Healthy Choice (7-2-09)

Improved Health Care or Sin Tax Error

President Obama and this Congress have spent close to $1 trillion, including interest, in the first few months of 2009. A trillion is a million million. If you attempted to count to a trillion, you would soon find it not possible. By counting one number each second...with no breaks, no sleep, it would take 32,000 years to count that high. Traveling "at the speed of light" it takes two months to cover a trillion miles. If you took a trillion one-dollar bills and laid them end-to-end, they would reach from the Earth to the sun. There is not that much cash in all of the United States. A trillion dollars worth of nice, neat, fresh and crisp $100 bills, stacked tightly together with no additional space in-between, would reach 630mi. high. More than 3 times further than the International Space Station. And nearly twice as far as the hubble telescope. It would take ten galaxies the size of our Milky Way to contain one trillion stars. We, as Americans, spend 2.2 trillion dollars per year on health care.

The House health care reform bill is estimated to cost $1 trillion over 10 years with a combination of estimated savings in health costs and tax increases worth $587 billion over that period. Even then, the Congressional Budget Office projects the legislation will add more than $230 billion to the federal budget deficit throughout that decade! The administration's argument about health care has been that it is both an emergency and a necessity for the long-term fiscal health of America. It is an emergency because people are losing jobs and health insurance is, wrongly, tied to employment. But it is also key to bringing down projected long-term deficits, as future government spending on health care grows at unsustainable rates and threatens to bankrupt our country. Health care now consumes more than 1/6th of our entire economy. Government spending on health care programs account for approximately 1/2 of that. So as the cost of health care grows, so then does the governments financial obligation and it's appetite for increased tax revenue.

Now, I'm not going to argue against the need for some sort of health care reform. In 2008, the United States spent more than 17 percent of our gross domestic product (GDP) on health care – more than any other industrialized country in terms of total and per-patient spending. By 2017, health expenditures are expected to consume nearly 20 percent of GDP, or $4.3 trillion annually. Our current health care system is not making progress toward containing costs for patients, providers or government budgets. In addition to inefficiency, the current health system suffers from significant levels of fraud, waste, and abuse. The improper payment rate for Medicare in 2008 was 3.6 percent or $10.4 billion. While it is difficult to know the exact amount of money lost through fraud and abuse, the National Health Care Anti-Fraud Association estimates that fraud is equal to at least three percent of total health care spending, or more than $60 billion per year! Scarce health care dollars, paid either through taxes or insurance premiums, should be spent as wisely as possible. Yes, the need of some sort of health care reform clearly does exist. But, ensuring the financial integrity of federal health care programs and minimizing fraud, waste, and abuse should be the most important components of that reform. The complete overhaul of the governments reimbursement, regulatory and liability structures of health care is required to reduce the costs and improve the quality of all care both public and private. But the governments involvement in the private sector / free market health care system needs to be kept to a minimum.

Ideas such as expanding the use of electronic medical records and health information technology, greater investment in preventive and care management tools, and establishing best practice models are all examples of reforms . Unfortunately, most of these savings proposals are unproven and, ironically, some of them actually require more spending. Even the Congressional Budget Office, the financial score-keeper for Congress, cautioned against depending too heavily on these types of promised savings.

I do not fall for the claim that health care reform is needed for the 46 million uninsured citizens of our republic. The true number is actually less than 1/2 of that. The National Center for Policy Analysis has cited some reliable figures refuting the 46 million claim. The Census Bureau, in a report issued last August, showed 9.7 million or about 21 percent of the "46 million" were not U.S. citizens. We don't know how many of them were illegal aliens, since the Census Bureau doesn't ask. We do know that hospital emergency rooms are burdened with the continuous flood of illegals, and that something surely needs to be done to address it. But, however you feel about providing health care to illegals, referring to them as "Americans without health insurance" is highly inaccurate and wildly misleading. 17 million of the uninsured live in households where annual income exceeds $50,000. And 7 million of those without coverage have incomes exceeding $75,000. Subtract non-citizens and those who should be able to provide their own insurance coverage, but choose not to, and the number of uninsured falls to approx 20 million. Many of the uninsured are young and healthy — 40% are between the ages of 18 and 34, and at this point in their lives, they choose to put their dollars elsewhere. Also overlooked in the carelessly bandied about "46 million" is that the uninsured are not always the same people and many are uninsured for a relatively short period of time. Providing those 20 million Americans with health care coverage under a public plan, at or around the current per-patient cost of Medicaid or Medicare, will cost $1.8 trillion over ten years. Much higher than the house health reform bill estimates.

