It’s a little-known fact in the great outside world — although probably widely known among Ricochet readers — that employer-paid health insurance is an artifact of the Roosevelt administration.
When employers were prevented by law from raising their employees’ salaries, they compensated by offering benefits, such as health insurance, to make it more desirable to stay on as employees.
Fast forward seven decades, during which the common practice went from lifetime employment with one company to a more free-flowing job-hopping style, when both employers and employees were more likely to look at other opportunities in the market. And now, taking that to the next logical step, the “gig economy” — independent contractors not beholden or dependent on any one company — is growing around the world.
Most of the evidence of the growth of free-lancing is anecdotal because it’s hard to get firm measurements. In 2016, CNBC estimated that the number of independent contractors had grown by 27 percent more than payroll employees over the last two decades. The McKinsey Global Institute interviewed 8,000 people in the United States and Europe and reported that “up to 162 million people in Europe and the United States — or 20 to 30 percent of the working-age population — engage in some form of independent work.” That includes people who like to work solo, those who do a side hustle for extra money, those who would prefer a regular paycheck, and those who are doing independent work to scrape by. But if you’ve ever spent a morning in Starbucks, you know that a lot of people are keeping office hours there.
So when people talk about generals fighting the last war, they’re also talking about Congress making laws about health insurance. They’re making rules to maintain a status quo that’s going the way of the buggy whip.
On top of that comes a disturbing report from PJ Media this morning: This Secret Obamacare ‘Replacement’ Lets Your Boss Invade Your Privacy AND Gut Your Paycheck. H.R. 1313, Preserving Employee Wellness Programs Act, allows employers to coerce employees into “wellness” programs (that don’t even have any record of success) and dock their paychecks if they don’t comply. It also gives employers intrusive authority to look into employees’ health records, including genetic testing. (If you wonder why the gig economy is growing, this kind of behavior is part of the reason.)
But let’s just stipulate that not all employers are fascists. Why are the bad ones given such control over employees’ lives? By Republicans?
It’s time to put a stop to it.
- Count employer-paid health insurance as a paid benefit for tax purposes
- If you allow tax deductions for health insurance, allow them for all health insurance, whether paid by the employer or paid by the individual.
- Allow all employees to choose from the entire universe of health insurance — across state lines and outside their employer’s offering — if they want to.
- Make current laws protecting employee genetic-testing and health-screening privacy apply to insurance companies and employers.
Not everybody wants to participate in the gig economy. Many, maybe most, people want the security and teamwork of working for a company, at least for now, particularly while the health-insurance deck is stacked against self-employed workers. Let people make up their own minds.
But freelancers provide valuable services — they write books, drive cars, provide skills, craftsmanship and expertise, and too many other services to name. They take the risk to do something unique and specific. Small businesses find freelancers to be a boon in not having to pay for more employee hours than they need. Freelancers get to set their hours and priorities.
Small business is the biggest source of growth in our economy — the Small Business Administration says, “Since 1995, small businesses have generated 64 percent of new jobs, and paid 44 percent of the total United States private payroll” (Houston Chronicle) — and microbusinesses, one-person shops, and solopreneurs provide valuable support to those small businesses.
Last I checked, Roosevelt was out of office, and the Internet has upended a lot of our expectations about business. Get the US government out of the way and stop large corporations from treating their employees like private property, so that we can have a robust economy and the kind of freedom we were promised when this nation was founded.
UPDATE: As @Chuck Enfield pointed out, H.R. 1313 gives employers the right demand genetic testing and health screenings from employees as part of “workplace wellness programs.” This ought, it seems to me, to be against the privacy policies of HIPAA, but apparently it’s not.
It is against a 2008 genetic law that “prohibits a group health plan (the kind most employers have) from asking, let alone requiring, someone to undergo a genetic test. It also prohibits requiring such tests for ‘underwriting purposes,’ which include basing health insurance deductibles, rebates, rewards, or other financial incentives on completing a health risk assessment or health screenings” (Tyler O’Neil, on PJ Media).
I’ve revised the article for accuracy.