Ideas for Market-Based Reforms to ACA

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Based on our experience enrolling more than 750,000 people in Affordable Care Act (ACA) health insurance plans, HealthSherpa has suggestions for revising the ACA. The following ideas are politically neutral, market-based reforms to help maintain access and improve the affordability of high-quality health coverage.


  1. Change the cap on the premium multiple from 3x to 6x. Currently a 64-year-old cannot pay more than 3x the premium of a 21-year-old. Before the ACA existed, the market set that multiple as high as 11x. Going from 3x to 6x would incentivize more young people to sign up, improving the risk pool and lowering premiums.
  1. Replace SHOP* with the Individual Market which lets small businesses help employees pay for coverage on the individual exchanges allowing small businesses to work with their employees to improve the  company wellness as well as the healthcare industry. Adding a group of generally healthy people (which lower premiums),  will save small businesses money. Note that the 21st Century Cures Act addresses this, in part, by permitting small employers to utilize FSAs**.
  1. Go a step further than 21st Century Cures Act and let large employers subsidize coverage on the public exchanges. Many large employers don’t want to manage their own health insurance plans. Allowing them to subsidize public exchange coverage would improve the risk pool (lowering premiums) and could lead to large employers helping more of their employees get coverage;  this could also include part-time employees.
  1. Require people to either maintain continuous coverage or wait three months after signing up for non-preventative care (if they sign up outside open enrollment). This would reduce the big hit on cost that the insurers are currently taking on people who wait until they get sick to sign up.


  1. Move the threshold for receiving subsidies down from 100% to 0% of the Federal Poverty Level (FPL). Rate a new cost-sharing reduction (CSR) tier for the people who currently fall within the gap. Having insurance isn’t very useful if you can’t afford your copay, which is something the  CSR addresses. These two changes take care of people who can’t get coverage because their state hasn’t yet expanded Medicaid.


  1. Combine the public exchanges into a single, federal platform. State exchanges have proved to be expensive and are slow to adapt to online innovative resources and alternatives.
  1. Remove pressure of a fixed enrollment window by opening enrollment to the month of your  birth. The current three-month window is expensive and difficult to manage because people are unsure of the requirements and the tax implications (not to mention frustration due to long wait times on  Those who wait until the last minute to sign up create huge call, email and web-traffic volume spikes.
  1. Make an open data platform where private companies can build Turbotax-like experiences on top of a common government infrastructure. This allows for innovative, channel-specific platforms that expand the reach of the exchanges, improving consumer access and the risk pool.

Regardless of what happens next for the ACA, HealthSherpa is a resource to help guide individuals and their families through their health insurance options. Learn more by visiting

*The Small Business Health Options Program (SHOP) Marketplace is for small employers who want to provide health and dental insurance to their employees — affordably, flexibly, and conveniently.

To use the SHOP Marketplace, your business or non-profit organization must have 50 or fewer full-time equivalent employees (FTEs).
**A flexible spending account (FSA), also known as a flexible spending arrangement, is one of a number of tax-advantaged financial accounts that can be set up through a cafeteria plan of an employer in the United States.

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