Will The Plan Gain Bipartisan Support?
Handing out billions of taxpayer dollars would create an incentive for individuals and employers to drop their current coverage and enroll in ObamaCare.
by Merrill Matthews – 11/25/25
Republicans succeeded in quashing Democrats’ efforts to reauthorize the Affordable Care Act’s enhanced subsides — at least so far. Now it’s time for Republicans to put forward their own health care reforms that will increase access to a wide variety of affordable health insurance plans. And that appears to be their goal.
For his part, President Trump now says he supports “SENDING THE MONEY DIRECTLY BACK TO THE PEOPLE, WITH NOTHING GOING TO THE BIG, FAT, RICH INSURANCE COMPANIES.” (Emphasis in original.) Details are thin, as usual, so it’s not clear what he means.
But there are some good health care reform options. Here are three of them.
Large HSAs — Health Savings Accounts (HSAs) have been around since 1996, though they were originally called Medical Savings Accounts. There were more than 37 million HSAs at the end of 2023, covering about 61 million Americans. And reforms in Republicans’ One Big Beautiful Bill will make HSAs available to an estimated 7 million more people. But account owners must combine them with a qualified high-deductible health insurance plan and face other restrictions. That needs to change.
Under what’s known as “large HSAs” — a concept developed by Michael Cannon of the Cato Institute — employers would be allowed to deposit the tax-free money they’re spending on health insurance for each employee in a large HSA. Individuals without access to employer coverage could make their own tax-free contributions to a large HSA.
Individuals should be allowed to spend their HSA funds to (1) buy into their employer’s health plan, if available; (2) buy any type of health insurance they choose; (3) spend the money directly on medical care; or (4) some combination of those options.
Unspent HSA funds grow tax free and belong to the individual, even when they change jobs — unlike health reimbursement arrangements and flexible spending accounts. Those provisions give people an economic incentive to become value-conscious consumers in the health care marketplace, which is not the case in the current system.
Trump wants to give individuals their ObamaCare subsidies, which currently go to health insurers. But that’s taxpayer money, rather than an employer’s or individual’s own money. Handing out billions of taxpayer dollars would create an incentive for individuals and employers to drop their current coverage and enroll in ObamaCare.
Supporters say recipients would be better health care consumers, saving the system money. But given the concern about widespread waste and fraud in Medicare, Medicaid, welfare programs, and even ObamaCare, why make ObamaCare a bigger target for scammers? Better to give people affordable health insurance options instead of using taxpayer dollars to make insurance appear “affordable.”
Health insurance deregulation — For large HSAs to work, individuals will need access to a wide range of health insurance options: comprehensive coverage, high-deductible plans, short-term plans, limited-benefit plans, sharing plans, and others. But ObamaCare largely outlawed most types of health insurance. Remember, President Obama’s “If you like your health plan, you can keep your health plan” won him Politifact’s 2013 Lie of the Year.
Republicans will need to repeal ObamaCare insurance restrictions, allowing insurers to underwrite policies in the individual health insurance market. But that doesn’t mean no regulations. For decades states were the primary regulators of health insurance. They would regain that role.
Democrats will say that the public can’t be trusted to choose their own health insurance plans. But people choose their auto, life and homeowners’ insurance without federal oversight. Consumers will have a learning curve, but health insurers will have an economic incentive to develop plans that people can understand and afford.
ObamaCare becomes a high-risk pool — Republicans don’t have to repeal ObamaCare, just let it morph into a high-risk pool, which will likely happen anyway.
ObamaCare requires insurers selling to individuals — there are different rules for employer coverage — to accept anyone regardless of their medical condition, which is driving up the cost of ObamaCare premiums. Without the enhanced subsidies, people will drop out.
If health insurers are allowed to underwrite individual policies again, millions of people will have better, more-affordable options than ObamaCare. But some people will likely be refused coverage or charged a much higher premium. In that case, they can go to ObamaCare with its original subsidies.
ObamaCare would likely become the national safety net for uninsured people with a major medical condition who are looking for coverage. Prior to the passage of ObamaCare, some 35 states had high-risk pools, but those shut down. ObamaCare would essentially become a federal high-risk pool.
Empowering patients, rather than insurers or the government, has been the missing ingredient in creating a competitive, innovative and affordable health care market. If members of Congress want health care providers and insurers to compete on quality and price to attract consumers, these three reforms would go a long way in reaching that goal.
SOURCE: Republicans aim for affordable health insurance reforms
