Over 6 million workers head families with incomes below the poverty line. This poverty occurs because of inadequate public assistance, low pay, and lack of jobs. Medical Protection a.
Medical protection is one method of reducing poverty among the working poor.
Increased medical protection could be provided by extending Medicaid to everyone in families whose incomes are below some designated level. This would significantly increase the tax costs of medical care, possibly increase the opportunity cost of medical care, and possibly decrease work effort. Increased medical protection could be provided by requiring employers to provide it as a fringe benefit. This may be counterproductive as employers may simply reduce wages by the amount of the fringe benefit, or reduce the number of people employed. Increased medical protection could be provided by having a government- supported residual insurance plan that required people who do not receive adequate insurance from employers or who do not purchase it privately to purchase government medical insurance.