Opinion · Marcus Malcom
Pick Model 3, with three changes
This is one person's opinion. The explainer takes no position on the plan, and nothing here changes it. The three changes and every figure marked my math are mine, not the board's.
The board drafted five ways to pay for the plan and recommended none. I would take the third, and fix what it gets wrong.
Written November 13, 2026 · Download this page as a PDF
© 2026 Malcom IO LLC. Printed from www.malcom.io/oregon-universal-health-plan/opinion.
Why Model 3
From the explainer's table of example households, which uses the board's schedules. Both households pay about $10,000 to $23,000 a year for health care today. The last bar in each is my proposal: a worker credit half the size of Model 2's, and a slower climb at the top that a higher household rate pays for. my math
What Model 3 gets wrong
Average tax on wage income, against other income
15.1% vs 5.9%
Household contribution plus payroll tax (Appendix FR, page 33)
A single public employee at $80,000
$940 → $3,697
Today, then Model 3. The appendix says nearly all single public employees would pay more
A self-employed family of four at $2,000,000
$22,871 → $148,725
Today, then Model 3. No upper limit
What the rates are sized to raise, against the actuary's estimate
$30B vs $39B
Both estimates are the report's. Every rate would be about 30% higher my math
The first is the root of it. Model 3 has no worker credit, so the same wages are taxed twice: once through the employer's payroll tax and again through the household contribution. The board's finance committee called a credit "necessary to avoid stacking" the two.
The three changes
Same pay, same share
A partial worker credit. An employee takes a quarter of the payroll tax paid on their wages off their own household contribution.
- Fixes
- Wages taxed far more heavily than other income; public employees and single workers paying more than today
- Costs
- A higher household rate, which lands on income with no employer behind it
- Priced
- As a range, from two of the board's own models
- Standing
- The core. Worth doing on its own
A slower climb
A soft cap. Above twice what a household buying its own coverage pays today, each further dollar of contribution is cut to a quarter. It never stops rising.
- Fixes
- A bill many times the cost of coverage at the top (it shrinks it; it does not end it), and the risk that those households leave
- Costs
- A higher household rate again, paid by everyone below the cap
- Priced
- Roughly, as a range. The documents do not give enough to price it
- Standing
- Worth doing. The middle pays for it and still pays far less than today
Honest rates
Publish the rates at both the board's $30 billion and its actuary's $39 billion, and reset them each year to what the plan costs, under a stated ceiling.
- Fixes
- Rates sized to the lower of two estimates, about 30% apart
- Costs
- Nothing in dollars; it shows the higher number up front
- Priced
- Yes: the rates scale with the target
- Standing
- Worth doing with or without the other two
Worker credit
None → 25%
Household rate, same exemption
7.7% → 11.7–13.1%
Slower climb starts, family of four
$45,742
Payroll tax, exemption, business taxes
As in Model 3
my math The board's Model 2 is Model 3 with a 50% credit: same exemption, same payroll tax, a 12.05% rate against 7.69%. Halfway between them is 9.9%, and that is the low end: a credit cannot exceed the bill it comes off, and a smaller credit runs into that limit less often, so more of it gets used. If all of it were used the rate would be 10.4%. So change 1 alone puts the rate near 10.1%. It is a range from two of the board's own models, not an actuary's figure.
my math The slower climb starts at twice what a household buying its own coverage pays today in the board's examples: $13,800 for one person (twice $6,900) and $45,742 for a family of four (twice $22,871). Above that, a quarter of each further dollar is still paid. It moves roughly $2.9 billion to $4.3 billion a year off the top, and I have the household rate make that up, which takes it to somewhere in 11.7–13.1%. The figures below use 12.4%. This part is rough: the documents give each income group's share of the contribution, not bills by household, so I assume 75% to 90% of what the top 1% pay sits above the start, and 20% to 45% of what the next 4% pay. A self-employed family of four reaches the start at about $434,000 of income.
