Yes, Mr. President: A Free Market Can Fix Health Care

[Elphaba]

Originally Posted by bytor2112

What do you think about the ideas?

Well, first, I admit I do not understand the issue as well as you and many others here do. So, I'll respond to each paragraph, but keep in mind I'm shootin' from the hip here.

First, Congress should give Medicare enrollees a voucher and the freedom to choose any health plan on the market. Vouchers would be means-tested, would contain Medicare spending, and are the only way to protect seniors from government rationing.

I am on Medicare and I have always been able to choose my providers, including a therapist, a doctor specializing in pain control, an endocrinologist and a GP. Additionally, I was able to change two of these doctors because the original ones did not meet my needs. (In other words, they were both batspit crazy.)

Additionally, I've had a number of tests, including sonograms, two MRIs, biopsies, and mammograms, and Medicare has never told me I cannot have them.

I have had my prescription drug plan refuse to pay for two anti-depressants, both about six months apart. However, my therapist has simply filled out a form, and/or talked with the plan's representative, and it has then approved the meds.

The fact that this would be means-tested concerns me, because it may drop people from the rolls who depend on Medicare. If this happens, these people's quality of life will plummet.

In fact, if a means test determined I was no longer eligible for Medicare, I would be crippled with pain, and I'm sure I'm not the only one.

Second, to give workers control over their health care dollars, Congress should reform the tax treatment of health care with "large" health savings accounts. Large HSAs would reduce the number of uninsured Americans, would free workers to purchase secure health coverage from any source, and would effectively give workers a $9.7 trillion tax cut without increasing the federal budget deficit.

I'm not sure what "reform the tax treatment of health care" means. Can you explain it? Also, is this something employers would initiate? What if a person can't afford a HSA?

Other than that it sounds good to me.

Third, Congress should break up state monopolies on insurance and clinician licensing. Allowing consumers to purchase health insurance licensed by other states could cover one-third of the uninsured without any new taxes or government subsidies.

I assume this only applies if the insurance in your state is not as good as it is in another. Is this correct?

Finally, Congress should reform Medicaid and the State Children's Health Insurance Program the way it reformed welfare in 1996.

I have a problem with this one.

Welfare reform meant a huge number of people, including families, who needed the assistance no longer qualified for it. This reduced the rolls drastically, which looks good on paper, but in reality, as I said, far too many needy people, and families, were no longer eligible.

Eligibility is determined by a means-test. I don't think there's anything wrong with that as long as people who are in desperate situations, especially the working poor, qualify for assistance.

Block-granting those programs would reduce the deficit and encourage states to target resources to the truly needy.

In my career I had experience with block grants, and so I know there are pros and cons to them. I searched for studies that determined whether or not they worked when it comes to Medicaid, and was persuaded they probably don't.

According to the Kaiser Commission on Medicaid and the Uninsured:

Block grants do not provide a federal guarantee of coverage to intended program beneficiaries:

While it is theoretically possible to design a block grant that guarantees coverage to all eligible people, no federal block grant program has such a federal guarantee. The lack of a guarantee or individual entitlement is tied to the capped financing arrangement. Without assuring states that the federal government will fully share all program costs, it is not likely that Congress could or would require states to serve all eligible people. As a result, programs funded through capped federal grants typically limit the number of people served through priority lists, waiting periods, and by simply closing down enrollment.

I think this is a convincing argument, though I admit I am not qualified to determine whether this statement is true or not; however, it does make sense to me in light of my experience with block grants.

Regarding meeting the needs of the truly need, I think the states do their best to make sure they target them, although there's obviously room to improve, as is true of any company. I know the assistance I received, prior to my officially being declared disabled, was excellent. I also know I am extremely grateful to taxpayer’s for this assistance.

That covers my remarks in response to the article. I realize I sound ignorant in some areas, so don't hesitate to explain where I am wrong.

I have an article from The Atlantic that explained the healthcare issues we face today in a way that even I understood. Additionally, parts of his solution resonated with me such that I wish the federal government would consider them when developing its healthcare reform plans. Unfortunately, that's not going to happen. But this is still worth the read.

