How Should Americans' Health Care be Paid For?

[NW-Bound]

Quote:

Originally Posted by M Paquette Shocking how the government would waste all that money they collected on some old people...

I don't think the question is really whether we should get some benefits from Medicare that we have been paying into, but rather if we get our money's worth. There is a difference between price and quality and efficacy, whether health care or anything else.

[dgoldenz]

Quote:

Originally Posted by M Paquette (Between me and my employers, I have $244,758 in Medicare. That's enough to cover a $1500 a month medical policy for over thirteen and a half years. If y'all decide Medicare is wasted on old people, I'd like that money back, please. kthxbai.)

Don't forget the $200+ per month you will spend on Medicare supplements and premiums even when you're getting the benefits...

[M Paquette]

Quote:

Originally Posted by NW-Bound I don't think the question is really whether we should get some benefits from Medicare that we have been paying into, but rather if we get our money's worth. There is a difference between price and quality and efficacy, whether health care or anything else.

I'd say we get OUR money's worth. It's just that the money goes about half as far as in other countries.

Everything seems to be more expensive in the US. Now, some would say that is just our natural burden as we have to fund all that R&D work, but it turns out that a bit over half the medical (including pharmaceutical) R&D spending takes place outside the US. We do lead in Marketing expenditures for pharmaceuticals and medical expendables, though. Must be all those print and TV ads to keep us informed. Yay us.

Alas, we don't have exactly a competitive marketplace in the US for the medical industry. About half of medical care spending comes from government programs (Medicare/Medicaid/VA/Tricare/SCHIP) with it's own pay per service price schedules. Much of the rest comes from bulk insurance coverage, mostly corporate group plans, with negotiated pay per service pricing, often tied to Medicare rates. The supply of physicians is restricted by negotiated limits on the number of medical residencies (set between Congress, the Association of American Medical Colleges, and the AMA). The cost to train a physician sets a floor on what the indebted newly minted doctor needs in income.

So far, the focus of reducing the cost of health care in this discussion has been on denying care. Dex mentioned the NIH model for determining appropriate care late in life. It's good to have some information. Thanks.

Now, what else can be done to actually lower the cost of treatment, or make some level of treatment more widely available?

We could set things up so that free market forces are actually at work. Move everyone to private individual insurance, for example, so everyone sees the full insurance cost and not just their co-payment. Loosen up the doctor supply. Heck, I bet for less than the indigent support paid through Medicaid that the government could flat out pay physician education through grants, improving the supply of doctors and lowering their indebtedness on graduation. (Yes, technically that's a subsidy. Like what we do for wheat, corn, cotton, rice, and soybean farmers across the country, 29.8 BILLION in FY 2000.)

I'm pretty sure that the centrally planned medical economy that we effectively (or ineffectively) have could be significantly improved on.

[kyounge1956]

Quote:

Originally Posted by ERD50 Each of us do it every day. As an example, I don't know anyone who pays to have a fully certified mechanic on their personal staff. Their car should get a full safety inspection prior to every single drive. What if your brakes failed? But it would be too expensive to do that. You can give so many examples of this. How many CO2 and different types of smoke detectors do you have in your house, different types are better at detecting different types of smoke. Do you have a sprinkler system? On and on. We all make this decision. But, if those mechanics or other things were available 'for free', many more would insist on frequent inspections. Total expenditures would go through the roof. And if I were in a mental state to be able to make the decision, I would absolutely decide to stop seeking medical treatment based on cost. At some point, I would not want to leave my family penniless, when the odds were against me, and I might not have much quality time left anyhow. If it's somebody else's money, sure - why not? Maybe that is what is immoral? -ERD50

You are mixing apples and oranges. Mechanic checks, smoke detectors and the like are preventive measures—they guard against negative outcomes that may possibly happen in the future. But there is a difference between failing to prevent death, and actively withdrawing or withholding treatment when the certain outcome of that withdrawal will be death within minutes, hours or days. The only person who has the right to make the decision to cease treatment is you, or someone to whom you have given authority to make it on your behalf in the event you are incapacitated.

