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With National Health Insurance, Workers Could Change Jobs Without Losing Benefits

July 08, 1990

One benefit of national health insurance that David M. Gordon ("National Health Insurance Would Be Cost-Effective," June 17) failed to mention is its portability from employer to employer. Our current system provides health insurance, pensions and similar programs on a company-by-company basis. When employees change jobs they often discover that significant benefit losses are entailed.

For example, at a new job an employee may discover that his or her previously insured medical conditions (or those of dependents) are not covered because they are "pre-existing." Pension formulas are often arranged to penalize employees who leave in mid-career. The contrast with Social Security is obvious; under that national system employees can change jobs without any loss of coverage. It is 100% portable.

The concern over rising health costs creates an opportunity for re-examining the decentralized, duplicative and mobility-inhibiting benefit system created by the tax code. That system reflects a bygone era of large, secure employers, long-term careers and economic stability. But in the modern world, many forces have combined to make job changes, both voluntary and involuntary, commonplace.

Benefit programs that are not 100% portable deserve no tax subsidy.

DANIEL J. B. MITCHELL

\o7 The writer is a professor at the Anderson Graduate School of Management at UCLA.\f7

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