Executive Summary: The Case for the Current System

TOS.C1 — The Other Side

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The strongest case for the current system is not that it works well. It is that the replacement described by this collection does not yet exist at scale and that 164 million Americans currently covered by employer-sponsored insurance, per the Census Bureau’s 2024 Current Population Survey, depend on a system whose failures do not make it safe to dismantle before the alternative is operationally ready.

Employer-sponsored group coverage solved the adverse selection problem by pooling risk involuntarily. That involuntary pooling is what makes any individual member’s premium bearable. Voluntary unbundled models produce the same distributional outcome that voluntary catastrophic markets produced before group coverage existed: the sickest people bear the highest burden. An employee managing a chronic condition at the point of enrollment cannot afford to assemble the components the non-insurance model describes on an employer contribution calibrated for the healthy employee.

The broker displacement thesis is accurate for functional small group tasks. What it underestimates is the employer’s appetite for accountability: a named professional who recommended the product and will answer the phone when a claim is denied. For a meaningful portion of the small employer market, that accountability is the entire value of the arrangement. The direct compact requires the 15-person construction firm owner to evaluate DPC practices, pharmacy programs, catastrophic attachment points, and ICHRA contribution levels. The bundled plan with a broker requires attending one 45-minute renewal meeting.

The collection is right about where the architecture is going. The transition is the part that requires more humility than the synthesis provides.