It’s high time to scrap the link between your health insurance and your employer. We just have to end federal tax breaks to corporations and employers to select your health insurance for you. How about you get the tax break instead? That means you would deduct the cost of your own private health insurance from taxable income in order to choose an affordable, quality policy from a well-regulated health insurance market with plenty of good choices.
Many who have employer-sponsored health insurance plans are under the illusion that that they are getting a better deal than they have been- or could! The quality of your health insurance should never have depended upon the size and commitment of your employer. We also realize that health insurance provided by employers is not really insurance- right? Sick or injured (eventually) = inability to work = no insurance. Our long-outdated, complex, convoluted system offers access that is separate and unequal, and deems different groups of people as the haves and have-nots.
Big insurers (that hold monopoly status in health insurance markets) and big corporations (which enjoy having the federal government subsidize their benefits to employees) may resist change, but Obamacare’s 2010 concessions to them can be the last time we ever give into their demands.There is no reason to cling to an outdated tradition that has never really served us well. The ACA incurred high government administrative costs to keep this broken market model.
Iowa comes in about dead last among the 50 states in realizing the benefits offered by the ACA and its potential to establish a thriving individual health insurance market. (So don’t use our state’s sad state of affairs to consider the kind of individual health insurance market I am proposing!) Most of that is the fault of our state government and legislators. Big health insurers can be expected to operate in their own best corporate interests- sometimes over the best interest of consumers, so it’s the governments job to set the rules, protect consumers, and maintain a fair playing field among insurance providers to prevent monopolies.
Individual health insurance markets throughout the nation will work profoundly better for all when they are consumer-saturated and flooded with people previously stashed away in employer-sponsored plans.
Employer – linked health insurance is not only bad for you and me- it’s bad for Iowa and the country! Here are only some of the reasons why:
- Downward pressure on workers’ wages.
- People stay in the wrong job for too long or don’t find the best applications for their skills and talents. Younger adults are particularly disadvantaged as today’s job market requires more adaptability and health care coverage concerns shouldn’t limit employment mobility.
- Business owners are burdened with unnecessary administrative costs, wasting time and resources to serve as provider of health insurance to employees.
- It is much more costly to our government than it need be to regulate the health insurance market and provide subsidies to low-wage-earning, non-Medicaid-qualifiers.
- Health insurance monopolies will continue to have their heyday at the expense of Iowans and Americans until this complex, unfair playing field is scrapped. This time they will have to give in as now they must see the writing on the wall with cries for Medicare for all, and the elimination of private insurers.
The Patient Protection and Affordable Care Act of 2010 (ACA or “Obamacare”) was for the most part effective legislation with many steps in the right direction. It helped in many ways to prepare us for the next essential bold move! The legislation was extensive and far-reaching. It even initiated a program that improves the likelihood that older Americans will be able to stay in their homes and receive the medical assistance they need, if they prefer that option over having to go into a nursing home for care.
The PPACA was more costly than it should have been because of work-arounds with high administrative costs that only served to prop up a broken employer health insurance market model.
Taxpayer dollars will have much more impact if they are reserved to: maintain a fair playing field and protect consumers (with effective, well-enforced regulations) , support and improve the public payment plans we already have (with additional support from new individual access payments with program expansion), and if they are used to offer other efficient and effective supportive provisions appropriate for federal funding.
No matter how you feel about this proposal compared to others- this bold market-model change is urgently needed first!
In more detail …
It’s an ideal time to be running for U.S. Senate because the country is finally on the verge of making affordable, quality healthcare a reality for all- and my life’s work can best be put to great use by making that happen. I spent most of my life taking care of people- directly helping them to feel better, and making sure that they have access to the resources and information they need to improve their lives. My goal in studying economics was to help determine the best ways to empower people. I have been keeping an eye on healthcare service and health insurance market developments for decades. For several years now I have been offering legislators constructive conversations and well substantiated proposals to get moving in the right direction. Some show signs of being ready to stand up to corporate special interest groups to simplify this convoluted system in the best interest of Iowans and Americans. Though from my perspective, they’re dragging their feet and gazing off in the wrong direction while a unique opportunity for important changes (that can actually get through Congress) is about to yet again pass us by.
