David R. Henderson  

Gruber and Henderson on Health Care Mandates

Outsourced to Scott Alexander... Two Takes on Ebenezer Scrooge...

A couple of weeks ago, I posted a video of Jonathan Gruber and me testifying on the economics of government mandates on employers to provide health insurance. We basically agreed on the analysis: the cost of those mandates is borne mainly by the employees in the form of lower pay. Jonathan was fine with that; I thought it was wrong for the government to do that, especially when many people would prefer higher pay and lower benefits.

The video link I provided, though, was very long and you had to work hard to get to our segment. When I posted on Facebook about my post, a FB friend, Taylor Davidson, took the initiative of going on to the C-SPAN site and forming a 12-minute video that, although it omits Ted Kennedy's introduction of Gruber and me, gives the whole of our testimony.

The video is here. I would post it directly, but I'm not sure if doing so would violate copyright.

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COMMENTS (5 to date)
LD Bottorff writes:

Thank you and thanks to Taylor. I'm sure many of us were intimidated by the prospect of searching through a two-hour video. Very good testimony on your part.

David R. Henderson writes:

@LD Bottorff,

ThomasH writes:

If Libertarians understood just as well as Liberals do that that health insurance is paid for out of workers compensation, why were they not able to explain to firms like Hobby Lobby and to the Supreme Court that firms have no religious liberty (or any other kind of) interest in dictating the coverage of employees' health insurance?

Chris Wegener writes:

I don't for a minute doubt that most people when faced with a choice of receiving more compensation now rather than protection from a future problem will automatically chose the immediate increase in wages.

Who then pays for the health care that these workers will require in the future and the economic impact of workers not being able to work because an increase of disability or illness in the work force? The people of the United States have clearly shown that they are unwilling to witness people dying in the street from a lack of ability to pay for health care. They are willing to experience a decrease in life expectancy in the the country as a whole but Hospitals are required by law to treat anyone who comes to an Emergency Room with a life threatening illness.

The libertarian answer of "Not my problem Mon" has been firmly rejected so a wiser choice seems to be to require corporations, particularly large multinational corporations to provide health care even if it leads to an immediate reduction of take home pay.

Any other approach is whistling in the wind.


Hazel Meade writes:

Unlike wages, health insurance is not fungible. The equivalent would be forcing Muslims to pay their workers in pork coupons instead of cash. Hey, it's just coming out of their compensation right? What possible objection could someone have to that?

@Chris Wegener,
If you're going to have an individual mandate the employee is going to have to purchase a plan on the individual market anyway. Why force the employee to get his insurance via the employer? Particularly if you're going ot regulate plans so the the employer-based plans have the same mandatory content as the exchange plans, what difference does it make? Let everyone shop around on the individual market. The employee has more options, the market has more competition, and the employer doesn't have to be involved in his employees medical choices. Everyone wins.

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