John Mackey, CEO of Whole Foods, has wisdom to share about health care reform that covers people while cutting costs, because he's done it in his chain of stores. Among his suggestions, which are just free-market enough to work (they already have at Whole Foods):
Remove the legal obstacles that slow the creation of high-deductible health insurance plans and health savings accounts (HSAs). The combination of high-deductible health insurance and HSAs is one solution that could solve many of our health-care problems. For example, Whole Foods Market pays 100% of the premiums for all our team members who work 30 hours or more per week (about 89% of all team members) for our high-deductible health-insurance plan. We also provide up to $1,800 per year in additional health-care dollars through deposits into employees' Personal Wellness Accounts to spend as they choose on their own health and wellness.
Money not spent in one year rolls over to the next and grows over time. Our team members therefore spend their own health-care dollars until the annual deductible is covered (about $2,500) and the insurance plan kicks in. This creates incentives to spend the first $2,500 more carefully. Our plan's costs are much lower than typical health insurance, while providing a very high degree of worker satisfaction.
• Equalize the tax laws so that employer-provided health insurance and individually owned health insurance have the same tax benefits. Now employer health insurance benefits are fully tax deductible, but individual health insurance is not. This is unfair.
Here's how Mackey explained the appeal of his approach several years ago. Keep in mind, it's appealing to the folks who work at Whole Foods, who are likely not a very right-of-center bunch: He even held a vote among employees about which health care plan to keep when some objected to the consumer-driven HSA plan. The vote was 77 percent in favor of the current Whole Foods plan:
"Because it's like, 'At last, I can go to that acupuncturist! At last, I can go to my chiropractor! At last, I can spend the money the way I want to spend it.'"
Whole Foods has an insurance policy with a high deductible. That means an employee like Braden Weirs must pay about $1,000 before his insurance kicks in. If he gets cancer or heart disease, his insurance covers it.
But if he has a sore throat or a sprained ankle, he pays.
To help workers pay, Whole Foods puts money into an account for them. Weirs got $1,500 this year. If he doesn't spend it on medical care this year, he keeps it and the company adds more next year.
"And I have plenty of money left over," Weirs said. "So I can go get my new prescription glasses at the end of the year."