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The Affordability Model

Capital_2Most health care experts agree the reason our system is so
unaffordable is because of all of the waste  and unnecessary care—up to
30% of what we spend.I will suggest that it will take the
genius of individual creativity to separate the 70% of this health care
system that is the best in the world from the 30% that is waste.So
far, the Congress has focused more on entitlement expansion then
fundamentally reforming the system and tackling the real
problem—getting all the excess costs out. The result so far is
expensive health care proposals and no real reform.How can we actually make the health care system affordable as we expand coverage? I will suggest a three-pronged attack:

  1. Launching a number of hopeful initiatives already outlined by the President that would improve the delivery system.
    These include health information technology, comparative effectiveness
    research, wellness, and prevention. These have promise but there is no
    guarantee they will work without unambiguous changes in incentives so
    those who provide care will begin to effectively use them.
  2. Changing
    the incentives for private sector consumers by adopting many of the
    financing proposals in the Wyden-Bennett Healthy Americans Act
    — which has already been scored by the CBO to broaden private sector coverage for no additional cost.
  3. Adopt what I call the Health Care Affordability Model to do what we should really be doing—making our health care system affordable.

I
will suggest that it is not enough to simply pay for the expansion of
the American health care system and end up deficit neutral. At 17% of
GDP already and with 30% of the system being wasteful we should set a
goal to actually reduce costs from what they would have otherwise been.

The Wyden-Bennett proposals take us to a place where we can expand coverage for no additional cost. The Affordability Model gives the Obama cost containment policies teeth so we can actually make our system more affordable.

The Affordability Model
creates an unavoidable imperative for health plans, health care
providers, and consumers to finally cooperate in ridding the waste and
avoidable care from our currently unaffordable health care system.

For
seventy years, we have used the federal tax system to encourage the
expansion of health insurance benefits. But now it only encourages more
spending at a time when health care is becoming even more unaffordable.

We
already know a great deal about where the waste is in our
system—wasteful treatments and procedures, poor quality, avoidable
sickness, and administrative costs.

We have the tools—or can create tools—to effectively manage the system.

But we haven’t done it quickly or effectively enough.

We
haven’t done it because we haven’t had to—as out-of-control as the
system is most of the stakeholders have continued to profit from the
status quo.

There would not be any global budgets. The
Affordability Model would use the tax system to fashion unavoidable
incentives to control costs and improve its quality—no stakeholder
would any longer profit from the status quo.

The Affordability Model
would continue to allow employers to self-insure their health plans. It
would not place any limits on insurance or provider prices. It would
not interfere in the delivery of care.

The Affordability Model
reflects a belief that quality health care decisions need to be made on
a patient-by-patient basis, that health care professionals should make
these decisions in collaboration with their patients, and that payers
and providers cooperating toward the same objectives can produce
meaningful results.

Under the Affordability Model,
health plan networks would have clear-cut incentives to first begin to
stabilize and then control their premiums. Failure to do so would mean
the loss of their federal tax qualification and that would mean
employers and consumers would move their business to health plan
networks of insurers and providers that achieved results.

Consumers
and employer sponsors would not be penalized. They would simply move
away from inefficient and ineffective health plan networks.

If
at any time all residents in a state did not have access to a tax
qualified plan, the Secretary of HHS would be directed to introduce a
public Medicare-like health plan in that state to compete with all
private plans—qualified and non-qualified.

The Affordability Model
would create an unambiguous reason for each of the stakeholders to
finally work together to get America’s health care system under
control. No stakeholder would want to see their network lose its tax
preferences:

  • The health plan would be placed at a substantial competitive disadvantage.
  • If
    doctors, hospitals, and other providers were not in a tax qualified
    health care network they would lose patients to networks that did
    control costs.
  • Employers and consumers would almost certainly purchase their health benefits only from qualified plans.

The
result would be consumers and employers moving to health plans that
succeeded in giving Americans better quality care at an affordable
cost—and bringing the American health care system with them.

If you liked this post, try reading, Why Congress Should Consider Bob Laszewski's Health Care Affordability Model and Fantasy League Baseball — Beltway Series Edition

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28 replies »

  1. BTW I am sick and tired of hearing about the car insurance model as posted by Steven. It’s a bad comparison … you can always chose to not drive. People in cities often don’t own cars.

