Comments on: Health Incentive Plans http://theincidentaleconomist.com/health-incentive-plans/ Economics, Health Policy, Law, Life: Musings of Curious Minds. Thu, 11 Mar 2010 01:04:39 -0600 http://wordpress.org/?v=2.8 hourly 1 By: STaylor http://theincidentaleconomist.com/health-incentive-plans/comment-page-1/#comment-1170 STaylor Tue, 01 Dec 2009 03:34:59 +0000 http://theincidentaleconomist.com/?p=2902#comment-1170 I suspect that the “incentive” portion of health insurance is due to the employer-based insurance system we have in the United States. Company spending on insurance premiums are tax deductible. Thus, employers, healthcare providers, and insures all have incentives to lobby the government to include as much as possible as “insurance”—even routine procedures such as trips to the dentist. I can see the need for government intervention in the market for health insurance (in the true sense of the term). The need for government intervention in the market for routine and preventative treatment is less obvious to me. Under a single-payer system, I could see subsidizing preventative care as consumers will not internalize the cost that their illness incurs on taxpayers, but anything more than a straightforward subsidy does not seem needed. (It is also worth noting that the system we have now drives UP the cost that the uninsured must pay for preventative care.) I would be interested to hear your thoughts on whether you think an optimal U.S. healthcare plan should treat catastrophic events differently than routine care. I suspect that the “incentive” portion of health insurance is due to the employer-based insurance system we have in the United States. Company spending on insurance premiums are tax deductible. Thus, employers, healthcare providers, and insures all have incentives to lobby the government to include as much as possible as “insurance”—even routine procedures such as trips to the dentist.

I can see the need for government intervention in the market for health insurance (in the true sense of the term). The need for government intervention in the market for routine and preventative treatment is less obvious to me. Under a single-payer system, I could see subsidizing preventative care as consumers will not internalize the cost that their illness incurs on taxpayers, but anything more than a straightforward subsidy does not seem needed. (It is also worth noting that the system we have now drives UP the cost that the uninsured must pay for preventative care.) I would be interested to hear your thoughts on whether you think an optimal U.S. healthcare plan should treat catastrophic events differently than routine care.

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