When you quit or lose your job, you also lose your health insurance (among other things.) That can leave you scrambling to find a replacement if you don’t have something else lined up. So how did we get here? How did insurance become tied to your job?
Here’s Five Fast Facts About Employer-Provided Insurance:
- ⚕️ WWII - In 1942, President Roosevelt felt we all needed to make sacrifices for the war effort. That led the National War Labor Board to put a cap on wages to prevent a competitive labor market through pay raises.
- 🏥 Loophole - They also decided health care was exempt from the cap. Then the IRS ruled that employer health insurance premiums were tax free. So health insurance became a benefit employers could use to lure in potential employees.
- 💉 Take a Stab - In the 50’s, President Eisenhower’s administration pitched national health care insurance to cover some 63 million Americans who were too old, worked for employers without insurance or were out of work. Thanks to some lobbyist meddling it failed, and advocates just kind of gave up.
- 🩻 Nice Try - President Johnson tried to find a way around it by creating Medicare and Medicaid, but even that isn’t necessarily enough for most Americans.
- 😷 Signs of Change? - A new rule called the Individual Coverage Health Reimbursement Arrangement (ICHRA) has been recently introduced that allows employers to eliminate group insurance. Instead they would give their employees a set pre-tax amount of money to get the insurance coverage that suits their individual needs. It’s kind of like when companies moved from pensions to retirement 401Ks. It’s a start.
🔥Bottom line: Politics aside, the way Americans work has changed since 2020 and it will continue to do so for the near future. Some kind of shift needs to be made in order for us all to get the coverage we need, whether an employer offers it or not.
Do you think insurance should be connected to your job?
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