Policy Lab | Healthcare Reform in the US

Phase 1: Preparation

AI agents map the political groups involved, write each group's specific grievances, and group the debate into distinct policy areas.

Constituency	Political Weight
Progressive Democrats	28%
Moderate Democrats	25%
Moderate Republicans	15%
Conservative Republicans	32%

1. The for-profit insurance model is structurally incompatible with universal coverage

Private insurers exist to return profit to shareholders. Their financial incentive is to collect premiums and deny or delay claims. That is not a failure of execution; it is the model working as designed. We spend more than $900 billion a year on insurance administration, including insurer overhead, hospital billing departments, and physician time spent fighting denials. Countries with universal public systems spend a fraction of that. The result is that tens of millions of Americans are either uninsured or underinsured, meaning they have a card in their wallet that doesn't actually protect them from financial ruin when they get sick. We are the only wealthy country that treats healthcare as a commodity to be rationed by ability to pay.

What could fix this: Eliminate private insurance for covered services and replace it with a single public payer that negotiates prices, sets a uniform fee schedule, and covers all residents. Transition displaced insurance workers through a funded retraining program.

2. Drug prices are set by market power, not cost or value

A vial of insulin that costs a few dollars to manufacture sells for over $300 in the United States and under $30 in Canada. This is not because American patients get better insulin. It is because pharmaceutical companies have legal monopoly power through patents, combined with a federal prohibition on Medicare, the nation's largest public insurer, negotiating drug prices. The Inflation Reduction Act of 2022 created limited negotiation authority for a small number of drugs, but the pharmaceutical industry successfully lobbied to cap that list and delayed implementation for years. Meanwhile, people ration insulin, skip doses, and die. The research and development costs that companies cite to justify high prices are routinely dwarfed by their marketing budgets and share buybacks.

What could fix this: Give the federal government broad statutory authority to negotiate prices for all drugs covered by public programs, and set an upper reference price tied to what peer countries pay. Allow importation from licensed pharmacies in countries with equivalent safety standards.

3. Medical debt is the leading cause of personal bankruptcy in the wealthiest country on earth

Roughly 100 million Americans carry some medical debt. A significant share of them had health insurance when they incurred it. The problem is not just the uninsured; it is that the insurance people pay for often does not cover what they actually owe. Deductibles of $5,000 or more are now standard in employer-sponsored plans. A single hospitalization can exhaust an entire year's deductible before any insurance kicks in. We have built a system where having a serious illness is a financial catastrophe even if you play by the rules and maintain continuous coverage. Medical debt destroys credit, forces home sales, deters people from seeking care, and falls disproportionately on Black and Latino households.

What could fix this: Cap annual out-of-pocket costs at a genuinely affordable level tied to income, not a flat dollar threshold that is affordable for high earners and devastating for everyone else. Prohibit hospitals from reporting medical debt to credit bureaus and require nonprofit hospitals to provide charity care commensurate with their tax exemptions.

4. Employer-tied insurance traps workers and distorts the labor market

Our employer-sponsored insurance system is a historical accident born from World War II wage controls. It has never made logical sense as a healthcare policy, and it actively harms workers. People stay in jobs they hate, decline to start businesses, and avoid leaving abusive situations because they cannot afford to lose coverage. When you lose your job, you lose your insurance at exactly the moment you can least afford it. The Consolidated Omnibus Budget Reconciliation Act of 1985, or COBRA, lets you keep your former employer's plan, but at full unsubsidized cost, which routinely runs $700 a month for an individual and over $1,800 for a family. We have structured our healthcare system around the relationship between corporations and their employees, which means anyone outside that relationship, the self-employed, gig workers, caregivers, the recently laid off, gets a worse deal or no deal at all.

What could fix this: Decouple insurance from employment entirely by moving to a universal system financed through progressive taxation. In the interim, remove the tax exclusion for employer-sponsored insurance and redirect those subsidies toward individual coverage that travels with the worker.

5. Mental health and substance use care are systematically undertreated and underfunded

The Mental Health Parity and Addiction Equity Act of 2008 requires that insurers cover mental health services at the same level as physical health services. In practice, insurers evade this through narrow networks, prior authorization requirements, lower reimbursement rates that drive therapists out of network, and arbitrary limits on session counts. The result is that the mental health system has effectively collapsed. There are not enough psychiatrists, and the ones who exist mostly do not take insurance because the reimbursement is too low and the paperwork too burdensome. People in crisis end up in emergency departments, jails, or on the street. We are in the middle of a suicide epidemic and an overdose crisis that kills 100,000 people a year, and our response is to maintain a system where getting a therapist appointment takes months and costs $200 a session out of pocket.

What could fix this: Mandate genuine parity enforcement with real penalties for insurer noncompliance, including suspension of operating authority. Increase Medicaid reimbursement rates for behavioral health to parity with primary care rates to rebuild the provider network.

6. Medicaid is inadequate and deliberately kept that way

Medicaid, the joint federal-state health program for low-income Americans, covers over 80 million people and is the single largest payer in the system. But it is designed with income cliffs that trap people in poverty, reimbursement rates so low that many providers won't see Medicaid patients, and administrative hurdles including work requirements in some states that strip coverage from people who cannot document their hours precisely enough. Twelve states still have not expanded Medicaid under the Affordable Care Act of 2010, leaving millions of adults in a coverage gap where they earn too much for pre-expansion Medicaid but too little for marketplace subsidies. The people caught in that gap are disproportionately Black, rural, and Southern. This is not an accident; it is a policy choice by state governments that have decided the people who need healthcare the least deserve it.

What could fix this: Make Medicaid expansion a federal floor rather than a state option, eliminating the coverage gap. Raise Medicaid reimbursement rates to Medicare rates and eliminate work requirements, which research consistently shows do not increase employment and do remove coverage from people who need it.

7. The hospital and provider consolidation wave is driving up prices with no quality benefit

Over the past two decades, hospital systems have merged aggressively, and physician practices have been acquired by hospitals and private equity firms at an accelerating rate. When a hospital system acquires a physician group, prices for the same services routinely rise 20 to 40 percent with no measurable improvement in outcomes. This consolidation is legal because antitrust enforcement in healthcare has been weak and underfunded. The Federal Trade Commission blocked some mergers, but most went through. The result is that in much of the country, especially rural areas, there is effectively one hospital system, one insurer, and prices are set by whoever has more market power. Patients have no ability to negotiate or choose. They go to the emergency room that exists.

What could fix this: Strengthen antitrust enforcement in healthcare with a presumption against hospital mergers in already-concentrated markets. Require price transparency that is actually machine-readable and comparable, and set site-neutral payment rates so hospital-owned clinics cannot charge facility fees for outpatient visits.

8. Reproductive and gender-affirming care bans are healthcare denials

Since the Dobbs v. Jackson Women's Health Organization decision in 2022, abortion has been banned or severely restricted in over a dozen states, and providers in those states are legally exposed for providing standard obstetric care. OB-GYNs are declining to practice in states with ambiguous exceptions because they cannot get clear legal guidance on when treatment is permissible. Women are being turned away from emergency rooms in septic shock because physicians fear prosecution. Miscarriage management and ectopic pregnancy treatment, both of which are medically necessary and have nothing to do with elective abortion, are being delayed or denied. Separately, gender-affirming care bans in many states are denying medically indicated treatment to transgender youth and adults, including care that every major medical association endorses as evidence-based. Healthcare access is being determined by state legislatures, not by patients and their doctors.

What could fix this: Federal statute establishing abortion access and gender-affirming care as protected healthcare rights that cannot be restricted by state law, paired with Medicaid coverage for both without the Hyde Amendment restrictions that currently prohibit federal funding for abortion.

9. Rural and low-income communities face a provider shortage that insurance status cannot fix

Insurance coverage is necessary but not sufficient if there are no providers within a reasonable distance. Rural hospital closures have accelerated, and the communities that lose their hospital often lose their only emergency department, their only obstetrics unit, and their only primary care access point. Primary care physicians earn dramatically less than specialists, so medical school graduates burdened with $200,000 or more in debt rationally choose higher-paying specialties. The result is that primary care, which is the foundation of a functional health system, is chronically underfunded and understaffed. Low-income urban communities face the same shortage. Insurance coverage does not help you if the nearest in-network provider is an hour away or has a six-month waitlist.

What could fix this: Substantially expand the National Health Service Corps and increase loan forgiveness amounts to make primary care competitive with specialty pay. Require Certificate of Need review before closing rural hospitals, and fund Federally Qualified Health Centers at levels that allow them to serve as genuine substitutes for primary care in underserved areas.

10. The system creates perverse incentives that reward volume over outcomes

Fee-for-service payment, where providers are paid for each procedure, test, or visit, rewards doing more, not doing better. A surgeon who performs an unnecessary procedure is paid more than one who counsels watchful waiting. A hospital that prevents a readmission by investing in discharge support receives no credit for that in a fee-for-service world. We have built a payment system that structurally incentivizes overtreatment of the insured and undertreatment of the poor, and there is no systematic mechanism for measuring whether the care delivered actually improves health. Value-based care models exist but remain niche and are rarely mandatory. Meanwhile, preventive care remains underfunded because it produces savings over years and decades, while quarterly earnings are reported now.

What could fix this: Move Medicare and Medicaid to prospective global budgets for defined populations, eliminating the per-procedure incentive structure. Require quality metrics including readmission rates, preventable hospitalizations, and patient-reported outcomes as conditions for full reimbursement, with independent measurement rather than self-reporting.

