Health Care, 10 Ideas

Health Care needs to be fixed; it’s a case of how and how much. It appears likely that the Supremes will gut ObamaCare and if they do we need a new fix.

20 years ago there were 256 mandates to insurance companies in terms of mandatory coverage conditions, today it is over 2,000 and will grow under ObamaCare. These mandates ignore age, condition and health status. The motivation was understandable as insurance companies were playing coverage games and there were clear cases of abuse. However, in the effort to justifiably protect some, these mandates accelerated costs for all. If you’re a 20 year old athlete in great health you are protected from a wide variety of circumstances that will, likely, not impact you for decades, if ever.

The question also looms: is there an appropriate role for government to play in health care? Yes there is!

The math? The most frequently quoted number is that 46 million Americans don’t have health care. 12 million of those 46 million are not Americans which leaves us with 34 million. Of the remaining 34 million between ages 18 and 65, 17 million had enough income to purchase health insurance if they chose according to a study by Barach College. That leaves 17 million uninsured. Of that remaining 17 million some uninsured were uninsured only temporarily, again according to Baruch College. So by any margin of error adjustment you might apply, over 90% of Americans are, in fact insured or specifically choose not to be.

We have, to some degree, universal coverage as hospitals are not allowed to refuse initial treatments regardless of insurance status.

Government run health care already exists in four high profile programs, Medicare, Medicaid the Veterans Administration and the Native American Health Service. Medicare and Medicaid have massive unfunded liabilities and the VA and the NAHS are abysmal failures.

So instead of jumping off the financial cliff let’s take a swipe at actual reform.

1. Mandate the guarantee of progressive coverage: as you age and your needs change the ability to adapt and convert coverage will reduce overall costs and provide guaranteed options. If you’re 20 and in good health you should be able to opt for a program that covers preventative intervention and catastrophic events, not the 2,000 conditions that will likely not affect you. As needs change so should coverage options.

2. Allow for a new definition of what constitutes a group. Small business especially start ups have encountered the “group” issue; the requirement to insure a minimum number of employees before qualifying for group rates. You’ve also faced the average age issue and limited choices based on employee population size and demographics. Vast numbers of small business cannot get over the “group” requirements. Mandate the recognition of new types of groups that will allow small business to participate at a reasonable cost; Chambers of Commerce, Trade Associations and groupings of similar type businesses with similar employee populations. Most small business can afford some coverage for their employees they simply cannot afford it outside of “group” rates.

3. Eliminate COBRA as it is currently structured. COBRA is a well intentioned idea that simply does not work for anyone without significant income or resources. The average increase in costs for health coverage under COBRA is 200%-300%. Your $400 a month contribution to your company provided coverage will result in $1,200 – $1,500 per month cost to maintain your plan under COBRA. COBRA is your option to maintain coverage if you lose your job. Following the logic, the loss of a job typically eliminates COBRA as an affordable option. COBRA should be transformed to a pooled national group allowing unemployed individuals to maintain basic health coverage at their prior contribution levels. Temporary government money to support what was the employer’s contribution would be an acceptable cost without the need for massive bureaucratic intervention. Employers would also be given the option to maintain their contribution and receive tax incentives for doing so simplifying the process.

4. Eliminate state based restrictions on insurance plan competition. Allow for national competition. Competition has always been the surest way to reduce costs to consumers. If a business in Florida can get the exact same plan in Nebraska, from the same company that offers the plan in both states but at a 45% discount, why not? That approach will actually reduce costs and expand the pool of covered employees. That idea will also tend to balance costs based on larger pools of participants. This option will require the states to agree to base line national standards for oversight and coverage options.

5. Allow surcharges for risky behavior. For instance, smokers pay more after a year of their plan being in place if they do not quit. Same for obesity, drug use, sky diving, mountain climbing, bungee jumping etc. If I smoke and don’t make the choice to quit I should pay more for insurance, my behavior should not be a drain on the entire insurance pool. We have already accepted the idea that life and liability insurance coverage considers risk, perhaps health coverage should as well, within rational boundaries.

6. Eliminate a vast majority of mandatory coverage requirements and allow a tiered system appropriate to age, condition and family size. Institute the requirement for clear guidance from insurance companies as to exactly what is covered under each option, and associated costs. This requirement should be executed at an eighth grade reading level, no fine print and no games. Take the social engineering out of health insurance coverage.

7. A large majority of Health Care costs are concentrated on early and late life. Create a privately managed, government supported insurance plan that supplements typical insurance plans and is focused on catastrophic health events, early life crisis and terminal care. Require all insurance companies to participate in funding a trust based on their number of subscribers, with government support for expense beyond the trust. Universal Health Care as currently structured demands rationing. It sounds rational, the pure numbers support rationing…………. until it’s your parent, wife, husband or child that is being denied care based on some decision being made somewhere by someone you don’t have access to.

8. Malpractice; There are in fact two forms of malpractice but only one carries a legal jeopardy. The first is obvious and a significant part of the current health care cost equation. There are clearly cases of medical malpractice albeit they are a very small percentage when compared to the number of individuals receiving care. The medical industry engages in massive spending associated with covering their legal liabilities. Two significant issues should be addressed. One, apply the “reasonable care” provisions that apply to all other types of liability to the medical industry. If two tests represent “reasonable care” in assisting with a diagnosis, Doctors should not feel the need to insist that six be performed so that potential liability can be eliminated. If you want six tests you’re going to have to pay for the extra four. The costs associated with physicians generating tests based on fear of legal jeopardy are massive. Two, reasonable standards that limit liability in the most commonly litigated situations would serve to limit costs both medically and legally. The second level of malpractice is more subtle and perhaps more costly and dangerous. When faced with complex medical situations you had better know enough to ask exactly the right questions. Short of asking exactly the right questions your physician will likely not volunteer information beyond the scope of your question, again for fear of liabilities. In other words you need to know a substantial portion of the truth to get the truth. If that sounds crazy it is. It is also expensive.

9. Elevate the status of and legal protections for medical personnel who are not physicians. Nurses, midwives and terminal care providers are among the most impressive individuals in the health care industry and capable of more involvement in the medical process at far less cost. Sergeants run the Army, nurses run the health care industry. We might want to consider recognizing the reality.

10. Preventive medicine and personal responsibility; it is easily agreed that preventative care is a significant path to cost reduction. Make scheduled preventative check ups a condition for continued insurance coverage. Make them extensive, we have incredible diagnostic technologies available, they could have a dramatic impact on ongoing costs related to reactionary versus preventative care. A government sponsored capital purchase program to get the technology out there and widely used, will reduce costs as well as patient pain and suffering. Motivate the provision of supportive services for weight management, smoking, drug use and alcohol abuse as a key component of all insurance coverage; that will reduce costs.

There are common sense, real world steps that can be taken to facilitate cost reductions and increase the number of insured Americans. They should be fully engaged in advance of another failed entitlement program. More Medicare and Medicade style corruption and inefficiency is not the answer.

We should pursue these types of ideas in the interest of real reform. We simply do not need a 15 ton fire truck to douse a campfire.