There are so many exciting details I wish I could share with each of you in person. The next bold steps we need to take are relatively simple to understand. But I am also up for the greater challenge of helping people understand the moving parts under this broken down jalopy of a system and why even though they are attached to the familiar old “get my insurance from my employer” model- it’s high time we trade it in for a sleek, efficient machine that can take us where we need to go.
- Prepare yourself to finally scrap the link between your health insurance and your employer. Most of us will still have private health insurance and many of us will even be insured by the same insurance company- the difference is that you will be in the driver seat. You will be able to select in an easy-to-understand, consumer-focused, competitive (so bye-bye monopolies and hello reasonable premiums) policy! We now realize that health insurance provided by employers is not really insurance- right? Most people who have gone bankrupt due to healthcare costs originally had employer-sponsored health insurance when they first became ill or injured- but then of course lost it when they got sick enough to be unable to work.
- The quality of your health insurance policy should never have depended upon the size and commitment of any employer! When insurance companies have to scramble for each and every one of us from a statewide (or larger) pool instead of negotiating with employers for baskets of members, then competition and choice will have a huge impact on premium prices and affordability. Individual private health insurance markets would serve us all profoundly better if we all left large group/employer insurance behind. Not only are separate markets not equal when it comes to fairness, but many who have employer-sponsored health insurance (considering themselves the haves- as opposed to the have-nots) are under the illusion they are getting a better deal than they actually have been, or could! If you really understand what goes into determining health insurance premiums, than you know that using employers to put people into groups to pool risk and determine costs is bad for consumers when that risk could be spread over larger groups (statewide or large rating areas for big, populous states, or even regional or national risk pools) and administrative costs could be significantly reduced. The current system is a sad, complex, nonsensical state of affairs.
- Did you know that the federal government gives corporations tax breaks to select and manage your health insurance for you? (State governments double this mistake.) How about you get the tax break instead? That means you would deduct the cost of your own health insurance from taxable income in order to choose an affordable, quality policy from a well-regulated health insurance market with all good choices.
The choices will be better and more affordable because finally health insurers will have to answer to you- the consumer, and be forced to operate in a competitive, transparent, consumer-focused, well-regulated U.S. health insurance market.
- Big insurers (that hold monopoly status in health insurance markets) and big corporations (which enjoy having the federal government subsidize their benefits to employees) will resist change, but Obamacare’s 2010 concessions to them can be the last time we ever give into their demands. Lobby groups were allowed to protect the failing, unfair, large-group health insurance market model that keeps our healthcare system so void of any consumer input, and so complicated, and so costly! Insurance companies (and other 3rd-party negotiators like “pharmacy benefit managers”) have been enjoying a heyday at the expense of Iowans and Americans. (see Economist article: “Which firms profit most from America’s health-care system”- links at end of section)
- That’s right, employer- linked health insurance is not only bad for you and me- it’s bad for Iowa and the country! Here are only some of the reasons why: Downward pressure on workers’ wages (especially for low-wage earners) as healthcare costs have risen while remaining part of employee benefit packages, employers have been unable or unwilling to increase wages. People stay in the wrong job for too long or don’t find the best applications for their skills and talents when they are burdened by health insurance concerns linked to their employment. Business owners are burdened with unnecessary administrative costs, wasting time and resources to serve as provider of healthcare coverage to employees. Businesses should be able to focus on their original purpose- we don’t need them involved in the business of health insurance too. We all know this convoluted system has too many moving parts that need to be dismantled if we expect to move forward. Small to medium business owners will be delighted to lose all those silly number-of-employee and small-group-plan schemes so that their business will be free to develop in its own best interest and in the best interest of its employees. They will be free to offer more direct benefits that impact every employee regardless of health status- like better pay, better working conditions, flexible schedules, or more generous paid time off.
