Now an entrepreneur in Utah, relying on a wrinkle in U.S. tax law, thinks he has found a way around the problem. His idea is to have employers stop providing group health insurance and instead help employees get individual policies.

Paul Zane Pilzer, a 53-year-old economist, occasional rabbi and author of books such as God Wants You to Be Rich, isn't just concocting theories. His sales method has drawn interest from insurance giant UnitedHealth Group Inc. His company, Zane Benefits LLC, has signed up 300 employers covering 3,000 people since opening in March 2006. A company led by America Online founder Steve Case and a unit of Wal-Mart Stores Inc. have teamed to market the idea to small business.

Pilzer is among a growing number of people - politicians, policymakers and others - scrambling to find alternatives to the U.S. system of employer-provided insurance. Some merely want to fix a system that leaves millions uninsured; others are looking for ways to profit from patching together the system.

None of the solutions are perfect, but Pilzer's is gaining traction. Critics say his plan doesn't account for those people who can't get individual coverage because of previous or existing illnesses. Pilzer says they can get help from their state or other sources. With many companies dropping group coverage, ''we believe something is better than nothing,'' says Bryce Williams, of a Case subsidiary.

Critics say the concept violates the fundamental principle of health insurance - that the well help pay for the coverage of the sick. ''Here it will only be healthy people who get individual policies, and the ones who need coverage the most - the highest-risk people - will be left holding the bag,'' says Greg Matis, counsel for SelectHealth, a Utah insurer that won't cover workers this way.

But Pilzer believes it's better for individuals to buy their own health-insurance policies because, under state and federal laws, the policies can't be terminated for health reasons. By contrast, workers who lose group coverage when they're laid off or change jobs may not be able to replace it. He also contends that with individual policies, consumers pay only for the benefits they want, avoiding the bells and whistles in employer plans that drive up health costs.

Some say Pilzer's setup violates a federal law requiring employers to offer coverage to everybody or nobody. Texas insurance regulators have warned employers not to try the idea.

''I think this is blatantly illegal,'' says Mila Kofman, an associate professor at the Georgetown University Health Policy Institute and a former Labor Department official. ''I would not advise any employer to do this.''

Pilzer calls his plan legal, and so far the federal government hasn't said anything to the contrary. The Department of Labor says it is aware of the controversy and is consulting with other parts of the federal government over possible clarification of the rules.