by KDunn
April 21, 2008 at 1:19 pm
· Filed under Uncategorized
OK - First session out of the box for me was the panel looking at the health care agenda of the major presidential candidates - and it was good. Good to hear more about how the policies differ, and having folks like George Shultz and the Kaiser Foundation’s Halvorson to compare and contrast was excellent as well.
Here’s the thing - it all sounds great, but until someone gives me some fiscal facts for what the planned Cost Per Participant under each plan is, it’s all pretty much theory to me. As someone who signs self-insured invoices and sees the costs rolling in, I’m aware that it’s easy to underestimate what health care is going to cost.
I know the candidates offer a mixture of private and public solutions. Doesn’t matter to me - I want to see the cost model… Not how it’s going to be funding (tax increases, etc.), but cost per individual.
I learned about how variable cost per covered individual can be by managing a self-insured plan and reading Joe Paduda. From a post I continue to go back to on Joe’s Managed Care Matters from 2007 regarding CT’s single payer plan:
Politicians were shocked by the estimated total cost, which ranged from $12 billion to $18 billion.
I’m shocked that they were shocked.
My home state has just over 3 million citizens. At $4000 per person, that’s $12 billion; at $6000 per person, it’s $18 billion. I don’t know what’s more troubling - for politicians to not know that health care costs between $4000 and $6000 per person, or that we have about 3 million folks living here.
And it wasn’t just the pols; “”Even we were quite shocked [by] the enormity of the cost. … A lot of people are just scratching their heads and saying, `Wow!,’” said Eric George, associate counsel of the Connecticut Business and Industry Association, the state’s largest business lobby.(Hartford Courant, 4/10/07).
More recently, San Francisco’s efforts to create a program for the city’s uninsured estimated the cost per covered individual at $2,800. Not enough…
So I like the debate, but would love to see what the camps assume their proposals would spend per covered individual. That would allow for a better analysis of each plan at a very basic and real level.
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Rodrigo wrote @ April 21st, 2008 at 2:51 pm
Here’s some interesting insight from a recent Washington Times editorial dealing specifically with consumers taking healthcare costs into their own hands …
Health crisis
Health care in America is in crisis (”Five myths of health care,” Commentary, March 21). Turn on the news, listen to the political candidates or simply speak with your friends and neighbors who are in need of or seeking medical treatment. The cost is high; the availability of service is sometimes inadequate and often unavailable to far too many who need it.
While it is abundantly clear that Americans in general, and the presidential candidates in particular, are keenly aware of the concern regarding ever-escalating health care costs, it appears their response is at best one-dimensional. In order to make a serious dent in the problem, we must own up to the fact that a multidimensional approach is necessary.
Asking who will pay for health care is certainly important, and each of the candidates has mapped out their own particular approach. Sen. Barack Obama is calling for incentivizing insurance for all, while Sen. Hillary Clinton wants to mandate insurance for every American. Meanwhile, Sen. John McCain is attempting to offer tax breaks or credits to help enlist almost all of the uninsured. While they’ve done the important work of opening a dialogue on the issue and who will pay, they have not yet begun to answer the question of how to pay for what they are offering.
It is significant to note that Mrs. Clinton has not explained how she will force people to buy insurance, presumably because the mention of any type of force might have voters running for cover.
However, each plan addresses only how risk will be allocated. None of the offered plans discuss how we will begin to pay for the resulting benefits. For the Democrats, the closing of loopholes for the rich does not come close to the total cost by even the most conservative estimates. As an aside, with commitments to increase entitlement spending without raising taxes, even a third grader would question the math.
Conversely, the Republican Mr. McCain will not close the loopholes of the rich and fails to indicate from where the funding will be obtained.
The sad truth is health care spending in the United States is currently 16 percent of the Gross Domestic Product, according to the National Coalition on Health Care. Simply stated, that means for every dollar produced in this country, 16 percent goes to fund health care. Our health care costs far outpace our rate of inflation and, as a result, the problem is not getting better. Factor in the “graying of America,” where we will have a higher percentage of senior citizens in coming years, along with our recently legislated Medicare program, which lacks any discernible source of funding, and at best the outlook is bleak.
In order to responsibly deal with health care costs, allocation of risk is not enough. We must seek meaningful and tangible ways to diminish the actual cost of health care.
Mr. McCain has touched on tort reform, proposing that the reduction of settlements in medical malpractice cases would serve to lower the insurance premiums every doctor must pay, thus lowering overall health care costs. Other suggestions include allowing people to import medication from other locales to alleviate related medical costs.
Yet another answer may be the recognition that there are overseas destinations providing comparable or substantially better levels of health care than what might be available in the United States for a fraction of the cost. In addition, access to doctors is generally believed to be better in certain foreign locations.
