Friday, June 24, 2011

Time to Change the World - pt 2

Before I proceed, I think I should add another example that I omitted from Part 1.  I said that the health care system in the United States is broken, and I can think of no better example than that of James Verone, who walked into a bank on June 9th and presented the teller with a holdup note, asking for $1.  He then sat in the lobby and waited for the police to arrive.  When asked, he said that he did it only because he had several health problems.  He worked 17 years for Coke, lost his job, found other work here and there, but nothing substantial, and he has no insurance and no money to pay for the doctor.

Now more about Part 2
This posting is long, and there are three sections: Solution, Benefits,and Costs.  I must ask that you read them all before forming any opinion or resorting to your pre-conceived notions.  I've played with the order of the sections for a long time, but no other options seem to work better, we go


The only viable solution to the problem is to convert health care to a Single Payer System.  Now, you can call that Socialized Medicine or any other pejorative term you like, but the fact remains it's the best option.  With that in mind, let's forgo the screaming and name-calling and look at the facts.  Here's how I see it working.

Every legal resident of the country is automatically covered.  You may select any doctor you wish, subject only to their ability to see additional patients.  The system will cover preventive care and normal illnesses and surgical needs.  It would not cover cosmetic surgery unless deemed a medical necessity by your doctor, which means, for example, that breast reconstruction after a mastectomy would be covered while simple breast enhancement would not be covered.  Treatments such as botox or cosmetic surgery to remove wrinkles and such would not be covered.

You would typically have a Primary Care Physician or a Licensed Practical Nurse (this may not be the proper official job title) as your normal service provider.  They may be at a clinic or in private practice.  Referrals to specialists would be made by these providers, but once a doctor-patient relationship is established, you could make an appointment with a specialist directly. 

Emergency needs would be handled at any hospital, and hospitals and clinics would be free to operate Urgency Centers for things not truly deemed emergencies.

Losing your job or changing your job would not affect your health care.  Moving across the country would require only that you locate a new physician.  Any prior conditions would continue to be covered.  Through a parallel change, all medical records would be stored in a single facility.  That means any doctor you visit would have complete access to your records, regardless of their location or your prior history.

There would be a minimal co-pay required for each visit, and a small co-pay for prescriptions.  Prescriptions, however, could be filled through on-line services and delivered by mail for non-emergency usage.


There are many, but I will touch on a few of the major changes.  If you think of something I haven't addressed, I'll be happy to explain further.

Medical Records:  In the current system, your records reside with your doctor, or possibly with your HMO.  If you change providers, there is no automatic way for your records to move with you.  In some cases it is up to you to get them (physically) and carry them to your new doctor.  In reality, that usually means delays, and often means you will have to have new tests that duplicate the old tests simply because the new provider needs that information to proceed. (extra costs!)

The current system also means that if you live in Seattle, but are injured while vacationing in Florida, the people treating you know nothing about you.  Let's say you have a heart attack.  The Emergency Room has no way to find out what drugs you are taking, what drugs you might be allergic to, or whether you have a history of heart problems.  They have no way to look at your pre-attack EKG or anything else.  That means they are flying blind, and hoping.  This is NOT GOOD!  In the new system, they could immediately access your central records and see everything there is to know about you, right now, in real time.


Currently, with the exception of HMO systems, doctors must submit forms to various insurance companies for payment.  Each company has different forms.  Each company has different rules.  Each company has different coverages.  Each company requires something different before certain procedures are allowed or covered.  Doctors, or their paid staff, spend hours completing all those forms, and then spend more time when the insurance company sends them back saying they're filled out wrong, or that they skipped a step.

With a single payer system, the doctor submits the same forms every time, and the coverage information is always exactly the same.  The doctor's accountant doesn't need to send you a new bill because something changed when the insurance company got done with it.  In fact, it's likely the medical records software could easily generate the request for payment without further actions.  All of that means the doctor can spend more time with patients...actually being a doctor...and less time on paperwork hassles.  It also means you're less likely to get surprised by a bill three months later.  You go in, get what you need, pay your co-pay...and you're done.

Patient Options:

If you decide/discover that the doctor you have selected just isn't meeting your needs (for whatever reason) you can select any other doctor, not just one that's "in the network."  If your friend recommends somebody, you can chose them too.  The only variable is their patient load, and you could chose to wait longer for an appointment because you really like them, or chose someone else because they can see you quicker.  The choice is 100% left in your hands.


These are responses to typical fears, so they're not so much benefits as they are clarifications.

The first thing people often say when responding to this proposal is that "some government official is going to decide if I get treatment."  However, that's not true.  Your doctor is in charge of your care, and he/she will need to explain why a course of treatment or specific tests were done if there are questions.  If you are told you need a knee replacement, you are still entitled to a second opinion.  If your doctor recommends surgery, again you can look for options.  

However, it is important to point out that the situation you fear actually exists currently, it's just not a "government official" making decisions for you.   If you look at your insurance paperwork, somewhere in all that fine print is a statement that reads something like this.

The Plan Administrator will make decisions regarding questions in coverage or the appropriateness of specific treatments. 

