Wednesday, May 13, 2009

 

Health Costs

The U.S. government has a tax expenditure of about $150 billion from exemption of employer-provided health insurance. That's about 10% of health care spending. (Statistical Abstract online, Table 459. Tax Expenditures Estimates Relating to Individual and Corporate Income Taxes by Selected Function: 2007 to 2010) That's much bigger than the home mortgage interest deduction ($95 billion). Add the health tax expediture to Medicaid and Medicare and we've got an even bigger government health care sector than before. Maybe that, US wealth, and state insurance coverage requirement regulation explain why the US spends so much on health care.

 

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