If you don't want employers to give it to employees, then we should fix the tax situation.
The actuarial assumption is that substantially all white collar employees will get group coverage and therefore any company's 25, 100, or 500 pulls out of the pool of white collar employee health risks will be actuarially consistent with random selections from the underlying distribution. This is not true of individual insurance purchasers, because the individual purchasers can have more signal on their health risks than their insurance companies. They can, for example, purchase insurance when they know they're likely going to require treatment and decline to purchase (or shift to different coverage options) when they're likely to be healthy.
This is called "adverse selection" and it is the tradeoff in individual insurance. For a while, the US's policy was that insurance companies could underwrite individual health insurance policies in a fashion roughly similar to underwriting business liability policies, which could be caricatured as "We'll give a policy to anyone with a pulse but if you've so much as glanced in the general direction of an expensive outcome at any point, our answer is Hell No, just like substantially every other insurance company's will be."
If you let insurance companies do underwriting, health insurance is (relatively) cheap and lots of people can't buy it on the individual market at any price. If you require "guaranteed issue", health insurance is only (relatively) cheap if everyone buys it.
The US has been wrestling this tradeoff with Obamacare and subsequent proposals. There are no simple solutions to it that make everyone happy.
And given the healthcare policy landscape, there are 0 insurers willing to offer such a contract.
As Charlie Munger says: "Never think about something else when you should be thinking about the power of incentives."
So if you didn't start your new job right away, and weren't paying for COBRA or other insurance in the interim, you could have been in trouble.
There's a lot of other good reasons to incorporate as well. Use an S-corp election (as an LLC) and you can get out of paying the SE tax on a significant portion of your income. There are some limitations and you need to bill over a certain amount, but anybody who makes a six-figure income consulting should be doing so under an LLC, not as a 1099 contractor.
[1] - https://www.irs.gov/publications/p535/ch06.html#en_US_2016_p...
In general I think the point is, why can corporations just straight write off premiums for their employees when self-employed types have all these special rules to follow vs just a standard deduction?
If you're a sole proprietor, the tax impact should be equivalent whether you choose to take draws or salary:
> Sole proprietors and members of partnerships are free to pay themselves — or otherwise take the profits out of their businesses — whenever they’d like. Payroll withholdings do not apply, but each individual essentially pays the equivalent on his or her reported income at tax time.
https://quickbooks.intuit.com/r/payroll/salary-or-draw-how-t...
Yes, I could continue to pay myself just $65,000, but the IRS could come knocking and say, "you said you paid for health insurance through S-Corp payroll, so that means you only gave yourself a $45,000 salary which is not fair and reasonable.
Going from being an employee to being 1099 and SE is still getting fucked on taxes, just in a different position.
If you're serious about freelancing, your income should be split between a W2 and a K1.
I am not a CPA. This is what I pay him to do for me.
In effect, instead of the employer picking the employee's health insurance the employee could go to the open market, but both the employer and employee get the same tax benefits via putting money pre-tax into a HSA which can then be used to pay for health insurance.
It would require massively increasing the maximum contributions on HSAs (currently only $6,750 for a family), since HSAs weren't originally designed to pay for your health insurance, just healthcare costs. But conceptually it is the easiest way to allow consumer choice in the health insurance market.
Surprisingly (it was to me, anyway), health insurance premiums don't qualify as a medical expense, so any funds withdrawn from an HSA for insurance premiums will be subject to taxes and penalties.
1) Company pays you 100k of which you then go spend 19k in the private insurance market to buy insurance leaving you with 81k after insurance costs.
2) Company pays for your health insurance and then pays you a salary of 81k.
They sound the same right? But they aren't! In #1 you will pay income tax based on a 100k salary. In #2 you will only pay income tax on 81k of salary. So you're better off in scenario #2.
Given the strong employee preference for #2 most employers in competitive hiring situations will tend of offer employer sponsored health care.
There are some other reasons why this happens too, but this is one of the biggest.