For decades, the American conversation around healthcare reform has been trapped in a binary struggle: the status quo of a fragmented private system versus the sweeping promise of Medicare for All. To many policymakers, it feels like a choice between a system that is too expensive to maintain and a proposal that is too politically radioactive to pass.
But as a physician, I have seen firsthand that the real crisis isn’t just about who pays the bill—It’s about how the care is delivered. The current tension exists because Medicare for All seeks to dismantle the profit motive entirely, a move that inevitably triggers fierce resistance from the very providers and insurers required to make the system function. Without the cooperation of the “major players,” reform remains a theoretical exercise rather than a legislative reality.
In his recent work, Beyond Medicare For All: Cracking the Code of the Healthcare Affordability Crisis, veteran healthcare journalist Ken Terry proposes a third way. His model suggests that the path to universal coverage isn’t through a single-payer monopoly, but through a “bifurcated” system. By separating routine primary care from catastrophic “major medical” events, Terry argues we can achieve universal access and lower costs without triggering an industry rebellion.
The Political Math of Healthcare Profit
The central premise of Terry’s proposal is a pragmatic acknowledgment of power. In the current landscape, health systems and insurance corporations exert significant influence. If a reform effort threatens to slash provider revenues or eliminate the insurance industry entirely, those entities will use every available resource to block the bill. This, Terry suggests, is the primary reason why a pure Medicare for All model has struggled to gain traction beyond the fringes of the legislature.
Instead of attempting to erase profit, this alternative model seeks to manage it. By allowing private insurers to remain in the system—albeit in a redefined role—the proposal “keeps them whole” while restructuring the delivery of care to prioritize affordability. The goal is to shift the financial incentive away from high-cost hospital interventions and toward the preventive care that keeps people out of the hospital in the first place.
A Two-Tiered Approach to Universal Coverage
The proposed system splits healthcare into two distinct financing streams: a subscription-based model for basic care and a standardized insurance model for major medical needs. This distinction is critical because it treats a routine check-up and a heart surgery as two fundamentally different economic problems.
1. The Basic Care Subscription
Under this model, “basic benefits” are redefined. Rather than a skimpy plan that leaves patients with high deductibles, basic care would cover everything most people need most of the time: primary care, preventive screenings, chronic disease management, and minor acute care. This would also extend to dental, vision, hearing, and behavioral health.
Crucially, this tier would not be “insured” in the traditional sense. Instead, patients would join competing, independent primary care groups via a subscription fee. These fees would be funded by a combination of individual payments, employer contributions, and government subsidies on a sliding scale based on income. For those on Medicare or Medicaid, the government would purchase these subscriptions directly.
2. Redefining Major Medical Insurance
When a patient requires a hospital admission, complex surgery, or high-cost specialty drugs, the financing shifts to “major medical insurance.” This represents where private insurers maintain their role. These plans would cover inpatient care, post-acute care, and expensive diagnostic tests like MRIs or PET scans.
To prevent the “tiered” quality of care often seen in private systems, major medical plans would have standardized benefits. While affluent patients could purchase supplemental “top-up” plans for amenities—such as a private hospital room—the core medical benefits would be universal. These plans would be available through a marketplace similar to the one established by the Affordable Care Act (ACA), with government subsidies ensuring that no one is left uncovered.
| Feature | Basic Care Tier | Major Medical Tier |
|---|---|---|
| Primary Focus | Preventive, Chronic, & Minor Acute Care | Hospitalization, Surgery, & High-Cost Drugs |
| Payment Model | Annual Subscription Fee | Standardized Insurance Premium |
| Delivery Method | Independent Primary Care Groups | Hospital Networks & Specialists |
| Funding Source | Employer/Individual/Gov (Sliding Scale) | Marketplace/Gov Subsidies |
How This Lowers Total Spending
The economic “linchpin” of this model is the relationship between primary care and hospitalization. In the current U.S. System, the financial incentives often favor the “sick-care” model—where the most profit is made when a patient is admitted to a hospital.
By creating a dedicated, subscription-funded primary care tier, the model incentivizes primary care groups to keep their populations healthy. If a primary care group can effectively manage diabetes or hypertension through the subscription budget, they reduce the need for expensive emergency room visits and hospitalizations. This reduces the burden on the “major medical” insurance tier, slowing the growth of overall health spending.
the model proposes “global budgets” for hospitals, meaning they would be paid a set amount to provide care within a region, rather than being paid per procedure. This removes the incentive to over-treat or perform unnecessary surgeries to increase revenue.
Stakeholders and Systemic Impact
The transition to this model would create a new set of dynamics for the key players in the healthcare ecosystem:
- Patients: Gain universal access to a comprehensive set of basic services without the fear of “out-of-network” surprises for routine care.
- Primary Care Physicians: Shift from a “fee-for-service” treadmill to a stable, budget-based subscription model, allowing for more time with patients.
- Insurers: Transition from managing all care to specializing in high-cost, catastrophic risk, maintaining profitability by covering a larger population with a more focused set of services.
- The Government: Reduces the volatility of healthcare spending by stabilizing the cost of basic care and using sliding-scale subsidies to ensure equity.
Disclaimer: This article is for informational purposes only and does not constitute medical or financial advice. Healthcare policy proposals are subject to legislative debate and varying economic analyses.
While this bifurcated model offers a pragmatic alternative to the current stalemate, its success would depend on the willingness of Congress to standardize major medical benefits and the ability of the market to support independent primary care groups. As the U.S. Continues to grapple with an affordability crisis, the focus is shifting toward these hybrid models that balance the necessity of universal access with the realities of political and economic power.
We will continue to monitor updates from the American Association for Physician Leadership and upcoming congressional discussions regarding healthcare financing reform.
Do you think a subscription-based model for primary care would improve your experience with your doctor? Share your thoughts in the comments below.
