Monday, April 9, 2012

I figured out the problem with the cost of healthcare

Not the solution, but the problem.  It started somewhere around the end of World War II.  The government decided to make health insurance paid for by an employer a tax free benefit to the employee.  As a partner in a law firm, I am painfully aware of how much I pay for my health insurance, as I am sure are others.  However, we are in the great minority of health insurance consumers.  After the government passed laws that put health insurance outside of income side of your tax return, the direct link between the consumer and the provider of health care services was lost.  So was the incentive to keep costs down and the correlative market forces that drive efficiency in any market.  Good intentioned legislators of more than a half century ago made a grievous error.  OK.  I figured out the problem.  Now all you need to do is figure out how to fix it.

1 comment:

Ken said...

It got that way owing to the war-era controls on wages (episode 756,244.3 in our continuing stooooory, "That Which Is Not Seen").