A sensible health plan -- that'll never get passed
Faithful reader Mr. Rational weighs in with a model health plan. This is how you might set it up if you were starting from scratch. But we're not. We have powerful interests wedded to the the inequities, inefficiencies, expenses and failures of the system we already have. Mr. R's scheme (he admits it's "quixotic"), if I have interpreted it right, is this:
1) Have people pay out-of-pocket for everyday medical encounters. That would encourage people to shop for good but inexpensive care. It would yield huge savings in bureaucratic costs. There would be no paperwork. 2) Have primary insurance to cover the odd appendectomy, broken-limb treatment and other "normal" emergencies that crop up throughout life. This would revert medical "insurance" to its true meaning -- a capitalized risk pool for non-ordinary expenses. 3) Have re-insurance from the government for catastrophic, bankruptcy-threatening expenses for say, cancer, car-crash recovery or heart surgery. 4) Devote a separate category of coverage for end-of-life treatment. Mr. R. puts it well:
If we are truly honest we can add a fourth category: Terminal care. Stop pretending that anyone gets out alive by refusing to flog and abuse our elderly and other terminal loved ones and still call it medicine. Most terminal care expenses are covered under Medicare (the elderly) but it still warrants its own category because of how it distorts every other cost statistic. It especially distorts when pointless treatments are used because the misguided emotionality and guilt of survivors mistakenly insist on them.
So we would cut bureaucratic costs in a huge way. We would deploy market forces for everyday care, making consumers spend their own money on medicine instead of somebody else's. We would have a safety net to keep people from going bankrupt. And we would have an honest discussion about why Medicare blows 30 percent or so of its dollars in the last six months of life.
Questions/possible objections: What about pharmaceuticals? Are they out of pocket? Wouldn't many people skip preventive care if they had to pay for it themselves, thus inflating aggregate health-care expense? Doesn't most medical spending come under categories 3) and 4), anyway -- so how will this save money? Thoughts?
Comments
This is basically a version of Brad DeLong's "utopian" health care plan, and I think Martin Feldstein proposed something like this too. So you could have the seeds for a truly bipartisan health care plan here. But things would have to be much different than they are today.
Posted by: Isaac | November 10, 2009 11:04 AM
Jay: Thanks for the presentation but yes a fair bit of detail was missed. Condensing five pages down to four paragraphs will do that.
The main point missed the statements addressing that aside from nationally based funding, the problematic aspects categories 3 & 4 are completely removed from individual consciousness and direct payment. Not that the expense would disappear.
"Expand the existing and generally well functioning Medicare to cover these catastrophic, traumatic and similar bankruptingly expensive disease treatments that worry everyone so deeply. The intention being to take this entire category of medical practice and their costs off the table as a concern to individuals." (and) "Achieve the 100% actuarial base needed to spread this universal risk to universal funding through the same tax supported means we already have in place." (and) "Despite all the rhetoric in the news there are very few working Americans who will be affected by medical treatment that would personally bankrupt them. Some other insurance like workman’s comp or auto liability is far more likely to be responsible."
As to pharmaceuticals (and similar) I deliberately made no distinction from other illness or injury treatments. Would the person enduring a chronic ailment which is treated adequately by pills prefer the risk of surgery or a likely early death?
Beyond a generally recognized standard of care that the tax deductions and income ratios should allow for the cold and harsh reality is that if you want more or better of anything... then be prepared to pay for it.
If the needs of your ailment so far exceed your ability to pay on your own then you should qualify for the backstop insurance or for Medicare.
Any proponent of a plan that claims to address the cost curve and doesn't also include substantial rationing measures (aka "standards of care") is lying through their teeth.
As I consistently get a "great idea, but" response from nearly every quarter the basic ideas indeed have appeal and merit. I should probably set up a web page for this to be explored rather than your blog.
Posted by: MrRational | November 10, 2009 11:44 AM
PBS is showing "Sick around the world" tonight at 9 p.m. which evaluates the health care systems of five different countries. Wonderful information - you can also view the program online:
http://www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/?utm_campaign=homepage&utm_medium=bigimage&utm_source=bigimage
Posted by: NotableM | November 10, 2009 11:47 AM
That is why they call him MrRational.
Nice proposal
Posted by: Dan | November 10, 2009 12:04 PM
I like this post. Would someone please send me a link to Mr. Rational's original complete post that is being responded to here? Thank you.
Thaddeus Pope
Health Law Institute
Widener University School of Law
tmpope@widener.edu
Posted by: Thaddeus Mason Pope | November 10, 2009 11:55 PM
Mr Pope asked to see the whole document. Assuming others may be inclined as well I have posted it in a venue that also allows for comments.
Look in the Health & Science section of the Sun's own Talk Forum
http://talk.baltimoresun.com/index.php
Posted by: MrRational | November 11, 2009 2:30 PM
The health care debacle has reached such a crisis level, has been so far corrupted, and become so ineffective that it excludes entirely, 47 million of our citizens and mal-services millions with ‘coverage’ and has devolved to the point where it is structured to benefit the stock-holder, at the expense of the patient, that consensus opinion on how to fix it will work about as well as the same type of opinion working on the field of battle. At the present time, we have the experts who know what must be done, being overpowered by the insurance and pharmaceutical industries and their ignorant supporters (who always grab onto whatever side has the simplest slogans and promises the easiest fix). This is a problem that will only persist and get worse if left in the hands of compromising committees of "elected" industry owned shills, already operating toward ends that do not favor the sick.
It must be recognized that the democratic form of government is no less, and in some ways more prone to being sold out to the highest bidder than even the most repressive form of governance. We have allowed ourselves to be ruled by corporate interests and their wealth (power), and any effective health care (as in the one payer system) will have to exclude the insurance and pharmaceutical control altogether. It may have to be demanded through the use of drastic measures, as they are not going to give up this money suck willingly.
Posted by: Robert Littel | November 11, 2009 9:40 PM
Actually, Mr. Rational, there is some evidence that bankruptcies are resulting from medical expenses incurred by insured people: http://pnhp.org/new_bankruptcy_study/Bankruptcy-2009.pdf. Also, not clear (at least from the summaries) how your system would account for chronic diseases (diabetes, asthma) that require a fair amount of care over many years.
Posted by: Bill in Columbia | November 12, 2009 10:00 PM