Sure, the current and future cost of Medicare/ Medicaid programs is of great concern. But why is government concerned -w- all health insurance? The answer is pretty easy. They don't see the problem as being caused by inefficiently run government programs. It's the entire health care systems fault! Since the government is not able to run it's entitlement programs any better, it will change the system. "Like when your losing a game... you change the rules or cheat" Problem there is, good doctors and hospitals will not work on the cheap. Price controls used to control health care cost will kill the quality of health care in America. If the goal is to control the cost of government run health programs, then it's the government health programs that are the problem. Obvious to all, and challenged by none, is the fact that means testing will have to occur on all governmental programs, especially medical. Only by limiting the size and scope of the programs to those truly unable to provide for themselves will government even begin to address the oncoming budget busting costs of our future.

Fact is, public programs just can't seem to compete. At least not on a level playing field. Even when providers are forced to accept discounted reimbursements from the government, and then transfers the "lost costs" onto the private sectors tab. Since 1970, Medicare and Medicaid's combined per-patient costs have risen from $344 to $8,955, while the combined per-patient costs of all other US health care have risen from $364 to $7,119. In fact, if the costs of Medicare and Medicaid had risen only as much as the costs of all other health care in America, then, instead of $807 billion in combined costs last year, they would've cost a combined $606 billion. That savings of $201 billion would have amounted to more than $1,750 per American household last year alone. This savings alone would be enough to pay for needed health care reform, without growth killing tax increases, discounted reimbursements or rationing care.

Speaking of health costs in America. Some have been quick to slam for-profit insurance companies and health care providers. To those I say, read the data! If the for profit companies and organizations are able to provide equal care, at reduced cost to the consumer, as compared to non-profits or government programs and still make a little profit for their trouble, we should be looking to them for ideas to save money. The ingenuity and innovation they provide is exactly what is needed in all of the health care community. Without the profit incentive, what is to drive cost reduction?

Government needs to get further away from health care, not deeper in. Medicare has moved closer towards privatization, working -w- private health insurance companies, and it needs to go "all in!" Medicaid... right along with it! Does a privately run plan have lower administrative costs?... Well, how often are public enterprises run more efficiently than private ones? Why did practically all economically advanced nations dismantle their public airlines, phone companies, and so on, invariably obtaining lower administrative costs and prices? This, while at the same time providing equal or better services to the consumer.

We know, from the failure of rationed health care systems around the world as well as the inefficiency, high cost and poor quality of government programs here at home (Veterans Affairs health care is a national disgrace, Medicaid provides poor quality at high cost, and Medicare has tens of trillions of dollars in projected unfunded liabilities) that more government involvement is not the type of health care reform that we need.

Employer mandates and a public plan

Under the current health reform bill. Employers would be required to insure their workers through a "pay or play" mandate. Those who did not provide "minimum coverage" for their workers would pay a penalty, equal to some percentage of their payroll, into a national fund that would provide insurance (presumably public) to uncovered workers. An employer mandate to provide health care for their employees would be a regressive tax on business that would be directly shifted to consumers in the form of inflated prices, or to employees in the form of less employment or reduced wage growth. Estimates suggest that an employer mandate could cost 1.6 million jobs over the first five years. Employer mandates are sure to erode employer-provided health insurance coverage. That's because millions of companies would simply pay the penalty rather than hassle with or spend more providing insurance that meets newly imposed HHS specifications. Millions of Americans, therefore, could find themselves dropped from their employer-provided private health insurance and forced to take part in the public plan.

The public plan would supposedly compete with private-sector plans. But Congress would determine the benefits, premiums and co-payments of the public plan, as well as impose the "minimum coverage" standards and regulation it's private competitors must meet. Such a public plan would have an inherent advantage in the marketplace because it's inefficiencies would ultimately be subsidized by taxpayers. It could, for instance, keep its premiums artificially low or offer extra benefits, then turn to the U.S. Treasury for periodic taxpayer bailouts to cover any shortfalls. (like the U.S. Postal Service and Amtrak) Consumers would naturally be attracted to the lower-cost, higher-benefit government program. The public plan, would eventually become "too big to fail" and take over the entire health insurance system.

A public plan would also have an unfair advantage because its tremendous market presence would allow it to impose even lower reimbursement rates on doctors and hospitals. Government plans such as Medicare and Medicaid traditionally reimburse providers at rates considerably below those of private insurance. Providers recoup the lost income by raising prices for those with private coverage. It is estimated that privately insured patients pay $89 billion annually in additional insurance costs because of cost-shifting from government programs. If the new public option would have similar reimbursement policies, it would result in additional cost-shifting of as much as $36.4 billion annually. Such cost-shifting would force insurers to raise their premiums, making them even less competitive with the taxpayer-subsidized public plan. Some estimates predict that as many as 118.5 million Americans, nearly two out of every three people with insurance, would shift or be shifted to the government program. The result would be a death spiral for private insurance and the American health care system would rapidly devolve into a single-payer system.