- States can have some options for implementation, but the Federal government has to set the stage. Iowa comes in about dead last among the 50 states in realizing the benefits offered by the ACA and its potential to establish a thriving individual health insurance market.(So don’t use our state’s sad state of affairs to consider the kind of individual health insurance market I am proposing!) Most of that is the fault of our state government and legislators. Big health insurers can be expected to operate in their own best corporate interests- sometimes over the best interest of consumers, so it’s the governments job to set the rules, protect consumers, and maintain a fair playing field among insurance providers to prevent monopolies. We have learned a lot from how the states implemented the ACA differently – some resulting in much more affordable access to quality health insurance in the individual market compared to others. Now we know what next steps to promote on the national level to make even more dramatic improvements for all. https://www.commonwealthfund.org/publications/maps-and-interactives/2019/apr/what-your-state-doing-affect-access-adequate-health?redirect_source=/publications/maps-and-interactives/2019/jan/what-your-state-doing-affect-access-adequate-health
- Individual health insurance markets throughout the nation will work profoundly better for all when they are consumer-saturated and flooded with people previously stashed away in employer-sponsored plans. Much of the complicated legislation in the ACA was dealing with the fact that individual markets throughout the nation only contained a minority of healthcare consumers and this does not make for a market that is easy to estimate average cost or spread out risk. So adaptive schemes like “risk adjustments” and “risk corridors” were necessary to sustain a market where insurers could effectively operate. Those schemes would be far less necessary in a truly consumer-saturated market.
- Minimizing or eliminating any rural disadvantage when it comes to healthcare access and affordability will be much easier once we make the transition I propose. When all Iowans are consumers in the same market we will have access to similarly affordable premiums and rural hospitals and healthcare providers will have access to similarly reliable payers. (Some of the details get a little complicated – but that’s where I come in with the knowledge to stand for and defend the meaningful changes that will have the most immediate impact on our lives! Consider a chat with me sometime if you want to understand how things like how a state defines “rating areas” makes a big difference. This is one area of legislation where the federal government can set some basic standards to help states stand up to insurers to support rural communities and keep costs fair no matter where you live). https://www.cms.gov/CCIIO/Programs-and-Initiatives/Health-Insurance-Market-Reforms/ia-gra.html (Iowa has 7 rating areas, but for its population and size we should only have 3 at max- or better yet none. With my proposal big health insurers won’t get any hand in defining them, even if they try to coerce state regulators.)
- The transition to this new, much-more-functional private health insurance market also means no need for any individual mandate or “responsibility payment” like the one just dropped by legislative changes in 2019. You will likely be much more enthusiastic about getting health insurance (even easier and with better information than when you buy car or homeowner’s insurance) when a simpler, properly-regulated, transparent, health insurance market offers you the coverage you need at a more reasonable price. Clearly employer mandates go completely out the window as well (since your employer should never have anything to do with such personal matters as your health insurance in the first place).
- No one should have to go bankrupt or be earning less-than survival level income to get access to publicly-funded healthcare programs! If for any reason there is still not enough economic incentive to get insured in a new, more-affordable, high-quality private health insurance market, (for those who don’t already qualify for Medicaid) we can establish reasonable payment to access Medicaid services for any year anyone finds them self in need of coverage for healthcare expenses. The amount paid into Medicaid can be based on a reasonably low percent of annual income and retroactive to the start date when the initial costs were incurred for the year. Does that sound fair? (No matter what your take on this proposal detail I want to hear from you!)
