Your plan falls apart right there because companies will say no.
Some will and some won’t. The ones that say no will not only look silly but find themselves looking for high quality employees since they are the ones paying less. I’ve worked for 16 companies since the early 80’s. Pretty much all of them would just shift the money directly to the employee as a good faith move. Of course, the tax implications would have to be dealt with. And there again we have the fascist government complicating the issue.
Some will and some won’t. The ones that say no will not only look silly but find themselves looking for high quality employees since they are the ones paying less. Come on down to the real world. If you make it illegal to include insurance as part of compensation, as you propose, then none of the companies have to do that. So where is the competition? Why should my company up my salary to make up for the loss of benefits? Can I leave and go to work for a company that does offer benefits? No, you make it illegal. So where is the motivation? What's in it for any company to increase salaries to make up for it if none of the others do?