Many of the morons in Washington claim the public option is the only way to get money grubbin' insurance companies to reduce premium costs. They claim only through the addition of a government program would companies have any sense of price competitiveness. Truth is, so long as there is more than one insurance company, there is already a sense of competition. Now, they are correct that, in some rural areas, there are only a few plans to chose from. To that I say, open the markets up to the entire country or the entire world for that matter. There are literally thousands of choices if, and when, government gets out from between you and those companies. Given that many of the most outspoken advocates of the "public option" have, in the past, supported a government-run single-payer system, it is reasonable to suspect they support a public option precisely because it would squeeze out private insurance and eventually lead to such a system. President Obama himself has said that if he were designing a health-care system from scratch, his preference would be a single-payer system "managed like Canada's." He has also said that, while this proposal is a less radical approach, "it may be that we end up transitioning to such a system."

. Bottom line.... No to employer mandates... and No to a public plan.

Rationed care / Worth of life

President Obama refuses to call government-run health care, rationed health care, but rationing is just what would be required if we expand the number of people covered and claim to save money over the long term. Mr. Obama's budget director has acknowledged that rationing reduces costs. (for once he's correct) Peter Orszag told Congress last year when he headed the Congressional Budget Office that spending can be "moderated" if "the diffusion of existing costly services were slowed."
Their idea is to appoint an advisory council to determine what medical products and services are to be considered "required" benefits of any public or approved private insurance plan, and which should not be covered by the public plan. They will form an advisory committee to "recommend a benefit package based on minimum standards set in the law." And propose a new medical commission that develops treatment protocols based on government directed cost-benefit analysis. Medicares decision to no longer cover the use of virtual colonoscopies, certain wound-healing devices, and even an asthma drug is just the start of what is to come. These restrictions don't treat people as individuals, they mandate one medical protocol for all and limit the doctors ability to make decisions based on what he/she believes is the best course of action for that specific person at that specific moment in time.

Policy makers who know rationed care is coming, form these boards, commissions and committees to make the ugly decisions and to insulate them from responsibility. Congress and the Obama administration are proposing to make the recommendations of the current Medicare Payment Advisory Committee (MedPAC) "legally binding" instead of "advice" for Congress to debate and legislate. This again prevents any elected member from suffering any political damage from the rationing policies that will be instituted. Unpopular decisions on access and price is a decision "YOU" should make when "YOU" choose your policy. Different people have differing medical needs and differing financial means to meet those needs. A one size fits all, cookie cutter model, that treats everyone the same and offers no alternatives is just plain wrong at it's core.

Other countries where government plays a large role in health care aren't shy about rationing. In countries such as Great Britain and Germany, layers upon layers of bureaucracy have been put in place to slow the implementation of innovative medical products and services in order to keep costs in check. In the past 12 months, the 15 medical products and services that cleared the German process spent an average 3 years under review. German boards regulate reimbursement, impose restrictions on prescribing, and does formal cost-effectiveness analysis that guides their decision making process. In Great Britain, the National Institute on Clinical Effectiveness makes such decisions, including a controversial determination that certain cancer drugs are "too expensive." The U.K. government effectively puts a price tag on each citizen's life — about $44,305 (£30,000) per year, to be exact, under NICE's guidelines. That's just a baseline, of course, and, as NICE chairman Michael Rawlins points out, the agency has sometimes approved treatments costing as much as $70,887 (£48,000) per year of extended life. But such treatments are approved only if it can be shown they extend life by at least three months and are used for illnesses that affect fewer than 7,000 new patients per year.

In an attempt to control health-care costs, the government would undertake comparative and cost-effectiveness research to determine which health-care procedures and technologies are most effective and, more ominously, cost-effective. Of course, there is a great deal of waste in the U.S. health-care system, and if the government's goal were simply to provide better information there would be little cause for concern. But there is every reason to believe such research would be used to impose restrictions on how medicine is practiced. Just how much do you trust the government? Do you think your quality life is as valuable to them as it is to you? Do you trust your life to a formal cost-benefit analysis?

