Health Plan Weekly: Report: Employer Sponsored Insurance Strained by Pandemic

A Sept. 9 report by the non-partisan health care policy group United States of Care highlights the challenges posed to the government, private firms and health plan members by the country’s reliance on employer-sponsored insurance — and points out that COVID-19 has made existing problems worse.

However, while the report identifies some public policy limitations of the employer-sponsored health system, it stops short of advocating for universal health coverage.

The report’s author, United States of Care Director of Policy, Federal Affairs and Partnerships Andrew Schwab, tells AIS Health that reticence is an intentional choice. Schwab says the organization wants to initiate a depoliticized conversation about health care reform by focusing on stakeholder engagement.

“This report is intended to begin a conversation,” Schwab says. “That conversation centers on the fragility of the job-connected health insurance system. U.S. of Care would like to begin a conversation with all stakeholders in this paradigm — with regular people, with employers large and small, with policymakers, and the larger business community that provides these health benefits for their employees…Our goal is to try to find consensus on the big health care problems facing our country. This report is aimed at raising the big questions that I think are lost in the larger health policy debate.”

Schwab says that posture has helped United States of Care bring in stakeholders from both political parties. The organization’s board includes prominent Democrats like former CMS Acting Administrator Andy Slavitt, former Kentucky Gov. Steve Beshear and former Deputy White House Chief of Staff Kristie Canegallo; the board’s Republicans include former Vermont Gov. Jim Douglas and former Senate Majority Leader Bill Frist, M.D., of Tennessee.

In the report, Schwab notes that tax write-offs of employer insurance are the largest type of tax expenditure in the federal budget— and the total cost of that expenditure has grown rapaciously. The report adds that employers and payers have struggled to keep up with the rising cost of care and passed that cost onto plan members in the form of high deductibles and rising premiums. Schwab also emphasizes the potentially devastating costs of medical debt for working- and middle-class families.

In addition, the paper features case studies of employers that have managed health care costs through aggressive negotiations with providers, including Boeing, Wal-Mart and the state of Montana. And the report advocates for price transparency — Schwab tells AIS Health that the Trump administration’s proposed transparency rules (see story, p. 1) are “a step in the right direction” — along with an increased emphasis on and investment in primary care and preventive medicine.

Contact Andrew Schwab