1. Premiums and deductibles keep rising even under the Affordable Care Act

We supported the Affordable Care Act (ACA) when it passed, and we still think it was the right move. But we did not sign up for a system where the average family deductible on a silver plan is now over $4,000 before insurance covers anything meaningful. People buy coverage, feel responsible, and then skip a procedure or avoid a specialist because they cannot afford the out-of-pocket cost. That is not insurance. That is a financial product that protects you from catastrophe while leaving you to absorb everything short of it.

The problem is structural. The ACA set floors on coverage but did not cap how much cost-sharing insurers could shift onto enrollees. Insurers responded exactly as you would expect: they met the letter of the law and pushed deductibles as high as they could. We are not naive about why this happened, but the result is that tens of millions of people with technically "full coverage" are one unexpected diagnosis away from medical debt.

What could fix this: Statutory caps on annual deductibles and out-of-pocket maximums for all plans sold on ACA marketplaces, scaled to income, with enhanced subsidies to prevent premiums from rising to compensate. Require actuarial review before any plan's cost-sharing parameters are raised year over year.

2. Drug prices are indefensible and the market will not fix them

There is no free-market explanation for why the United States pays two to four times what Germany or Canada pays for the same drug, manufactured by the same company. Insulin, which has been generic chemistry for a century, cost some patients over $300 a vial until political pressure finally forced cap arrangements. That should have never required political pressure. The pharmaceutical industry's pricing power is a policy choice, not a market outcome. Congress chose to prohibit Medicare, which covers roughly 65 million people, from negotiating drug prices directly. That prohibition existed for 20 years. We spent two decades subsidizing pharmaceutical profits with public money.

The Inflation Reduction Act (IRA) cracked the door open, allowing Medicare to negotiate a small number of drugs. It is a start. But negotiation rights cover only a handful of medicines per year, apply only to Medicare, and exempt newly launched drugs for a decade or more. The people paying the highest prices right now are not protected.

What could fix this: Expand Medicare negotiation authority to cover all drugs, including new launches after a reasonable exclusivity period. Require manufacturers to justify price increases above inflation. Extend any negotiated price to the commercial market through a most-favored-nation rule.

3. Coverage is tied to employment, which makes no sense

The United States is the only high-income country that routes health coverage primarily through employers. This was an accident of World War II wage controls. Sixty years later, we have built an entire system around it, and it punishes everyone who does not fit the mold: freelancers, part-time workers, people who left a job to care for a family member, people who got laid off during a recession, people who want to start a business but cannot afford individual market premiums.

We are not calling for eliminating employer-sponsored insurance (ESI). Most people on employer plans are reasonably satisfied and we are not going to blow that up. But the current arrangement means that getting sick at the wrong moment, or making a career change, can cost you your coverage. That is a design flaw, not a feature.

What could fix this: Make ACA marketplace plans a genuine competitive alternative to ESI by removing the affordability rule that blocks employees from accessing marketplace subsidies when their employer offers any plan at all, regardless of how expensive it is. Expand subsidies to make individual market coverage genuinely cost-competitive for mid-income workers who would prefer portability.

4. Insurance companies are denying medically necessary care at industrial scale

Prior authorization was designed to prevent unnecessary procedures. It has become a mechanism for delaying and denying care that doctors have already determined is necessary. The American Medical Association (AMA) has documented that prior authorization causes treatment abandonment, serious patient harm, and physician burnout. We know doctors who spend more hours a week on insurance paperwork than on direct patient care.

The worst part is that most denials get overturned on appeal. When a denial rate is high and an overturn rate is also high, that tells you the denials were not about medical necessity. They were about attrition: most patients and doctors do not have the bandwidth to fight every denial, so insurers collect the premium and avoid paying the claim. That is not insurance. That is a bet that you will give up.

What could fix this: Mandate same-day or next-business-day prior authorization decisions for urgent care. Require that prior authorization decisions be made by a licensed clinician with relevant specialty training. Create a private right of action so patients can recover damages when a denied-then-overturned authorization caused harm. Publish denial and overturn rates by insurer and plan type.

5. Rural and low-income communities still lack basic access

Expanding coverage through the ACA was the right call. But coverage without accessible providers is not healthcare, it is a card in your wallet. Roughly 30 million people live in primary care shortage areas. Rural hospitals have been closing steadily for years, not because communities do not need them but because the reimbursement structure makes small-volume facilities economically unviable. If you live in a rural county, a Medicaid card or an ACA plan may entitle you to services that do not exist within a two-hour drive.

We have a provider distribution problem that is connected to medical school debt, specialty pay gaps, and the way Medicare and Medicaid reimburse primary versus specialty care. Fixing coverage without fixing supply is incomplete policy.

What could fix this: Substantially increase reimbursement rates for primary care and mental health services under Medicare and Medicaid to attract providers into shortage areas. Expand and fund the National Health Service Corps loan repayment program. Reform rural hospital payment models to move away from volume-based reimbursement toward population-based funding for facilities that serve as sole community providers.

6. Mental health and substance use coverage is still effectively inferior

The Mental Health Parity and Addiction Equity Act (MHPAEA) has been law since 2008. It says insurers cannot apply stricter limits to mental health and substance use disorder benefits than to comparable medical benefits. Insurers have spent 17 years finding ways around it: setting reimbursement rates for psychiatrists so low that most will not take insurance, requiring prior authorization for therapy sessions that they do not require for comparable medical visits, and maintaining narrow networks of mental health providers while calling them parity-compliant.

We are in a behavioral health crisis. Suicide rates, opioid overdose deaths, and youth mental health hospitalizations are all elevated. This is not a funding-only problem. It is also a structural problem in how insurers treat mental health as a cost to minimize rather than a condition to treat.

What could fix this: Require insurers to demonstrate quantitative parity in network adequacy, reimbursement rates, and prior authorization frequency for mental health services. Give federal regulators enforcement authority with teeth, including the ability to levy fines per violation. Establish minimum reimbursement floors for psychiatric services.

7. Medicaid is chronically underfunded and politically fragile

Medicaid covers over 90 million people: children, pregnant women, people with disabilities, low-income adults, and a large share of nursing home residents. It is the backbone of the safety net. And yet it has been on the chopping block in almost every major budget negotiation for the past 15 years. States run their programs with perpetual uncertainty about federal matching rates. Providers accept Medicaid patients at a loss or not at all, because reimbursement rates are often 60 to 70 percent of Medicare rates, which are themselves already below commercial rates.

The result is a two-tier system where Medicaid enrollees technically have coverage but face longer waits, fewer in-network providers, and lower-quality facilities than people with commercial insurance. We expanded access; we did not expand quality. Those are not the same thing.

What could fix this: Increase federal Medicaid matching rates, particularly for primary care, with a floor requirement that state reimbursement must reach a minimum percentage of Medicare rates. Make expanded Medicaid matching rates permanent rather than subject to congressional renewal cycles. Remove the gap in states that have not expanded Medicaid by offering 100 percent federal funding as an inducement.

8. Hospital and provider consolidation is destroying competition and driving up prices

The healthcare market has been consolidating for two decades. In most metro areas, two or three hospital systems control the majority of inpatient beds. When a health system acquires a physician practice, prices for those services go up, often by 14 to 20 percent, with no improvement in quality or outcomes. Insurers have limited ability to resist because patients need in-network access to local hospitals, and there is often only one dominant system to negotiate with.

This is a competition problem with a market-power solution on the provider side, and it is one that both antitrust law and insurance regulation have failed to address. The Federal Trade Commission (FTC) has blocked some mergers, but most consolidation has happened below the federal radar, through small acquisitions and physician employment that individually look benign and collectively produce monopoly pricing.

What could fix this: Strengthen merger review standards for hospital and health system acquisitions, including retrospective review of past mergers that created anticompetitive market positions. Require hospitals with dominant market share to offer community-rate pricing for uninsured patients and Medicaid enrollees. Limit surprise billing and facility fees that flow from consolidation-driven pricing power.

9. The uninsured rate is still too high and the coverage gap is a policy failure

The ACA reduced the uninsured rate substantially. It did not close the gap. Roughly 25 to 30 million Americans remain uninsured. Many of them fall into a specific trap: they earn too much for Medicaid in non-expansion states, but too little to afford marketplace premiums even with subsidies. A significant share are undocumented immigrants who are excluded from both programs entirely, receive emergency care that the system absorbs at elevated cost, and often forgo early intervention that would prevent more expensive treatment later.

We are not going to solve every coverage question in one bill. But the people caught in the coverage gap are not an edge case. They are a predictable consequence of designing the ACA to work alongside a Medicaid patchwork that states can opt out of. Twelve states still have not expanded Medicaid. The coverage gap in those states is a political choice, not an economic inevitability.

What could fix this: Establish a federal fallback option for residents of non-expansion states that provides Medicaid-equivalent coverage with full federal funding. Make enhanced marketplace subsidies from the IRA permanent. Create a pathway to marketplace coverage with scaled subsidies for uninsured immigrants who are long-term residents and taxpayers.

10. Healthcare administrative costs are wasting hundreds of billions of dollars annually

The United States spends roughly twice what peer nations spend on healthcare administration as a share of gross domestic product (GDP). Billing complexity alone, driven by thousands of distinct insurance products with different networks, coverage rules, and coding requirements, costs hospitals and physician practices an estimated $250 to $350 billion per year. That money does not buy better care. It pays for billing departments, coding consultants, prior authorization staff, and insurance company claim-processing infrastructure.