If you were in a mental state to make the decision and elected to decline further treatment, I would have no argument. What is immoral is for someone else to decide to withdraw treatment from you, without your consent and possibly against your wishes, solely because of the cost. The question "what is the right thing to do?" cannot be answered by a dollar amount.

[chinaco]

Come on... just a pile of words.

I am not going to pretend that I know every detail of the problem. But I have read a lot... because there are tons of reports that have been published.

I am not saying we should model our system exactly like the UK or the other Industrialized nations.

The data shows that we are spending more per person and have higher mortality rates.

Quote:

Originally Posted by dgoldenz Which implies that even a 20% VAT and $8/gallon gas would not be enough to have the same type of system in the US.

The only thing I can figure is you aren't thinking about what you are saying or are not thinking about the actual numbers or what the words mean.

Quote:

Originally Posted by dgoldenz Cost control is the key, but it's not going to be cut in half overnight either.

Yes... this is part of the problem. But a broad generalization that is like stating crops will have problems if we have a drought.



Wikipedia provide some basic facts and figures. You can find these from other sources.

United States - Wikipedia, the free encyclopedia
United Kingdom - Wikipedia, the free encyclopedia

Look at this chart.

Healthcare Costs Around the World - VisualEconomics.com


The UK has 1/6 of the US GDP. They have 1/5 of our population. In other words we are worth more/make more and have fewer people per $ of GDP. However, we pay double what they pay per person on average for health care.

What do we get for it? Not better health results... but apparently for non-life threatening situations... faster service.

Fast service is good... but if it is not sustainable something will have to give. On an economic basis people will choose to wait if it cost too much... they make choices.... even with our current system.

As our costs continue to spiral upward... we will all be in jeopardy.

Those of us that work and or have nicely subsidize plans do not see it too directly yet (the company pays it)... But business will not be willing to shoulder the burden... they will pass it through. Many are passing it through!

Health care inflation is outpacing income growth (for families and individuals).

Family Health Premiums Reach $13,375 Annually in 2009 Up 5 Percent as Inflation Fell Nearly 1 Percent - Kaiser Family Foundation


Ultimately, the way we manage it is out of whack and has to change.



If you keep it up with the half truths and misinformation... I am going to call you an insurance agent.

[Gumby]

Interesting article in yesterday's WSJ regarding potentially unnecessary spinal fusion surgery at $30k a pop.
Top Spine Surgeons Reap Royalties, Medicare Bounty - WSJ.com

[ERD50]

Quote:

Originally Posted by kyounge1956 You are mixing apples and oranges.

OK, but it was to point out that we make $ vs life risk decisions everyday, and we all often side with money. And we may put our children in those cars or homes with less than perfect maintenance, and they have no say in the matter. So maybe we are all immoral, even when we have control of the situation? Having say, five CO2 detectors instead of just one or two (or none!) is within just about everyones budget. It is different (preventative), but it still makes the point (albeit from a slightly different angle).

But my second example is a direct comparison. So let's stick with that.

Quote:

If you were in a mental state to make the decision and elected to decline further treatment, I would have no argument. What is immoral is for someone else to decide to withdraw treatment from you, without your consent and possibly against your wishes, solely because of the cost. The question "what is the right thing to do?" cannot be answered by a dollar amount.

Except money isn't some infinite resource, so we do need to ration it. Extending a poor quality of life for a short time at high expense means those dollars are being taken from someone else who might need it more. I'll call that immoral. I also see it as somewhat immoral to make a decision with someone else's money that I wouldn't make with my own money. That is a big issue with cost controls in general.

There needs to be some guidelines here if it is going to be funded with public money. It can't be whatever someone wants without limits. And I guarantee that not everyone will agree with those limits. Such is life (and death).

