Back in the day, employers began to insure employees to retain them. Customarily people spent their entire careers in the same company, climbing the company ladder and retiring with full benefits after a long and fruitful career. Labor Unions sealed the deal when they successfully instituted the practice which prevails today.
The American dream has been defined in countless ways. A common theme arguably includes "having good health, happiness, and enough income to live comfortably".
I consider myself a successful individual with above average income, excellent credit, and my only debt is my mortgage. I own a lovely home with positive equity despite the frightening economic picture. I willingly pay my fair share of taxes. I am surrounded by loving friends and family. Am I living the American dream? No. I don’t have decent health care.
"Employer-based health insurance" implies that if one has long-term employment with the same employer, one should be able to have the same doctor and medical plan for the length of their employment. This is not reality in the 21st Century, and in my opinion, hasn’t been for a long time.
Since the early 1980’s, as medical insurance costs were rising nearly exponentially, my employers found new ways to cut back on their share of health benefits. Almost every year they offered employees a new mix of progressively skimpier insurance plans. During annual open enrollment, I scrambled to calculate whether I could afford keeping the same insurance, or whether I had to select a cheaper plan. Many times, I found that my current doctor was not in the new insurance’s network, and I had to transfer all of my medical history and current care to a new one.
Job mobility has been steadily increasing since the recession of the mid 1970’s. By the late 1980’s no one I knew started working for a company with the expectation that they would eventually retire from it. For employers, "full-time employment" became a convenient way to employ people only for as long as they were needed. But it was a two-way street, with employees freely job-hopping to get higher pay. Prevailing wisdom was that you had to quit the company to get paid what you were worth. You were a sucker if you stayed put, receiving the puny cost of living increases. The joke was that if you hung on, odds were that the company would lay you off before your retirement date.
I saw the writing on the wall and switched jobs several times to climb up the income ladder. Later I became a consultant - typically working 3 to 12 month contracts. Contracts may start and end mid-year, or may span two benefit-plan years. The result is that I may have up to 3 employers in one year. If insurance is even available, it often doesn’t start for 3 months. Last year I had one insurance plan sandwiched between two COBRA plans. Needless to say, I never reached the deductible on any of the plans. I paid almost $5000.00 for premiums, co-pays and prescriptions. Adding insult to injury, this was not enough to trigger a tax deduction.
I don’t have anything close to continuous care by the same doctor. At a minimum, I have had to switch doctors once or twice each year in the last 4 years. How many people can claim that they have had the same doctor and coverage for 5 years or more? I suspect the answer would be a pretty small percentage of employed people.
Somehow the non-employed get left out of the picture. Retired people, children, the disabled, the unemployed, all need good health care. If Medicare was working the way it should, we wouldn’t need Medigap insurance. Most people on unemployment can’t afford to pay COBRA. It seems that when your luck is down, you need medical coverage more than ever. It is cruel and unusual punishment to hinge your medical benefits on the ephemeral and fickle job market.
The employer-based medical insurance benefit model is totally broken. Some may cry "socialist", but I believe that heath coverage is as important a right as police and fire protection is. The paradigm should shift to a model where absolutely everyone is insured and it is not tied to employment. Now more than ever, it is time to make the big leap. We have nothing to lose and everything to gain if we radically change how people get health coverage. Imagine, the American dream could be attainable for everyone, including me!
*** Update. Betty Pinson has another angle on this story. See De-Linking Health Care Coverage from Employment