- The Patient Protection and Affordable Care Act of 2010 (ACA or “Obamacare”) was for the most part effective legislation with many steps in the right direction. Yes – more people have health insurance. It invested in a system where consumers have access to more information and simplified descriptions of confusing health insurance policies. In my work I have directly observed its more meaningful positive impacts: because of it there are even more incentives for hospitals to prevent complications, our chronic diseases are more likely to be managed effectively, and unnecessary yet costly tests and treatments are less likely to be done at our expense. https://www.ced.org/blog/entry/top-healthcare-stories-for-2016-pay-for-performance. The legislation was extensive and far-reaching. Many are unaware that important protections were gained even for those with employer-sponsored insurance plans. https://www.healthaffairs.org/do/10.1377/hblog20170111.058297/full/. ACA legislation even initiated a program that improves the likelihood that older Americans will be able to stay in their homes and receive the medical assistance they need, if they prefer that option over having to go into a nursing home for care. (Yay for Iowa being one of 18 states to participate in this important ACA provision- the Medicaid Balancing Incentive Program! https://www.kff.org/medicaid/report/medicaid-balancing-incentive-program-a-survey-of-participating-states/
*No major legislation is perfect and most end up with some unintended consequences (Subsidizing and facilitating a rapid transition to the use of electronic medical records is one area that didn’t work out as smoothly as intended. In some cases, not only did it not improve efficiency of care, but it actually ended up distracting doctors and healthcare providers from being able to focus on caring for patients as well as they could before.) I am eager and prepared to tackle such problems in the senate as necessary to keep our healthcare system improving with great momentum! http://fortune.com/longform/medical-records/.
- The PPACA was more costly than it should have been because of work-arounds with high administrative costs that only served to prop up a broken employer health insurance market model. Monitoring, reporting, and collecting the individual (“shared responsibility provision” fees) and employer mandates incurred high administrative costs and had we stood up to health insurance lobbyists and large corporations that benefit from our broken system (like Walmart), they would have been totally unnecessary. The big step backward with the passage of the ACA was its propping up of employer sponsored health insurance just as we were starting to break those shackles. If left the majority of healthcare consumers in the convoluted, complex system of large group/employer insurance where big insurance and other middle-men negotiators could continue to control our costs. This also prevented consumers from flooding into the individual market where transparency and competition among insurers would have lowered costs. It’s time to learn from this grave mistake!
- My proposal would serve Iowans, Americans, and our economy better than single payer or “Medicare for All” proposals – what’s more, it would happen more quickly to immediately provide relief! I want to empower you by taking the power away from big insures and corporations- not empower government to struggle with a high-administrative-cost and inefficient payment model that continues to deny consumers input. Our country has yet to experience what it would be like if the government simply did what it is supposed to do with the health insurance industry: 1- Set a fair playing field that offers fair premiums to all consumers and limits monopolies, 2- Protect and empower consumers with good information, enforcement of regulations, and economic incentives to make good choices 3. Stop giving tax breaks to employers to get in the way! The health insurance industry can serve us reasonably well if government fixes the glaring market failures that have been overlooked for decades. https://www.healthsystemtracker.org/chart-collection/u-s-spending-healthcare-changed-time/#item-health-spending-growth-has-outpaced-growth-of-the-u-s-economy_2017 (Wonderful simple colorful charts to give you the big picture!- “How has U.S. Healthcare Spending Changed Over Time.”)
- Our great nation has unique cultural, sociopolitical, and demographic characteristics- the best health care solution for each country is different. Learn more about how things work in other countries: https://international.commonwealthfund.org/features/what_covered/
There are a lot of great solutions out there to learn from, but our combination will be unique.
- Taxpayer dollars will have much more impact if they are reserved to maintain the fair playing field, support and improve the public payment plans that we already have (with additional support from consumer access payments), and offer other new supportive provisions. Federal re-insurance programs to support cost extremes or outliers, collaboration with disease foundations, and public-private partnerships could offer us much better healthcare bang for each tax-payer buck. The ACA subsidizes premiums for low-wage earners and in doing so has been paying more than our government should for overpriced premiums that would be lower once we change the health insurance market model. This part of the legislation could continue subsidizing fewer premiums that are more reasonably priced- or perhaps better still- we could keep people from falling through the cracks by increased access to our public programs- like Medicaid (as previously described).
