Why You Can’t Fire Your Insurance Company

Andrew Sullivan —  Jan 11 2012 @ 5:23pm

Pivoting off the Romney gaffe, Peter Suderman points to the main reason insurance choice is limited:

The tax exclusion for employer sponsored benefits has shaped the American health care market for decades, locking people into job-based insurance, decimating the individual health insurance market, and making it difficult for people to pick a health insurance plan early in life and then stick with it. Romney frequently talks about wanting to make health insurance work more like a market, but neither he nor any of the other Republicans have proposed getting rid of the tax exclusion for employer-provided benefits.

(Democratic Sen. Ron Wyden, who recently teamed with GOP Rep. Paul Ryan on a joint Medicare reform plan, proposed shifting away from employer-sponsored health insurance as part of The Healthy Americans Act in 2008.) There are obvious political reasons for avoiding the topic: Along with the home mortgage deduction, the tax break for job-based health insurance is among the most popular tax breaks. But it’s responsible for a big part of the mess the American health care market is in, and yet no one really wants to touch it.