Health Care Is Fixable: Workers’ Compensation Shows Employers Don’t Need to Wait for Washington

A staggering one-third of Americans—over 82 million people—are skipping meals, cutting back on utilities, or borrowing money to pay for health care, according to a recent West Health-Gallup survey. Employers aren’t faring any better, facing projected cost increases of 6% to 11% in 2026 and making difficult decisions about coverage and cost-sharing.

For decades, this cycle has repeated itself, leading many to believe the problem is too complex to fix or that we must wait for Washington to act. That assumption is wrong, and we already have proof.

I know there is no quick fix. But those who believe better outcomes at lower costs are impossible need only look at a system that’s already working: workers’ compensation.

In the workers’ comp market, real per-capita costs have fallen by more than 40% since 1990, from $512 in 1990 to $299 today, while serious injuries and lost-time incidents at work have also declined. By contrast, self-insured health plans have seen costs more than double over the same period, from $6200 to $15,500 per capita in real terms since 1990, without consistent improvement in outcomes.¹

The difference is not complexity. It is incentives.

Workers’ compensation rewards prevention and better results through clear reporting, aligned financial incentives, and shared risk. Employers, insurers, and providers are all focused on helping people recover and return to work safely and quickly. The system is designed to reward outcomes, not the volume of services delivered.

Health care is more complex, but the lesson is clear. When incentives are aligned around results, better performance follows.

I have no illusions that it will be an easy process, but I have no doubt it can be done, starting with self-insured employers applying this prevention playbook and unlocking 10%–30% savings in high-stakes areas while improving employee health.

The path forward is a market-driven overhaul under the Employee Retirement Income Security Act. It does not require new legislation or taxpayer funding. Employers take the reins voluntarily, certifying plans with workers’ comp-like capital mandates, audits, and stop-loss uniformity to ensure solvency. Private catastrophic risk pools can be built through group self-insurance, supported by underwriting and reinsurance to manage high-cost risk.

Clearer claims reporting through Form 5500 enhancements provide better insight into where dollars are going. Care can be directed to Centers of Excellence for musculoskeletal conditions and high-risk maternity, using cost-sharing incentives that mirror workers’ comp models. A private guaranty trust can provide continuity and backup. Legal audits, data alignment, and pilot programs are all driven by private enterprise, demonstrating that markets can move faster than mandates.

At the Health Transformation Alliance, a cooperative of over 80 companies covering more than 5 million US lives, we are already seeing what is possible. By using data to identify high-value care and aligning incentives around outcomes, employers have achieved 15%–20% cuts in specialty-drug costs through bulk buying, and top employers have regulated spending growth below 3%, defying the 8% industry average, while lifting chronic care results, curbing hospitalizations, and boosting workforce vitality.

But we are far from satisfied. The current system continues to reward volume over value, and too many dollars still flow to parts of the system that are not directly improving patient outcomes.

We do not need to wait for Washington or accept another decade of rising costs and uneven outcomes. Employers already have the scale, the data, and the leverage to drive change if they choose to use it. By applying the principles that have worked in workers’ compensation, aligning incentives around outcomes, insisting on transparency, and rewarding prevention, we can build a system that delivers better health at a lower cost.

The tools already exist. The question is whether we are willing to use them.

Reference

Andrews, R. Aligning incentives in employer health benefits: lessons from workers' compensation. Healthcare Transformation Alliance. May 26, 2026. Accessed June 18, 2026.