A progressive individual tax would be far more complicated, as you would have to assign, track and audit individual use. And that doesn’t even get into secondary uses (e.g. manufacture and transport of goods).
The flat rebate makes the tax progressive. Typical people pay $0 net tax, or even come out ahead, while heavy polluters pay almost the full tax. Just raising the tax will effectively make it progressive.
Most of them are leaving. I think the ones remaining rely on bundling with other insurance or services.