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Utah's Defined-Contribution Option: Patient-Centered Health Care

Americans who receive health insurance through their jobs generally have little flexibility: 86 percent of employers in the country offer only one plan. This system of “defined benefits” has worked well for expanding group coverage, but severely limits options for individuals, and has not kept costs from skyrocketing. Recipients of employer-sponsored health insurance also lose their current coverage when they leave or switch jobs. In Utah, state policymakers have taken a different approach, giving businesses and their workers the option of “defined contribution” health benefits where participating workers choose coverage from a wide variety of plans offered by competing insurers through Utah’s health insurance exchange. Utah’s state leaders are innovators who are doing precisely what they should be doing using their authority to resist concentrated power in Washington, and working to provide more and better choices for their citizens. ....

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Consumer Power: 5 Lessons from Utah's Heath Care Reform | The Heritage Foundation

Obamacare is on the march, and state policymakers must decide by 2014 how they will respond to this encroachment on state’s rights to control their own health insurance markets. The state of Utah has been on the reform path since 2005. With its system of defined contributions (as opposed to the standard defined benefits), a functioning health insurance exchange, and appropriate risk-adjustment mechanisms, Utah has given its workers the freedom to choose among many health plans with different levels of benefits, instead of remaining tied to the one-size-fits-all approach dictated by Washington. The Heritage Foundation has discerned five distinct lessons that the other 49 states can learn from Utah’s experience. The time for learning and for action is now. ....

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