Meanwhile, in the United States, the continued rise in health care costs is readily in evidence. In the last few weeks in the New York market alone, Cabrini Medical Center closed and Victory Memorial announced it will soon be auctioned.
I do not think there is just one answer to the complexities of addressing the health care dilemma. However, I believe if we fail to keep an open mind and neglect to recognize that, as a complex problem, the answer must be multidimensional, we will not be able to adequately address our needs.
MENDEL ZILBERBERG
President and CEO, One World United
Brooklyn
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Elle wrote @ April 24th, 2008 at 11:23 am
The following health care plan will be successful if implemented in the US and is already successful and having astounding results for Whole Foods Market.
______________________________
50/50 Health Care - A Better Way
Power of the free market with protection of the government.
Health care costs are out of control because of so-called middle men or health insurance companies. Not only do health insurance companies take money with
the promise to pay if we are sick or injured, they often refuse to pay for sicknesses and injuries. Health insurance companies have numerous excuses for not paying while at the same time charging a small ransom to be covered under a health plan.
In fact, premium increases and refusal to reimburse health care services have driven up the cost of health care to the point that is it unaffordable for almost everyone in the United States.
In wasn’t until the late ‘80s and early ’90s, when health care insurance companies changed from nonprofit companies to publicly held (for profit) companies traded on Wallstreet, that health care premiums and health care costs skyrocketed.
According to the Kaiser Family Foundation and the Health Research and Educational Trust, premiums for employer-sponsored health insurance in the United States have been rising four times faster on average than workers’ wages since 2000.
One reason costs for health insurance are rising is the high salaries of health insurance executives. According to FamiliesUSA, the average annual compensation of health insurance executives is over $15 million, and that does not include unexercised stock options. According to Paywatch.org, the CEO of UnitedHealth Group, William McGuire, earned over $8 million in 2006, with an additional $1.6 billion in stock options in 2006, and he is guaranteed an annual pension of $5.1 million as well as healthcare for life. (Mcguire will pay back $468 million to settle a lawsuit regarding backdating, but that amount hardly makes a dent in the billions he received.) Wellpoint’s CEO, Larry Glasscock, earned over $19 million and Aetna ’s CEO, Ronald Williams, earned over $32 million in 2006.
According to UnitedHealth Group’s newsletter, revenues grew from approximately $600 million to more than $70 billion under McGuire’s leadership. The stock price of
UnitedHealth Group rose by almost 8500 percent, more than 30 times the growth of the S&P 500. (But, the pertinent question is how many people were denied health care in order to increase revenues, under his leadership?)
Health care experts estimate that the cost of health insurance companies (overhead and paperwork) is over $400 billion annually. If we eliminate these ‘middle men’ insurance companies, then this $400+ billion in overhead would be eliminated along with the billions in insurance executive salaries. These enormous savings could be passed on to the consumers.
The health insurance companies claim they need to raise their rates because of the high cost of treating the elderly, but this argument isn’t logical as the elderly are already covered under Medicare! As we age, insurance companies charge us more because,
potentially, we could cost the insurance companies more money, but shouldn’t we be given credit or lower premiums for all of the money/premiums we have paid to
the insurance companies over an entire lifetime?
Insurance companies also claim the high cost of health insurance coverage is driven by people who don’t have insurance and who don’t pay for their health care. But, our taxes pay for the people who can’t afford insurance/health care through Medicare, Medicaid, SCHIP, the Veterans Administration, as well as state-subsidized health care rendering this argument null as well.
Furthermore, hospitals receive huge tax exemptions for treating the poor, so why do health insurance companies claim their costs are so high? The truth is that health insurance companies are raising premiums and lowering coverage when many of the uninsured costs are already covered by taxpayers.
How can we lower costs and cover everyone?
Clinton and Obama have developed health care plans that require everyone to purchase health care coverage from the same health insurance companies who have gotten us into this mess. The Clinton/Obama plans will further enrich the insurance executives without increasing our coverage or reducing costs.
Do we really need health insurance companies? Without them we could save our own money in health savings accounts and pay the doctors directly from our health care savings accounts.
America spends approximately $2 trillion on health care costs annually. If over 200 million (figure from America’s Health Insurance Plans) Americans are giving health insurance companies $1,000 per month, then health insurance companies are collecting $200 billion per month. Over twelve months that amounts to $2.4 trillion dollars given to the health insurance companies!