We are not arguing for eliminating private insurance. But the administrative overhead from running a fragmented multi-payer system with no standardization is a real cost that shows up in premiums and out-of-pocket spending. Simplifying the billing and coding infrastructure would free up resources without eliminating choice.

What could fix this: Mandate a standardized claims processing format and a universal credentialing system for providers across all payers, public and private. Require all insurers operating in the US market to use common administrative platforms for claims submission and prior authorization. Establish a federal administrative simplification office with authority to enforce standards and measure compliance.

1. Hospital and Insurer Consolidation Has Destroyed Real Competition

We have watched the healthcare market consolidate for two decades while Washington did almost nothing. Today, a handful of massive hospital systems and three or four dominant insurers control most of the market in most regions. When a hospital system buys up the independent physician practices in a community, prices go up and patients have no real alternative. When two insurers merge, employers and workers lose negotiating leverage. This is not a functioning market. It is a cartel dressed up as one. The Federal Trade Commission (FTC) and the Department of Justice (DOJ) have the authority to block these mergers and have largely failed to use it aggressively enough. Meanwhile, antitrust law written before the internet age is being interpreted so narrowly that hospital chains can swallow entire regional healthcare ecosystems without consequence.

What could fix this: Strengthen FTC and DOJ authority to block vertical and horizontal healthcare mergers, lower the market share threshold that triggers mandatory review, and require divestiture in markets where consolidation has already produced documented price increases above a defined benchmark.

2. Price Transparency Rules Exist on Paper but Not in Practice

The previous administration mandated price transparency for hospitals and insurers. That was the right call. But compliance has been a joke. Hospitals post machine-readable files that are deliberately unusable. Insurers bury negotiated rates in formats no consumer or small employer can navigate. There is no meaningful enforcement and no penalty structure with teeth. We cannot have a market-based system if prices are hidden. A car dealership cannot refuse to show you a sticker price. A hospital should not be able to hide what it charges a commercial insurer for a knee replacement. The gap between the "chargemaster" rate charged to the uninsured and the negotiated rate paid by insurers is sometimes five to one. Nobody can shop, compare, or make rational decisions in that environment.

What could fix this: Mandate machine-readable price transparency with standardized formats set by a federal body, require that consumer-facing price estimator tools be accurate within a defined margin of error, and impose escalating daily fines on providers and insurers who fail to comply, with a portion of fines directed to fund enforcement.

3. The Tax Code Distortion Ties Coverage to Employment and Locks People In

The employer-sponsored insurance deduction is the largest single healthcare subsidy in the federal budget, well over 300 billion dollars per year, and it mostly benefits workers at large companies with stable employment. If you are self-employed, a small business owner, a gig worker, or someone who leaves a job to start a company, you are at a structural disadvantage. We believe in portability. We believe people should own their own coverage the way they own their car insurance. The current system chains coverage to employment, which depresses labor mobility, disadvantages entrepreneurs, and leaves people in bad jobs because they cannot afford to leave. It also disadvantages small businesses competing for talent against large corporations that can offer generous benefits.

What could fix this: Equalize the tax treatment of individual and employer-sponsored premiums, allowing individuals who purchase their own coverage to deduct premiums at the same rate as employers, and expand Health Savings Account (HSA) contribution limits and eligible uses to make individual coverage more financially viable.

4. Regulatory Barriers to Entry Protect Incumbent Providers from Competition

Certificate of Need (CON) laws in many states require that any new hospital, clinic, or imaging center prove to a state board that the market "needs" it before it can open. Who sits on those boards? Often, representatives of the incumbent hospitals that would face competition. This is government-sanctioned market protection masquerading as consumer protection. Ambulatory surgery centers, urgent care clinics, and telehealth providers have demonstrated that they can deliver many services at dramatically lower cost when they are allowed to operate. Instead of expanding access to these lower-cost alternatives, we build regulatory moats around expensive incumbent institutions. The same dynamic plays out federally with drug approvals, device clearances, and scope-of-practice restrictions that prevent nurse practitioners and physician assistants from practicing to their full training in states that restrict it.

What could fix this: Repeal or preempt state CON laws for outpatient facilities through federal legislation tied to Medicaid and Medicare participation, expand federal scope-of-practice flexibility for federally qualified health centers, and streamline Food and Drug Administration (FDA) approval pathways for generic devices.

5. Small Businesses Bear a Disproportionate Cost Burden with No Leverage

A Fortune 500 company negotiates with insurers from a position of power. A company with twelve employees does not. The small group insurance market is heavily regulated, expensive, and offers limited plan choice. Many small employers have dropped coverage entirely because the cost is simply unworkable. We believe employers should want to provide coverage. But when a family plan premium for a small business costs 25,000 dollars per year with a 6,000 dollar deductible, offering it is charity, not a sustainable business decision. The Affordable Care Act (ACA) small business exchanges largely failed to produce the competition and cost reduction that was promised. Small employers are stuck paying rates that are far above what large employers pay for equivalent coverage, subsidizing a system that was not designed with them in mind.

What could fix this: Allow small employers to band together across state lines through association health plans with appropriate consumer protections, expand qualified small employer health reimbursement arrangements (QSEHRAs) to give employees more flexibility to purchase individual coverage with employer dollars, and create reinsurance mechanisms targeted specifically at the small group market.

6. Medicaid Expansion Has Shifted Costs onto the Privately Insured

Hospitals that treat large Medicaid populations are paid below their cost of care in most states. The shortfall is real and documented. Rather than fixing Medicaid reimbursement rates, hospitals have responded the way any institution responds to a below-cost mandate: they raise prices on the customers who will pay. Commercial insurers are charged more. Employers pay more. Workers pay more. This cost shift is estimated to add thousands of dollars to an average family's annual premium. We are not opposed to covering low-income Americans. But hiding the cost of Medicaid through cross-subsidization from private payers is dishonest policy. It obscures the true fiscal cost of the program, distorts market pricing, and penalizes people who play by the rules and buy their own coverage.

What could fix this: Reform federal Medicaid reimbursement rates to reflect a higher share of actual costs, conditioned on state reforms that increase Medicaid efficiency, and require transparent accounting of cost-shift estimates in federal and state budget documents.

7. Drug Pricing Is Opaque and the Middlemen Are Extracting Value Without Accountability

Pharmacy Benefit Managers (PBMs) sit between drug manufacturers and patients and take a cut of every transaction while negotiating rebates that flow back to insurers, not to patients at the pharmacy counter. A drug with a list price of 300 dollars may cost the PBM 80 dollars after rebates. The patient on a high-deductible plan pays based on list price. The system is designed to be opaque, and the opacity benefits the middlemen. We are not asking for government price controls. We are asking that the economics of drug distribution be visible so that employers, patients, and policymakers can make informed decisions. The consolidation of PBMs into three companies that together manage the vast majority of commercial prescriptions is itself an antitrust problem that has gone unaddressed.

What could fix this: Require PBMs to pass rebates through to patients at the point of sale on a dollar-for-dollar basis, mandate disclosure of net drug prices to plan sponsors, and require the FTC to conduct mandatory market reviews of PBM consolidation every three years with authority to impose structural remedies.

8. The Regulatory Burden on Physicians Has Made Practice Economically Unviable

Independent physician practice is disappearing. It is being absorbed by hospital systems not because hospital systems deliver better care, but because the administrative cost of running an independent practice has become unbearable. Prior authorization requirements from insurers consume dozens of hours of physician time per week. Electronic Health Record (EHR) documentation requirements were designed around billing, not clinical care, and add hours of clerical work to every physician's day. The result is physician burnout, early retirement, and consolidation into large systems where doctors have less autonomy and patients have less continuity of care. We are losing the independent practitioner, who historically provided more cost-efficient, relationship-based care than large institutions.

What could fix this: Establish a federal prior authorization standardization requirement with enforceable response time limits, require interoperable EHR systems to comply with documentation burden reduction standards set by the Centers for Medicare and Medicaid Services (CMS), and create safe harbor liability protections for physicians who use standardized clinical decision support tools to streamline documentation.

9. Liability Risk Drives Defensive Medicine and Inflates Costs Systemlessly

Medical malpractice liability in the United States operates through a patchwork of state tort systems that vary enormously in caps, standards, and jury behavior. The result is that physicians in many specialties practice defensive medicine as a matter of routine: ordering tests, imaging, and referrals not because they believe they are clinically necessary, but because they fear what a plaintiff's attorney will say about the decision not to order them. Estimates of the cost of defensive medicine range from 50 to 200 billion dollars annually. We are not saying patients should not be able to seek redress for genuine malpractice. We are saying the current system's uncertainty produces waste at industrial scale and makes it economically irrational for physicians to practice in high-risk specialties in certain states.

What could fix this: Establish a federal baseline for medical liability with caps on non-economic damages, a safe harbor for care that follows evidence-based clinical guidelines, and health courts staffed by medically trained adjudicators as an alternative to jury trials for complex cases.

10. The Individual Market Remains Too Thin and Too Volatile for Families Who Earn Above Subsidy Thresholds

The ACA individual market was intended to provide a viable option for people who do not have employer coverage. For low-income enrollees who qualify for large subsidies, it functions reasonably well. For a family of four earning 120,000 dollars per year, it is a catastrophe. They earn too much for meaningful subsidies in most states and face premiums of 20,000 to 30,000 dollars annually with deductibles of 8,000 to 14,000 dollars. This is not insurance. It is an expensive commitment to pay almost everything out of pocket until a catastrophic event occurs. These are exactly the families, many of them self-employed or employed by small businesses, who should be the core of a functioning individual market. Instead, they are priced out and either go uninsured or make economically irrational coverage decisions.

