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Nathan Newman on April 6, 2006 - 11:40am
Here's one interesting part of the Mass. health law that has largely been undiscussed in the media: the Free Rider Surcharge detailed in the the legislative summary, which is an additional incentive for employers to provide health care for their employees:
The Free Rider surcharge will be imposed on employers who do not provide health insurance and whose employees use free care. Imposition of the surcharge will be triggered when an employee receives free care more than three times, or a company has five or more instances of employees receiving free care in a year. The surcharge will range from 10% to 100% of the state’s costs of services provided to the employees, with the first $50,000 per employer exempted. Revenue gained from the surcharge will be deposited in the Commonwealth Care Trust Fund.De facto holding employers legally liable for the hospital bills of their employees is in some ways one of the strongest ways to encourage them to provide health care coverage-- more important than the measly $295 fee being assessed.
As the provision stands, it only would encourage Massachusetts firms to provide catastrophic coverage to their employees. But if extended, it's an interesting alternative to a general mandate that employers provide insurance-- if employers choose not to provide insurance, employees would know that they could show up to get care at public hospitals, knowing that the bill would be sent to their employer.
Most employers would pretty rapidly get insurance for their employees under such a regime to avoid unexpected bills from the state hospitals. It will be interesting to see how the Massachusetts system plays out in this regard.
BTW Ezra Klein at the American Prospect has made a bit of a mantra of the idea that "Little is more anti-worker than forcing them to depend on their employer for medical care." But this is wrong-- If EVERY employer has to pay for health care for their employees, then there is no problem for employees that their health care comes through their employer, since they know if they switch jobs, the next employer ALSO will be providing for their health care. As long as the state covers folks during low-income periods such an unemployment, an employer-based health care system is wonderful for workers.
And this is the system in much of Europe. Only a few countries don't tie health care largely to employment in some way or the other.
So folks should stop confusing our present system of health care, which has anti-worker aspects, with a system where all employers are mandated to provide health care. The latter would be very good for America-- and avoid the budgetary games that Ezra notes are likely be at play in the Mass bill in coming years. It is highly unlikely that any system, especially any state government health system, can afford a health care program funded purely through government taxation, so a strong employer component is essential if only because of budgetary realities.