One bit of good news on the health insurance front: Despite some trial balloon suggestions, health insurance premiums in 2011 will continue to be tax-deductible for all self-employed professionals.
That’s the good news. The bad news is, the system of actually getting health insurance is still an unholy mess. And the system forces people into arrangements that any reasonable person would consider ridiculous.
For example, I have clients who are getting divorced, and have amicably reached agreement on all their issues. They get along with each other as well as people can under such circumstances, and they still care about each other. But they’re choosing to put off making the divorce final.
The reason: when the divorce is final, one spouse is going to lose the health insurance provided by the partner’s job. And neither of them want to see that happen. So while they’re moving on in their lives emotionally, legally they remain stuck together.
Health insurance is the sand in the gears of many Americans lives. Fear of losing or not having health insurance stops people from changing jobs. It keeps them from trying to start a new business. Losing a job is bad; losing the health insurance attached to it can be catastrophic.
And of course, you can still lose your health insurance even if you don’t lose your job. Wal-Mart is slashing employee health insurance benefits, the New York Times reports, eliminating coverage for anyone who works less than 24 hours a week and reducing coverage or hiking premiums for many other employees. Some Wal-Mart workers earn so little they may qualify for their state Medicaid programs.
If you are under 65, the fact that you could not get a health insurance policy for yourself will freeze you in place, even if you could retire early with full benefits. The state of Oregon, recognizing that, is even considering offering continued health coverage to employees who retire early as a way of getting more high-earning people off of the state payroll.
Until we have a system where everyone is guaranteed health coverage regardless of their employment status, we’re going to have a self-imposed, or, more accurately, insurance-company-imposed, drag on the economy.