  2. This is all very interesting but please explain something to me. At a very basic level, how is this affordability credit actually supposed to work? It is easy to say that credits will make the premiums more affordable but I really don’t understand how that will work in practice.
    Most tax credits work by spending the money first and then getting the credit later. Often working people can accelerate the receipt of this benefit by offsetting their monthly tax payments accordingly.
    However, most people in the lower part of the subsidized income category simply do not have the cash to pay the up front premiums required in the first place … and in the case of low income homeowners (widows, unemployed, etc.)their monthly taxes are likely to be so low that there isn’t that much tax if any for the the credit to offset.
    For these unfortunate people, is there going to be some other mechanism at work like a voucher to pay the subsidized portion when the premium is due? If not, the tax credit really is moot! Tax credit or no tax credit … buying health insurance will still be impossible for those that need the affordability assistance most.

  3. The most essential part of the Health Plan is it’s rechability and affordability.
    The most next thuing that comes in the way of application of it is How the govt. machinery implements it it so that it can reach to the grass-root needs, the second is the entire system should not be based on the PERCOLATIVE WAY od RECHABILITY of THE AID bu it shoud reach to them as it is their RIGHT TO HAVE
    Here the Efficient ROLE of Govt machenery is tested to have flawless implementation of the GOVT POLICY….
    uday chhatre

  4. Health care in the US is controlled by big business profiteers only interested in making lots of money for their bottom lines and to hell with stupid US consumers.
    HBOs, insurance companies and all those in shiny office buildings who don’t actually treat patients or provide medicines should be eliminated – or at least taxed at 90% to pay for universal health care for all citizens.

  5. Margalit,
    It sounds like you where on the right path, maybe you got hung up on the risk factor of it. In very few cases do we see the premium savings being significant enough to cover 100% of the increased liability. This is because employees will not incur 100% of that liability, carriers charge premium for the expected claims then a healthy margin.
    This is where we break prospects into two groups. I personally have an HSA but use it as an investment not as a method to finance healthcare. In the past I had it invested in mutual funds and am in the process of moving my HSA funds into a self directed account to buy real estate. Generally speaking I don’t like HSAs for anything more then investment vehicles.
    Make sure none of your employees are reading this.
    I like HRAs because you the employer retain the money. With an HSA once you make the contribution it is the property of your employee. With the HRA you own it until the employee actually spends it. If an employee terminates; you can retain the funds in their account if you like. It’s not as attractive to employees but they are lucky we give them a paycheck in the first place.
    Lets say you have 20 employees. 4 of them will account for 70-80% of your claims on average. The rest will have no claims or not even meet a normal deductible.
    I have a client that gives their employees a $0 deductible that just renewed in May. They have 18 employees. Their carrier premium for a $0 deductible plan this year is $29,296 per month or $351,563 per year. Their $5000 deductible carrier premium is $9,998.84 per month or $119,986.08 per year. They save $231,577.44 in premium. Last year savings where about the same, we paid $58,166.50 in claims for them, their net savings where $173,410.94. This year to date we have paid $5,043.86.
    They need to be prepared for bad years but over a 5 years period you will usually only have one of those bad years.
    When you send over your actual rates we can project for you what you would have in claims. Going from $0 to a higher one though should save the company a fortune!
    PS Anyone that thinks I am a shill for the insurance companies do you really think they appreciate be whacking 60%+ of their income? They hate us and what we do, in competitive markets though as long as one carrier sells these policies the rest have to or they will lose most of their business.

  6. Deron, what you are describing is exactly what we wanted to do. However, the numbers just didn’t add up. The savings in premium between the high deductibles and the zero deductible were not substantial enough to cover the deductible.
    I am going to get the exact numbers on Monday and email them to Nate. Our goal was to cover all expenses for all employees at all times. With the exception of copays, that’s what this plan does and it is only slightly more expensive than the high deductible. I thought we made a good and economical decision, but I’ll defer to Nate on this one.

  7. Margalit – If your company isn’t going to go bankrupt by paying for a $0 deductible plan, then your employees shouldn’t need to go bankrupt if you opt for a $6000 deductible, because you should be able to use the premium savings to fund HSA accounts for them. The savings might not cover the full deductible, but it should really knock it down to size if the plans were priced properly. Employees could make up the difference by putting $10-$20 in the account each week. It works well for us.

