A couple of posts ago I examined the idea that health insurance costs are part of a worker’s remuneration package. Chris suggested that my logic was wrong, but didn’t show me where. However, he did offer an argument that insurance is not a cost on employers. I think he is – in general terms – right. As this article I found puts it:
More importantly, however, is for us to understand that our employers are simply fooling us into believing that they are paying for part of the insurance. In fact, health care benefits come directly at the expense of reduced wages. Although space does not allow me fully to prove this point, Drs. Emanuel and Fuchs state that “Employers’ contribution to the health insurance premium is really workers’ compensation in another form. Rather than coming out of corporate profits, the increasing cost of health care has resulted in relatively flat real wages for 30 years. That is the health care cost-wage trade off.” And, “The health care cost-wage trade-off is confirmed by many economic studies.” Further, “In a review of studies on the link between health care costs and wages, Gruber concluded, ‘The results [of studies] that attempt to control for worker selection, firm selection, or (ideally) both have produced a fairly uniform result: the costs of health insurance are fully shifted to wages.’” (italics mine)
We can see then that we pay for our own portion of insurance premiums directly and we pay for the company’s portion indirectly, through reduced wages. Which leaves government as a potential payment source for health care. But clearly governments pay for things either by taxing current citizens, borrowing from future taxpayers (by creating deficits) or by reducing other services. We all pay for government-sponsored health care through our tax dollars! That’s the direct cost. But the indirect cost is the reduced services that must be cut in favor of health care spending. And one of the biggest areas of cuts, particularly for states, is publicly funded higher education. As the doctors note in the JAMA article, “In other words, the increasing cost of Medicaid and other government health care programs are a primary reason for the substantial increase in tuition and fees for state colleges and universities. Middle-class families finding it more difficult to pay for their children’s college are unwittingly falling victim to increasing state health care costs. Not an easy – but a necessary – connection to make.”
In fact, this applies to all employee benefits – and, for that matter, to all goods and services provided, as Chris pointed out when he suggests that students pay for universities and patients pay for hospitals. (I’d qualify that by saying ‘part pay for..’, since the total costs of such services are usually higher than fees earned, but let that pass.)
So does this mean that employers have no moral responsibility for any goods or services offered through them, since they don’t pay for them?
Clearly, we don’t believe this; we don’t think that a hospital should be able to offer infanticide to its staff, or a school prostitution to its staff, on the grounds that they’re not the ultimate source of the money to pay for the service, so it’s okay. Or do we?
Let’s try a little thought exercise. Let’s pretend that, instead of contraception being the sticking point for the opponents of the HHS, it was something else.
Let’s say that the HHS had declared, following the best professional advice, that visits to prostitutes were necessary for male health.
Or that killing children with severe handicaps was necessary for parental health.
(Both of these propositions have been made at some time or another by mental health practitioners.)
Or – as I suggested a couple of posts ago – let’s say that cloning of human beings for spare parts was an established practice, and was included on the HHS ‘mandated coverage’ list.
Or let’s say that the country where all this was happening has a long cultural heritage of female clitorectomies, and that the medical establishment argues (as supporters of this foul practice do) that these are necessary for health.
In such cases, does the employer have no responsibility? Yes, they pay the premiums. We’ve established that. And if we are really sure that the money they pay the premiums with isn’t really their money, then what’s the problem?
This reminds me of the Bob Jones claim, that directors and managers of companies have one goal only – to maximise profit for their shareholders. Ethical investment, corporate social responsibility, any of these social justice issues – those are not the responsibility of directors and managers. Shareholders can do that if they like. Directors and managers don’t own the money – they simply have a stewardship responsibility for it, and their stewardship responsibility, says Jones, is to make more.
It seems to me that this is of the same class as the claim that employers have no moral responsibility for what is covered by health insurance paid for with money over which they have a stewardship responsibility.
I’m not convinced by Jones, and I’m not convinced by Chris.