Workers could then compare total compensation instead of guessing whether “competitive health benefits” means excellent family coverage or a $7,000 deductible.
Some employers would adjust future wages or other benefits to absorb the cost. That already happens when premiums increase. The difference is that the contribution would become visible and portable rather than disappearing into an arrangement controlled by the company.
Congress would still have substantial work to do. Federal tax law, the Affordable Care Act and ERISA would have to be coordinated. Lawmakers would have to decide how contributions are calculated, how subsidies interact with employer payments and how regional medical costs are treated. The Congressional Budget Office and Joint Committee on Taxation would have to estimate the effects on wages, federal revenue and existing coverage.
But complexity is a reason to draft the legislation carefully, not a reason to preserve a bad idea forever.
We have already built part of the machinery. Individual Coverage Health Reimbursement Arrangements allow employers, under federal rules, to reimburse workers for premiums on individual insurance selected by the employee while preserving tax-favored treatment.⁷ The current system is too limited and remains employer-controlled, but it proves that employer financing and individually chosen insurance can coexist.
The larger task is to turn that possibility into a right.
We have confused the employer’s role in transmitting health-insurance money with ownership of the benefit itself. The employer should contribute while the worker is employed. The worker should choose the insurance. Every plan should meet a decent national standard, and changing jobs should not send anyone’s coverage over a cliff.
Jacob McDonald should be able to decide whether he is ready to retire by looking at his savings, his family and what he wants to do with the next part of his life. A parent should be able to care for a child. A skilled employee should be able to join a startup. Someone who hates a job should be free to leave without gambling the family’s health.
Health insurance should be personal security, not an instrument of employment dependency.
Bibliography
1. Jamie Ducharme, “Why Your Health Insurance Costs Keep Rising,” Time , October 22, 2025. The article profiles Jacob McDonald, a 47-year-old Dallas network engineer facing the prospect of paying approximately $4,000 a month through COBRA if he retires before Medicare eligibility.
2. Ellyn Maese, “One in Four U.S. Employees Locked in Jobs for Health Insurance,” West Health–Gallup Center on Healthcare in America, July 21, 2026; West Health, “1 in 4 American Workers Report Staying in Unwanted Jobs for Health Insurance,” July 22, 2026. The study estimates that 24 percent of workers dependent on employer insurance—approximately 23 million adults—remain in unwanted jobs because of coverage concerns.
3. Congressional Budget Office, “Reduce Tax Subsidies for Employment-Based Health Insurance,” December 7, 2022, and related CBO budget-option materials. CBO identifies employer premium payments as employee compensation that, unlike ordinary wages, is generally excluded from income and payroll taxes.
4. KFF, 2025 Employer Health Benefits Survey , October 22, 2025. Average annual family premiums reached $26,993, with workers contributing an average of $6,850.
5. U.S. Department of the Treasury, Tax Expenditures: Fiscal Year 2026 Estimates . Treasury estimates the exclusion of employer contributions for medical insurance premiums and medical care at $296 billion for fiscal year 2026.
6. Internal Revenue Service, “Minimum Value and Affordability,” and “Questions and Answers on Employer Shared Responsibility Provisions Under the Affordable Care Act.” Federal rules generally define minimum value as covering at least 60 percent of the total allowed cost of expected benefits, together with substantial physician and inpatient hospital coverage.
7. Centers for Medicare & Medicaid Services, “Health Reimbursement Arrangements.” Individual Coverage HRAs may reimburse premiums for individual insurance chosen by employees while preserving tax-favored treatment for employer contributions.