  8. Lumenos is both individual and group. We use their 5K HSA for a large number of our clients. We then self fund back down to a normal deductible. Most of our clients are groups with old or sick people that came to use because they had to save money and needed new options.
    All group covers maternity so that isn’t an issue for what we do. I strongly advocate for continuing the employer distribution of insurance, we should do everything we can to eliminate the need for individual insurance, either through group coverage or pools.
    What competition? Right before UHC bought SHL/HPN they bought PacifiCare. We have no competition here. Pricing is fair compared to the couple other choices we have, Anthem, Alden, Humana, etc but non of them are doing employers any favors. Sierra didn’t even have HSA products before they where bought. It’s nearly impossible to get high deductible plans to self fund under here. That being said they are like Kaiser, if you follow the rules people love them, if you don’t like being managed you hate them. With 60-70% market share they make the rules. They do a decent job and provide decent care. Seen worse and seen better. Use to be fun to work with back in the day, we did some cool municipal trust and association plans with them. Don’t think they really do stuff outside the margins any more.
    Margalit, would you be open to sharing the rates and plan names? I’m willing to bet you could have got the exact same coverage and risk far cheaper with the high deductible. Never ever ever is a zero deductible plan a good idea, unless you’re the insurance broker selling it. Just tell me the rates and name for the plan you bought and for the 5K/10K HSA plan anthem quotes. If you act now I’ll show you how to give your employees a $0 deductible and save money, and you don’t even have to pay me. How many employees do you have?
    One of my blocks of business is small employers 10-50 employees who buy the high deductible then self fund back down to the low deductible. If everyone is young and no one is really sick why are you paying your carrier all that extra premium? My clients take that premium they save and if someone does have a claim they pay it directly. They cut their insurance premium 30-50% and their overall cost 10-20%. Just think about the added bonus you could give employees with 10-20% savings.
    For all the fighting I really though we at THCB where a family, then both you and Matt go and overpay for insurance. To think you rather blow thousands or tens of thousands of dollars before you ask my advise brings a tear to my eye:( Hope you and Matt are happy with yourselves!
    nate at obatpa dot com I can email you how it works if you prefer. We have been doing it for 20+ years and have 50-60 clients doing it now. As long as your not in CA your just throwing money away with a zero deductible.

  9. Nate, here is why:
    Just recently I was involved in picking new insurance for our company and it was nauseating. We looked at Anthem and UHC. First we looked at mostly high deductible plans. It took hours on top of hours to figure out what is covered, when it kicks in and when you get kicked out. A $6000 deductible for a family of four for example would have easily bankrupted some of our folks, if they got sick. $50 copays have the potential to add up like crazy if you are really sick. Life time maximum of 1MM or 2MM are not exactly what you want if disaster strikes.
    On the other hand, if you are very healthy, anything the company funds, is free money, if you ignore the fact that you’re probably not going to get a good raise/bonus because the company had to fund some of your deductible (nothing is really free).
    At the end, we went with a traditional zero deductible plan, with no life time maximum. Most of our folks are young and nobody is really sick, so the premiums were palatable. I feel that the plan we chose will protect people in the unfortunate event of a major change in health status better than the high deductible contraptions that I looked at. Yes, it is costing us a pretty penny, but we couldn’t do anything else in good conscience.
    I’m sure you are going to tell me that this was the wrong decision 🙂 I should have probably asked your opinion before I signed the contracts.

  10. Nate,
    Correct me if I’m wrong, but I think Anthem’s Lumenos product is aimed at healthy young men. As I understand it, it doesn’t cover maternity benefits, and, if it did, Wellpoint would have to charge at least twice as much for it. I also wonder if there is a maximum payout limit on the policy that could be easily breached if one were in a serious accident. It’s a pretty good product for the population that it’s aimed at, assuming the prospective client can pass the underwriting screen. However, it’s misleading to imply that Lumenos and similar products could adequately serve the broader population.
    Separately, since I think you mentioned that you are in Nevada, I wonder if you could comment about Sierra Health Systems regarding market perceptions around quality of care, pricing vs. the competition, and whether anything has changed since they were acquired by UnitedHealth Group.

  11. there is 1 way to fix the majority of the problems, not all of them but most. Health insurance should be just like your car and life insurance. high risk = pay more. if you are out of shape and refuse to exercise you are going to cost the system more, if you smoke you pay more, this will give people an incentive to exercise and take care of themselves. this will bring down costs and make it more afforable, allowing more people to contribute and bringing the costs even lower.