How American Health Care Killed My Father - The Atlantic (September 2009)

I especially liked the following:

First, we should replace our current web of employer- and government-based insurance with a single program of catastrophic insurance open to all Americans—indeed, all Americans should be required to buy it—with fixed premiums based solely on age. This program would be best run as a single national pool, without underwriting for specific risk factors, and would ultimately replace Medicare, Medicaid, and private insurance. All Americans would be insured against catastrophic illness, throughout their lives.

Proposals for true catastrophic insurance usually founder on the definition of catastrophe. So much of the amount we now spend is dedicated to problems that are considered catastrophic, the argument goes, that a separate catastrophic system is pointless. A typical catastrophic insurance policy today might cover any expenses above, say, $2,000. That threshold is far too low; ultimately, a threshold of $50,000 or more would be better. (Chronic conditions with expected annual costs above some lower threshold would also be covered.)

We might consider other mechanisms to keep total costs down: the plan could be required to pay out no more in any year than its available premiums, for instance, with premium increases limited to the general rate of inflation. But the real key would be to restrict the coverage to true catastrophes—if this approach is to work, only a minority of us should ever be beneficiaries.

There are thousands of stories of people who have lost everything due to catastrophic illness. This would address that problem, making it possible for families wiith such an illness to survive financially.

The rest of the article is extremely interesting. I think you'd enjoy it.

Elphaba

[anatess]

Originally Posted by ferretrunner

HSAs are a good suplmentary idea. There are a couple major drawbacks, though. If you misjudge and end up not saving enough, you could be in trouble. On the other hand, if you can't spend all of it, you loose the money. It doesn't roll over. It's hard to judge how much you'll end up spending in health care. Two years ago, I made more insurance claims and spent more money after the bike accident. My HSA was not nearly enough to cover it. But... last year, I spent significantly less, so I would have lost all the money I didn't spend if I increased my HSA based on the previous year's expenses. How much money should a person put into the HSA to pay for all their health care costs? $200/$300 a month, in case? Ok, now I have $200- $300 a month less to pay the rest of my bills. Money I will loose if I don't use. Whereas my insurance premium is much less.

You are mistaking Health Savings Account (HSA) with the Flexible Spending Account. A flexible spending account is taken out of your pre-tax income. And you have to use it within that tax-period otherwise, you lose it.

An HSA works like a Roth-IRA or an ESA (Educational Savings Account). It is an investment of your post-tax dollars that will go into your own portfolio and can never be taken away from you. If you die and there is still money in your HSA, it goes to your estate or whoever you put as your beneficiary. The advantage of an HSA over regular savings account is that any gains made by your HSA (interests, etc.) is NON-TAXABLE. Currently, if you put money in your savings account, you have to declare the interest you gained from it in your 1040 and it gets added to your earned income to be taxed.

The difference between an HSA and a regular savings account is that you can only spend the money in your HSA for medical related purposes. There is no covered/not-covered anything. If it is medically related, you can use your HSA for it.

The really cool thing about an HSA for the young people is it gives you incentive to stay healthy. You will find that you will make healthy decisions on your healthcare because you like to see that money in that HSA grow and grow. The more it grows, the more you will have saved up to spend when you get older and the medical bills. Also, it makes you aware of how much something costs - so, for example, I used to get contact lenses from the optometrist because it was covered by insurance. When I exchanged my vision coverage for an HSA, I realized I could get it much cheaper from that 1-800 number so the monthly premium for my vision coverage that I started putting into my HSA could still well cover my vision needs and I still have money left-over!

You really need to check it out. It is really a great tool to lead people to better accountability which, in turn, will help reduce healthcare costs through competition.

[Moksha]

There already is a free market health care available. Many USA doctors have left the USA high cost of operation and legal system and set up shop just across the border in Mexico. Currently a person can fly into Arizona and drive across the border to a clinic to obtain either dental, vision or general medical care (major procedures) and recover in facilities there all for a total cost (including transportation) that is less than the total cost of a year of health insurance in the USA. Granted this does not cover all major health care concerns such as cancer or heart replacements but a lot of procedures are available.