What could fix this: Allow catastrophic plan options with HSA compatibility to be available to all ages in the individual market, expand premium tax credit eligibility with a smoother phase-out curve that does not create effective marginal tax rates above 30 percent, and allow cross-state plan sales under a federal minimum benefit floor.

1. The Affordable Care Act Destroyed Individual Choice

Before the Affordable Care Act (ACA), people could buy coverage that matched what they actually needed. A healthy 28-year-old man could get a lean plan. A family that wanted a high deductible and low premium could have one. That market existed, and it worked for millions of people. The ACA eliminated it. Washington decided what "real" insurance looks like, mandated ten "essential health benefits" including pediatric dental and maternity coverage for people who will never need them, and made those stripped-down, affordable plans illegal. Our premiums shot up because we're now subsidizing a product bundle we didn't ask for.

The individual mandate compounded this. The government told us: buy what we tell you to buy, or pay a fine. That is not how a free country is supposed to work. Even after Congress zeroed out the federal penalty, many states reimposed their own version. The core offense remains: the government substituted its judgment for ours about what we should purchase with our own money.

What could fix this: Repeal the essential health benefits mandate, or at minimum allow states to opt out entirely. Restore the ability for insurers to offer bare-bones, low-premium catastrophic plans to any adult who wants them, not just those under 30.

2. You Cannot Buy Insurance Across State Lines

Insurance is regulated at the state level, which means a plan licensed in Texas cannot be sold to someone in Tennessee. This is an artificial government-created barrier, and it destroys competition. If you live in a state with only two or three insurers on the exchange, you have almost no negotiating power. You take what they offer or you go without.

Every industry that has been opened to interstate competition has seen prices fall and quality improve. There is no good reason health insurance should be different. The argument that state-level regulation protects consumers is largely a protection racket for incumbent insurers who have lobbied for the status quo. We pay the price in the form of narrow networks, high premiums, and take-it-or-leave-it plan designs.

What could fix this: Pass federal legislation enabling insurers licensed in one state to sell across state lines. Alternatively, allow individuals to purchase plans certified by any state, giving them access to the full national market regardless of where they live.

3. Medicaid Expansion Created Dependency and Crowded Out Private Coverage

The ACA's Medicaid expansion extended coverage to able-bodied working-age adults, most of whom could have obtained private coverage with a modest subsidy. Instead, we put them on a government program with zero premium, zero skin in the game, and no incentive to ever transition off. Medicaid enrollment has ballooned from around 57 million before the ACA to over 90 million today. That is not a success story. That is a dependency program.

Medicaid crowds out private coverage because people rationally choose the free option. But Medicaid's reimbursement rates are so low that many physicians refuse to accept it, meaning enrollees have a card that does not actually get them access to care. We have expanded coverage on paper while degrading the actual quality of care. And the cost falls on taxpayers, including the small business owners in our communities who are struggling with their own premiums.

What could fix this: Convert Medicaid to a block grant or per-capita allotment to states, with work requirements for able-bodied adults. Allow states to use Medicaid dollars to help low-income people buy private insurance instead of enrolling in the government program.

4. The Employer Mandate Hammers Small Businesses

Under the ACA, businesses with 50 or more full-time equivalent employees must offer health coverage or pay a penalty. The intent was to preserve employer-sponsored insurance. The effect was to penalize growth. We know small business owners who deliberately kept their headcount below 50, hired part-timers instead of full-timers, or structured their businesses to stay under the threshold. That is an economic distortion created entirely by government regulation.

For the businesses that do comply, the administrative cost of tracking hours, navigating the employer shared responsibility rules, and filing the required information returns is substantial. These are not Fortune 500 companies with compliance departments. These are family-owned firms with a bookkeeper and a prayer. The mandate costs real money and produces real compliance burden for businesses that are already competing on thin margins.

What could fix this: Repeal the employer mandate. Detach health insurance from employment entirely by giving individuals the same tax treatment that employers currently get for providing coverage, and let people buy plans in a competitive individual market.

5. The Tax Code Locks People to Their Employer's Plan

Employer-provided health insurance is purchased with pre-tax dollars. Individual health insurance is not, except through an imperfect deduction available only to the self-employed. This means that if you get coverage through your job, the government subsidizes it. If you buy your own, the government does not. The entire system is rigged to keep people tethered to their employer's choice of plan.

This is not a neutral policy. It is a relic of World War II wage controls that we have never fixed. The consequence is that when you lose your job, you lose your insurance. That is not a market outcome; it is a government distortion. People cannot shop for coverage that fits their lives because the tax code makes staying on a bad employer plan cheaper than switching to a better individual one.

What could fix this: Make individual health insurance premiums fully deductible or eligible for pre-tax treatment, on the same terms as employer-sponsored coverage. Alternatively, convert the employer exclusion to a universal credit that follows the individual, not the employer.

6. Price Transparency Is Still a Fiction

In any functional market, buyers know prices before they commit to a purchase. In healthcare, this almost never happens. You go to the hospital, you get a service, and six weeks later you receive an Explanation of Benefits that bears no relationship to what you actually owe. The "chargemaster" rates hospitals publish are fictional; the negotiated rates insurers pay are secret; what you owe as a patient depends on which insurance you have, which you may not fully understand until you get the bill.

The Trump administration issued a price transparency rule requiring hospitals to publish their negotiated rates, which was a step forward. But compliance has been poor, enforcement has been weak, and most patients have no idea this information exists or how to use it. True price transparency would transform the market. It would let patients make real decisions, force providers to compete, and give employers the information they need to negotiate. We are nowhere near that.

What could fix this: Strengthen price transparency enforcement with meaningful penalties for non-compliance. Require that patients be given a good-faith cost estimate before any non-emergency procedure. Expand Health Savings Accounts (HSAs) to make high-deductible, price-sensitive shopping plans more attractive.

7. Government Price Controls Are Strangling Pharmaceutical Innovation

The Inflation Reduction Act (IRA) gave Medicare the power to negotiate drug prices, which sounds reasonable until you understand what it actually does. Pharmaceutical companies spend billions developing drugs, most of which fail. The few that succeed need to recoup those costs across a limited window before generics arrive. When the government forces prices down below what the market would bear, it destroys the economic case for developing the next drug.

The United States is responsible for the majority of new drug development in the world precisely because we have not had hard price controls. Countries that do cap prices free-ride on American innovation. We are now beginning to import their model, and the consequence will be fewer drugs in the pipeline. The rare disease patients, the cancer patients, the people waiting for the next breakthrough treatment will pay that price. This is not abstract. Investment in early-stage drug development has already begun to shift.

What could fix this: Repeal the IRA drug negotiation provisions. Instead, pursue reforms that increase competition: faster FDA (Food and Drug Administration) approval of generics, stronger enforcement against "pay-for-delay" settlements, and reference pricing that allows Medicare to pay what the VA (Veterans Affairs) pays through competitive bidding rather than government-set price ceilings.

8. Bureaucratic and Regulatory Overhead Is Eating the System

Somewhere between 25 and 30 cents of every dollar spent on healthcare in the United States goes to administrative costs: billing departments, prior authorization staff, compliance officers, coding specialists, and the insurance industry's own administrative apparatus. This overhead does not make anyone healthier. It is pure friction, and much of it exists because of government-imposed complexity.

The ACA added hundreds of new requirements. Every mandate, every reporting obligation, every network adequacy rule, every state insurance commissioner's idiosyncratic requirements adds cost that ultimately shows up in premiums. Small physician practices that cannot afford a billing department get absorbed into hospital systems, which then use their market power to charge more. The regulatory environment actively concentrates the market and then complaints about market concentration are used to justify more regulation.

What could fix this: Implement a federal standard for prior authorization timelines and electronic administrative transactions to reduce friction between payers and providers. Roll back duplicative state mandates through federal preemption. Reduce the ACA's reporting requirements on small employers and individual market insurers.

9. Medicare and Medicaid Are on a Path to Fiscal Collapse

Medicare and Medicaid together represent roughly $1.5 trillion in annual federal spending, and both programs are growing faster than the economy. Medicare's Hospital Insurance trust fund has been projected to become insolvent within a decade for years running. Medicaid has no formal trust fund at all; it draws directly from general revenues, competing with everything else the federal government does.

We cannot have an honest conversation about healthcare policy without acknowledging that the current trajectory is unsustainable. Every proposal to expand government health coverage, whether through a public option or "Medicare for All," assumes that the federal government can competently administer and finance a program that is already straining. The people who will pay for the fiscal recklessness we are running now are younger workers who will face either massive tax increases or drastically reduced benefits. Neither outcome is acceptable.

What could fix this: Convert Medicare to premium support so beneficiaries choose among competing private plans, with the government contribution calibrated by income and health status. Introduce means-testing for Medicare benefits. For Medicaid, implement block grants with per-capita growth caps so states have an incentive to control costs rather than maximize federal matching dollars.

10. The Individual Market Is Broken for People Who Don't Qualify for Subsidies

The ACA exchange plans are heavily subsidized for people below 400 percent of the federal poverty level (FPL). Congress temporarily expanded those subsidies even further through the American Rescue Plan Act (ARPA). But for people who earn just above the subsidy cliff, or who are self-employed with variable income, or who simply do not qualify for any subsidy, the individual market is a disaster. Premiums for a family of four in their 40s can exceed $2,000 per month in many markets.

