President Donald Trump and congressional Republicans are kicking off 2026 with a significant initiative aimed at overhauling the United States health insurance system. The administration is set to conduct hearings involving insurance executives to investigate practices that inflate healthcare spending. While these measures are not a complete solution, they mark an important step toward addressing the challenges within the health insurance landscape.
Insurers play a critical role in determining the healthcare services available to patients, including treatment locations, prescribed medications, and overall costs. Despite widespread recognition of the detrimental impact of insurance companies, reform efforts have consistently faltered. The current system benefits from substantial taxpayer subsidies, often supported by politicians with close industry ties. Over the years, health insurance has evolved from a safety net for rare, catastrophic events into a comprehensive bureaucracy that governs virtually every medical interaction.
The financial strain on families is evident. In 2026, the average family plan for two adults and two children on the Obamacare exchanges costs nearly $27,000 in premiums alone. With healthcare costs continuing to rise faster than wages, projections indicate that by 2032, an average American family could spend 40% of its income on health premiums.
Beyond costs, the insurance system increasingly encroaches upon medical decision-making. As a former clinician, Dr. Wolfgang Klietmann observed that insurers frequently override doctors’ clinical judgments, dictating which medications and procedures patients can access. The presence of pharmacy benefit managers (PBMs), intermediaries that negotiate drug prices on behalf of insurers, has further complicated matters. PBMs often steer patients to more expensive medications that yield higher rebates for them, resulting in increased out-of-pocket costs for patients even when cheaper alternatives are available.
Insurers have recently exploited a loophole by creating offshore entities known as Group Purchasing Organizations (GPOs). This strategy allows them to route drug transactions through these organizations, potentially evading U.S. tax liabilities and circumventing requirements to pass negotiated savings on to patients. As a result, patients face higher prices at the pharmacy counter while insurers and PBMs retain financial benefits.
To address these issues effectively, comprehensive reforms are necessary. First, Congress must curtail the power of insurers and PBMs by eliminating their incentives to inflate drug prices and mandating transparency in coverage decisions. Policymakers should also reconsider the substantial taxpayer investments in a system plagued by fraud and inefficiency. In the previous year, the federal government spent nearly $140 billion subsidizing Obamacare, yet taxpayer subsidies per enrollee have surged by more than 50% since 2014 without corresponding improvements in care or affordability.
Moreover, Medicare Advantage plans have begun offering perks unrelated to health, such as ski passes and pet food, which further dilutes the intent of taxpayer funding. Taxpayers should not bear the burden for such expenditures.
The Paragon Institute estimates that over 6 million individuals received fully subsidized Obamacare coverage incorrectly last year. Additionally, the Centers for Medicare & Medicaid Services (CMS) acknowledged that nearly 3 million Americans were improperly enrolled in multiple insurance plans during 2024, resulting in double billing for the same medical services. Furthermore, some insurers have adopted unethical practices like “upcoding,” exaggerating patients’ diagnoses to secure higher government reimbursements.
The historical context parallels Émile Zola’s famous “J’accuse,” which condemned a system enabling fraud under the guise of self-protection. This echoes today’s entanglement of government officials, insurers, and policymakers in reimbursement schemes that inflate costs for patient care.
While both the United States and Europe rely on the same pharmaceutical companies for innovative medicines, American patients often pay significantly more for identical drugs. This discrepancy arises not from differences in the medications themselves, but from insurers and intermediaries imposing additional fees and opaque pricing structures.
To restore control to patients, it is essential to reduce reliance on taxpayer-funded insurance coverage for every aspect of healthcare. One effective approach could be expanding the use of health savings accounts, empowering patients to make their own healthcare decisions without intermediary interference.
As the year progresses, patients are looking to Donald Trump and Republican leaders in Congress to champion meaningful reforms in the health insurance system that prioritize their needs. The path to a more effective and affordable healthcare system will require decisive action and a commitment to transparency and accountability from all stakeholders involved.
