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Taxes and Health Insurance

In: Tax Policy and the Economy, Volume 16

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  • Jonathan Gruber

Abstract

A common prescription for reducing the number of uninsured is to increase the tax subsidization of health insurance in the U.S. Yet, we already provide over $100 billion per year in tax subsidies to health insurance. This paper provides an assessment of the past and potential impacts of taxation on health insurance coverage and costs. I begin by reviewing the central facts on health insurance and taxation. I then provide a framework for assessing the impacts of tax policies on health insurance coverage and costs, and I review the existing empirical evidence on the key behavioral parameters required to model these impacts. I conclude with the policy implications of these findings for tax policies to expand insurance coverage.
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Suggested Citation

  • Jonathan Gruber, 2002. "Taxes and Health Insurance," NBER Chapters, in: Tax Policy and the Economy, Volume 16, pages 37-66, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberch:10862
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Jonathan Gruber, 2008. "Covering the Uninsured in the United States," Journal of Economic Literature, American Economic Association, vol. 46(3), pages 571-606, September.
    2. Jonathan Gruber, 2008. "Covering the Uninsured in the U.S," NBER Working Papers 13758, National Bureau of Economic Research, Inc.
    3. Jung, Juergen & Hall, Diane M. Harnek & Rhoads, Thomas, 2013. "Does the availability of parental health insurance affect the college enrollment decision of young Americans?," Economics of Education Review, Elsevier, vol. 32(C), pages 49-65.
    4. Liran Einav & Amy Finkelstein & Mark R. Cullen, 2010. "Estimating Welfare in Insurance Markets Using Variation in Prices," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 125(3), pages 877-921.
    5. Jonathan Gruber, 2005. "Tax Policy for Health Insurance," NBER Chapters, in: Tax Policy and the Economy, Volume 19, pages 39-64, National Bureau of Economic Research, Inc.
    6. Avi Dor & Joseph Sudano & David W. Baker, 2003. "The Effects of Private Insurance on Measures of Health: Evidence from the Health and Retirement Study," NBER Working Papers 9774, National Bureau of Economic Research, Inc.
    7. Spierdijk, Laura & van Lomwel, Gijsbert & Peppelman, Wilko, 2009. "The determinants of sick leave durations of Dutch self-employed," Journal of Health Economics, Elsevier, vol. 28(6), pages 1185-1196, December.
    8. Michael Smart & Mark Stabile, 2005. "Tax credits, insurance, and the use of medical care," Canadian Journal of Economics, Canadian Economics Association, vol. 38(2), pages 345-365, May.
    9. Amy Finkelstein & Casey McQuillan & Owen Zidar & Eric Zwick, 2023. "The Health Wedge and Labor Market Inequality," Working Papers 2023-01, Princeton University. Economics Department..
    10. Jonathan Gruber, 2008. "The Tax Exclusion for Employer-Sponsored Health Insurance," NBER Chapters, in: Economic Analysis of Tax Expenditures, National Bureau of Economic Research, Inc.
    11. Katerina Sherstyuk & Yoav Wachsman & Gerard Russo, 2007. "Labor Market Effects Of Employer‐Provided Health Insurance," Economic Inquiry, Western Economic Association International, vol. 45(3), pages 538-556, July.
    12. David M. Cutler, 2003. "Employee Costs and the Decline in Health Insurance Coverage," NBER Chapters, in: Frontiers in Health Policy Research, Volume 6, pages 27-54, National Bureau of Economic Research, Inc.
    13. John F. Cogan & R. Glenn Hubbard & Daniel P. Kessler, 2007. "Evaluating Effects of Tax Preferences on Health Care Spending and Federal Revenues," NBER Chapters, in: Tax Policy and the Economy, Volume 21, pages 65-82, National Bureau of Economic Research, Inc.
    14. Dey, Matthew & Flinn, Christopher, 2008. "Household search and health insurance coverage," Journal of Econometrics, Elsevier, vol. 145(1-2), pages 43-63, July.
    15. Herzlinger, Regina E., 2010. "Healthcare reform and its implications for the U.S. economy," Business Horizons, Elsevier, vol. 53(2), pages 105-117, March.
    16. Hamersma, Sarah & Kim, Matthew, 2009. "The effect of parental Medicaid expansions on job mobility," Journal of Health Economics, Elsevier, vol. 28(4), pages 761-770, July.
    17. Voßmerbäumer, Jan & Wagner, Franz W., 2013. "Steuerwirkungen betrieblicher Entgeltpolitik," arqus Discussion Papers in Quantitative Tax Research 144, arqus - Arbeitskreis Quantitative Steuerlehre.
    18. Bhattacharya Jayanta & Vogt William B., 2014. "Employment and Adverse Selection in Health Insurance," Forum for Health Economics & Policy, De Gruyter, vol. 17(1), pages 79-104, January.
    19. Sang-Hyop Lee & Gerard Russo & Lawrence H. Nitz & Abdul Jabbar, 2005. "The Effect of Mandatory Employer-Sponsored Insurance (ESI) on Health Insurance Coverage and Labor Force Utilization in Hawaii: Evidence from the Current Population Survey (CPS) 1994-2004," Working Papers 200512, University of Hawaii at Manoa, Department of Economics.
    20. Jayanta Bhattacharya & William B. Vogt, 2006. "Employment and Adverse Selection in Health Insurance," NBER Working Papers 12430, National Bureau of Economic Research, Inc.
    21. Jonathan Gruber, 2011. "The Impacts of the Affordable Care Act: How Reasonable Are the Projections?," NBER Working Papers 17168, National Bureau of Economic Research, Inc.

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    More about this item

    JEL classification:

    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • I1 - Health, Education, and Welfare - - Health

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