Question: Is it not a fact that federal premium subsidies are another form of social welfare?
Answer: If you get health insurance from your employer, you’ve been receiving a generous public subsidy for years. The higher your income is, the larger your subsidy relative to your lower-income colleagues. That’s because the contributions your employer makes toward your group health insurance premium is a tax-deductible business expenses and non-taxable compensation to the employee even though it is a form of compensation. Estimates of the total dollar amount of that subsidy range between $200 billion and $300 billion a year, depending on what taxes are included in the analysis (only federal income taxes, or also payroll taxes and state income taxes). Estimates consistently show that high-income earners receive the bulk of that public subsidy.