  12. Margalit….why oh why?
    “Or will the plans that offer very high deductible HSA accounts, that do not serve the sick very well,”
    please do explain what the heck you mean. I have been doing this for almost 20 years and for the life of me can’t figure out how an HSA does not serve the sick very well. Unless you OD on maggie I can’t fathom where you would ever get such a silly idea.
    Please tell me you at least sat down and did a comparison before making this comment, you aren’t just repeating what you read somewhere are you?
    Let me give you a little help before you respond, look very closely at maximum OOP and wellness benefits. If you need help finding plans to compare search Anthem Lumenos and you can find benefit sheets for their HSA.

  13. Interesting thought Bob. I think there’s a precedent for this: it sounds soething like the “public education insurance” plan wherein students at underperforming state schools are allowed to transfer out of their “home districts” into better performing districts, and in some cases even to private schools. Of course it is a different mechanism. And of course, it’ll never happen 😉
    t

  14. the real health care solution. tax fat people. the more you weigh the more you pay. your choice. obesity is the bigest problem to our healthcare. if fat people have to pay more taxes, they will have less money to spend on food. half of my family is on disabillity because they are too fat. they cant work anymore, and millions of health problems start with diabetes

  15. I don’t quite understand this Affordability Model. If it is based on the Wyden-Bennett model, then I don’t really see how we prevent the current situation where sick people cannot really get insurance. The entire “community rating” notion will be easily circumvented if insurers are allowed to offer a wide variety of plans. The cheap ones, better tailored for the healthy, will attract the healthy. The ones with low deductibles and comprehensive care will attract the older and sicker folks and those premiums will explode. Cherry picking will be alive and well.
    Unless we require that all insurers provide the same plans at the same premium, regardless of health status, this is not going to work.
    Now to that affordability, I don’t understand how exactly will the plans manage their costs down if indeed treatment decisions are left entirely to the patient and provider.
    Will they be excluding providers that consistently provide more expensive treatments?
    Will they cut reimbursements?
    Is it that elusive cost effectiveness analysis that we are discussing?
    Or will the plans that offer very high deductible HSA accounts, that do not serve the sick very well, be the ones to win the affordability contest, in which case the sicker people will be even worse off than they are today?

  16. Well said John, but I would have targeted texasjoe too. I think it’s quite clear that neither of them took the time to read Bob’s post. Nothing about it strikes me as self-serving or turf protecting. I think it actually addresses the real cost drivers of the system better than anything I’ve heard coming out of Washington.
    Mindless attacks are certainly not furthering reform efforts.

  17. PSA I think you probably should read more of Bob’s work before you call him a “shill” — or anything else for that matter. I’d suggest you start with “The Dumbest Thing I’ve Ever Seen an Insurance Company Do” or another one of his recent posts and work your way back through his collection in the THCB archives. This constant denouncing of people who write things we don’t agree with is giving this whole debate a stupid monty pythonish edge that’s very unfortunate.

  18. PSA says in one sentence what I have been blathering on about for months. For the sake of brevity, I would only add that the “offensive intermeddling” must be replaced by an independent payer who has the trust of care providers, patients and insurers.

  19. This blog implies the author is a shill. Until docs are paid to provide cost effective care and there is stoppage of the offensive intermeddling by the author’s clients, health reform will remain a dream.

  20. How to buy prescription drugs? My doctor prescribed vicodin for a while back, my back hurts, I think it is a great help, but in my country it is difficult to find, it is paramount to have my information on it and found information about findrxonline the medicine, because it provided me.

  21. “The majority of Mr. Laszewski’s time is spent being directly involved in the marketplace as it comes to grips with the health care cost and quality challenge.
    His clients include health insurance companies, casualty insurance companies, HMOs, Blue Cross organizations, hospitals, pharmaceutical companies, and physician groups”
    From ROBERT LASZEWSKI’s web site
    Now we know just how objective this author seems to be.
    What a joke!

  22. A proposal like the “Affordability Model” that threatens to put insurers out of business almost overnight is a total non-starter.
    Aside from its political unacceptability, anyone who has been around health care contract management will be familiar with the unleashing of armies of lawyers and consultants by companies in danger of losing a contract. Imagine this multiplied all across the country—assuming that the target cost control rates are not so generous as to be meaningless (the other risk of this kind of approach).
    And imagine the machinations of insurer marketing and underwriting staffs as they concoct ever more imaginative ways of attracting only good risks and dumping the sick (yes, I know what insurers have promised about eliminating pre-existing condition limits, etc, but the guys seeking to protect their profits—let alone the very existence of their companies—will always be ahead of the regulators).
    So, forget this unworkable kind of stick approach, and think about a carrot model, in which health plans offering lower prices and better value gain more business.

