Please select your state
so that we can show you the most relevant content.

What does the personal option in health care mean, exactly?

Nov 12, 2021 by AFP

The United States boasts some of the best doctors in the world. U.S. companies produce dozens of new prescription drugs each year, innovative and lifesaving medical technologies, and groundbreaking therapies.

They researched, created, and distributed hundreds of millions of COVID-19 shots for all who want them in less than a year.

It’s no surprise, then, that 80 percent of Americans view the health care they receive positively. That’s the good news!

The bad news is that, while Americans enjoy their health care, they are less enthusiastic about our health care system.

That isn’t surprising, either.

Our health care system is replete with mandates, restrictions, and regulations enforced at the federal and state levels that make America’s excellent health care more expensive and difficult to access.

Yes, Americans enjoy top-notch care — but they must walk on hot coals to get it.

Lawmakers have heard these concerns, but rather than reform their top-down, one-size-fits-all mandates, they have doubled down on this failed approach.

So, as health care technology grows more advanced, the health care system becomes more stifling, bureaucratic, and infuriating for patients.

To make matters worse, some lawmakers suggest reforming the system with the largest top-down measure to date: single-payer health care, which would put the federal government in control of your medical decisions, pushing you and your doctor to the sidelines.

But patients need greater control over their health care decisions, not less. They want a system that places the doctor-patient relationship in the driver’s seat.

In other words, Americans want a personal option in their health care.

What does that mean, exactly?

What the personal option offers

The personal option is a set of smart, sensible reforms that gives the patient greater choice when navigating the labyrinth of health care.

These reforms recognize that decisions are best left between doctors and their patients, not between patients and the government.

To that end, the personal option provides three key reforms that preserve what has worked for countless patients and fix what has not.

The personal option would:
  • Make care more affordable
  • Increase accessibility
  • Improve the quality of care

What is the personal option for health care?

The personal option offers more affordable care

Most Americans are worried about the affordability of care. And they’re right to worry. Access to even basic care can be frightfully expensive. But it does not need to be.

At the state and federal levels, our health care system is saddled with restrictions that increase the cost of care without doing the least bit to improve outcomes.

Personal option reforms could fix that.

Reduce prescription drug prices

What this means: Eight-in-ten Americans say that prescription drug prices are too high. Patients need reforms that spur robust market competition, creating more innovative drugs and lowering prices.

How this will help: Congress could enact reforms that would allow Americans to access drugs already approved in other countries whose regulatory authorities we trust.

Congress should also enact reforms to the Food and Drug Administration’s sclerotic approval process, while maintaining important safety standards.

That would help Americans access the drugs they need at more affordable prices.

Expand health savings accounts

What this means: Health savings accounts, or HSAs, are tax-free accounts that allow people to save for current and future medical expenses. HSA holders are not subject to federal income tax on the money they deposit into the account or the money they spend on health care.

How this would help: At the federal level, Congress could remove barriers to tax-free health savings accounts.

  • Only about 10 percent of Americans have access to HSAs. But HSAs are indispensable in helping account holders save and pay for the care they need, when they need it.
  • HSAs help Americans save between 10 and 40 percent on each expense. Expanding these accounts, as Senator Marco Rubio’s Health Savings Act of 2021 would do, would reduce the costs of care dramatically for more Americans.
  • Lawmakers could allow HSA holders to pay for direct primary care arrangements, which would give them round-the-clock access to the country’s top doctors at a lower price.
  • Congress could increase the annual contribution limit for HSAs, allowing account holders to save even more for future medical expenses. The current limit sits at $3,600, but Representative Chip Roy’s Personalized Care Act would push that limit to $10,800.

Expand renewable health insurance plans

What this means: People deserve more tailored, affordable insurance options, such as short-term, renewable plans. These plans are especially useful for Americans in between jobs.

How this would help: These renewable insurance plans are typically 50-80 percent less expensive than traditional plans.

Unfortunately, about a dozen states overregulate or ban them. Lawmakers should maximize the amount of time Americans can use these affordable, personalized plans.

Legalize association health plans

What this means: Association health plans, or AHPs, enable small businesses and individuals to band together to get the same great group discounts enjoyed large businesses.

