Lets Focus on Solutions - Can somebody PLEASE start a Health Care Solutions group?

[Jason Taylor]

Look, if we expect to have the right answers to the current issues in American society, we need to start figuring them out now. Obviously, having a phenomenal solution to the health care mess is critically important.

I think that we need to have a group here that is focused on exploring the solutions currently being offered by Mitt Romney and others, and really create a dialogue to explore the pros and cons of these plans. We need to come together and create a constitutionally sound, conservatively founded, free-market based solution that will allow us to own the debate on health care.

I am currently up to my eyeballs in commitments just from my blog and the two groups I've already created. Is there not a courageous soul out there who has enough understanding of the health care mess to focus their efforts on creating a successful, focused group dialogue which can produce results?

[Kathleen Henry]

The main problem is government intervention. Unfortunately, I do not know of any great efforts we can do to reduce government interference and involvement in health care until, as morbid as it sounds, the great numbers of baby boomers have come and gone off the rolls of Medicare and we find a way to reduce the size of government and the number of employees..

Let me explain succinctly what I mean. The government today is the largest single employer in the United States. As such, it has the most significant bargaining power. In order to obtain coverage for its very large employee base at even a reasonable price, it negotiates prices for some services at a higher rate in order to receive lower premiums and some other services, like basic doctor visits and drugs, at lower rates.

As anyone who understands any market concepts, wherever someone is willing to pay more for certain services and goods, it has the over all impact of increasing prices across the board. In the same respect, wherever the price of services goes down, it has the same impact across the board to lower prices.

Second, because government has a mandate to insure quality and equality of care and services as well as, in the guise of protecting the tax payer's money, policies and regulations that set standards for deliverable and payable services, they demand specific documentation, tests and programs be in place. It is not necessarily true that all of these tests, documentation or programs are absolutely necessary to insure against fraud or against poor care. However, because the government sets the standards and because all payers and providers who provide coverage or medical services must sign agreements to the effect that they will not discriminate their care or charges based on who is paying or receiving the services, all of the same policies, regulations, tests, pricing, etc is applied across the board to any and all customers. Which means, we all pay the same rates which have been increased to cover these additional documentation, testing and regulatory necessities.

The same is true for Medicare and Medicaid programs. The government, adding Medicare and Medicaid programs in with their employee based benefits, is the single largest purchaser of medical insurance (in the guise of HMO and PPO replacement policies) and medical services in the United States.

Now, take everything I said about government employee health benefits and extrapolate that across a third or more of our population that is aging quickly and becoming eligible for government benefits or who are on those programs now and you get one of the major reasons why health care is so expensive and why coverage is difficult across the greater population. Add to that the growing utilization of services and you have the current maelstrom of Health Care.

This is a politically charged issue because, in a few short years, the greatest part of our population will be over the age of 55 and will be shortly seeking to take advantage of the benefits that they have been paying for all of these years. You cannot blame people for expecting to get something for the money that they have been paying. Further, they are increasingly savvy about health care programs and procedures which means they will be looking for the best care possible from these benefits. They will not be interested in reduced services. Nor will an entire segment of the population that will be on fixed incomes from social security be interested in paying much more for these services and coverage.

Further, our nation has become programmed to believe they have a right to certain services and a right to have them paid.

Changing that will be the difficulty.

The first thing that we should be looking to do is to look at how much it costs us to prevent fraud and abuse v. how much it actually costs us. Then we look at risk to benefit ratios. Can we deregulate certain services, thus, reducing or stagnating their costs to slow the rate of health care inflation?

Secondly, we should be looking at how certain service sectors lobby the government for pricing on these government paid services. In many cases, these industries lobby the government to ask them to maintain certain services and equipment on the "formula" not because they are better, more efficient or more cost effective, but because of protectionist tendencies. Many in congress will support these protectionist tendencies because it does not necessarily harm the patient and also provides money and jobs to these companies within their constituencies. So, government is willing to keep the prices higher and less cost efficient to maintain these protections while new technologies, procedures and services languish and must push through the commercial sector for years before being accepted, if ever.