There are two things about this you should know.  First, you have no idea who that person is, and never will know.  He/she is the ultimate anonymous person.  Second, in most cases, the Plan Administrator is working for a company that needs to make a profit and he/she is looking at the bottom line at the same time they're evaluating your need for treatment.  Guess which point of view is likely to prevail.

The second thing people believe is that government is so inefficient it could never be cheaper to fund medical care this way.  In fact, the government already runs two medical programs, so we have some examples to measure.  The first is the VA, which not only funds medical services but also provides them.  While the VA is not perfect, it is worth pointing out that independent surveys reveal that the VA has better medical outcomes than a number of other hospitals and medical organizations throughout the country, so the quality of care is at least comparable.  The second program is Medicare, and I'll address that in a minute.


Okay, so this is all fine and wonderful, but how do we pay for it?  Good question.  In order to provide a good, or at least reasonably complete, answer I need to include some background.

Currently most medical insurance is purchased through group policies by employers.  Those rates are set by the insurance companies, and their only real competition is between themselves.  They are also dependent upon rates charges by hospitals and doctors.  It's a true free-market system.  However, it's also a mess.

Most hospitals are designed to make a profit.  That's fine.  Most insurance companies are designed to make a profit.  That's fine too.  However, when combined, it gets ugly.  If you look at the rate of inflation, or the consumer price index over recent years, you'll discover that medical costs are rising faster than any other segment of the economy.  We all know that wages over the last couple of years have been generally pretty flat, but in Oregon a medical insurance company just filed for a rate increase of more than 20%.  Why?  What could possibly drive their costs that much higher.

There are a couple of factors.  The first is the large number of people who can't pay their bills, which means the hospital doesn't get paid, which means they raise their general rates to those with insurance to cover those without.  You, and your employer, are already paying for those without insurance, so this new idea actually does what the old system is forced to just does it honestly.

The second factor is that there is no restraint on the system.  You can raise your rates...simply because you can.  People either pay, or go without.  Only recently have employers and insurance companies started looking at their costs realistically, and finally we see surcharges for people who smoke, are severely obese, or have other untreated medical conditions.  Finally they've begun to look at preventive care being cheaper than resultant care, but they only did that because of push-back from their clients.  Profit is more important.

So, how do we pay for this?

First we begin by taking the money we currently pay for Medicare and the VA medical system and throw it into the pot.  In Europe, that money alone would be enough to provide care for EVERYONE in the US!  (more on this in a minute, but remember that fact)  Their costs are that much lower, and ours could be too.

We also allow (demand) that the government negotiate drug prices for all of us, something that was specifically not allowed under the prescription drug bill passed a few years ago.  Why?  Obviously, the drug companies didn't want it an lobbied Congress to exclude it.  Congress needs to work for us, not the drug companies.  My answer is simply..."Tough!"  Every pill of this drug costs the same amount, regardless of where the drug store is and who the patient is.  End of discussion.

There are also savings to be recognized with that centralized records system, and even more savings to be had with the single payer forms (see above).

There is, however, one last place to look.  Right now your employer is paying a bunch of money for your coverage, assuming you have it.  In most companies, it is the second highest single item they buy, second only to the payroll itself.  There are numbers all over the map, but let me toss out some samples.

If you cover yourself, your spouse, and your dependents (children) the company may be paying $1500 per month for that.  It's not money that shows up in your paycheck, and you're not charged any taxes on it, but it is a real cost to your employer.  If you're just covering yourself, or just you and your spouse, it will be less, but that's a number we can work with for now.  So, let's say the company gave you a raise of $1500 per month, and the government required you to pay a tax of $1200 per month.  You'd come out ahead, and the $1200 is actually too much.  It doesn't need to cost that much. be brutally honest, to make this system work, you'll pay higher taxes.  But, you'll also be making more.  There's a third benefit in this math, which I'll get to in a moment.  For right now, I'm going to suggest that you take a moment and visit a web site.

On this site, you can compare medical services between the US (current system) and other health care systems around the world.  You can see coverages, costs, and all sorts of parallel data.  When you first go there, you'll see a comparison between the US and the UK, and two numbers immediately jump off the page.

In the US, the average spent per person is $6402.  In the UK it's $2723!  Less than half...and, life expectancy in the UK is nearly a year longer!  They have a single payer, governmentally run system.

You can change the countries and make other comparisons, but a single fact keeps popping up in every comparison involving the US:

Without exception, every country spends less, and usually less than half...every country covers everybody...and every country has a longer life expectancy!

It's time to take a serious look at what we're doing, not only because it doesn't work, but also because it costs way too much and doesn't provide "the best" available.

As a parting thought, I'm going to toss out one more idea.  Right now, we have unemployment at nearly 10% and when you toss in under-employment, it's even higher.  Want to know why companies are hiring lots of part-time, temporary workers?  It's because they're desperate to avoid the high costs associated with paying for medical benefits.  If we make this change, jobs will suddenly become something companies can invest in again.

Thanks for reading.  I know it's long, but hopefully it provided some food for thought.

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