Overstepping ones bounds

Under a committee bill, Congress and federal officials would exert a high degree of control over health insurance, including underwriting and rating rules, and would prescriptively organize the market for competing health plans. That would limit the ability of states to design rules and market the rules to fit specific local conditions. The federal government certainly has a role in encouraging states to make health insurance more accessible and affordable for all Americans. But because of the radical diversity in state health insurance markets, states rather than Washington are best suited to design policies for universal coverage within their own boundaries. In expanding coverage and improving health care delivery, the federal government and the states should enter into a partnership of equals; the states should not be reduced to mere agencies of federal authority.

I believe government can have a broad and powerful supervisory role and set regulations on the medical and insurance markets to a point. But only in the name of cost savings or improved health. The moment they over-regulate, costs shoot up and they become a disservice to everyone involved. I believe the government should encourage the formation of public or private clinic networks in all urban areas to take some of the load off the overfilled hospital emergency rooms.

I believe the patients should have some measure of responsibility for themselves. A few ideas for this include risk-based / health-based premiums, significant co-pays for use of specialists, elective procedures or costly medications, and added incentives for healthy lifestyle choices. You'll be shocked to hear that I'm in favor of certain sin taxes. So long as revenue from those taxes is actually spent towards, and are proportional with, offsetting the additional expenses they create for the provision of care. I pay a higher health and life insurance premium to cover the added risk my insurance company takes on due to my smoking habit. Government imposed sin taxes are then also a logical method of recouping the added costs incurred by government programs. (limited sin tax of 33%)


Malpractice and defensive medicine

Doctors can and do make mistakes, and patients should be compensated when they are harmed from those mistakes. But the current malpractice system is financially unsustainable and court rulings have been proven to be both inefficient and inconsistent. It takes an average of 5 years to reach settlement in current courts, with 75% of the award needed for lawyers fees and administrative costs. Determining whether doctors are fit to practice medicine is no longer effectively managed by the woefully underfunded and generally ineffective state licensing boards. There needs to be a new authority structure that can gather the data, collect peer reviews and make the important decisions on professional competence.

The defensive medicine measures of repeated or unnecessary diagnostic tests have been built-in to our health care system to help defend against malpractice lawsuits. This is are another reason for the overall high cost of health care. Some industry studies have estimated the cost to be anywhere between 20 and 100 billion dollars per year in additional health care costs. The only cure for this is to cap medical malpractice settlements or the amounts awarded by the courts.

Health care has become a legal jungle for medical providers. Legal fears of this system have been calculated into every health care decision they make. That's why a broad coalition of providers, patient safety experts and consumer groups have proposed the idea of special health courts. We can't expect health care providers to focus on delivering effective, efficient, quality care if they're instead focused on lawsuits, loss of license, and financial ruin. Restoring trust requires a Federal Reserve-style structure to make the tough decisions about the ever changing standards and practices of health care in America. It would be a mistake if "best practices" measures were forced on doctors and hospitals, removing their decision-making abilities. But if these practices were mandatory, the defendant in medical malpractice lawsuits should then be the court itself. No, I believe they can institute guidelines in which, if followed by doctors and hospitals, they would be insulated, at least partially, from bankrupting malpractice court action. Therefore, reducing the cost of outrageous malpractice insurance and eliminating some the need for defensive medical tactics.

Appealing to Medicare already takes patients an average 2 years. 3/4 of that time is bureaucratic administrative processing. Layers of commissions and health boards would delay access still further. Creating this medical supreme court structure is also essential to reducing the layers of overlapping bureaucracy currently in government systems, or proposed to be added to it.

Red tape / Need for speed

With approx 20 million new patients to juggle, providers are either going to need to hire more doctors or free up more of the current doctors time. Doctors talents are wasted when having to argue -w- government program or insurance company bureaucrats. Their job is to serve patients, not push paper or make phone calls. Instead of bureaucracy and arguments for approval over each and every procedure your doctor wants to perform, "annual" audits (by insurer or government) can evaluate whether providers have delivered effective care efficiently, with rewards and penalties based on their findings. With disagreements being handled by the special health court that is specifically geared toward heath care issues, a more reliable, efficient and consistent ruling can be expected. Millions of hours will be saved when doctors don't have to get approval for each and every procedure, but they will still be accountable for over-utilization when their yearly audit comes due.

The fee-for-service model is hopelessly inefficient, allowing unnecessary procedures and requiring hours upon hours of administrative paperwork. Primary care and chronic care can be offered on a "per patient- per year" basis, with annual reviews to account for unexpected needs and make price adjustments for the following year. This idea can work with any type of health care provider, private or public, health care system or single practitioner.

Own your own insurance company?