  23. Is it Now or Never for Affordable Healthcare?
    There’s no doubt that affordable healthcare is a hot topic these days. From Washington, D.C. to rural America to every city across the country, Americans need affordable healthcare options. In fact, according to President Obama, healthcare reform could have a major impact on the economy as a whole but only if we act now.
    Congress intends to create a healthcare reform bill to bring to the floor in July. President Obama urges the process on, believing that if it isn’t tackled this year, it won’t get done at all.
    There is a big price tag on healthcare reform, however. Transforming the system could cost as much as $1 trillion dollars! Many Republicans in Congress are fighting hard against any type of reform that includes government programs providing more medical insurance options than they currently do through Medicare and Medicaid..This type of public program could cost the government far more than it will save anyone. There is also discussion going on as to whether healthcare reforms will be paid for through higher taxes or through cutting existing programs.
    On June 17, 2009, Congress met to consider the President’s healthcare reform bill and many are worried that things are moving too fast to make smart decisions. The costs of the proposed program haven’t even been determined and Sen. Michael Enzi (R) of Wyoming wonders how a bill can be discussed and amended without any understanding of the costs “This bill costs too much, covers too few and will force about 10 million people to have to lose their employer-provided coverage.” Enzi believes the current bill will not help the economy but would actually make things worse. “We need a bill that won’t destroy the economy.”
    Instead of looking at a public healthcare program that can wind up costing billions or even trillions of dollars, it makes sense to work with the insurance companies to find affordable healthcare solutions now. By letting states, small businesses and other people groups band together to access lower cost medical insurance to people who aren’t currently eligible for group health insurance, more Americans could find affordable healthcare insurance now instead of waiting for the government to take on healthcare like some other nations have. Government provided healthcare does not encourage the high quality health care that Americans deserve and need.
    Another proposed solution that could save the government money and help more Americans access affordable healthcare of their choice would allow those eligible for Medicare to receive an equivalent benefit they could use toward any private health insurance policy they choose. These types of solutions toward affordable healthcare could save both the government and the citizens save money on their medical insurance without sacrificing quality care and choice. Congress could do well to consider all proposals- and their costs- before rushing into a decision that could wind up costing billions- even trillions- of dollars without giving Americans the best choices in medical insurance available.

  24. Americans believe the most affordable health overage is prevention, according to a poll released by the Trust for America’s Health and the Robert Wood Johnson Foundation. Seventy percent of respondents to the poll support investing in community and nation-wide prevention plans as the best form of affordable healthcare Americans could find. As the debate over healthcare reform continues, more and more people agree that the best possible health care is preventing disease and injury in the first place. Lowering health problems will lead to lower health coverage costs. BesthHealthcareRates.com offers these tips for preventing health problems and keeping affordable health coverage a priority for individuals and families.
    1. Don’t smoke. The most important thing you can do for your health is to stop smoking. It’s also a great way to reduce your medical insurance costs. Although the number of smokers has reduced dramatically over recent years, smoking remains the number one preventable cause of death in the country. Smoking affects virtually every organ in your body, from your lungs to your heart to your circulation. Because smoking constricts your blood vessels, it severely limits the amount of oxygen your body receives, including your brain. Medical professionals agree unequivocally that quitting smoking is the best thing you can do to prevent disease and death. Because of the many health problems smoking causes, medical insurance premiums increase dramatically for smokers. Providing funding to smoking cessation programs is a preventative measure that will help make affordable health coverage possible.
    2. Closely following smoking as a health threat, obesity is a national epidemic in America, making affordable health coverage difficult to provide. Obesity is one of the fastest growing health threats, leading to heart problems, diabetes and a host of other medical problems. Tackling obesity is a two-fold proposition including healthy eating habits and increasing physical activity. Rather than following fad diets or pre-packaged diet programs, funding programs to teach real-life nutritional meal preparation and eating habits can prevent and reverse obesity. Incorporating physical activity into your daily lifestyle is another terrific way to prevent and reduce obesity, which will help lead to affordable health coverage for American families.
    3. Make use of free health screenings and services. Nearly every community has some health screening tools available for very low or no cost. It is especially important for people without medical insurance to take advantage of these resources. You can find free blood pressure screening machines in many pharmacies, grocery stores or even discount department stores. Keeping a regular eye on your blood pressure can help spot developing medical problems early, which can significantly decrease medical expenses and help you maintain affordable health coverage. You can also take advantage of vision and hearing screenings in many communities, as well as diabetes screenings. These tests can all help you detect problems at their earliest possible stages and save your health as well as your money.
    We all need affordable medical insurance, but it is even more important to have good health. The best way to attain and maintain good health is to prevent disease and poor health habits every way we can. By not smoking, eating properly, incorporating regular exercise into our lives and keeping an eye on our health through free screenings, we can make affordable medical insurance a reality for our families.

