10Plan, How Would It Affect Health Care Spending by Consumers and the Federal Government
Feb 25, 2021
The 10Plan is a self-pay plan for individuals currently uninsured or covered by a private nongroup health insurance plan. Individuals would pay no premiums up front, face Medicare rates, pay a copayment for each encounter, and have the option to pay cash for services or borrow from the government at a low interest rate to pay for care. The authors built a microsimulation model to estimate health care spending under the status quo and the 10Plan.
A Self-Pay System Designed to Minimize the Burden of Health Care Costs
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The authors of this report investigate an alternative health care financing approach, the 10Plan, for the nearly 28 million individuals who are not covered by health insurance and the approximately 20 million individuals who purchase private coverage in the nongroup health insurance market, including on the Affordable Care Act exchanges.
The 10Plan, designed by Mark Cuban, would eliminate the need for traditional health insurance for these individuals and allow them to pay only for the healthcare services that they use, and then at Medicare prices. The 10Plan is called the "10" Plan because most participants will not pay more than 10 percent of their family's income on repayment premiums.
To protect participants from financial uncertainty stemming from healthcare events that are high-cost or beyond participants' abilities to afford, participants in the 10Plan would be able to defer payments after a $25 copay for each encounter. In the case of deferred payments, participants would be borrowing from the federal government at a 3-percent interest rate.
In this analysis, the authors built a microsimulation model to estimate how much the 10Plan would cost participating individuals and families and what portion of the cost would be shouldered by the federal government. The authors also examine cases in which individuals could be negatively affected by the 10Plan's implementation.
How the 10Plan Works
Health Care Demand and Supply
This research was funded by Mark Cuban and conducted by the Payment, Cost, and Coverage Program within RAND Health Care.
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