Pay or Pay


One of the hot policy proposals these days is a pay-or-play universal health-care plan, touted as a public-private alternative to socialized medicine. Employers would have to provide health benefits to their employees or pay a tax that would fund federal health insurance.

But is pay-or-play really that desirable? The plan would make it more expensive for firms to employ workers and would reduce employment. How much? Well, the Republicans on Congress's Joint Economic Committee estimate that a pay-or-play program with a 7-percent tax would cost 712,742 jobs nationally. Most of the jobs would be lost in small businesses. Firms with fewer than 20 employees would lose 308,265 jobs.