Your Employer-Based Insurance Doesn't Love You Back, Especially If You're Poor

Perhaps the most prominent argument offered against single-payer healthcare, at least by those who don’t just call it “socialism” and leave it at that, is that many people say they like their employer-sponsored insurance, which is the largest single source of insurance coverage in America (though it still covers slightly less than a majority of Americans). From a policy standpoint, this argument is bad; there are not many employer-based plans that would be better than Medicare for All, which would have no co-pays, deductibles, or premiums.

A post at Axios today highlights again how tenuous and fractured the employer-based coverage system is. According to new data from the Health System Tracker, employer-sponsored insurance for low-income people is less affordable than insurance purchased on the Affordable Care Act exchanges. This is largely because of the premium subsidies available on the ACA; instead, middle-income people tend to be hurt on the ACA, because they make too much to qualify for those subsidies but may still end up paying a significant share of their income for care.

According to Axios, families earning less than twice the federal poverty level who have employer-based insurance will spend nearly twice as much on premiums and out-of-pocket costs as those with ACA coverage, at 14 percent to 8.4 percent. Out-of-pocket costs are comparable, but premiums are much higher for low-income people with employer coverage.

And it’s only getting worse. As healthcare costs continue to grow, employers are also shifting more of the premium costs to their employees; the average worker contribution for a family plan is up to $5,500 a year.

This highlights the true divide on Medicare for All, which isn’t between people with employer-sponsored plans and people with other coverage. It’s rich people and poor people. People who are currently spending 15 percent of their income just on health costs because their shitty employer only offers them an expensive plan with a $6,000 deductible are not well-served by the current system. If you don’t make a lot, healthcare costs—like most other costs, from student loans to childcare—are simply far more onerous than they are for rich people. These are the people who Medicare for All advocates should seek to rally and energize.

A 2018 survey by America’s Health Insurance Plans, the trade association representing insurers, found 71 percent of those with employer coverage say they’re happy with it; 49 percent of Americans have employer coverage. That means we’re looking at roughly 34 percent of the country in this hypothetical demographic of people who love their employer-provided coverage. Is that an insurmountable obstacle? Is that worth giving up on the chance to free the rest of America from expensive, oppressive, and often deadly healthcare costs?

Regardless of the politics, employer-based coverage should not be something that Democrats work to preserve. That same AHIP survey found that 56 percent of Americans say their employer-based coverage “remains a key factor in their choice to stay at their current job.” This is a terrible and ridiculous situation. You should not have to worry about losing your coverage if you want to change jobs; you shouldn’t even be persuaded to stay at an otherwise-bad job because your insurance is good and you don’t want to lose that. The conditions of your health insurance should not be dependent on what kind of plan your employer offers, but rather your right as a human being to access care. There is no choice but to work to dismantle this system.