Entrepreneurs’ Coverage: An Alternative Health Policy Reform

This study examines the prospective implications of a national

public policy allowing individuals, families, and smaller groups to

purchase an “entrepreneurs” coverage policy free of the benefit

mandates imposed by state laws.

The study finds that if such

plans were offered to the public, enrollment would be about 8 percent

or 16.8 million individuals—approximately 13.6 now covered by private

policies and, conservatively, about 3.2 million now uninsured who are

ineligible for government programs. At the state level, the projected

entrepreneurs’ policy enrollment would range from a low of 1.6 percent

of those insured privately or uninsured in Idaho, to a high of 11.9

percent in Rhode Island.

“Entrepreneurs’ coverage represents a

sharp departure from the policy proposals dominating the current public

discussion,” said Dr. Zycher. “The economic and political debate over

health care reform as it has evolved in Washington has one clear

characteristic: the absence of serious measures to make health care

coverage less expensive for the country. If a federally chartered

entrepreneurs’ health insurance policy is made available to the public,

free of mandated requirements, there would be real cost savings for the


Entrepreneurs’ coverage could also improve health

care by engendering competition in the market for health insurance,

thus decentralizing decision making and offering patients greater

choice. “This form of coverage could represent an important step toward

restoring health insurance as protection against catastrophic events,

rather than as prepayment for medical services, and improve incentives

to economize on the consumption of medical services,” Dr. Zycher said.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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