-ERD50

[Independent]

Quote:

Originally Posted by nvestysly This is a favorite topic of mine. I've spent hours writing elected officials, debating the pro and con. The answer seems obvious to me. I realize it's a complex topic and it's likely there is not a simple, one size fits all method of addressing health care and health care insurance. Yes, they are two different topics. While many interchange the phrases health care with health insurance they are separate. I have not taken time to read the entire thread but I will come back to it when time permits. As I said above the answer seems obvious. In my mind at least part of the obvious answer is we all (as invidviduals) must realize that when you spend other people's money (OPM) you don't spend it as wisely as when you spend your own hard-earned money. Therefore, I am clearly on the side of less governement involvement. That being said, I think the government needs to establish a framework to make a health care and health care insurance system work well for most if not all citizens. Let me stress that government only provides the framework - less is better - let the individual decide how much insurance to purchase - let the individual decide if they want a high deductible or a low deductible. Let the individual decide if they want insurance to cover out of pocket expenses. So what's up with the nearly 43% of you that voted ...

I happen to be in the 18%, not the 43%. But I wonder what you mean by "framework".
Suppose I buy private insurance and then get cancer. My insurer will see that the rationale profit seeking decision is to refuse to renew my insurance.
Or, suppose I get my insurance through employer group and my employer goes out of business or decides to drop group insurance. I'd like to continue my coverage at normal rates, but the insurer wants to drop me.
Or, suppose I'm a young person with a congenital problem. I've aged out of normal "family" coverage and my parents' insurer doesn't want to continue my coverage.
Or maybe I'm a young person and I believe I'm immortal, until I'm injured in a one car crash. I don't have any insurance for my injuries.
Do these situations involve the government "framework"?

[DeborahB]

Has anyone seen this site?
Physicians for a National Health Program

Physicians for a National Health Program

There's a lot of interesting information for discussion.

[Texas Proud]

Quote:

Originally Posted by chinaco My conversations took place just prior to the election.... not 10 years ago. They said there were some problems that had to be ironed out. I have no illusions... I am sure their system is not perfect. For that matter, it may not be a good fit for America. But they seemed to be happy and healthy. On that note, ever meet anyone who didn't have a complaint? For that matter, ever see a complex system that couldn't use some improvement? I hear a lot of complaining here in the US.... and it is getting louder as prices spiral upward.... and that is from the people that have coverage. Those who do not have coverage really have something to complain about!

I don't think the system has gotten better over the years... but who knows, I could be wrong..

BTW, when I left the big thing that was starting to be offered was private health insurance... I do not know how big it has become, but it seem strange that if a system is so good you can give incentives to employees to get around that system...

[flyfishnevada]

I chose individual responsibility. If I choose to go it alone, so be it. At no time are you responsible for my bills or bad choices, but I am not responsible for yours. I believe that if people we actually involved in the fiscal transaction prices would go down. A doctor or hospital would have to compete for your business and set prices accordingly. I mean would you go in to the ER for a small cut if you knew it would cost $500 dollars? Would you go to the doctor if you had the flu, if a clinic would see you for half the cost? People do it now because its included in their plans. Might as well use it if you got it and who cares what it really costs.

With the overwhelming government control of the industry competition is non-existent. Can't a tech give you a shot or stitch up a small wound? Can't a RN at a clinic interpret your blood work or prescribe antibiotics? I think they can. Sure surgery and complex cases require a doctor, but you can always be referred if you are beyond the skills of a tech or RN. For instance if you cut your hand and needed stitches would you go to the ER for $500 or a clinic and see a tech for $100? I would trust an ex military medic or retired EMT to do something like that. I don't mind the Fed or the states regulating certain aspects, but if I want to pay a tech to sew up my hand (or any number of other things) I should be able too. Information and the free market are my protection, not some bureaucrat.

