AVIK ROY: Trump could revolutionize the private health insurance market.
Enter President Trump and his team at the National Economic Council, led by Larry Kudlow. The council found an elegant way to give employers the opportunity to voluntarily convert their health benefits from a defined benefit into a defined contribution. For example, an employer could fund an HRA for each worker and their family, which they could then use to shop for a plan that best suits their needs.
The administration estimates that as many as 800,000 employers — mostly smaller businesses — will choose this option, expanding health care choices for 11 million workers in the next decade. These employers will benefit from having fiscal certainty over their health expenditures. And workers will benefit from being able to choose their coverage and take it from job to job.
Furthermore, if those estimates are right, the new rule could dramatically expand the market for individually purchased health insurance, encouraging more plans to enter the market and lowering premiums for all participants. The White House estimates that the rule could expand the number of Americans with health insurance coverage by as many as 800,000.
The Trump HRA rule should be seen as the beginning — not the end — of reforms to improve the quality of private health insurance. Congress also needs to repair the individual market for health insurance by reforming Obamacare-era regulations that punish young and healthy people for buying coverage.
Faster, please.