By NextBestFitStates administer under national rules
National rules and funding, but states run enrollment and provider relations, like Canada's provinces.
States run enrollment and provider relations under national rules.
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This path
States administer under national rules
Concrete changes if chosen
What would actually have to change in law, agencies, payment rules, or systems.
- Let states administer under national rules
Effects
Each effect has its own page: the evidence, the case that it is or isn't a real cost, and whom it affects.
The question it answers
States lose control and budgets shift between levels of governmentLetting states run enrollment and provider relations under national rules and funding preserves local control and allows experimentation.
What it fixes
None identified.
What it creates or worsens
- About $1 trillion a year in administrative cost
Having states administer enrollment and provider relations duplicates administration.
21 paths soften this
One claims system and standard rulesAbout $1 trillion a year in administrative costChosenStandardize across many payersAbout $1 trillion a year in administrative costChosenSingle public payer for everyoneTens of millions of people have no coverageChosenRegulated multi-payer: everyone must have a non-profit or tightly regulated planTens of millions of people have no coverageRejectedPublic option alongside private insuranceTens of millions of people have no coverageRejectedContinuous eligibility (12-month or multi-year) in Medicaid and CHIPPeople lose coverage when their life changes (churn)ChosenCoverage tied to residence, not job or incomePeople lose coverage when their life changes (churn)ChosenNo cost sharing at the point of careUnderinsurance: covered, but can't afford to use itChosenEvery licensed provider is in-networkNarrow networks and out-of-network surprisesChosenPrevent new debt by ending point-of-care billsMedical debt affects about 100 million peopleChosenEliminate out-of-network statusSurprise billing and a runaway arbitration systemChosenEliminate prior authorization except for a short listPrior authorization delays and blocks careChosenPublic administration with a cost targetInsurer overhead and profitChosenPublic review of hospital budgetsExecutive pay and nonprofit statusChosenCut documentation and billing burdenClinician burnout from paperwork and EHR workChosenGlobal budgets for hospitalsU.S. prices are far higher than in other countriesChosenLower costs for clinicians, not only payProviders leave, retire, or go cash-only if pay dropsChosenFast transition in one or two yearsTransition disruption: jobs, companies, and familiar coverageRejectedAutomatic exemptions and annual collection through taxesCopays keep billing systems alive and still deter poorer patientsChosenDrop point-of-care charges entirelyCopays keep billing systems alive and still deter poorer patientsChosenReport measures publicly without tying pay to themTargets and quality metrics invite gamingRejected
Who's affected
Who gains
- Health insurers, brokers, and their shareholders
- About $1 trillion a year in administrative cost: Insurers, billing firms, and clearinghouses earn from the complexity.
- Insurance and billing workers
- About $1 trillion a year in administrative cost: Their jobs exist because of the complexity.
Who loses
- Doctors, nurses, and other clinicians
- About $1 trillion a year in administrative cost: Time goes to billing and insurer rules instead of patients.
- People with employer coverage
- About $1 trillion a year in administrative cost: Premiums pay for the administration.
- Taxpayers and public budgets
- About $1 trillion a year in administrative cost: Public programs pay for it too.
Where it has been tried
- Canada: Under Canada's framework where 13 provinces and territories administer health plans under national standards, the federal government provided over $52.1 billion via the Canada Health Transfer in fiscal year 2024–2025 (2025).Sources: Health Canada (2025)