Who Really Pays for Health Care?
The Myth of “Shared Responsibility”
- Ezekiel J. Emanuel, MD, PhD;
- Victor R. Fuchs, PhD
- Author Affiliations: Department of Bioethics, Clinical Center, National Institutes of Health, Bethesda, Maryland (Dr Emanuel); Department of Economics, Stanford University, Stanford, California (Dr Fuchs).
Since this article does not have an abstract, we have provided the first 150 words of the full text.
- KEYWORDS:
- DELIVERY OF HEALTH CARE
- ECONOMICS, MEDICAL
- EMPLOYER HEALTH COSTS
- FINANCING, GOVERNMENT
- HEALTH CARE COSTS
- HEALTH POLICY
- HEALTH CARE SYSTEM REFORM
- SALARIES AND FRINGE BENEFITS
- UNITED STATES
When asked who pays for health care in the United States, the usual answer is “employers, government, and individuals.” Most Americans believe that employers pay the bulk of workers' premiums and that governments pay for Medicare, Medicaid, the State Children's Health Insurance Program (SCHIP), and other programs.
However, this is incorrect. Employers do not bear the cost of employment-based insurance; workers and households pay for health insurance through lower wages and higher prices. Moreover, government has no source of funds other than taxes or borrowing to pay for health care.
Failure to understand that individuals and households actually foot the entire health care bill perpetuates the idea that people can get great health benefits paid for by someone else. It leads to perverse and counterproductive ideas regarding health care reform.
The Myth of Shared Responsibility
Many sources contribute to the misperception that employers and government bear significant shares of health care costs. For example, a …
