NCPA - National Center for Policy Analysis

Tax Credits Could Solve Uninsured Problem

July 19, 1999

The problem of the growing uninsured population has sparked bipartisan interest in Washington to use some form of health care tax credits, according to observers. Questions to be addressed include whether the tax credit should go to those who get employer-sponsored health insurance as well as to low-income people, and how Congress should pay for a tax credit program.

NCPA President Dr. John C. Goodman has proposed a plan in which the federal government would take the subsidies it currently dispenses to offset the private sector's costs of caring for the uninsured and redirect them.

Goodman notes that:

  • Federal and state governments spend $41.8 billion every year on a variety of programs, but the money could be used to cover the uninsured.
  • For example, the government gives $9.2 billion a year through Medicare and Medicaid to hospitals whose patient populations include a disproportionately high number of people without insurance.
  • Fewer uninsured patients -- or none at all -- would make those payments unnecessary.

Goodman's plan would give every American access to health insurance by offering a tax credit to those who can't get insurance through the workplace and providing a state-run safety net program for those who choose to remain uninsured.

Source: Marilyn Werber Serafini, "One in Six, and Counting," and "A Dozen Key Players," National Journal, July 17, 1999.


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