World War II created health insurance perk
Ron French / The Detroit News
The fact that GM pays anything for health care is an accident of history.
By the 1940s, health care costs in most industrialized nations were paid by the government.
That might have happened in the United States, too, if not for World War II.
To halt inflation during the war, the government put a cap on wage raises. To compensate workers, companies began offering health insurance.
By the time the cap on raises was lifted, health insurance had become a common perk to attract and retain workers.
In 1950, GM President Charles Wilson offered to pay 50 percent of the health care costs of his employees. Walter Reuther, national president of the United Auto Workers, initially resisted, believing the cost should be spread across many companies or across the nation, according to a biography of the union organizer.
Reuther gave in, and GM entered the health care business.
In 1961, retirees were included. Three years later, the company began paying 100 percent of health care bills for workers and retirees.
Today, the United States is the only industrialized country in which most health care is paid for by employers.
Tips to college buddy Bob Cain.
HKO Comments- few people realize this and therefore see the government as the only option for our health care problems in spite of the fact that few would freely choose the government plans such as VA or Medicaid that we now have. The answer is to get business out of the picture and put individuals in charge.
Government wants to provide the benefit but they do not want to pay for it. The result is the Medicare strongarm technique that forces providers to drop prices so low that it only shifts the costs to the paying patients. The result of making this technique system wide is to reduce choice and quality. In a private market you could choose this option but in a government controlled market this will forced on all of us.