To me this doesn't mean we can't have catastrophic insurance, but now I pay into a pool for colonoscopys. They cost a few hundred bucks and you maybe have 3 or 4 during your life. I pay into a pool so I can get a $20 copay for a doctors visit that costs $100, but only because that is the negotiated rate not what the market will bear. Considering I usually see the doctor for about 2 minutes, does that make sense? We all pay into a pool to help reduce the cost of mundane services that without the regulation and insurance price setting would likely be very affordable.

Government regulation and oversight doesn't solve problems, it creates them. Then it claims we need more oversight and regulation to fix the unintended consequences, not to mention money. I realize medical care costs more today because of the technology employed, but the current system is like paying for auto insurance that covers burned out taillights and dirty windshields as well as catastrophic damage to your car. I don't mind paying for insurance that covers major surgeries and illnesses, but I don't want to pay for some over protective mom's or hypochondriac's constant visits to the doctor and ER or for some dude's AA treatment or some gal's methadone. And I definitely don't want the government telling me I have to buy that coverage and then telling me how to live my life or rationing my access to care to make it affordable.

And by the way, government means Federal Government. The Constitution does not preclude the states from playing with this stuff and in my mind that's the way it should be. 50 experiments in democracy. If California or New York want to dabble in state run health care let them. If Texas wants a free for all, let 'em. We'll see how it goes and let people migrate to the state of their choosing.

In the interest of self preservation, I will not visit this thread again. I know that the above convinced nobody to change their opinion and any future arguments will accomplish nothing either.

[dgoldenz]

Quote:

Originally Posted by chinaco Ultimately, the way we manage it is out of whack and has to change. If you keep it up with the half truths and misinformation... I am going to call you an insurance agent.

I deleted most of the quote to save some space, but I think you missed my point. We already spend ~2x the amount as the UK (among other countries) per capita on healthcare. My point was that if the UK already has a 20% VAT and massive gasoline taxes and only spends half of what we do, how would a country like the US account for the extra spending required based on the per capita numbers? Would we have a 40% VAT and $16/gallon gas? Even if you reduce the per capita cost (unlikely at this point), it won't be cut to UK levels overnight.

Without giving people some skin in the game (a big chunk, not just $10 co-pays) for their own costs, costs will continue to rise. It's always easy to spend somebody else's money. Third party payments for basic health services is the #1 thing driving healthcare costs in my opinion.

[DeborahB]

Quote:

Originally Posted by dgoldenz Third party payments for basic health services is the #1 thing driving healthcare costs in my opinion.

ABSOLUTELY agree.

[jIMOh]

I voted other.

My suggestions are fixing certain inefficiencies in the system and improving access through creative means. That creativity could be in form of products, distribution, or general problem solving.

Examples

In efficiency 1 is different people pay different things, depending on who their provider is. Private company 1 vs private company 2 vs medicare vs medicaid all have different costs for the same MRI or the same surgery. This is inefficient- make everyone pay for same service at same hospital or treatment center (regardless of insurance). Much of this could be accomplished thru full disclosure (disclose procedure and price prior to service).

Another example of inefficiency is there are lots of plans (even by same insurance company) and it would be simpler in some cases if there were fewer plans by more providers (not more plans by fewer providers) to encourage competition.


An example of a product which has merit (but does not exist) is combine health insurance and life insurance (as an option) for some consumers.

For example if I need $500,000 in term coverage, why not add a health insurance rider to the policy and charge me more for the coverage? Meaning give me 500k of term coverage and 7k of annual health costs (covered) for a larger premium, and carry this for a specific term (meaning I have locked in my costs and coverage for a term of 10-20 years).

Similar to permanent (whole life) insurance, offer a plan with $1 M in coverage. For every dollar of health coverage I need it reduces the death benefit dollar for dollar.

Both options allow someone to lock in their costs for a period of time (term of 20 years or for whole life). And the premiums paid can be added to sub account (similar to an HSA) which can grow bigger than the policy value.

Most importantly this means more companies will compete for health insurance dollars, so the costs to consumers should decrease.

