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Commentary

Under an Avalanche
Grace-Marie Turner, Galen Institute, 1-26-06

Turner returns to an issue we addressed last week, the passage of a “Wal Mart” bill in Maryland that penalizes employers who don’t spend a fixed minimum (8% of payroll) on employee health care. Turner argues that

The employer mandate is a jobs killer, it takes management of health costs out of the hands of companies, and it opens the door for even more micromanagement of health care by government. Even The Washington Post editorialized that the bill is "a legislative mugging masquerading as an act of benevolent social engineering." …
But you can be sure that the bills in the next states will target smaller and smaller companies, and the mandates on how much they must spend on health care will get bigger and bigger. Big Labor may have figured out how to get a political winner in the first round, but there's time to explain to the next 30 states that labor is targeting that this is bad policy, bad economics, and bad for workers.

Surely, it is a bad policy to penalize companies for finding innovative ways to contain health care costs. It is also hypocritical for states to penalize companies for trying to restrain health care spending while the states themselves inflict price controls on doctors, hospitals, and pharmaceutical companies—who must then recoup those costs from uninsured patients. The more legislatures try to “fix” health care through mandates like this one, the more broken health care becomes.



Project FDA.
  
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