The current debate on national health insurance has not given sufficient attention to the impact of various proposals upon income maintenance programs. Health and welfare benefits are difficult to coordinate and frequently work at cross purposes. Health care benefits are one of several in-kind forms of income that can affect the economic behavior and well-being of welfare recipients. As an in-kind form of income, subsidized health insurance for low income persons can undermine the objectives of public assistance, particularly the willingness to work, by making some individuals worse off when income rises. Five national health insurance proposals are analyzed to determine how each will interface with cash transfer programs. Most of these proposals perpetuate many of the benefit coordination problems that now exist with the Medicaid program. The article concludes by delineating some of the difficult policy decisions that must be made if health and welfare reforms are to be meaningful.
Research Article|August 01 1977