Question

What has been the role of the availability of employer-based health coverage?

Answer 1

Employer-based health insurance (insurance that employers buy for their employees that is provided by employer or mutual employer-workplace contributions) is currently partly subsidized by the federal government by tax exclusions on employer contributions to employee health insurance programs. Such subsidization costs the federal government about $10 billion in lost income a year. Some of the national health insurance programs introduced give a central role to employer-based health insurance as a mechanism for health care funding.

Federal subsidization of employer-based health insurance and policies that give employers a key role in administering a national health insurance program both believe that private industry acts to achieve federal health policy objectives— particularly cost containment— in administering health insurance plans. Nonetheless, little is understood about how employers select the policies they give their workers or about the incentives and disincentives that employer-based health insurance provides in terms of care costs

In general, workers were dissatisfied with managed care plans, because they desired more flexibility over their health decisions. Patient "rights laws" have been drafted, and HMOs have become more inclusive, with so-called open access policies. In the meantime, healthcare costs kept increasing.

In 2010 President Obama signed the Affordable Care Act as a response to the failing situation of American healthcare. The ACA is only in its infancy, having met with strong resistance and commonly dubbed by the acronym "Obamacare." Although it remains to be seen what the Obamacare's long-term consequences will be, there is no doubt that we are in the midst of a new era in the tumultuous history of health care in America.

Organizations providing benefits for their workers are expected to report on W-2 forms the expense of the compensation, the annual pay statements workers use to file their taxes. Health benefits are not taxed; the Internal Revenue Service (IRS) needs this information to appear on the W-2 only to allow workers to better understand their coverage.