By Tevi TroyFormer Deputy Secretary of Health and Human Services

This week FOX Business Network reported that Congress is looking at three health insurance changes:

  • A mandate for individuals to purchase insurance
  • A mandate for businesses to provide insurance or pay into a pool
  • Some kind of national health insurance exchange

Regarding the exchange idea, whether it is a good idea depends on how it is configured. If it allows individuals to purchase insurance across state lines, thereby allowing individuals to avoid expensive state "mandates" -- requirements that plans cover very specific conditions, rather than allowing plans to develop options that consumers want -- then it could be a very good development. Unfortunately, I am hearing that Congress is unlikely to make that reform, which makes the exchanges less useful.

A better way of going about this, which does include a reform to allow individuals to purchase insurance across state lines, is a plan that was promoted this week by Senators Richard Burr and Tom Coburn, and described by Duncan Currie in the National Review Online. It would create a refundable tax credit to allow individuals to purchase health insurance, and allow individuals to use money in their Health Savings Accounts to pay for insurance premiums. Senators Coburn and Burr also call for auto-enrollment of eligible individuals into public health programs, a clever mechanism for handling the estimated 20% of the uninsured who are eligible for public forms of coverage but are just not taking advantage of it. It also focuses on prevention of the five chronic conditions that account for roughly 75% of our health care costs . This plan tackles the specific problems of health care rather than changing the whole game for everyone, which is a smart way of going about things.