As an employer, if I'm paying an employee $30/hour in direct wages and I'm picking up the cost of a medical insurance policy that translates to around $5/hour for him, it's true that I am effectively paying him $35/hour (let's leave aside any other benefits he may be receiving). But that doesn't mean I'm going to go to great lengths to look for opportunities to eliminate that medical plan just to save $5/hour in costs. Think of it this way:
1. If I'm looking to save $5/hour in labor costs with this employee, it might be easier to just reduce the direct salary to $25/hour either by cutting his pay or (more likely) by hiring someone else to do the same job for less money.
2. It costs more than $5/hour to pay for an insurance plan that translates to a $5/hour cost for this employee. There's an administrative side of this that costs money and is increasingly bureaucratic, legalistic and complex. To be frank with you, it is an enormous pain in the @ss. I'm not in the health care business ... I'm in the business of selling Product X or Service Y. And yes, I'd be perfectly fine just paying the employee $35/hour and letting him deal with his insurance needs on his own. Getting involved in health care for my employees isn't much different than negotiating with their landlords or mortgage lenders, or attending parent-teacher conferences for their children. Did I mention that it's an enormous pain in the @ss?
The only reason that employers got involved in health insurance in the first place, was as a workaround for wage controls.