The same twelve households
The explainer's households. ↓ less than the household pays today, ↑ more.
| Household | Pays today | Draft, Model 3 | My proposal: changes 1 and 2 | Its employer's payroll tax |
|---|---|---|---|---|
| Single worker, private employer, $45,000 1 person, about the median for one | $2,150 | $1,006 | Less than today: $672 | $3,800 |
| Single public employee, $80,000 1 person, school district or other public employer, about the 80th percentile for one | $940 | $3,697 | More than today: $3,404 | $10,300 |
| Self-employed, buys own plan, $90,000 1 person, above the 80th percentile for one | $6,900 | $4,466 | More than today: $7,211 | None |
| Couple, private employer, $85,000 2 people, the median for two | $4,700 | $3,208 | Less than today: $3,380 | $7,200 |
| Retired couple on Medicare, $75,000 2 people, income not counting Social Security | $9,600 | $2,439 | Less than today: $3,938 | None |
| Family of four, private employer, $70,000 4 people, below the median for four | $10,000 | $308 | Less than today: $0 | $5,900 |
| Family of four, private employer, $110,000 4 people, the median for four | $10,000 | $3,384 | Less than today: $3,235 | $8,900 |
| Family of four, public employer, $110,000 4 people, the median for four | $4,000 | $3,384 | Less than today: $1,998 | $13,900 |
| Family of four, private employer, $220,000 4 people, about the 80th percentile for four | $10,000 | $11,843 | More than today: $15,070 | $16,200 |
| Family of four, self-employed, $400,000 4 people, buying their own plan, between the 80th and 95th percentile | $22,871 | $25,685 | More than today: $41,467 | None |
| Family of four, self-employed, $1,000,000 4 people, buying their own plan, above the 95th percentile ($500,000) | $22,871 | $71,825 | More than today: $63,296 | None |
| Family of four, self-employed, $2,000,000 4 people, buying their own plan, above the 95th percentile ($500,000) | $22,871 | $148,725 | More than today: $94,334 | None |
my math My proposal uses a 12.4% rate, near the middle of the range, with the slower climb paid for. "Pays today" and Model 3 are the explainer's and count the household's own bill only. The last column is not paid by the household: it is the payroll tax its employer pays on its wages (the board's 9% example for a private employer, 14% for a public one), and it is what the credit is a quarter of. It is the same under Model 3 and under my proposal. A smaller employer pays less, and under $500,000 of payroll nothing, so its workers get a smaller credit or none.
Who pays for the slower climb
Collecting less from the top means a higher rate for everyone below the start of the climb. Here is each change on its own.
| Household | Pays today | Draft, Model 3 | Change 1 alone (10.1% rate) | My proposal: both (12.4% rate) |
|---|---|---|---|---|
| Single public employee, $80,000 | $940 | $3,697 | $2,297 | $3,404 |
| Family of four, private employer, $110,000 | $10,000 | $3,384 | $2,223 | $3,235 |
| Family of four, private employer, $220,000 | $10,000 | $11,843 | $11,526 | $15,070 |
| Family of four, self-employed, $400,000 | $22,871 | $25,685 | $33,781 | $41,467 |
| Family of four, self-employed, $1,000,000 | $22,871 | $71,825 | $94,466 | $63,296 |
| Family of four, self-employed, $2,000,000 | $22,871 | $148,725 | $195,608 | $94,334 |
my math Adding the slower climb takes about $1,000 a year more from the median family and the single public employee than change 1 alone, and at 12.4% both still pay a little less than under Model 3. At the top of my range they would not: the median family would pay about $3,600 against $3,400. The family pays far less than today either way; the public employee still pays more than today. The households it costs most are higher earners below the start: the family at $220,000 and the self-employed family at $400,000 pay more than under Model 3 and more than today. That is the price of the two rows below them.
Who gains, and who pays for it
Single public employee, $80,000
$3,700 → $3,400
Median family of four, private employer
$3,400 → $3,200
Self-employed family of four, $1,000,000
$71,800 → $63,300
Self-employed family of four, $2,000,000
$148,700 → $94,300
Own bill under Model 3, then under my proposal.
Show these figures as a table
| Income | Draft, Model 3 | Change 1 alone | My proposal |
|---|---|---|---|
| $500,000 | $33,375 | $43,896 | $47,777 |
| $1,000,000 | $71,825 | $94,466 | $63,296 |
| $1,500,000 | $110,275 | $145,037 | $78,815 |
| $2,000,000 | $148,725 | $195,608 | $94,334 |
The private-employer family is drawn with nine tenths of its income as wages at the 9% example rate.
- Households with no employer behind their income, below the top: the self-employed, retirees with income, investors. Their rate goes from 7.7% to somewhere in 11.7–13.1%, and a self-employed family of four pays more than under Model 3 up to about $810,000.
- Higher earners with an employer. A family of four with a private employer pays more than under Model 3 from about $120,000 to about $730,000: the credit no longer covers the higher rate, until the slower climb takes over.