Excellent point. If American health care was able to relocate to Malaysia or India, they might be able to pass on some considerable cost savings. Nothing impractical about that plan!

Unfortunately, if they stayed in the states, the desire for profits would preclude the health care industry of ever meeting the needs that reform is trying to address. Try getting around the profit incentive from excluding preexisting conditions from the health care menu.

[Just_A_Guy]

Originally Posted by Elphaba

The fact that this would be means-tested concerns me, because it may drop people from the rolls who depend on Medicare. If this happens, these people's quality of life will plummet.

As far as quality of life--there has to be a happy medium somewhere. We don't want people starving (obviously!), we don't want people depleting their retirements. On the other hand, it seems kind of silly to have the taxpayer covering the medical expenses of a family that has multiple vehicles and recreational vehicles. Means testing--done right--is a good thing; but done wrong I fully agree it can be an abomination.

FWIW, the way means testing works in bankruptcy (after the 2005 amendments) is that first, they compare your household income with the median income for households of similar size in your geographical region (based on US Census Bureau data). In Utah, that amount is in the upper-forty-thousand-dollar range for a family of one. Only if your income exceeds the median, do they subject you to a means test.

Unfortunately, the CATO paper doesn't say what kind of means testing it recommends. Without a solid formula for means-testing, it seems to me you really can't say who will and won't be covered and so you can't make any decent predictions regarding the required taxpayer commitment to the new plan.

I also note that in some areas, state Medicare/Medicaid fraud prevention units are known to indulge in witch-hunts, threatening good doctors with jail and slapping them with exorbitant fines for clerical errors made by part-time staffers.

[Traveler]

Originally Posted by ferretrunner

Not everyone can get vacation time to travel to Mexico or afford the travel expenses. As for people not needing health care for 95% of their lives- what about preventative medicine. You know, the "woman's yearly" exam? The male's prostrate exam? What about me wiping out my bicycle and tearing my ACL? No insurance? HUUUGGGE medical bill with the MRI, ortho surgeon consult, and physical therapy. Not to mention the ambulance. None of whic would be covered by catastrophic insurance. So, I break an arm tripping on the stairs and I have to go to Mexico for my health care? I don't think this is a realistic solution. And you're talking about one trip being less than a year's insurance- does that include lost wages if you don't get paid for sick time? What about if you need more than one trip a year?

HSAs are a good suplmentary idea. There are a couple major drawbacks, though. If you misjudge and end up not saving enough, you could be in trouble. On the other hand, if you can't spend all of it, you loose the money. It doesn't roll over. It's hard to judge how much you'll end up spending in health care. Two years ago, I made more insurance claims and spent more money after the bike accident. My HSA was not nearly enough to cover it. But... last year, I spent significantly less, so I would have lost all the money I didn't spend if I increased my HSA based on the previous year's expenses. How much money should a person put into the HSA to pay for all their health care costs? $200/$300 a month, in case? Ok, now I have $200- $300 a month less to pay the rest of my bills. Money I will loose if I don't use. Whereas my insurance premium is much less.

Interesting - how many times in your life do you plan to take a trip to emergency. If one year you made five trips - what about the next 50 years. The question for you is: do you want to control your money or do you want someone else to control it for you (after they take their cut for making decisions for you).

I agree this is not the best solution but I hear that a lot of people from Canada come to the USA for medical. I wonder how many of them are now considering Mexic.

For myself - I do believe that medical cost in the USA are out of control. and to be honest if the current stuff is passed I will take a hard look at Mexico. I am close enouth to retirement that if the government tries to force me to pay into a government program - I may just move to Mexico for my residence and visit the family in the USA a lot.


BTW I ride a Trek 4.7 Madone. What is your bicycle?

