Chapter 17 · Appendix E.5 and E.7

Health care without financial fear.

The book proposes a National Health Guarantee: automatic coverage through a federally chartered nonprofit American Health Trust, phased in over roughly a decade. This page explains what would change, how it would be financed, what the book says could go wrong, and what the illustrative numbers would mean for different households.

Proposed policy · not enacted law · financing figures are author planning estimates, not an official score

Current policy vs. the book

Coverage, payment, and household financing all change.

The largest difference is not simply “public versus private.” The proposal changes who provides the insurance function, how hospitals and clinicians are paid, and how households finance coverage.

Current framework

Coverage is split among employer plans, Medicare, Medicaid and CHIP, ACA marketplaces, and other programs. Medicaid is jointly funded by states and the federal government and administered by states under federal requirements.

Book proposal

Every resident is automatically enrolled in a National Health Guarantee administered by the nonprofit American Health Trust, with a common core benefit package.

What it could mean for people

Coverage would no longer depend on keeping a particular job or renewing eligibility for the core plan. The transition would occur over roughly a decade rather than all at once.

Current framework

Households can face premiums, deductibles, copayments, and other out-of-pocket costs; those amounts vary by coverage.

Book proposal

Deductibles are eliminated. Primary, preventive, maternity, and chronic-condition care have no cost-sharing; some other services can have modest income-scaled copayments and an income-scaled annual cap. Financing shifts to dedicated employer and household contributions.

What it could mean for people

Some households would pay less in the book’s model and some would pay more. The result depends heavily on income, current coverage, and whether national health spending actually falls.

Current framework

Hospitals and clinicians now receive a mix of negotiated private payments and administratively set public payments; U.S. health spending was $5.3 trillion in 2024.

Book proposal

Hospitals move toward global operating budgets, clinicians use national fee schedules or population-based arrangements, and the Trust negotiates drug prices nationally.

What it could mean for people

Billing could become simpler, but lower provider revenue and increased demand could create capacity or waiting-time problems. The book therefore treats workforce growth and wait-time reporting as part of the design.

Current framework sources: CMS National Health Expenditures and Medicaid.gov. Book proposal: Chapter 17 and Appendix E.

Start here

What would actually change for a person?

The proposal changes who finances primary health coverage more than it changes who provides medical care. Doctors and hospitals would still deliver care; the national nonprofit insurer would replace the current patchwork of primary insurance financing over time.

Coverage follows you

At full implementation, every resident would be enrolled automatically. Coverage would not depend on a job, income, marital status, or state of residence.

One core benefit package

The book includes primary, preventive, emergency, hospital, maternity, mental-health, substance-use, reproductive, prescription-drug, dental, vision, hearing, rehabilitation, and long-term services and supports.

Deductibles go away

Preventive and primary care, maternity care, and chronic-condition care would have no cost-sharing. Some other services could have modest income-scaled copayments and an income-scaled annual out-of-pocket cap.

Financing changes

Premiums and much existing out-of-pocket spending would be replaced by dedicated federal health funding, state maintenance-of-effort payments, an employer health contribution, and a progressive household contribution.

Important: “self-financing” means the Health Trust's dedicated revenue must equal its spending. It does not mean every household automatically pays less. The book makes household savings depend on whether the system controls total health costs.

How care would be paid for

The proposal changes the payment system, not the profession.

The book's cost-control strategy has several moving parts. Each is intended to replace a different part of the current financing system.

Hospitals

Hospitals would receive negotiated annual global operating budgets, with major capital investment planned separately. The purpose is to reduce billing complexity and the incentive to maximize the volume of billable services.

Doctors and clinicians

Clinicians could remain independent or work in groups and hospitals. Payment would use simplified national fee schedules, with adjustments for complexity, quality, and underserved areas.

Prescription drugs

The Trust would negotiate drug prices nationally and use transparent rules for pharmacy-benefit functions.

Workforce and access

The transition includes clinician-workforce expansion, regional workforce targets, published wait times, and a care guarantee when a region misses its waiting-time standard.

What happens to private insurance?

Under the proposal, private insurers could continue selling supplemental coverage for services outside the core package and could work as contracted administrators. They could not sell duplicative primary coverage for the core package after the transition is complete.

What happens to Medicare and Medicaid?

The proposal phases them into the Guarantee rather than switching everyone on one day. Medicare benefits are preserved during integration and the proposal adds dental, vision, and hearing; Medicaid and CHIP are integrated earlier with continued state maintenance-of-effort financing.

This interactive Health Trust ledger needs JavaScript. The table is Appendix E.5 of the book.

Income examples

How the worked health example changes with income.

Appendix E works through five hypothetical single-earner families of four with employer coverage. They show the direction and scale of the book’s illustrative contribution schedule; they are not predictions for a specific family. They count the employer premium as part of compensation because employer health costs can reduce wages over time.

Illustrative family of four$55,000 wage income

In the book's illustrative design, total modeled health costs are $27,511 lower than the current employer-premium, worker-premium, and out-of-pocket total.

Current modeled total $29,993

New modeled total $2,482

Modeled change−$27,511

Important limitation: families with Medicaid, no employer coverage, retirement coverage, different family sizes, different medical use, or different final contribution rates can have different results. The book says a full household-level microsimulation remains an important test before legislation.

Ten-year transition

The proposal is phased rather than switched on overnight.

Click a phase to see who would move first and what infrastructure has to be built before the next phase.

Build the Trust and enroll first groups

Establish the American Health Trust; automatically enroll children and uninsured residents; let people 55 and older enroll voluntarily; allow employer buy-in; begin workforce expansion and drug-price negotiation.

What could go wrong?

The book treats the risks as part of the design.

The proposal does not claim that universal coverage makes tradeoffs disappear. Chapter 17 identifies specific failure risks and the mechanisms intended to detect them.

Provider payment

Lower payment rates could threaten some hospitals or practices. The proposal phases payment changes and uses global budgets, with particular attention to essential and rural facilities.

Waiting times

Coverage can increase demand faster than the workforce grows. The proposal uses workforce investment, published regional wait standards, and an out-of-region care guarantee when standards are missed.

Transition disruption

Employer coverage would not disappear at once. The decade-long phase-in is intended to avoid asking people to pay the new contributions before their coverage has moved.

Household costs

If the system fails to control national spending, households can pay more even though the Trust remains balanced. The sensitivity lab above is designed to make that risk visible.

Read Chapter 17 Explore the fiscal model Read objections and answers

The Strongest Counterargument & Our Response

Best case against

A national guarantee could increase demand faster than clinician and hospital capacity, compress provider revenue, disrupt existing coverage, and concentrate too much financing authority in one federal system.

The author's response

The chapter phases implementation, adds workforce investment, uses global hospital budgets and a fee schedule rather than immediate across-the-board price cuts, and publishes waiting-time standards and external appeals.

What remains uncertain

The achievable national savings and the speed at which employer premium savings reach wages are among the largest fiscal uncertainties in the book.