Wherein a foreigner who knows nothing about privatized health insurance tries to fix the US health insurance system

What if US health insurance companies weren't taxed on their earnings, and were instead taxed on the value of the claims they decline? If they pay in full every claim submitted to them, they won't pay any taxes. If they pay none of the claims submitted to them, they have to pay taxes on the full amounts of all the claims submitted to them.

Other problems I've heard of are a) insurance premiums being too expensive, and b) patients being refused insurance coverage at all because they are or have been sick. So in addition to taxing the amounts of any claims that are refused, they should also tax the amounts of any insurance premiums above a certain percentage of the client's income, and there should be a penalty for every applicant they refuse to cover, equal to either the cost of their average client or the cost of their most expensive client (I can make arguments for both).

Now the obvious flaw here is that taxes are never 100%, so the insurance companies would still be saving money by doing whatever they want. It's possible that anti-tax sentiment would provide sufficient motivation, but you can't make policy on the assumption that people are that stupid. So the next step is to use any money collected through this coverage denial tax to create an insurance fund for people who can't get or afford coverage elsewhere. So basically the insurance companies are paying the insurance premiums of people they refuse to cover.

I think they either did or were talking about making a rule in the states where every citizen has to buy health insurance, so it would be perfectly logical to tweak legislation at this point to make that more feasible. And if the insurance companies don't want to pay any denied-claim tax and just want to revel in unbridled capitalism, all they have to do is provide their services to anyone who asks at a fair price.