In 2017, the Trump administration issued a regulation that would make AHPs available nationwide. A federal judge blocked the rule in 2019.

How this would help: Congress should allow individuals and small businesses to purchase these plans, giving them the same savings and coverage enjoyed by employees of large businesses. To that end, they could pass the Association Health Plans Act.

Promote price transparency

What this means: When Americans access care, they all too often do not know what they will be paying for and how much it will cost.

Paying for health care is not like shopping for groceries, in which the prices for goods are clearly labeled. Patients are often plagued by surprise medical bills received weeks or even months later. Lawmakers must work to promote price transparency in health care.

How this would help: Giving patients access to costs up front will make them more informed consumers, resulting in increased competition and lower prices.

Doctors and hospitals will have powerful incentives to publish their cash-pay prices when – and only when – patients are firmly in control of the dollars and the decisions.

We need to put patients in the driver’s seat, via the various reforms in this plan. We also need to enforce existing antitrust and anti-fraud laws.

Unfortunately, some lawmakers have proposed violating contracts by forcing providers to publish fictitious and/or proprietary prices. Government mandates are not the right approach.

The right approach is to empower patients as consumers. Then, prices will become public naturally, just as they do online, at the grocery store, and the gas station.

How a personal option makes care more accessible

Many Americans also worry about the availability of care. And, again, they are right to worry.

From 2010 to 2018, the percentage of small businesses offering health insurance to their employees dropped 32 percent, from 44 percent of such businesses to only 30 percent. In no small part, that was the result of Obamacare’s prohibition of a wide range of insurance options.

Among Americans who do have health insurance, a growing number are finding it harder and harder to get convenient, timely access to their preferred doctors.

This is because health insurance companies put up barriers designed to reduce patients’ choices and maximize the insurance company’s profits. For too many patients, this means receiving substandard care, or no care.

Accessing medical care can be a byzantine process for patients, in general — but the federal government can offer reforms that would make seeing your doctor an easier task.

Strengthen health reimbursement accounts

What this means: A health reimbursement account, or HRA, is an IRS-approved, employer-funded health care benefit intended to reimburse employees for out-of-pocket medical expenses.

HRAs can act as portable insurance for account holders between jobs, granting greater access to care for more Americans. Lawmakers should work to expand these accounts.

How this would help: In 2018, the Trump administration issued a rule allowing employees to use these employer-sponsored accounts to purchase personally tailored, portable health insurance plans they can take with them from job to job.

If all employers were to offer this option, the days of “job lock” would be gone. No longer would millions of people feel stuck in a job for fear their next employer won’t offer the same good coverage they need.

This sensible reform can make health care much more accessible for millions of Americans. Congress should pass the Increasing Health Coverage Through HRAs Act to make this new option, known as an individual-coverage HRA, permanent and to prevent a future president from rescinding it.

Let nurses deliver the care for which they’re trained

What this means: The states should reform their scope-of-practice laws, which forbid nurse practitioners, physician assistants, and other health care professionals from delivering care without doctor supervision.

How this would help: States should reform or repeal these laws, which do not make patients safer. In states that have reformed their scope-of-practice laws, the quality of care did not deteriorate at all.

That is because these health care professionals, who have routinely been sidelined by scope-of-practice restrictions, are well-qualified to perform primary and specialty care.

Many states began suspending their scope-of-practice laws when the pandemic struck, widening the pool of health care providers who could see their patients. For Americans living in rural areas, these reforms were particularly helpful.

Let doctors and nurses practice across state lines

What this means: Many states refuse to recognize out-of-state professional licenses for doctors and nurses. These regulations constrict the supply of care available to patients, especially those with limited mobility and those living in rural areas.

How this would help: States should repeal or reform these laws. Doing so would improve choice and quality of care by increasing competition.

Give patients direct access to doctors

What this means: One of the more exciting developments in American health care is the rise of direct patient care (DPC) clinics, which offer unlimited access to a primary care doctor, preventive services, and drug discounts, all for a flat monthly fee.

DPC removes needless barriers to care, helps patients save money, and allows patients and doctors to spend more time with each other, thus offering a better overall experience and improved health outcomes for patients.

