*Professor of Economics and Political Science, and Director, Public Policy Analysis Program, University of Rochester, New York. Views expressed here are those of the author. An earlier version of this paper was presented at the Annual Western Economic Association International Conference in Seattle, Washington, July 1983. Thoughtful comments from Douglas Conrad, University of Washington, improved the paper notably.
TAXING HEALTH INSURANCE: HOW MUCH IS ENOUGH?
Article first published online: 27 JUL 2007
Contemporary Economic Policy
Volume 3, Issue 2, pages 47–54, December 1984
How to Cite
PHELPS, C. E. (1984), TAXING HEALTH INSURANCE: HOW MUCH IS ENOUGH?. Contemporary Economic Policy, 3: 47–54. doi: 10.1111/j.1465-7287.1984.tb00796.x
- Issue published online: 27 JUL 2007
- Article first published online: 27 JUL 2007
The Reagan administration has again proposed in 1984 to limit the tax exemption on health-insurance premiums. Objectives of the proposal are to curtail rising health costs by reducing insurance coverage—and hence medical-care use—and to raise revenues to offset the large federal deficit. The change would have little effect on either dimension. Most likely, consumer response would reduce dental, drug, and eyeglass insurance, but would leave coverage for hospital and doctor care—the most bothersome health-cost sectors—essentially unaffected. Larger tax changes which are structured differently possibly could reduce health costs dramatically and raise up to $27 billion a year in new tax revenues.