- No matter how you feel about this proposal compared to others- this bold market-model change is urgently needed first! It dismantles the complex, convoluted system in a few simple steps to immediately provide relief to Iowans and Americans (and what’s more- there is plenty of middle ground here to get it through Congress!) Insurance companies see the writing on the wall with people frustrated and crying out for Medicare for all. I believe this is the only way forward to give that industry one last chance and realize its positive potential. Let’s see what happens when YOU finally have input as a consumer to make the healthcare service and health insurance industries work as they should. The healthcare industry employs more people than any other in our country. Even though some in the industry are overcompensated, many healthcare workers or care providers are underpaid (I have personally experienced both sides of that issue ;-)). We need to make sure that essential service facilities throughout the country are supported and able to provide quality care. Elect me to fix what’s broken now. Regardless of where you envision us ending up for good of Iowans and Americans, I know this is now the right direction forward.
Enjoy other great links and resources to help you understand the facts on the ground, and to get you excited about more positive changes we can realize together:
- This link offers one of the best resources to help you understand Iowa’s health insurance recent history- debacles and all! https://www.healthinsurance.org/iowa-state-health-insurance-exchange/ Follow us: @EyeOnInsurance on Twitter | healthinsurance.org on Facebook. (This information was provided by some of the most qualified experts in the country. Iowa is one of 6 states that use a state-federal partnership for our ACA or individual health insurance market exchange and Healthinsurance.org manages that platform.)
- Did you know that ACA initiatives have significantly improved access to home and community-based services for long-term care for elderly and disabled Medicaid recipients so that there is less incentive to be institutionalized to receive long-term care? Isn’t this a more efficient and effective use of tax-payer-provided funds (to help people stay in their homes and more connected with their families and communities) and a welcome development that should be protected? https://www.kff.org/report-section/potential-changes-to-medicaid-long-term-care-spousal-impoverishment-rules-states-plans-and-implications-for-community-integration-issue-brief/
- Here’s a fantastic analysis how different state implemented the 2010 PP-ACA and what were the results. Some states did much better than others by taking advantage of the options and experienced less than half the rate of insurance premium cost increases. https://www.commonwealthfund.org/publications/issue-briefs/2019/jan/choice-competition-individual-insurance-health-reform
- (Recommended reading*- an easy-to-understand resource that offers some history, fairly current observations, and meaningful explanations for why the primarily employer-sponsored health insurance system in the U.S. so detrimentally fails us all:
Pilzer, Paul Zane., and Richard Lindquist. The End of Employer-Provided Health Insurance: Why It’s Good for You, Your Family, and Your Company. Wiley, 2015.)
- This article also may offer additional insights on what we are up against with this proposal: https://www.washingtonexaminer.com/stop-protecting-the-employer-based-healthcare-system)
- Check out how Premium costs have been halved as a percentage of income for low wage earners (those with income < twice the poverty level) for ACA plans compared to employer health coverage for the same. https://www.axios.com/employer-coverage-less-affordable-than-aca-low-income-1f1642a7-b211-497f-aec7-d3315c150266.html?utm_campaign=KFF-2019-TheLatest&utm_source=hs_email&utm_medium=email&utm_content=71865572&_hsenc=p2ANqtz-9ppkPugNMAMtoGNz70Zc8pSKQFbGRRNI6IikWIF2xWrOmW28daSs7VSz6w0OnonKjmoJsof1C_oUwusTuCifA_WIEzQg&_hsmi=71865572
- About healthcare “middle men” and the profits they sponge up + a note on monopolies: “In the case of health care, consolidation has probably made things worse by muting competition. There are now five big insurance companies, three big wholesalers, three large pharmacy chains and three big benefit managers.” (Here in the U.S.)