  25. healthcare reform proposed by the Federal Government may actually eliminate affordable medical insurance from the private sector entirely. While publicly funded healthcare may seem to create affordable medical insurance for more Americans, it may actually create a bigger problem.
    Private medical insurance is not the enemy of affordable healthcare in the US. In fact, if the federal government creates another public healthcare program, it will ultimately raise the costs of private medical insurance to exorbitant levels. While the idea of expanded public healthcare may seem to be the answer to affordable medical insurance, it could be the end of private insurance altogether. Medicare and Medicaid, the two public health programs currently in effect, cost private insurance companies – and by extension, Americans paying premiums for private insurance- $88 billion in 2007, according to the consulting group Milliman, Inc. In fact, the average family of four with private medical insurance saw their premiums increase $1500 because of public programs. In California alone, that represents nearly 10% of every premium dollar paid.
    The problem comes because Medicare and Medicaid pay as much as 15% to 30% less than private insurance companies on every doctor and hospital bill. Because the doctors and hospitals aren’t willing or able to accept this much loss, they push those losses onto private insurance companies, who, in turn, shift the loss to the consumer through higher premiums.
    Private insurance companies must not only cover their costs and earn a profit; they also need to maintain a reserve of cash to pay out claims. If a new public health care program is developed and then pays medical costs at a reduced rate like the current systems do, it means there will be an increase in expense shifted onto private insurance to make up the difference. This increased cost will need to be offset through higher premiums for the people covered under private medical insurance plans. As those who have private insurance become forced to pay increasingly higher premiums, the number of Americans who no longer find private insurance an affordable health coverage option will increase. Those people will then need to turn to the newly formed public healthcare program and will then become part of the increased costs passed on to private insurance by underpaid doctors and hospitals.
    As more unpaid costs from private health insurance continue to be pushed into premium prices and more people become unable to pay those premiums, eventually private health insurance will be completely unable to compete with public programs and will face the inability to stay in business. Affordable healthcare in the private sector will become impossible to find.
    BestHealthCareRates.com can help most Americans find affordable healthcare right now. By comparing various private insurance rates and coverage’s, individuals and families can find the right policy at the right price.

  26. Market-based policies are more cost effective for the government – and therefore the taxpayers- than publicly funded healthcare. According to the Kaiser Commission on Medicaid and the Uninsured, January 2005, if every uninsured individual was covered by a government program such as Medicaid, the cost to the federal and state governments is approximately $2000 each. If, however, low-income and modest-income Americans could purchase their own health insurance by utilizing a $1000 tax credit, the federal government would save 50% of that money. With over 45 million uninsured Americans, that savings would be substantial indeed.
    Market-based insurance would not only be more affordable health coverage, it would also provide consumers with more choice. Because savings come from a tax credit, the option to choose insurance companies, policies and doctors is left to the person who purchases the insurance, not a group of politicians. Health insurance needs vary widely from one individual to the next and having the ability to choose the options that work best for an individual’s circumstances is fundamental to quality health care.
    Several different market-based solutions could help low and modest-income individuals and families find affordable health coverage. Tax credits, tax deductions, health savings accounts and high-risk pools are all market-based options to make affordable medical insurance a reality for uninsured people who are working, but cannot afford medical insurance.
    Tax credits allow people to keep more of their income on a monthly basis in their pay so the can purchase coverage. Because tax credits enable people to make their own choices of providers, plans and doctors, they are considered to be a preferred market-based solution for affordable health coverage. Tax credits enable working people to pay for their own health insurance without having to fall back on Medicare or other government health programs. Because a tax credit would cost only half the amount of Medicare per individual, the burden on all taxpayers is also reduced, saving everyone money.
    Private health insurance can be affordable health coverage for every working American. By working with market-based solutions, health care reform can be a workable solution to the millions of Americans living in fear of a medical crisis because they have no medical insurance.

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