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Right now, millions of professional and blue collar employees are remaining in current jobs, not because it's their preference, but because of their health care plan. In some cases, it's health care for a spouse or dependent: the employee knows that a job shift with a health plan shift could jeopardize coverage or benefits, hence they stay put.
New freedom: benefits portability
However, if the United States, as expected, moves to a universal health care system -- one where every American has an opportunity to purchase federal health care insurance if a plan is not offered by a new employer, or if they can't afford a private plan -- that eliminates a great deal of the "health care coverage risk" that currently exists in the system.
The significance? Employees seeking a promotion, a career change, or a better work environment, will now make that change, and not remain in their current company/organization simply to retain health care benefits.
The aforementioned will result in a more efficient and appropriate allocation of talent in the U.S. economy 0 one that will unleash creativity and increase productivity.
It also means that companies will have to do more to ensure that their employees are satisfied with their current positions - another change that will lead to more-productive organizations and better working conditions. This is not to say that health care coverage is the only reason a citizen remains in an organization, but universal health care would increase benefits portability - something the United States is well behind Europe on - and any time benefits portability increases, it enhances the ability of talent to seek its highest and best use.
And as history tells us, when the latter occurs, a developed economy always wins, from a valued-added standpoint.
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Financial Editor Joseph Lazzaro is writing a book on the U.S. presidency and the U.S. economy.
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Reader Comments (Page 1 of 1)
8-03-2009 @ 10:28AM
Pro2Pro Network said...
I find this very interesting. In a way, universal healthcare will create a level palying field among employers, allowing employees to take a greater part in their own future at a company. You've given me a new perspective on the topic!
8-04-2009 @ 1:03AM
michael said...
If we evenly disperse benefits its good for the economy? There's a word for that, it's communism (or socialism if you prefer) and I would like you to point to a time when that has ever been good for the economy.
8-04-2009 @ 1:24AM
Bruce said...
@michael: we even disperse a number of benefits: military protection from foreign invasion is the classic example; firefighting is another; primary education. All benefit the economy enormously.
More generally, something that this post doesn't emphasize is that the employment-based insurance system discourages entrepreneurship: moving from one employer to another is tricky, but striking out on one's own is especially so. With universal coverage, that barrier to starting a small business is reduced.
8-04-2009 @ 1:31AM
Devin said...
@michael If i recall correctly, communism helped Russia (or the USSR) go from a back word country to compete with America as the worlds leading super power in a little more than 20 years. As a side note in no way am i saying that the USSR was indeed Communism (as Marx saw it because Stalin was a fascist). And in case you want to make the argument that Hitlers Germany was socialist (which is wasn't), that to turned the worst depression in recent history into an industrial nation which almost conquered the world. The only examples in history that were masked under the name of socialism and communism actually did very well economically.
8-04-2009 @ 3:19AM
Steve said...
Great article, Joseph. I've actually held this opinion for a while, and I'm glad to see someone has finally written about it.
Efficient talent allocation will indeed constitute a highly beneficial human-resource economy. There could be one drawback, though -- presumably, wage inflation could trigger some negative consequences and offset the productivity gains.
However, one would have to assume that efficient talent allocation is preferrable, and that any sort of wage inflation that could theoretically result would also bring its own benefits for a specific time period. Besides, any kind of inflation is desirable over deflation, and can be dealt with accordingly.
8-04-2009 @ 4:59AM
Mathew Ferguson said...
Here in Australia we have universal health care which means yes, you can quit your job and not have a worry about losing health care coverage. People don't have to stay in terrible jobs just because they'll lose health insurance coverage. Back in 2005 I became a freelance writer and I don't have to worry about coverage because I automatically have it.
Health Care is a human right -- come along and join the civilised countries America.
8-13-2009 @ 5:15PM
taxbite said...
I wonder if we would still be required to pay under or uninsured motorist "medical" premiums?
Or. will employors still pay workmen's comp?
Or. Will the disability laws will change? Will people who are on disability that aren't REALLY disabled be able to go back to work? In my experience many of the 'disabled' on disability, pushed to be on disability because their medical bills are so high they cannot afford insurance, or get insurance, or pay the medical bills themselves. Then you have those that are too lazy to get a job somehow qualified for disability.