Real health care reform should empower health care consumers, not government bureaucrats. Today, too much of health care spending is controlled by the government, employers and insurance companies. Instead, we should return that money to individual families and workers.
The option of obtaining coverage through a non-profit health insurance co-op offers a practical solution to those who complain that existing for-profit and non-profit insurers are too self-interested, make too high a profit, or spend too much on administrative overhead. With policyholder/owners controlling the company, there would be incentives to find ways of lower costs while also expanding coverage and benefits. A health insurance co-op would be able to ensure policyholder/owners receive any profits or surpluses in the form of either lower premiums or enhanced coverage... much like your credit union distributes surpluses to it's members in the form or either higher interest rates paid on deposits or lower interest rates charged on loans. Furthermore, those policyholder/owners are not likely to impose the cost cutting measures of denying claims or limiting the number of health care providers. What they will want is a premium that rises less, without impeding their ability to receive access to quality care. As "owners", the managers they hire to run the company will work hard with health care providers to find a better value for them as "policyholders." The assumed successes of cooperative health unions would also apply pressure on for-profit or non-profit competitors to adopt more "policyholder-friendly" business practices.

Easy answers

Now, we all know heath insurance premiums are out of control. Partly due to the cost of health care providers having to deal -w- deadbeats. The uninsured raise insurance premiums through cost-shifting much like the government programs discounted reimbursement rates. Hospitals and doctors try to recover the costs of treating the uninsured by charging private insurers more. That cost is passed along in the premiums the rest of us pay. It has been estimated that the cost uncompensated care could be anywhere between $14 and $43 billion annually. For that reason, I believe government can and should impose a individual mandate legally forcing everyone to find at least a minimal amount of health care coverage. An individual mandate . . . would require people to purchase an approved, private sector plan that meets minimum-benefit guidelines and is appropriately regulated and audited. This, along with privatizing the public health programs will end the practice of "cost shifting" and bring private insurance costs down.

I believe ending employer based health coverage and mandating insurance coverage be sold on an individual-based, risk-based, private market place... (much like auto insurance) would open the market to increased competition and reduce costs even further. Your insurance would be portable from job to job and maintained between jobs by a government unemployment subsidy. I believe employers should contribute to health costs, but not provide the benefits or receive a tax credit for doing so. Employers never should have been in control of their employees insurance in the first place! How does this give us any personal choice when our employers control this most important, personal and private decision of our lives. My employer chose who they purchased my health insurance from. I had no say! And, if I was unhappy with this benefit... too bad... go work somewhere else.

Employers should pay a "5% of payroll" health tax into a government health subsidy fund. This would be separate from the, employee matched, medicaid/medicare tax (also 5%) and an, employee matched, social security/minimum investment (10%) [all payroll taxes limited to the 1st $200K of income per employee] The new government health subsidy fund would be used to help citizens of average or below average income purchase private insurance policies.
I know, I know... business already pays too much. But I want to eliminate the business tax and replace it -w- a 10% value added tax, so it's still a savings to business, would lower prices, increase employment and allow for wage growth so you can more easily afford your insurance premium.
(BUSINESS TAX =20% OF WAGES PAID + VALUE ADDED TAXES COLLECTED)

Will this cure the problem, in short... NO!, but it WILL help. Too many people get too much benefit from public programs (Sorry, someone had to say it). Your premium and co-pays will need to be adjusted to match the costs remaining after the governments subsidy contribution. How much of government Medicare/Medicaid should be paid through tax and how much by policy holders? Well, good question. Obviously all government aid for below poverty level citizens will have to be covered entirely by Medicare/Medicaid taxes collected, the rest gets spread out based on need.
The government health subsidy fund will be spread across those of us not covered under Medicaid or Medicare in much the same way (based on need).

I do limit my socialist tendencies to 10% of government revenue for poverty aid programs. (I know, I know...That's twice what were spending now. But I want the size of government cut by 1/3 so its not so bad) By poverty aid, I mean welfare programs, food stamps, medicaid, medicare, W.I.C, you name it, 10%! I'll leave it to government liberals to spread that 10% to each of their poverty program as they see fit. (that's called bi-partisanship)

I believe government can help those not covered who are below the poverty line... it's called Medicaid. I believe government can help those of average and below average income with a subsidy paid out from a health fund our employers pay into. I believe a health subsidy system can be devised where everyone is guaranteed not to have to spend more than 10% of their income on health care. I also believe you should be able to choose from every insurance company on the planet. So long as they are accepted by your local providers, offer the basic coverage, meet minimum regulations and are open to regular audits as mandated by law.

But most of all, I believe government should stay the hell out of the health care business as much as possible.

Posted by theconservative@yahoo.com