These are not wealthy people. These are small business owners, contractors, farmers, and workers who do not get employer coverage. They are paying full freight for plans that were designed and priced to serve the subsidized majority. They have no good option: pay an amount that crowds out retirement savings and college funds, go without coverage and hope nothing goes wrong, or restructure their finances to qualify for subsidies they morally object to. This constituency includes a lot of our neighbors, and they are furious.

What could fix this: Expand access to short-term, limited-duration insurance plans and association health plans as lower-cost alternatives for those who do not need or want comprehensive ACA-compliant coverage. Expand HSA contribution limits so that self-employed individuals can effectively self-insure for routine care while carrying catastrophic coverage for major events.

Legislative mechanism: A coverage-access bill addressing premium design, subsidy levels, employer tie-in, and benefit standards. Can move independently of drug pricing or antitrust bills, though its fiscal cost depends partly on whether Medicaid fills remaining gaps.

This cluster addresses how insurance is structured, priced, and accessed: whether coverage is tied to employment, whether individual and small-group markets are stable enough to actually use, and whether out-of-pocket costs are tolerable once someone has coverage. The core tension is between mandating richer benefits (which raises premiums) and giving people access to thinner, cheaper plans (which leaves them exposed to catastrophic costs). Constituencies agree the individual market is broken but propose opposite fixes, from eliminating private insurance entirely to deregulating it further. Mental health parity enforcement, medical debt protections, and reproductive care coverage belong here because they are all specifications of what a compliant insurance product must include and pay for.

Progressive Democrats: "The for-profit insurance model is structurally incompatible with universal coverage"
Progressive Democrats: "Employer-tied insurance traps workers and distorts the labor market"
Progressive Democrats: "Medical debt is the leading cause of personal bankruptcy in the wealthiest country on earth"
Progressive Democrats: "Mental health and substance use care are systematically undertreated and underfunded"
Progressive Democrats: "Reproductive and gender-affirming care bans are healthcare denials"
Progressive Democrats: "The system creates perverse incentives that reward volume over outcomes"
Moderate Democrats: "Premiums and deductibles keep rising even under the Affordable Care Act"
Moderate Democrats: "Coverage is tied to employment, which makes no sense"
Moderate Democrats: "Insurance companies are denying medically necessary care at industrial scale"
Moderate Democrats: "Mental health and substance use coverage is still effectively inferior"
Moderate Democrats: "The uninsured rate is still too high and the coverage gap is a policy failure"
Moderate Republicans: "The Tax Code Distortion Ties Coverage to Employment and Locks People In"
Moderate Republicans: "Small Businesses Bear a Disproportionate Cost Burden with No Leverage"
Moderate Republicans: "The Individual Market Remains Too Thin and Too Volatile for Families Who Earn Above Subsidy Thresholds"
Conservative Republicans: "The Affordable Care Act Destroyed Individual Choice"
Conservative Republicans: "You Cannot Buy Insurance Across State Lines"
Conservative Republicans: "The Employer Mandate Hammers Small Businesses"
Conservative Republicans: "The Tax Code Locks People to Their Employer's Plan"
Conservative Republicans: "The Individual Market Is Broken for People Who Don't Qualify for Subsidies"

Legislative mechanism: A drug pricing bill covering federal negotiation authority, price transparency requirements, and pharmacy benefit manager (PBM) regulation. Separable from the insurance market bill and the antitrust bill, though each interacts at the margins with overall premium levels.

This cluster covers how drug prices are set and who captures the spread between manufacturer list price and patient cost. Every constituency agrees drug prices are a problem; they disagree sharply on whether government negotiation is the fix or whether it will suppress innovation. The core tension is between using federal purchasing power to force prices down and relying on generic competition plus middleman reform to let markets work. PBM practices sit here because they are a pricing mechanism, not a market structure question.

Progressive Democrats: "Drug prices are set by market power, not cost or value"
Moderate Democrats: "Drug prices are indefensible and the market will not fix them"
Moderate Republicans: "Drug Pricing Is Opaque and the Middlemen Are Extracting Value Without Accountability"
Conservative Republicans: "Government Price Controls Are Strangling Pharmaceutical Innovation"

Legislative mechanism: A provider competition bill covering antitrust enforcement, price transparency mandates, scope-of-practice preemption, and rural access investments. Can move independently, though some provisions interact with how public programs set rates.

This cluster covers whether patients can actually find and afford a provider, and whether market forces in healthcare delivery work at all. Hospital and insurer consolidation has eliminated competition in most regional markets, driving prices up without quality gains. Rural and low-income communities face a parallel problem: price is not the binding constraint, it is simply the absence of any provider to see. The legislative lever here is a mix of antitrust enforcement, transparency mandates that expose price differences, scope-of-practice reforms that expand the supply of providers, and targeted funding for underserved areas.

Progressive Democrats: "The hospital and provider consolidation wave is driving up prices with no quality benefit"
Progressive Democrats: "Rural and low-income communities face a provider shortage that insurance status cannot fix"
Moderate Democrats: "Rural and low-income communities still lack basic access"
Moderate Democrats: "Hospital and provider consolidation is destroying competition and driving up prices"
Moderate Republicans: "Hospital and Insurer Consolidation Has Destroyed Real Competition"
Moderate Republicans: "Price Transparency Rules Exist on Paper but Not in Practice"
Moderate Republicans: "Regulatory Barriers to Entry Protect Incumbent Providers from Competition"
Conservative Republicans: "Price Transparency Is Still a Fiction"

Legislative mechanism: A public program bill covering Medicaid reimbursement, expansion policy, and long-run Medicare financing. This cluster cannot fully move without some agreement on federal-state fiscal relationships, but it does not require resolving the insurance market structure debate.

This cluster covers whether Medicaid and Medicare are funded well enough to do what they promise, and who pays. Medicaid reimbursement is low enough that many providers refuse patients on it, making coverage nominal rather than real. Non-expansion states have left millions in a coverage gap that Congress has not closed. On the other end, Medicare's long-run fiscal trajectory is unsustainable under current law. The core tension is between constituencies that want to expand and stabilize public programs and those that want to convert them to block grants or premium support to control federal liability.

Progressive Democrats: "Medicaid is inadequate and deliberately kept that way"
Moderate Democrats: "Medicaid is chronically underfunded and politically fragile"
Moderate Republicans: "Medicaid Expansion Has Shifted Costs onto the Privately Insured"
Conservative Republicans: "Medicaid Expansion Created Dependency and Crowded Out Private Coverage"
Conservative Republicans: "Medicare and Medicaid Are on a Path to Fiscal Collapse"

Legislative mechanism: An administrative simplification bill covering prior authorization standardization, claims processing interoperability, and electronic health record (EHR) burden reduction. Highly separable: this is a process and technology reform with no direct impact on benefit levels or financing structures.

This cluster covers the overhead that eats roughly a third of every dollar spent on healthcare in the United States. Prior authorization delays and denials, non-standardized claims systems, and redundant credentialing processes impose costs on every party without benefiting any patient. It is the one area where all four constituencies find some common ground, since the problem is waste, not redistribution. The fights here are narrower: how aggressive should enforcement be, which federal agency runs the simplification office, and whether standardization should preempt state mandates.

Progressive Democrats: "Insurance companies are denying medically necessary care at industrial scale" (prior authorization dimension)
Moderate Democrats: "Insurance companies are denying medically necessary care at industrial scale"
Moderate Democrats: "Healthcare administrative costs are wasting hundreds of billions of dollars annually"
Moderate Republicans: "The Regulatory Burden on Physicians Has Made Practice Economically Unviable"
Conservative Republicans: "Bureaucratic and Regulatory Overhead Is Eating the System"

For each policy domain, this step maps where the groups agree and where they are stuck. Operational conflicts (disagreements about how to do something) are tradeable. Moral conflicts (disagreements about whether to do something at all) are not.

Points of agreement

Progressive Democrats and Moderate Democrats: Employment-based coverage is structurally broken. Workers who lose jobs lose coverage; portability is essentially nonexistent. Both want to sever that tie, though through opposite mechanisms.
Moderate Democrats and Moderate Republicans: The individual market is too volatile and too thin. Both recognize that healthy people drop out, sick people stay, and premiums spiral. They disagree on why and what to do, but they agree the current equilibrium is not working.
Moderate Republicans and Conservative Republicans: The tax code's treatment of employer-sponsored insurance is a market distortion. Both want to equalize tax treatment between employer and individual coverage. This is a real, specific area of shared diagnosis.
All four constituencies: Medical debt is a real problem. The disagreement is about cause and remedy, not whether debt-driven financial ruin is acceptable.