- Workers at employers under $500,000 of payroll. No payroll tax is paid on their wages, so there is no credit, and their rate still rises.
- Progressivity, at the very top. The board left a soft cap out because it makes the structure less progressive. That is true of change 2. It is the trade I am making.
- Most workers up to about the middle, public employees most of all. A family of four with a private employer pays less up to about $120,000, at the middle of my rate range; at the top of it, only to just under the median. Not all: the couple at $85,000 pays about $170 more.
- Households at the top, above about $810,000 for a self-employed family of four.
- The plan itself, if the appendix is right that without a credit there is "a large financial incentive" to turn employees into contractors, and if fewer of the highest earners leave.
Change 3
Honest rates
The draft's rates are sized to the board's own cost estimate. Its actuary's is about 30% higher. Print both, and reset them each year to what the plan costs.
| Sized to raise | Household rate, Model 3 | Household rate, my proposal | Payroll tax above $500,000 | Payroll tax above $10 million |
|---|---|---|---|---|
| $30 billion, the board's estimate | 7.7% | 12.4% | 9.6% | 14.0% |
| $39 billion, Milliman's estimate | 10.0% | 16.1% | 12.5% | 18.2% |
my math Every rate scaled by the same 30%. My proposal's rate is the middle of a rough range (11.7–13.1% at $30 billion). Every figure above this section uses the lower row, as the board's draft does.
Beyond the revenue model
Signing up on your word
The draft covers anyone who says Oregon is their home and that they intend to stay. Every taxpayer will ask what stops someone from saying it, getting care and leaving. The draft's answer is thin.
Starting benefits in full, before any proof
60 days
Proof of residency is due after coverage starts, not before (report, page 7)
One proof the committee would accept
A statement plus any mail
"Attestation of residency plus any mail addressed to applicant at Oregon address" (enrollment proposal, page 3)
If the plan drops you because it could not verify you
Sign again
They "can re-enroll by attesting that they still meet the residency standard" (report, page 8)
If the statement was false, or proof never comes
No penalty, no bill
Coverage depends on proof, but neither document names a penalty or says who pays for care already given
The draft makes new members wait six months for full benefits, and that wait covers less than it sounds like. From day one a new member gets primary care, behavioral health, emergency care and "medically necessary services." The only things the report names as waiting are planned outpatient procedures and fertility services.
My proposal: proof on day one
The committee chose a statement because it is simplest and keeps new residents covered without a gap. It is simplest only on day one. After that the plan has to go back to each new member its records cannot confirm, track a 60-day deadline for each one, and end coverage for those who miss it, who can then sign again and start a new 60 days. That is a paperwork problem waiting to happen. Asking at sign-up means the plan chases fewer people, and nobody twice.
- Take a statement
- Start coverage
- Ask for proof
- Track 60 days
- Take a statement and a document or records match
- Start coverage. Done
With nothing to show that day, both versions ask and track 60 days. Mine does it once; the draft can repeat it.
So: keep cover for care that cannot wait, ask for proof up front, and make the statement mean something.
Proof first
The state checks its own records, as the draft plans, but at sign-up and not after. A match, or one document, finishes enrollment that day: an Oregon license, a lease, a utility bill, a pay stub showing an Oregon home address, enrollment papers from a Tribe with Oregon lands. With no lease in your name, a letter counts: from a shelter, caseworker or public agency, or from the person you are staying with, signed under penalty of law, at an address the state has on record for them. A statement plus a piece of mail does not.
Care that cannot wait, never waits
With no proof yet, a new member still gets emergency, urgent, primary and behavioral health care, prescriptions a month at a time, and any treatment a clinician says cannot safely wait, for up to 60 days. So do their children. The plan pays the hospital or clinic for this care whatever happens later. Other care the draft allows in the first six months starts the day proof arrives.
One residency
The statement is signed under penalty of law, like an Oregon tax return, and goes to the Department of Revenue and no other agency: you cannot be an Oregon resident for care and another state's resident for tax. It has to be true the day you sign; leaving later for a job or family is no offense. It asks nothing about immigration status. Out-of-state students, seasonal farm workers and people in custody, whom the draft covers as exceptions, show a school, employer or facility record instead, and their taxes do not change. Tribal members may join or not, as the draft says.