[nvestysly]

Quote:

Originally Posted by dgoldenz Third party payments for basic health services is the #1 thing driving healthcare costs...

Couldn't agree more! Stop spending OPM and health care and health care insurance costs will straighten out in a few years.

For example - somebody is in a serious automobile crash and requires significant surgery, rehabilitation, etc. That's what insurance is for.

On the other hand - you get a cold or the flu - go to the doctor if you want and pay for the visit. Then pay for the medication. You might just decide you should stay home and rest for a few days and recuperate.

Spending your money will put you much more in touch with the cost. When individuals are aware of the actual costs they will make much more rational decisions.

A previous post indicated it may be immoral to spend OPM on something you would not spend your own money on. I agree.

[dgoldenz]

Quote:

Originally Posted by jIMOh An example of a product which has merit (but does not exist) is combine health insurance and life insurance (as an option) for some consumers. For example if I need $500,000 in term coverage, why not add a health insurance rider to the policy and charge me more for the coverage? Meaning give me 500k of term coverage and 7k of annual health costs (covered) for a larger premium, and carry this for a specific term (meaning I have locked in my costs and coverage for a term of 10-20 years). Similar to permanent (whole life) insurance, offer a plan with $1 M in coverage. For every dollar of health coverage I need it reduces the death benefit dollar for dollar. Both options allow someone to lock in their costs for a period of time (term of 20 years or for whole life). And the premiums paid can be added to sub account (similar to an HSA) which can grow bigger than the policy value. Most importantly this means more companies will compete for health insurance dollars, so the costs to consumers should decrease.

No insurance company would offer a guaranteed health insurance rate for 10, 20, 30 years because there is no way to know what medical costs will be in the future and how legislation will change. The premiums would also be so ridiculously expensive that nobody would buy it. Combining more than one type of insurance into a single product is always a bad idea. If you want health insurance, buy health insurance. If you want life insurance, buy life insurance. If you want disability, buy that. If you want LTC, buy that. Combining them doesn't make them cheaper, it just makes the benefits for the "add-ons" suck because otherwise the price would be too high.

[RonBoyd]

Quote:

Originally Posted by jIMOh Most importantly this means more companies will compete for health insurance dollars, so the costs to consumers should decrease.

All these new companies would, no doubt, help the Unemployment picture. However, I don't see the Consumer's costs decreasing to make payroll... not to mention all the other duplication of costs.

[nvestysly]

Quote:

Originally Posted by Independent ...government "framework"?

There is no simple answer and we'll not solve the matter here but I generally think less federal government involvement is better. The framework I imagine allows individuals to "shop around" to purchase the type and level of insurance coverage they want. The framework allows individuals to decide if they want end of life care or simply want to take their chances. If you want long-term cancer coverage (or other extended extended illness coverage) you pay a higher premium. I suspect many people would want chronic illness care. But if you want minimal coverage and want to take your chances so be it. We all do this with car insurance, liability insurance, house insurance, etc. Why is health care insurance that much different?

A significant reason health care insurance is different is because we've made it so. The federal government got deeply involved in the WWII period when employers began adding health care as an employee option to make certain jobs look appealing. The federal government gave preferred tax status to employer health care costs. It just spiralled out of control from there as this and that tax advantage was put in the code. My idea of framework is to unwind all the convoluted health care and health care insurance schemes and bring it back to basics. The government, preferable the state government, would oversee health care and health care insurance. The framework would be decided by elected officials and it may vary by state. States with a good framework would have more people participating. States with poorly defined, poor customer service plans would suffer the consequences.

Ultimately, the premiums would be based on large pools of people buying various types of insurance coverage for various situations. There is not a one size fits all answer. Back to the car example.... there are minimum amounts of coverage required in each state - I typically buy more coverage than the minimum. But that's just me.

Give me the same opportunity with health care and health care insurance. Take it away from employers, take it away from the federal government. Pay for it like anything else. With your own money.