Points of contention

Progressive Democrats vs. everyone else on private insurance: Progressive Democrats believe the for-profit insurance model is structurally incapable of producing universal coverage. This is a moral conflict, not an operational one. Eliminating private insurance is not a policy tweak; it is a structural transformation that Moderate Democrats, Moderate Republicans, and Conservative Republicans all reject. There is no compromise that splits this difference because the underlying question is whether private health insurance should exist at all.
Progressive Democrats vs. Conservative Republicans on reproductive and gender-affirming care coverage mandates: Conservative Republicans view many of these coverage requirements as compelled participation in procedures they consider morally objectionable. Progressive Democrats view denial of coverage as a healthcare denial, full stop. This is a moral conflict with no operational resolution. A mandate that covers reproductive care and a plan that prohibits it cannot be reconciled through drafting.
Moderate Democrats vs. Conservative Republicans on the Affordable Care Act framework: Moderate Democrats want to preserve and expand the Affordable Care Act's coverage architecture. Conservative Republicans want to repeal the individual mandate and move to block grants. These are incompatible legislative goals, but the conflict is more operational than it appears: both sides accept that some public support for coverage exists in principle. The fight is over conditionality, amount, and delivery mechanism. Tradeable in theory, very hard in practice.
Moderate Republicans vs. Progressive Democrats on market deregulation: Moderate Republicans want to allow short-term plans and interstate sales to create a thinner, cheaper tier of coverage. Progressive Democrats argue this moves healthy people out of the regulated market and destroys it. Both are describing the same market dynamic; they have opposite preferences about the outcome. This is operational, not moral, but it is a zero-sum tradeoff.
Conservative Republicans vs. Moderate Democrats on subsidy design: Conservative Republicans want to expand Health Savings Accounts (HSAs) and give people control over healthcare dollars. Moderate Democrats believe HSAs are useless to people who cannot afford to fund them. This maps onto income distribution and is operational in character, though it reflects deeply different assumptions about individual responsibility.

Bottom line

This cluster will not pass as a unified bill. The gap between Progressive Democrats (eliminate private insurance) and Conservative Republicans (deregulate and block-grant) is not bridgeable because it involves a moral conflict about the role of markets in healthcare and a structural conflict about federal versus individual control. A narrow bill could pass: equalize the tax treatment of employer and individual coverage, and add some form of individual market stabilization fund. That coalition exists between Moderate Democrats, Moderate Republicans, and enough Conservative Republicans to move. Progressive Democrats would oppose it as insufficient; that is acceptable math if the coalition holds.

Points of agreement

All four constituencies: Drug prices in the United States are too high. This is one of the strongest areas of cross-partisan agreement in the entire healthcare debate. The diagnosis is unanimous.
Moderate Democrats and Moderate Republicans: Pharmacy Benefit Managers are extracting value from the system without providing commensurate benefit to patients or payers. Both constituencies support transparency requirements and rebate reform. This is a genuine legislative opportunity.
Progressive Democrats and Moderate Democrats: Federal negotiating authority for Medicare drug prices should be expanded. Both supported the Inflation Reduction Act's negotiation provisions and want to go further.

Points of contention

Progressive Democrats and Moderate Democrats vs. Conservative Republicans on federal negotiation: Conservative Republicans believe government price controls suppress pharmaceutical research and development investment. Progressive Democrats and Moderate Democrats believe prices are set by market power, not by innovation costs. This appears operational (how do we get prices down?) but has a moral dimension: does the government have the right to set prices for private products? Conservative Republicans say no in principle. The other three constituencies say yes in this domain. This is a soft moral conflict, not quite as hard as the insurance structure fight, but not purely operational either.
Moderate Republicans vs. everyone on where to locate the problem: Moderate Republicans focus their anger on PBMs and middlemen rather than on manufacturers. This is not just a tactical difference; it reflects a view that markets work when they are transparent and that manufacturers are not the primary villain. Progressive Democrats and Moderate Democrats want to hit both manufacturers and PBMs. Conservative Republicans want to deregulate, not regulate. PBM reform is the one space where Moderate Republicans and Moderate Democrats can find common cause, but that coalition cannot also satisfy Progressive Democrats on negotiation authority.

Bottom line

A standalone PBM transparency and reform bill can pass. Moderate Democrats, Moderate Republicans, and possibly enough Conservative Republicans will support it because it is framed as anti-middleman, pro-market reform rather than government price control. Expanding Medicare negotiation authority beyond the Inflation Reduction Act baseline is much harder: it requires holding Moderate Democrats and peeling off Moderate Republicans while losing Conservative Republicans entirely. The math is tight but not impossible, particularly if the negotiation authority is structured with guardrails on the number of drugs covered per year.

Points of agreement

All four constituencies: Hospital and insurer consolidation has been bad for prices and competition. There is no constituency defending the status quo on consolidation. This is a rare area of genuine consensus on the problem.
Moderate Democrats, Moderate Republicans, and Conservative Republicans: Price transparency requirements are good policy. The fight is over enforcement, not principle. Hospitals have evaded existing mandates; constituencies across the center-right want real penalties.
All four constituencies: Rural and underserved communities lack adequate provider access. The disagreement is about cause (market failure vs. regulatory failure) and remedy (public investment vs. deregulation), not about whether the problem exists.
Moderate Republicans and Conservative Republicans: Scope-of-practice restrictions protect incumbent providers at patients' expense. Nurse practitioners, physician assistants, and other mid-level providers should be able to practice at the top of their training. This is a market-access and competition argument that the center-right finds compelling.

Points of contention

Progressive Democrats vs. Conservative Republicans on antitrust enforcement mechanism: Progressive Democrats want aggressive federal antitrust enforcement with structural remedies, including potential breakups. Conservative Republicans are skeptical of regulatory overreach and prefer market solutions. This is mostly operational; both nominally support competition. The conflict is about federal power and enforcement intensity.
Progressive Democrats vs. Moderate and Conservative Republicans on rural access funding: Progressive Democrats want direct federal investment in rural health infrastructure. Conservative Republicans believe this crowds out private providers and creates dependency. Moderate Republicans are somewhere in between. The rural access problem is real; the disagreement is about whether the solution is public spending or deregulation of who can provide care. This is partly moral (role of government) and partly operational (which mechanism actually works).
Moderate Democrats vs. Conservative Republicans on scope-of-practice preemption: Moderate Democrats are more cautious about overriding state medical licensing boards, which have union and professional association backing in Democratic constituencies. Conservative Republicans see scope-of-practice restrictions as straightforward regulatory capture. This is an operational conflict with political coalition complications on the left.

Bottom line

This is the most legislatively viable cluster. A bill combining strengthened antitrust enforcement, real price transparency penalties, and scope-of-practice flexibility for underserved areas can attract a genuine bipartisan majority. Progressive Democrats want the antitrust and rural investment; Moderate and Conservative Republicans want the scope-of-practice reform and transparency enforcement. Neither side gets everything, but both sides get something real. The hard part is the rural funding mechanism: block grants versus direct federal spending will be a fight, but it is an operational fight with a deal in it.

Points of agreement

Progressive Democrats and Moderate Democrats: Medicaid reimbursement is too low and must be raised. Nominal coverage that providers refuse to accept is not real coverage. Both constituencies agree on the diagnosis.
Moderate Republicans and Conservative Republicans: Medicare and Medicaid fiscal trajectories are unsustainable and must be addressed. Both constituencies agree that the current spending path ends badly. They disagree on the fix, but not on the problem.
Moderate Democrats and Moderate Republicans: Some mechanism for closing the coverage gap in non-expansion states is desirable. Moderate Republicans are more reluctant, but the political cost of leaving millions uninsured in their own states has become hard to defend.

Points of contention

Progressive Democrats vs. Conservative Republicans on Medicaid structure: Conservative Republicans want to convert Medicaid to block grants, giving states a fixed federal payment and full design authority. Progressive Democrats want to expand Medicaid, raise reimbursement, and federalize the floor. These are structurally incompatible program designs. This is a moral conflict about federalism and the nature of the social contract, not an operational disagreement about implementation details. There is no hybrid that satisfies both sides because the underlying question is whether the federal government has an obligation to guarantee a minimum level of healthcare to all low-income Americans regardless of state.
Moderate Democrats vs. Conservative Republicans on Medicare financing: Conservative Republicans want to move Medicare toward a premium support model, giving beneficiaries a fixed contribution toward a plan of their choice. Moderate Democrats will not accept any change that shifts cost risk onto beneficiaries. This is partly operational (how do you close the fiscal gap?) and partly moral (does the federal government bear the residual risk or does the individual?). The premium support proposal has never passed because Moderate Democrats treat it as a benefit cut, not a reform.
Conservative Republicans vs. Progressive Democrats on Medicaid expansion: Conservative Republicans argue expansion created dependency and crowded out private coverage. Progressive Democrats argue it saved lives and that the evidence on crowd-out is weak. This is partly an empirical dispute and partly a moral one about dependency and government responsibility.
Moderate Republicans vs. Progressive Democrats on program costs: Moderate Republicans worry that Medicaid expansion has shifted costs onto privately insured individuals through cost-shifting. Progressive Democrats dispute this mechanism. This is an operational conflict about economic incidence, not a moral one, and in principle it could be resolved with evidence. In practice, both sides have selected their preferred evidence.

Bottom line

This cluster has the hardest deadlocks in the entire healthcare debate. The Medicaid block grant question is a moral conflict with no deal in it between Progressive Democrats and Conservative Republicans. The most that can move is a narrow Medicaid reimbursement increase paired with some fiscal guardrail mechanism, enough to attract Moderate Democrats and possibly Moderate Republicans, while Conservative Republicans vote no. Closing the coverage gap in non-expansion states is more tractable if framed as a state option rather than a mandate, but Progressive Democrats will resist anything that lets states opt out. The fiscal sustainability question is the most urgent and the least addressed: no coalition currently has both the votes and the will to touch it.

