Health Care Costs and Public Policy Toward Employee Health Plans

Abstract

The growing cost of health care and health insurance have become major public policy issues, since these costs affect governments in several roles: as borrowers in financial markets, as major purchasers of health care, as employers, and—at the state and local level—as payers of last resort. This paper reviews various public policy initiatives that are part of the government's concern about health care costs: proposals to reduce tax preferences for employer contributions to health insurance; changes in public employee group health insurance plans to contain cost; and emerging public policy toward the growing problem of health care indigency. Although public-employee health insurance plans are only one source of health care costs for government, government responses to other sources of health care costs may also affect public employee plans.