Study: Private Health Coverage Costs IRS $188 Billion

NU Online News Service, Feb. 26, 2004, 2:23 p.m. EST – Supporting the private health insurance market will cost the federal government about $188 billion this year.[@@]

John Sheils and Randall Haught, researchers at The Lewin Group L.L.C., Falls Church, Va., have published that estimate in a paper on the Web site of Health Affairs, a health finance policy journal.

In the Health Affairs paper, Sheils and Haught look at the federal government’s “tax expenditure” on private health coverage. The researchers define “tax expenditure” as “the amount of revenues that the federal government forgoes by exempting health benefits and spending from the federal income and Social Security taxes.”