Pay it back
If the statement was false, the plan bills the person or their insurer. The test needs no proof of intent: by your own statement you owed an Oregon resident return for that year, and after a written notice you still filed none. Filing late clears it. If proof simply never arrives, membership ends at day 60, apart from treatment under way that a clinician says cannot stop, and nobody is billed for those 60 days. After that an emergency room still treats you, as the law requires, and bills you as it would any visitor. Signing up again takes proof, not a second statement.
| Sign-up | The draft | My proposal |
|---|---|---|
| To enroll | A statement | A statement, plus one document or a match in state records |
| With no proof yet | The first-six-months benefits, for up to 60 days | Emergency, urgent, primary and behavioral health care, prescriptions, and anything that cannot safely wait, for up to 60 days |
| Proof never comes | Coverage depends on it; no penalty or bill stated | Membership ends at day 60, except treatment that cannot stop; no bill for care already given |
| A false statement | Not addressed | Billed for the care |
| Signing up again after being dropped | A new statement, and a new 60 days | Proof |
| Tax | A tax return renews coverage; the statement is not tied to tax | The statement goes to the Department of Revenue |
| Full benefits | After six months | After six months |
- People with the least paper wait longest. That includes long-time Oregonians who file no return and have no lease, not only newcomers. Until proof arrives they get less than the draft gives them, and after day 60 only treatment that cannot stop.
- For 60 days the plan still pays for urgent and everyday care on a statement alone, and past day 60 for treatment that cannot stop. That is the price of nobody waiting.
- A signed statement and a possible bill will scare off some people who qualify, and clinics will have to judge what can wait.
- It does not stop a short stay with real paperwork. A lease proves an address, not an intent to stay. Someone who rents a room, gets treated and leaves pays Oregon tax and the household contribution for those months if they have income, and nothing if they do not. The report names the risk; Milliman's estimate counts some of it.
- Most bills will not be collected from someone who has left Oregon. The bill is a deterrent, not revenue.
- Medicaid's rules still govern anyone who qualifies for Medicaid, and many people with the least paper do. For them much of this may not apply.
- A waiting period based on time lived in Oregon. The committee weighed a "tenure-based distinction" and notes that Medicaid rules "prohibit states from imposing any durational residency requirements." In 1974 the Supreme Court struck down a one-year county residency wait for poor people's non-emergency care at county expense (Memorial Hospital v. Maricopa County). Asking for proof that someone lives here is different from asking how long they have lived here.
- A longer wait for full benefits. It would land on every new member, and the same case law is a risk to the six months the draft already has.
What I would ask for: have the board's counsel test these four parts, and the draft's own six-month wait, against federal law. Parts 3 and 4 would need to be written into statute. And have the plan publish each year how many people enroll within a year of arriving, what their care costs, and how many leave within a year. Nobody has to guess at the size of this once it is counted.
In this section "the committee" is the board's Operations committee, and "enrollment proposal" is its Preliminary Proposal: Enrollment, which the board approved on February 19, 2026 and the draft report cites.
Four smaller fixes
$1,600
End the marriage penalty
Two single people exempt $63,840 between them; a married couple, $43,280. That costs a couple this much a year. Set the couple's exemption at twice the single's. my math
$48,000
Count related firms as one
Each $500,000 exemption is worth this much a year, so splitting one firm into several pays. The draft has no rule against it. my math
14%
Treat public employers like private ones
School districts, cities and the state would pay the top payroll rate from the first dollar, because they spend more of payroll on coverage today. In the board's example that is still less than the premium they pay now, but it is one public budget taxing another.
55%
Write in a fallback
More than half the money is the payroll tax, which a federal benefits law could be used to challenge. The committee said it "may want automatic triggers" on other taxes if that happens. None is written.
I cannot price the first and third: the documents do not give the number of married returns above the exemption or the size of public payrolls.
What I looked at and set aside
A hard ceiling
A household at $1,000,000 and one at $2,000,000 would pay the same.
A lower rate on more income
Lowering the exemption to 138% of poverty only gets the rate to about 6.6% to 7.0%, and it charges households that pay nothing today. my math
Moving money from payroll to households
Households would see more of the cost, but payroll tax is paid before federal tax, and the report does not say a household contribution would be. It would likely send more of Oregon's money to Washington.
What I would ask for: have the board's actuaries price Model 3 with a worker credit at a few levels and a slower climb at a few starting points, at both cost estimates, and show who pays more and who pays less, before the Legislature picks a model. My figures for the slower climb are rough; theirs would not be.
Written November 13, 2026 by Marcus Malcom, who built the explainer. This is my view, not the board's and not a finding of that page. Quotations are from the draft report, its Appendix FR and the ECOnorthwest finance and revenue report. Disagree? Tell me.