Would you agree or disagree with the following statement The

Would you agree or disagree with the following statement, “The single most important health policy choice in the United States over the past four decades has nothing to do with the Department of Health and Human Services, but rather with the Internal Revenue Service.” What evidence can you cite to support your position?

Solution

The Internal Revenue Service (IRS) is the revenue service of the United States federal government. The government agency is a bureau of the Department of the Treasury, and is under the immediate direction of the Commissioner of Internal Revenue. The IRS is responsible for collecting taxes and the administration of the Internal Revenue Code. It has also overseen various benefit programs, and enforces portions of the Affordable Care Act.

The first income tax was assessed in 1862 to raise funds for the American Civil War, with a rate of 3%. Today the IRS collects over $2.4 trillion each tax year. It processes around 234 million tax returns annually.

Tax Free Insurance from IRS:

Employers’ payments covering premiums for employer-sponsored health insurance are exempt from federal income and payroll taxes. Any portion of premiums paid by the employee is typically excluded from taxable income and is therefore also tax-free, although some employers require employees to pay their share of premiums out of after-tax income. The exclusion of premiums lowers most workers’ tax bills and thus reduces their after-tax cost of health insurance coverage. This effective tax subsidy is a major reason why most Americans have health insurance coverage through either their own employer or that of a family member. Other factors also play a role, however, including the lower costs of group coverage and reduced administrative expenses.