Jacob Fuchs traces how a 1942 wartime wage freeze created American employer-provided health insurance. When the government banned wage raises, factories offered health benefits instead, which the War Labor Board ruled weren't wages. A tax code that made employer premiums tax-free but not employee-paid ones locked in the system, splitting who consumes care from who pays for it.
The government banned raises, so employers paid you in healthcare. Your health insurance exists because of wartime wage freezes. In 1942, the US government froze wages. Not a guideline, a law. It was wartime, so factories were desperate for workers and couldn't offer a dollar more to get them. So they offered something that technically wasn't money: health insurance. The War Labor Board ruled fringe benefits didn't count as wages. Which meant a company could hand you coverage and stay legal. Before the war, fewer than 1 in 10 Americans had health insurance. A decade later, tens of millions did. Then the tax code locked it in. Your employer buys it, nobody's taxed. You buy it, you don't get a break. And that's the thing that actually got built. Not coverage, gap. The person taking the drug stopped being the person paying for it. Price left the room. Every rebate, every formulary, every prior auth you ever screamed at all lives in this gap. Nobody designed this. It was a workaround for a wage freeze. It just never got turned off. No villains required.
