Tuesday, February 3, 2015

Gruber and the Employer Mandates

David Henderson made  a blog post that links to a a video in which Johnathan Gruber, in a wonderful display of candor, says that the employee will pay for his own health insurance through lower wages whether he writes the check directly to the insurance company or his employer writes the check.  Gruber then goes on to advocate for employer mandate?

So what are the plausible reasons to mandate that employers pay for health insurance:

Employers are more capable to handle the book keeping for their employees.
To fool people into thinking health insurance is cheaper than it really is
To fool people into thinking that the employer is paying for his health insurance.

So what are the plausible reasons to not mandate that employers pay for health insurance:

Because of politics the employer mandate will have exceptions that distort the labor market and hurt employees. 
The consumer is more ignorant of what health insurance really costs.
It ties employees too closely to their employer.
It is inefficient for small employers. 
It makes it more difficult to start a business.
It can advantage smaller of bigger business depending on exceptions.

I believe that on net that the employer mandates are a bad idea 

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