Musings of the Delivery Guy – January 30, 2010

Author Amy Stewart asks the question – “Can we come up with one simple five-point plan and actually get it passed? Can it be simple enough to fit on a single sheet of paper?”

She then proceeds to offer her 5 point plan.  It is a very good start but it doesn’t go quite far enough, and forgive me if this seems simplistic.

I would add the following:

Remove the Moral Hazard.  In other words bring the consumer back into the transaction.  Currently, the customer in health care is NOT the patient, it is either the insurance company or it’s the government.  The axiom those who have the money make the rules applies equally here.  Remove both to the extent that’s feasible and allow the consumer (patient) to shop for the best deal and prices will come down.

Secondly, we need tort reform, if California has done anything right these past years it has been to pass legislation that limits “pain and suffering” damages to $250,000.  Of course, one should be able to sue in the event of gross negligence, but multi-million dollar lawsuits “mental anguish” needs to be limited and reasonable.

Amy suggests an annual deductible at $10,000, I’d probably make it $25,000 to $45,000 high enough that annual medical expenses would be taken care of out of pocket, but enough to protect the individual from financial ruin should a catastrophic medical condition occur.

Amy’s monthly premium of $99.00 for individuals under 30 and $199.00 a month for those 30 – 65 sounds good on paper, although I’m not an actuary so I really don’t know if that’s reasonable or not.

HSA’s (Health Savings Accounts) are critical to this plan.  Allow individuals to privately start HSA’s (like an IRA) that’s tax deductible currently HSA’s are only available through an employer.  Make it transferrable from year to year, currently if you don’t use it within the year, you lose it.

I like Amy’s idea allowing individuals the ability to make tax deductible contributions to others’ HSA’s.

Allow insurance companies to compete across state lines, and reduce the tangle of state government regulation affecting how premiums are determined and charged.

Lastly, create community clinics where individuals can go to receive non-emergency care.  Currently our hospital’s ERs are inundated with non-emergency patients who can’t afford to go anywhere else.  Community clinics (wasn’t there something called Free Clinics years ago?) would alleviate the pressure on the ER’s both with workload and financially.

Students who want to become physicians and nurses could apply to the government to pay for their medical education provided they commit to 8 years of service in these clinics.  The military has been doing this for years and has worked extremely well.

As a side note, President Obama made a critical mistake at the very beginning.  Namely, farming out the job of creating a Health Care Bill to Congress, I’m positive that had he simply drafted his own bill internally and sent it to Congress to approve, we would’ve had a very different outcome.  Unless of course it wasn’t really about reform in the first place, but that’s another discussion altogether isn’t it?