Burr’s boneheaded health proposal this week is simply one more exercise in Republican denial on real health reform. Like President Bush – surprise, surprise – Burr proposes taxing health benefits everyone receives now through their employers. To offset the increase in taxes some sort of credit or deduction would be offered. This is an idea that’s been around for years.
Many people don’t realize the money paid by their employer for health insurance is not considered as income and not taxed. If it were suddenly counted as income, then people’s taxes would go up dramatically. In addition, employers would have a huge incentive to stop offering coverage since it would no longer be subsidized through the tax system.
Let me just stop and say this – if Democrats were proposing this sort of reform can you imagine the talk radio shouts about “the largest tax increase in American history”?
The real goal for these so-called “reformers” is actually pretty simple – dismantle the employer system and have everyone buy coverage individually. We already know that individual coverage is more expensive and far less efficient. That’s why a large company pays far less for the same health coverage for its employees than if each one of those employees went to buy coverage on the individual market.
Finally, there is an inescapable truth that makes this Bush-Burr type approach to health reform fairly dotty. Health insurance is expensive and the reason most people who aren’t covered don’t have coverage is that it costs too much. For some reason, this is hard for conservatives to admit. In point of fact, it isn’t such a bad idea to at least explore changing the tax treatment of health benefits, but only if there is a comprehensive health plan in place like Medicare where anyone who fails to roll the dice and get “great coverage” in the private market can obtain reasonably-priced health benefits.
Until then, upping costs even more for people who are already covered makes no sense in any world except the desperate one Republicans currently find themselves in.