Wednesday, January 31, 2007

Snow Job

In a post at NRO's The Corner, Ramesh Ponnuru talks about the way the White House has been presenting President Bush's proposal to remove the tax deductibility of some employer-provided health insurance plans.

What [White House Press Secretary Tony Snow is] saying is that, yes, expensive health plans would be taxed more. But people would respond to the new policy by scaling back their health plans. Thus they’d avoid the tax.

In a later post, he corrects himself (my italics):

[Snow's] point wasn't that people with expensive health insurance plans would scale them back in response to the president's proposed tax reform. Rather, it was that insurers would offer more coverage for less money. Thus (at least some of) the affected workers would find themselves getting the same coverage and, perhaps, a raise. The value of their compensation to them, after tax, could go up. He has a good point.

Yes, health insurance companies have a longstanding habit of offering more coverage for less money.

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