The problem is, DPC isn’t widely available yet because state and federal regulations and tax rules haven’t yet caught up with this exciting new model.

Importantly, DPC is not insurance, but rather the direct provision of medical care, and therefore it should be regulated as care rather than as coverage.

Everyone should have DPC as an available option.

  • Employers should be allowed to offer it to their employees as a tax-free benefit.
  • Individuals should be allowed to use their tax-free HSA and HRA funds to pay for it.

How this will help: Protecting DPC from inappropriate regulations and allowing people to pay for it tax-free would give millions of Americans access to lower costs, better care, and greater peace of mind.

Improving the quality of care through the personal option

The United States has some of the world’s best health care, but that doesn’t mean there’s no room for improvement. Many Americans would like to see improved health care outcomes.

Unfortunately, state and federal regulations often stand in the way of that goal.

Repeal certificate-of-need laws

What this means: Thirty-five states and the District of Columbia enforce certificate-of-need laws, which forbid providers from purchasing new equipment, expanding their facilities, or opening new locations without government permission.

These CON laws reduce access to quality, affordable care, as a recent report from Americans for Prosperity Foundation demonstrates. State lawmakers should repeal them.

How this would help: Early last year, as COVID-19 began to spread, state governors quickly began issuing emergency executive orders to suspend their CON restrictions, recognizing that they would do more harm than good. Some states, including Tennessee and Montana, repealed some of their CON laws.

More states should follow suit. Repealing CON restrictions would cut health care expenses for countless patients and allow greater investment in state health care systems, drastically improving the quality of care.

By repealing or reforming their CON laws, states would, over time, see dramatic investment and improvement of their health care systems, pushing unnecessary government interference out of the way of innovation.

Promote telemedicine

What this means: During the pandemic, governors began suspending restrictions on the remote service that, among other things, prevented out-of-state providers from treating their patients through telemedicine.

This service allows patients to see their providers using phone and video calls and with innovative store-and-forward technology.

How this would help: Patients across the country began relying more on telemedicine to see their providers quickly and safely during the pandemic. And, critically, they were happy with the services they were provided.

That was particularly useful for patients in rural areas and with limited access to in-person care. It also helped to reduce infection and keep patients safe.

States should reform restrictions on the delivery of telemedicine, expanding the practice.

But the federal government also has a role. During the pandemic, the Centers for Medicare and Medicaid Services issued emergency — but temporary — reforms that, among other things:

  • Authorized health care providers to deliver telemedicine to patients located in any zip code and setting, including their homes.
  • Allowed providers to deliver telemedicine from an expanded array of facilities, including rural health centers, federally qualified health centers, and their own homes.
  • Permitted providers to provide telemedicine through any non-public facing communications platform, including Zoom and Skype.

These reforms were helpful, but will expire when the public health emergency is rescinded. Congress should codify these reforms to preserve them, including with the CONNECT for Health Act of 2021.

Streamline FDA drug approvals

What this means: It takes an average of 12 years and billions of dollars for an experimental drug in the laboratory to reach your medicine cabinet. For many patients, especially those in need of lifesaving medication, that is simply too long.

These significant delays are caused by the Food and Drug Administration’s arduous and expensive drug approval process.

While the process can be useful, it can also be too bureaucratic and burdensome. It takes on average 10-15 years to approve a vaccine, for example. But our rapid approval of COVID-19 vaccines under Operation Warp Speed accomplished the same task in under a year.

How this would help: The FDA should streamline its approval processes. It can also grant expedited approvals to drugs already reviewed by countries whose regulatory agencies we trust.

That would improve the quality of care for millions of Americans by giving them access to more lifesaving medications.

In all the pandemic-driven efforts to save lives by removing barriers between doctors and patients, the result was the same: Providing Americans with a personal option in their health care improved patient outcomes.

None of these lifesaving efforts involved or required giving government more power over patient decisions.

Permanently enacting these and additional personal option reforms would provide more Americans with greater access to quality, affordable care.

Screenshot of AFP's Personal Option campaign landing. Text: A Personal Option for Health Care - greater access to better care at a price you can afford

Get involved with the campaign to provide patients with greater access to more affordable, better quality health care today.