Dear Sen. Murray and Rep. Pallone:
The HR Policy Association and the American Health Policy Institute submit the following comments for your consideration regarding your May 26, 2021 request for information on design considerations for legislation to develop a public health insurance option. As Congress develops public option legislation, or for that matter any coverage expansion bill, it is important for Congress to consider the potential unintended consequences that could negatively impact employer-sponsored health benefits, and the 183 million Americans enrolled in employment-based coverage.
The HR Policy Association is the leading organization representing chief human resource officers of over 390 of the largest employers in the United States. Collectively, their companies provide health care coverage to over 20 million employees and dependents in the United States. The American Health Policy Institute, a part of HR Policy Association, examines the challenges employers face in providing health care to their employees and recommends policy solutions to promote affordable, high-quality, employer-based health care. The Institute serves to provide thought leadership grounded in the practical experience of America’s largest employers.
Large employers work hard to provide innovative, high value health care benefits at the lowest possible cost. According to recent NBER economic report, the annual social value of employer sponsored insurance (ESI) is about $1.5 trillion beyond what policyholders, their employers, and taxpayers pay for it. Some of the benefits of ESI include, reduced adverse risk selection, the ability of obtaining substantial discounts and rebates for employees and their dependents, and the division of labor employed in shopping for health providers. ESI also encourages work, eases government spending by providing health coverage, and is a mechanism for employers to act on their incentives for a healthy and productive workforce.