Points of agreement

All four constituencies: Prior authorization is a costly, patient-harming bureaucratic layer that needs reform. This is the broadest genuine agreement in the entire healthcare debate. Every constituency, including those that want to deregulate and those that want to expand coverage, agrees that prior authorization delays cause harm and waste money.
All four constituencies: Claims processing non-standardization and administrative overhead are pure waste. No constituency defends it. No constituency has a moral objection to reducing it.
Moderate Democrats and Moderate Republicans: Electronic health record burden on physicians is real and contributes to burnout. Both constituencies want interoperability requirements and documentation relief. This is a bipartisan consensus without a constituency in opposition.
Moderate Republicans and Conservative Republicans: Regulatory compliance costs on physician practices have made independent practice economically unviable. Both want regulatory streamlining. Progressive Democrats and Moderate Democrats are sympathetic but more cautious about preempting patient protection regulations.

Points of contention

Progressive Democrats vs. Conservative Republicans on the cause of administrative burden: Progressive Democrats attribute most administrative overhead to private insurance's multi-payer fragmentation; their preferred solution is single-payer, which eliminates the complexity at the source. Conservative Republicans attribute it to government mandates and regulation. Both are describing real contributors, but the framing determines the remedy. This is partly a diagnostic conflict and partly a moral one about whether the government is the problem or the solution. In practice, it does not block an administrative simplification bill because both sides can vote yes on the specific provisions even while disagreeing on the root cause.
Progressive Democrats vs. Moderate Republicans on scope of prior authorization reform: Progressive Democrats want to prohibit prior authorization for emergency care and dramatically narrow the categories where it is allowed. Moderate Republicans want transparency and appeals process reform rather than prohibition. This is an operational conflict about how far to go, not whether to go.

Bottom line

This is the most buildable coalition in the entire healthcare debate. A standalone administrative simplification bill, covering prior authorization standardization, claims interoperability mandates with real teeth, and electronic health record burden reduction, can pass with broad bipartisan support. It does not require resolving any moral conflict. It does not threaten any constituency's core program. It produces immediate, measurable savings. The only risk is that it gets used as a trade: conservatives demanding it in exchange for blocking coverage expansion bills, progressives refusing to move it without accompanying access provisions. Keeping it clean and standalone is the strategic play.

The Affordable Care Act (2010) is the primary federal statute governing the individual and small-group insurance markets. It established guaranteed issue (insurers cannot deny coverage based on health status), community rating (premiums can vary only by age and location, not health history), and ten essential health benefits that all qualifying plans must cover. Premium subsidies are available on ACA marketplace plans for households earning up to 400% of the federal poverty level, a threshold temporarily removed by the American Rescue Plan (2021), with enhanced subsidies extended through 2025. The Mental Health Parity and Addiction Equity Act (2008) requires insurers to cover mental health and substance use treatment at the same level as physical health. Employer-sponsored insurance (ESI) benefits from a tax exclusion worth over $300 billion annually in foregone federal revenue, the largest single tax expenditure in the code. COBRA (Consolidated Omnibus Budget Reconciliation Act, 1985) lets workers keep employer coverage after job loss for up to 18 months at full unsubsidized cost.

Roughly 25 to 30 million Americans remain uninsured. Another 12 states never expanded Medicaid, leaving approximately 2 million adults in a coverage gap: they earn too much to qualify for pre-expansion Medicaid but too little to receive marketplace subsidies. Even with insurance, the average deductible on a family silver-plan is over $4,000. COBRA continuation coverage runs $700 or more per month for an individual and $1,800 or more for a family, which is unaffordable for most recently unemployed workers. Mental health parity is routinely evaded through benefit design (narrow networks, higher cost-sharing for behavioral health), and most enforcement actions are administrative complaints rather than penalties. About 100 million Americans carry medical debt. Prior authorization denials are common, well-documented by the AMA as causing treatment delays and outright abandonment of care; most denials are overturned on appeal, suggesting the denials are often unjustified.

The system has two insurance tracks with very different tax treatment: employer coverage is subsidized at full marginal rate for any worker at any income, while individual coverage is not equally favored. This embeds job lock and creates a coverage cliff at every point of employment transition. The ACA layered subsidies and mandates onto this pre-existing structure rather than replacing it, leaving coverage tied to employment status and income in ways that create millions of gaps. Mental health parity enforcement is complaint-driven, not proactive, so the burden falls on patients least able to navigate a bureaucratic appeal process.

The ACA (2010) brought coverage to roughly 20 million previously uninsured people. The individual mandate that anchored the risk pool was effectively eliminated in 2017 when the tax penalty was zeroed out. The American Health Care Act (2017) attempted ACA repeal, passed the House, and failed the Senate 51 to 49 on the deciding vote of Senator John McCain. The American Rescue Plan (2021) and Inflation Reduction Act (2022) enhanced and extended marketplace subsidies, which expire at the end of 2025 without further legislation. Medicare for All bills have been introduced in multiple Congresses and have never advanced past committee.

Until 2022, federal law explicitly prohibited Medicare from negotiating drug prices directly with manufacturers. The Inflation Reduction Act (IRA, 2022) created the first federal negotiation authority: the Department of Health and Human Services can negotiate prices for 10 drugs in the first year, rising to 20 drugs per year over time, beginning with drugs that lack generic competition and account for high Medicare spending. The IRA also capped insulin costs for Medicare patients at $35 per month and requires drug companies to pay rebates if they raise prices faster than inflation. No federal law governs the relationship between pharmaceutical manufacturers, Pharmacy Benefit Managers (PBMs), and health plans in the commercial market.

The same insulin vial that costs roughly $300 at list price in the United States costs under $30 in Canada. Three PBMs control approximately 80% of the commercial market. Their business model is built on rebates paid by manufacturers to secure formulary placement. These rebates flow to health plans, not to patients at the pharmacy counter, meaning patients paying cost-sharing often pay based on the list price rather than the net price after rebates. Generic drugs are frequently cheaper without insurance than through a PBM-managed plan. Drug manufacturers have also used patent thickets, pay-for-delay agreements with generic competitors, and authorized generic strategies to extend exclusivity.

Drug prices in the US are set through a chain of opaque negotiations between manufacturers, PBMs, and insurers. The incentive structure rewards high list prices because rebates, which are often calculated as a percentage of list price, are larger when list prices are higher. No participant in this chain is financially rewarded for lowering the price a patient actually pays at the counter. The IRA negotiation authority is real but narrow: 10 to 20 drugs per year out of thousands of brand-name products. And it applies only to Medicare, not to commercial insurance or Medicaid.

Build Back Better (2021) contained stronger drug pricing provisions including a cap on out-of-pocket costs for Medicare beneficiaries and broader negotiation authority. It passed the House and was blocked in the Senate, primarily by opposition from Senators Manchin and Sinema. The IRA enacted a scaled-back version. PBM-specific reform bills have passed committee in multiple Congresses but have not reached a floor vote, in part because the three major PBMs are subsidiaries of CVS Health, Cigna, and UnitedHealth Group, among the most lobbied sectors in healthcare.

The Federal Trade Commission has authority to block hospital and insurer mergers under the Clayton Act, but healthcare mergers between non-profits are in a gray zone, and many proceed without challenge. A 2021 rule requires hospitals to publish machine-readable files of all negotiated rates with every payer. Certificate of Need (CON) laws in roughly 35 states require government approval before new healthcare facilities can open or expand. Scope-of-practice laws are state-level: about 20 states restrict nurse practitioners from practicing independently without physician supervision. The Health Resources and Services Administration (HRSA) designates geographic areas as Health Professional Shortage Areas (HPSAs); providers in these areas may qualify for loan forgiveness or enhanced reimbursement.

Post-merger hospital prices rise 14 to 40% with no documented quality improvement, according to peer-reviewed studies. Private equity acquisition of physician practices has accelerated rapidly; roughly 70% of physicians are now employed by hospitals or PE-backed groups rather than owning independent practices. Price transparency compliance is poor: most hospitals have not published complete rate files, and fines of $300 per day were considered insufficient to compel compliance. CON laws have been shown to protect incumbent hospital systems from competition rather than ensuring quality. More than 140 rural hospitals have closed since 2010, and over 600 are at financial risk. HRSA designates 7,200 primary care shortage areas. In states that restrict NP independent practice, primary care access shortfalls are more severe.

Healthcare markets fail basic competitive conditions: buyers (patients) cannot shop when in crisis, prices are not transparent, and quality information is limited. Consolidation removes the weak competitive discipline that exists. CON laws institutionalize entry barriers with incumbent providers holding regulatory influence over their own competitors. The price transparency rule addresses information asymmetry in principle, but without real enforcement and data standardization, it does not change market behavior. Scope-of-practice restrictions are a credentialing holdover that constrains supply in shortage areas without a demonstrated quality rationale.

The FTC has challenged a handful of mergers, winning some and losing others. Courts applying the Sutter Health precedent have been mixed. Price transparency rules were strengthened in 2024 with higher fines, but implementation remains incomplete. Bipartisan scope-of-practice reform bills have been introduced repeatedly but face opposition from physician professional associations. Rural hospital closure legislation has proposed enhanced Medicare payments and conversion to Rural Emergency Hospital status, a new designation created in 2023 that lets small hospitals operate as emergency-only facilities.

Medicaid is a federal-state partnership: the federal government matches state spending through the Federal Medical Assistance Percentage (FMAP), which varies by state income. States administer their own programs within federal minimum standards. The ACA expansion extended Medicaid to adults up to 138% of the federal poverty level; the Supreme Court in NFIB v. Sebelius (2012) made expansion optional, and 12 states have not done so as of 2026. Medicaid sets its own reimbursement rates, which states determine with federal matching. Medicare covers Americans 65 and older and certain disabled individuals. Medicare Part A (hospital insurance) is funded through payroll taxes; Part B (outpatient) and Part D (prescription drugs) are funded primarily through general revenue and beneficiary premiums.

