took this relationship farther – legislating what employees needed to be covered and legislating a high set of minimum benefit.  Now, with all that governmental intervention, health care doesn’t look so much like a fringe benefit being provided by an employer and more like any other tax – money that goes out, where the government determines how it will be spent on what (Consider: would I have wanted to pay for the second Gulf War or the war in Afghanistan with MY tax money?)

And the group rates issue can be handled by the ACA exchange function (OK, pause for laughter here. But they are supposed to serve this function for those who aren’t covered by an employer.)

So, given this, why do we need to have the employers involved at all?

Should we not, instead, just change the tax status of health care so an employer could just provide money toward health care, but let the employee make the decision on how to be covered?  If they want a policy that covers acupuncture, let them buy it. If they don’t, let them buy a policy without it.  If the government (unwisely) decides acupuncture must be covered, at least the employer isn’t involved.

This, of course, avoids the whole Hobby Lobby can of worms with employers’ beliefs and attitudes. It’s easy to make fun of the particular beliefs of the owners of Hobby Lobby because I don’t agree with them (and, in fact, wonder if they are sincere or just agreeing to serve as a test case).  But no matter, let’s avoid the whole issue and get my employer out of my health care.