Let’s say everyone contributes approximately $1,000,000, to health insurance companies, over their lifetime through premiums, co-pays, deductibles, etc. $1,000,000 x 200,000,000 (approximate number of people with private health
insurance) = $200,000,000,000,000 or $200 trillion dollars. If we kept the insurance premium money paid to insurance companies, then each of us would have at least $1,000,000 in our health care savings accounts when we turned 65!
If insurance companies receive billions monthly, and taxpayers are picking up the costs of the uninsured, then the insurance companies should have plenty to pay for their customers’ health care needs. Yet, even with an abundance of our money, these health insurance companies make it difficult for us to receive health care services. Obviously, we need a better way to manage health care.
The way to create a better health care system we need to rid ourselves of the health insurance companies and to use the power of the free market to pay for our own health care. For example, instead of a monthly insurance premium going to health insurance companies, a quasi-governmental insurance organization would be created to receive half of our insurance premiums. The other 50% would be placed into individual, personal health care savings accounts.
Employers would still pay premiums for their employees, but employees would have individual health care savings accounts for 50% of the premium and the other 50% of the premium would go to the quasi-governmental insurance organization. Employees
would use funds from their individual health care savings account when visiting a doctor or health care provider. It would be up to the consumers concerning the use of the funds in their accounts to manage their health care.
That is, health care savings accounts would be similar to bank savings accounts, with the money in the health care savings accounts available to pay only for health care needs (until age 65 when the funds would become a retirement account, too).
Doctors, hospitals, therapists, and other health care providers would have special health care card readers that consumers/patients would use to pay for services. It would be as simple as using a credit/debit card. That is, after a patient is treated by the doctor the
patient would slide their health care account card to pay the doctor. The patient would approve the charges and receive a receipt describing the charges as well as the new balance in their health care savings account. Obviously, the transactions would be secure
and would require a pin number and photo ID.
A quasi-governmental organization would manage the individual health care savings accounts as well as the quasi-governmental accounts. The health care savings accounts would pay interest too. However, if a person used up everything in their health care savings account, then his health care would taken care of by the quasi-governmental organization through the other half or 50% of monthly premiums that the employer paid into the system.
The 50% of the premium that goes to the quasi-governmental organization would pay for the people who have depleted their health care savings account and/or to cover the indigent as well. Everyone would have health care coverage through this combination of individual savings accounts and the quasi-governmental organization. When a person reached the age of 65 or 70 and became eligible for Medicare, then the health care savings account would act as an addition to a retirement account. If a person died before reaching age 65-70, then money in the health care savings account would be passed on to heirs or beneficiaries.
Using the 50/50 health care plan, health care costs will be reduced and everyone will be covered. There will no longer be a “hidden tax” caused by people who do not pay for health care services, and we will no longer pay for the costs/overhead of health insurance companies. Furthermore, there would be no more of the many disagreements with insurance companies over services or payments. Patients and doctors would decide the treatment that is necessary and the patient would pay for the services either through their health care savings account or the quasi-governmental organization. No more billionaire insurance executives denying claims.
The 50/50 health care plan uses the power of the free market and the idea that a person is more prudent with his/her won money. Additionally, people would not skimp on routine tests to save money as regular/routine checkups would be paid through the 50%
of the premium that goes to the quasi-governmental organization. I’m betting that most people would not skimp on necessary treatments, since most people want a healthy quality of life; and after reaching the age of 65 or 70, the money in their health care savings account is theirs to enjoy and/or pass on to their heirs.
By eliminating the greedy middle man (the health insurance companies), and by giving people the power to manage their health care through their health savings accounts we will have a more efficient and effective health care system and healthier lifestyles.
Will this system work? Yes, and already is working and having astounding results for Whole Foods Market.
Let’s stop funding insurance companies that then use our money to pay for astronomical executive salaries and to lobby Congress!
Gail wrote @ May 2nd, 2008 at 4:08 am
The biggest problems of the US health care are: 1) services are too expensive 2) people are too sick.
Services are too expensive because they are paid by the third party, not the patient themselves. Everyone naturally believes the higher price is, the better service he receives. Who would not want to buy the best produce there is if all they have to pay is a small portion?
Americans are too sick because they believe money can buy health, and their health insurance through their employers, or medicare or medicaid will pay.
Therefore, to solve the health care problem, we need to transition into personal health account - a mendatory payroll deduction of 5%, e.g., Eventuall, everyone will use his own health account to pay for either medical expenses or health insurance. This will force them to shop around, and to take care of their own health. Those who exhausted all their fund will go to public hospital which will exercise ration.
Medicare will be bankrupt in eight years because there is no cap in spending. Although the government sets prices, but it covers about everything. What if someday there is a machine which can make a dying person live forever at $1 million a day? Will the goverment pay for it or not? If it does, why would there not be a better machine which costs $2 million a day?
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