Third, free market principles and competition within markets are stagnated by regulations within health care markets that were ostensibly meant to protect those markets from LOOSING services and keeping out monopolies, has meant that competition by hospitals and doctors, the thing that typically helps reduce costs or keep inflation down, is none existent. For instance, how many people know that hospitals, based on where they exist within certain urban and suburban markets, are limited in the number of beds and physicians that they can open or hire? This insures that other hospitals in other nearby sectors do not lose patients, thus, revenue, and can remain open to serve those communities. However, that also means that competition is squashed and the drive to effective and efficient services is limited within the scope of the necessary driven by government regs, no the market.

But, the same mechanisms that are meant to help retain physicians in certain markets, like rural areas and inner urban areas, are countered by government's interference in the pricing structure and regulatory areas along with the cost of providing services. Due to regulations, there is limited to no existing structure that allows physicians or other providers to negotiate pricing based on their market. Which means that they are not able to adjust for the cost of providing those services nor are they able to negotiate a price that their customers can afford.

So, what we could do, in a limited way to effect the first capable adjustment to better market competition and reducing or stagnating inflation, is to reduce the regulations that limit competition and individual negotiations for services between providers and customers. We could create a carve out for basic physician office visits that would allow physicians to set more appropriate rates. In some cases, it might be slightly higher than the average today, but likely not. Even if it is, it may reduce some unnecessary utilization when people must pay for these visits themselves if it is not directly related to certain diagnosis and care. We must be willing to stop interfering with and limiting the market. It is not necessarily true that private practitioners would raise their rates across the board. It would allow them to negotiate more closely based on what the patient may be able to afford or what is more appropriate for that market. Further, it would allow the customer/patient more flexibility in seeking out the best services and that which they can afford.

Now, there is a fear that this would lead to less qualitative care where the price is reduced, but that is not necessarily true. Like other services and products, people don't just flock to the cheapest, they go where the service and product is the best. Think of it as the Japanese car makers vs. American car makers. Who is struggling to stay in business?

Once competition is more open and negotiations are more flexible, it will also open up the way for more competition and negotiation of contracts for fees with insurance companies that will also allow greater flexibility in setting premiums in specific markets.

In conclusion, our first steps can be small steps. We do not have to overhaul the entire system. we can start by taking a few regulations off the table and mandating the government to look for cost efficiency and service efficacy instead of protectionism that, in the end, actually helps keep extremely large and slow industry conglomerates in control of our health care and keeping the prices high. We can set the circumstances that will create better competition in the future when government beneficiaries are smaller and free market ideas will be more acceptable. Unless, of course, it is too late and everyone already assumes they should get government health care.

[James]

Kudos to Kathleen Henry for the insight on the healthcare system.

While I am by no means an expert in this field, I know that a major challenge for doctors is the increasing medical liability insurance costs. In 2002 liability insurance rose over 25% in 20 states in a single year and rose as high as 80% in some places. For instance in Florida obstetricans pay upwards of 250k annually for insurance. http://www.aafp.org/fpm/20021000/47unde.html

This is an issue that is personal for me as doctor committed malpractice on a surgery I had as a child; however, my parents did not sue. I see the necessity of legal recourse, but the costs for malpractice insurance are beyond reasonable reimbursement.

[Sara Jean]

We MUST be vigilante against Tom Daschel's plan for healthcare. I think Obama wants to push for it immediately, certainly before Spring is over. Daschel has written a book on how to get it done, and how to avoid the pitfalls which derailed the Clinton's attempts in the 90s. I think the urgency for us is to organize to resist this latest threat.

I recall, however, from our 08 elections that John McCain's health plan was actually pretty good; unfortunately he was just unable to articulate it as well as he should have. If you're interested in doing some research on it, I saw a write-up on it in a commentary in the Washington Times, likely in or about Sept. I think whatever shape ours takes, it is extremely important to also point out the many governments who rely on nationalized Healthcare with quite bad results. Aren't they all abysmal? Again, I think the immediate focus needs to be to position ourselves (57 Million) against their immediate plans to nationalize. Tony Blankley wrote an excellent piece on Daschel in today's Wash. Times.

[Jason Taylor]

Hey, there's Good News! Check out the Conservative Health Care Solutions group that has been created. As the request which prompted the creation of this discussion has been fulfilled, I will now close this discussion. Please take a look at the group, and if you're passionate about finding a conservative solution to health care, join in the discussion!