The Traveler

[ferretrunner]

If we were to drop regular health insurance and require people to buy their own catastrophic insurance, we'd be in a huge mess. Catastrophic insurance does not cover routine health care: things such as pap smears, physicals, trips to the doctor for strep throat, payment for xrays and/ or MRIs, blood tests, medications, most surgeries, etc. would NOT be covered under catastrophic insurance as I understand it. So, instead of having $20 copay at an office, you now have a bill around $250 for an office visit and an antibiotic if you're sick. You now pay for the MRI (around $2000). Nope. Catastrophic insurance alone won't meet the need.

[ferretrunner]

Originally Posted by Traveler

Interesting - how many times in your life do you plan to take a trip to emergency. If one year you made five trips - what about the next 50 years. The question for you is: do you want to control your money or do you want someone else to control it for you (after they take their cut for making decisions for you).

I agree this is not the best solution but I hear that a lot of people from Canada come to the USA for medical. I wonder how many of them are now considering Mexic.

For myself - I do believe that medical cost in the USA are out of control. and to be honest if the current stuff is passed I will take a hard look at Mexico. I am close enouth to retirement that if the government tries to force me to pay into a government program - I may just move to Mexico for my residence and visit the family in the USA a lot.


BTW I ride a Trek 4.7 Madone. What is your bicycle?

The Traveler

Hopefully, not very many times. But, emergencies happen. And all it takes is one emergency to do some considerable damage to someone's life savings, if not wipe them out altogether. If they have life savings. Many of the lower income are living hand to mouth. Of course, many of them are currently uninsured or minimally insured. I don't have much in savings right now. When I was laid off, most of my savings went to make sure my mortgage was paid on time and moving expenses. I couldn't absorb an ER bill at all right now without going into debt.

Even if I don't end up in the ER, I still plan to get my preventive medical exams. THe yearly woman's exam and mammogram are important. And, with my strange hobby of running 26.2 miles... well, injuries can happen. Personally, I don't want to have to travel to Mexico to get medical care. Since my Spanish is very rudimentary, I can't imagine trying to explain to a doctor what symptoms I have....

I ride a Raleigh Sport. Nice bike. Mainly, I use it to cross train and for fun rides in wine country out here.

[Traveler]

Originally Posted by ferretrunner

Hopefully, not very many times. But, emergencies happen. And all it takes is one emergency to do some considerable damage to someone's life savings, if not wipe them out altogether. If they have life savings. Many of the lower income are living hand to mouth. Of course, many of them are currently uninsured or minimally insured. I don't have much in savings right now. When I was laid off, most of my savings went to make sure my mortgage was paid on time and moving expenses. I couldn't absorb an ER bill at all right now without going into debt.

Even if I don't end up in the ER, I still plan to get my preventive medical exams. THe yearly woman's exam and mammogram are important. And, with my strange hobby of running 26.2 miles... well, injuries can happen. Personally, I don't want to have to travel to Mexico to get medical care. Since my Spanish is very rudimentary, I can't imagine trying to explain to a doctor what symptoms I have....

I ride a Raleigh Sport. Nice bike. Mainly, I use it to cross train and for fun rides in wine country out here.

I have discovered that many doctors will see someone uninsured that is willing to pay cash for less than a copayment with insurance. That is because all the paper work and manpower to maintain records for insurance companies are a major cost for doctors.

In fact while traveling (in the USA) I once came across an Amish doctor that would not deal with insurance but only accepted cash. He also refused to carry malpractice insurance. True because he was Amish he lived a simple personal life but a visit with him cost $5 which I gladly paid and if I lived in that area he would be my doctor of choice. Not because of price but because of ability, honesty and honorable character.


The Traveler

BTW - I though I would add that several doctors I have talked to that will see people on a cash basis have said that they have never heard of someone without insurance (that is not on a government dole) that has ever sued for malpractice.

[Moksha]

Red flag time: Medicaid in Utah has cut back on even some diagnostic procedures. If Medicaid is short on public money, then what about even
scarcer resources when a public option is added?

[Palerider]

I wonder if a Politician will ever tell us, if and when this Healthcare paases, why they don't or won't have the same coverage we will have???? If this plan is suppose to be so great how come they don't use it???