So that leaves the "less fortunate" - where do they stand? That's another story in itself and must be addressed. I suspect it will not be difficult to address the "less fortunate" issue when we first address the basic problem.

[jIMOh]

Quote:

Originally Posted by dgoldenz No insurance company would offer a guaranteed health insurance rate for 10, 20, 30 years because there is no way to know what medical costs will be in the future and how legislation will change. The premiums would also be so ridiculously expensive that nobody would buy it. Combining more than one type of insurance into a single product is always a bad idea. If you want health insurance, buy health insurance. If you want life insurance, buy life insurance. If you want disability, buy that. If you want LTC, buy that. Combining them doesn't make them cheaper, it just makes the benefits for the "add-ons" suck because otherwise the price would be too high.

Quote:

Originally Posted by RonBoyd All these new companies would, no doubt, help the Unemployment picture. However, I don't see the Consumer's costs decreasing to make payroll... not to mention all the other duplication of costs.

I love how people see problems which "prevent" something from happening. The problems you present are both valid, but very very fixable.


The idea of locking in costs for 5-10-15 years is in best interest of consumer. Sure it might cost more money for a 10 year fixed premium, but because its linked to a higher life insurance payout (for example) it's in the insurance company's best interest to keep me alive. In current health insurance system it's better if I die from the standpoint of what I cost the insurance company.

It is OK for something to cost a lot of money. This might also help control costs by both consumer, providers and the insurance companies. Plus with plans like this, the need for Cobra goes away, so any funding for programs like that disappears, and the burden that puts on tax payers when economy contracts is non existent (next time).

As for combining policies, it is one cash pool fighting for my insurance dollars, and those policies have a conflict of interest. It is in health insurance best interest if I die fast, where is it in life insurance company's best interest if I die after policy expires.

In addition, I want insurance to protect me from going bankrupt. I have a finite amount of dollars to spend, so LTC, life insurance and health insurance are all doing the same thing- making sure my family does not go broke if something bad happens. It makes sense to combine them if the consumer wants the higher premiums and flexible payout options. There already riders on LIFE insurance policies which allow people to tap into them before they die if they become disabled. This is just an extension of that.



Imagine a world where HSAs went away, and if you paid $400/mo for the HDHP and another $400/mo for the HSA and another $100/mo for term policies on each spouse and another $100/mo for long term care.

There is no way all those policies will be needed (at same time), so why not put $1000/mo into one big pool, then allocate money as needed (7k covers annual worst case medical if its HDHP, the rest is building a cash value for life insurance or long term care). If I tap into health insurance enough, it might lower my LTC payout or require higher premiums to keep same benefit.

In general the difference between LTC and health insurance is what? In reality LTC IS health insurance (because LTC provides health care), and a person might need to carry both, yet the person with an LTC policy is duplicating coverage (IMO). Combining saves the insurance companies money and is what is best for consumer.

[dgoldenz]

Quote:

Originally Posted by jIMOh I love how people see problems which "prevent" something from happening. The problems you present are both valid, but very very fixable.

I think you don't have a very strong grip on how insurance pricing works and are ignoring what people are willing to pay for what they get. If only people who could qualify for health insurance through underwriting could get life insurance or LTC, there'd be a lot less people with life insurance and LTC. You can't make it guaranteed issue because then you'd also be making life and LTC guaranteed issue, which would be a disaster.

People struggle to pay $300-400/month for health insurance for their families now, most don't buy enough life insurance, and very, very few buy LTC. A group health policy for a family averages over $1000/month by itself today, where will that be in 15 years? You really think people will drop $3-5k/month for the combination of all 3 guaranteed for 10, 20, 30 years? The pricing for different types of insurance is very different, hence the reason they are sold as separate products.

What happens when the insurance companies misprice one of those products and the company goes down the tubes because they can't pay claims? If such a product worked, it would already exist. The demand for such a product would be somewhere between slim and none, even if it were offered.