Medicaid covers more than 90 million people and spends roughly $800 billion per year (federal and state combined). Medicare covers more than 65 million people and costs roughly $900 billion per year federally. Medicaid reimbursement rates average 60 to 70% of Medicare rates. Physicians increasingly refuse Medicaid patients because the administrative burden is similar to Medicare or private insurance but payment is substantially lower. The Medicare Hospital Insurance trust fund is projected to reach insolvency within roughly 10 years under current law, at which point it could pay only about 90% of scheduled benefits from payroll tax revenue. Part B and Part D have no finite trust fund and would require congressional appropriation increases.

Medicaid's structure creates a race to the bottom on reimbursement: states compete to minimize their share of costs, which drives down rates and physician participation. The opt-out design of Medicaid expansion creates a coverage gap where the neediest population falls through. The Medicare Hospital Insurance funding mechanism, a dedicated payroll tax, creates a hard solvency cliff rather than a gradual shortfall, making the insolvency date politically visible and forcing legislative action under crisis conditions rather than deliberate policy adjustment. Medicaid and Medicare operate as parallel systems with separate administrative infrastructure, eligibility rules, and payment rates, creating redundancy and fragmentation for the roughly 12 million people dually enrolled in both.

Every major deficit reduction package in the past 20 years has included proposals to cap Medicaid through block grants or per-capita caps. None have passed as stand-alone legislation, though the structure is perennially proposed in Republican budget frameworks. Medicaid expansion in holdout states has advanced through ballot initiative in several states (Oklahoma 2020, Missouri 2020, South Dakota 2022), bypassing state legislatures. Medicare solvency fixes in past years have included provider payment cuts (sequestration), premium increases, and income-related surcharges on wealthier beneficiaries. No comprehensive restructuring of Medicare financing has passed.

No single federal statute governs the prior authorization process in the commercial market. The IRA and CMS rules have imposed some prior authorization timelines on Medicare Advantage plans (a 2024 rule requiring decisions within 72 hours for urgent requests and 7 days for standard requests). HIPAA (1996) established standards for electronic health data exchange, but EHR interoperability has been addressed mainly through the 21st Century Cures Act (2016) and its information blocking rule. The No Surprises Act (2022) established protections against unexpected out-of-network bills and set up an arbitration process for disputed payments. There is no universal provider credentialing system; providers credential independently with each hospital and each insurer.

The United States spends roughly $250 to $350 billion per year on healthcare billing administration, which is approximately 30% of total healthcare spending. Physicians report spending 15 to 20 hours per week on administrative tasks rather than patient care. EHR systems are not fully interoperable: data does not flow automatically between hospital systems, primary care offices, and specialists. Documentation in EHRs is designed primarily for billing and liability rather than clinical decision support, a legacy of fee-for-service payment design. The No Surprises Act arbitration process has generated a large backlog; insurers and providers have both complained that the process is expensive and slow.

Administrative complexity is not incidental; it is a structural feature of a fragmented multi-payer system where each payer maintains its own rules, forms, and review criteria. Prior authorization exists because insurers bear financial risk for high-cost treatments, but the design creates a system where delay and denial are cost-effective strategies even when the treatment is ultimately approved. EHR design followed billing incentives rather than clinical ones because fee-for-service payment rewarded documentation volume, not outcomes. Credentialing redundancy persists because no single entity has authority to set and recognize a universal standard; each hospital and insurer has legal and liability reasons to maintain independent processes.

The HITECH Act (2009) provided $30 billion in incentives to drive EHR adoption, achieving near-universal adoption by 2015. Interoperability rules under the 21st Century Cures Act required data sharing and prohibited information blocking, but implementation has been slow and enforcement actions few. CMS finalized prior authorization rules for Medicare Advantage plans in 2024, requiring electronic prior authorization (ePA) and faster decision timelines. The Improving Seniors' Timely Access to Care Act passed the House in 2021 and 2022 with bipartisan support, but stalled in the Senate. Proposals for a centralized credentialing clearinghouse have been introduced but have not advanced, partly because hospital systems and insurers view independent credentialing as a risk management function they are unwilling to cede.

Approval: out of 100 members of each group, how many would vote to put the current system into place if it didn't already exist. Satisfaction: how content the average member is with how things currently work, from 0 (actively angry) to 100 (content). Both scores are weighted by each group's political representation.

Approval

Progressive Democrats

Moderate Democrats

28%

Moderate Republicans

22%

Conservative Republicans

18%

avg

17%

Satisfaction

Progressive Democrats

Moderate Democrats

35%

Moderate Republicans

30%

Conservative Republicans

25%

avg

23%

Progressive Democrats: The for-profit insurance model is the problem; no version of the current system is acceptable
Moderate Democrats: ACA was a step forward, but premiums, deductibles, and prior auth make it feel like a half-measure
Moderate Republicans: Markets are broken, but not because of too little government; consolidation and PBM opacity are the core failures
Conservative Republicans: ACA is the law and they oppose it; individual market premiums hurt their own constituents despite ideological objections

Context

Healthcare is one of the few policy areas where every major constituency is dissatisfied with the status quo, for reasons that cut across partisan lines. Progressive Democrats would not vote for the current system under any framing. Moderate Democrats and Republicans both see structural failures but disagree sharply on cause and remedy. Even Conservative Republicans, who oppose the ACA on principle, are hurt by the individual market dysfunction it created and has not fixed. The 25-30 million uninsured, $250-350 billion in annual administrative waste, and looming Medicare insolvency are not contested facts; what is contested is who is responsible and what should replace the current arrangement. Weighted average: 18/100 approval, 25/100 satisfaction.

Phase 1: Preparation

Who's at the Table

What They Care About

Progressive Democrats

1. The for-profit insurance model is structurally incompatible with universal coverage

2. Drug prices are set by market power, not cost or value

3. Medical debt is the leading cause of personal bankruptcy in the wealthiest country on earth

4. Employer-tied insurance traps workers and distorts the labor market

5. Mental health and substance use care are systematically undertreated and underfunded

6. Medicaid is inadequate and deliberately kept that way

7. The hospital and provider consolidation wave is driving up prices with no quality benefit

8. Reproductive and gender-affirming care bans are healthcare denials

9. Rural and low-income communities face a provider shortage that insurance status cannot fix

10. The system creates perverse incentives that reward volume over outcomes

Moderate Democrats

1. Premiums and deductibles keep rising even under the Affordable Care Act

2. Drug prices are indefensible and the market will not fix them

3. Coverage is tied to employment, which makes no sense

4. Insurance companies are denying medically necessary care at industrial scale

5. Rural and low-income communities still lack basic access

6. Mental health and substance use coverage is still effectively inferior

7. Medicaid is chronically underfunded and politically fragile

8. Hospital and provider consolidation is destroying competition and driving up prices

9. The uninsured rate is still too high and the coverage gap is a policy failure

10. Healthcare administrative costs are wasting hundreds of billions of dollars annually

Moderate Republicans

1. Hospital and Insurer Consolidation Has Destroyed Real Competition

2. Price Transparency Rules Exist on Paper but Not in Practice

3. The Tax Code Distortion Ties Coverage to Employment and Locks People In

4. Regulatory Barriers to Entry Protect Incumbent Providers from Competition

5. Small Businesses Bear a Disproportionate Cost Burden with No Leverage

6. Medicaid Expansion Has Shifted Costs onto the Privately Insured

7. Drug Pricing Is Opaque and the Middlemen Are Extracting Value Without Accountability

8. The Regulatory Burden on Physicians Has Made Practice Economically Unviable

9. Liability Risk Drives Defensive Medicine and Inflates Costs Systemlessly

10. The Individual Market Remains Too Thin and Too Volatile for Families Who Earn Above Subsidy Thresholds

Conservative Republicans

1. The Affordable Care Act Destroyed Individual Choice

2. You Cannot Buy Insurance Across State Lines

3. Medicaid Expansion Created Dependency and Crowded Out Private Coverage

4. The Employer Mandate Hammers Small Businesses

5. The Tax Code Locks People to Their Employer's Plan

6. Price Transparency Is Still a Fiction

7. Government Price Controls Are Strangling Pharmaceutical Innovation

8. Bureaucratic and Regulatory Overhead Is Eating the System

9. Medicare and Medicaid Are on a Path to Fiscal Collapse

10. The Individual Market Is Broken for People Who Don't Qualify for Subsidies

Policy Clusters

1. Insurance Market Structure and Coverage Access

2. Drug Pricing and Pharmacy Benefit Manager Reform

3. Provider Markets, Competition, and Access

4. Public Program Adequacy and Fiscal Sustainability

5. Administrative Burden and Care Management Reform

Points of Agreement and Contention

Insurance Market Structure and Coverage Access

Points of agreement

Points of contention

Bottom line

Drug Pricing and Pharmacy Benefit Manager (PBM) Reform

Points of agreement

Points of contention

Bottom line

Provider Markets, Competition, and Access

Points of agreement

Points of contention

Bottom line

Public Program Adequacy and Fiscal Sustainability

Points of agreement

Points of contention

Bottom line

Administrative Burden and Care Management Reform

Points of agreement

Points of contention

Bottom line

The Status Quo

Insurance Market Structure and Coverage Access

Current law and policy

What it produces in practice

The structural flaw

What has been tried