1. Subsidies for those who most need financial assistance obtaining health insurance.
This assistance could take the form of tax credits or vouchers, should be more generous at lower income levels, and should be earmarked for health insurance coverage. It is important to note that the government already gives people financial assistance to buy private health insurance—well over $125 billion each year—with an employee income tax break on job-based insurance that is hidden from public view. This tax break gives more assistance to those in higher tax brackets, and gives no assistance to those without employee health benefits. Shifting some or all of this assistance to tax credits or vouchers for lower-income people would reduce the number of uninsured and improve fairness in the health care system.
2. Choice for individuals and families in what health plan to join.
Today people are effectively locked into the health plans their employers offer, often just one or two plans, which are subject to change from year to year. A change in employment typically means a change in insurance coverage. In contrast, under the AMA plan, people could use tax credits or vouchers to help pay for premiums of any available insurance, whether offered through a job, another arrangement or the open market. As with job-based insurance today, health plans would still have to meet federal guidelines for covered benefits, but people would have greater say in what types of benefits and plan features they value. Coupled with individual choice, tax credits benefit recipients directly, and everyone indirectly, by stimulating the market for health insurance. If enough people have enough purchasing power—and enough say over how that purchasing power is used—insurers will be compelled to offer better, more affordable coverage options.
3. Fair rules of the game that include protections for high-risk patients and greater individual responsibility.
For markets to function properly, it is important to establish fair ground rules. A proliferation of state and federal health insurance market regulations has made it more difficult and expensive for insurers to do business in many markets. The AMA proposes streamlined, more uniform health insurance market regulations. Regulations should permit market experimentation to find the most attractive combinations of plan benefits, cost-sharing and premiums. It is also important that market regulations reward, not penalize, insurers for taking all types of patients. People should have a guarantee that they will not lose coverage or be singled out for premium hikes due to changes in health status. Market regulations intended to protect people who have high health risks typically have backfired, sometimes disastrously, by driving up premiums for younger, healthier people and leading them to drop coverage.
To help high-risk people obtain coverage without paying astronomical premiums, additional targeted government subsidies are needed for high-risk people that would allow insurers to keep premiums down in the regular market. Individuals also need to be encouraged to play fairly by taking responsibility for obtaining health insurance without waiting until illness strikes or medical attention is needed. People who are uninsured despite being able to afford coverage should face tax implications.---
No health insurance reform proposal would be complete without giving serious consideration to managing health care costs. The AMA’s work on developing solutions to address rising health care costs is ongoing, and its current focus highlights areas that physicians can influence. The AMA has identified four broad strategies to contain health care costs and achieve greater value for health care spending: reduce the burden of preventable disease; make health care delivery more efficient; reduce nonclinical health system costs that do not contribute to patient care; and promote value-based decision-making at all levels. The AMA’s approach to gaining better control of health care costs is to ensure that we get the best value for our health care dollar.