Restoring the Health Care Market Systembedewy
The Private Sector Can Do It With The Correct Guiding Policies
The private medical health care system is not broken. It provides excellent care for patients. What is broken is the cost of the service.
Before health insurance use became wide spread, the market determined prices. The doctor would determine what price he could provide the service for. The patient would determine if he/she was willing and able to pay the price. When a third party became involved, such as an insurance company or the government, the price rose to the amount of the third party’s ability to pay.
The government decided to increase the number of people that were purchasing health insurance. Lobbied by the insurance companies, business and the medical industry the government decided to make the health insurance premiums tax deductible for businesses and individuals. Of course this set off a furry of creating health insurance policies that had very low deductibles.
The problem of higher medical cost each year is created when the insurance companies are able to rise insurance premiums each year to pay for the higher prices of the medical establishment. Higher medical cost are also caused by low deductible insurance policies.
When the patient uses the insurance policy’s benefits, he/she is not concerned about the price of the medical services, only the fact that they are proud of themselves for making the wise chose of purchasing health insurance and that he/she is getting their money’s worth. This attitude of the consumer, allows prices to increase. If they have chosen a low deductible insurance policy and it is totally or partial paid for by the employer, they are even further disconnected from feeling the cost of the medical expense. The fact that he/she or the business is allowed a tax deduction, equal to the amount of the annual premiums, takes away from the premium payer any desire to comparison shop.
It would be better to increase the deductible amount and encourage the use of Health Savings Accounts (HSAs). HSAs should be completely tax-deductible up to the amount of the annual insurance deductible amount each year. The government created HSAs to encourage people to save money for future medical expenses and encourage the use of high deductible health insurance policies. Health insurance premiums should not be tax-deductible by employers and private citizens.
To level out the cost of the health insurance premiums, the private citizens and the self-employed should pay the same amount as the employers and employees of large businesses. The insurance companies should be encouraged to make this change so more people would buy health insurance and the insurance companies could lower premiums by spreading the risk over a larger number of. people.
With health insurance premiums being non tax deductible, the employers, private citizens and the self-employed will be more likely to comparison shop for the best deal on health insurance premiums and policy benefits. It will encourage the insurance companies to be more diligent in their negations with the medical industry, because the purchaser of the health insurance would be more sensitive to the price of the premiums. As more people purchase health insurance, the insurance companies would be at less risk of having to pay out money for benefits, therefore would be able to lower health insurance policies premiums.
HSA health insurance policies should be used all across the country, so we do not repeat the same mistakes of the past. Preventive care benefits should be available without the payment of a deductible amount.
HMOs and government run health programs are slow to provide services because a medical board or primary doctor must first approve medical procedures. Other countries central run medical programs have shown this to be true.
The insurance companies should not be allowed to deny medical insurance to a patient with preexisting conditions. It is best to include the entire population into the medical insurance system, in that way the risk is spread over the largest amount of citizens.
Since the deductible amount will increase with this plan, instead of the government paying directly for 100% of the medical expenses of the working poor, it should match dollar for dollar, each dollar placed in the HSA by the person or family, up to the deductible amount. The same policy should be applied to the insurance premiums. The money could only be removed, with a debit card, used by an approved and willing medical office or hospital with the approval of the patient. Both the patient and the medical facility would have to enter their pin number to have the money removed from the HSA.
If a person does not have an immediate life threatening illness or injury, the hospital should be allowed and be encouraged to deny the patient medical attention after being seen by a doctor, intern or nurse in a screening room. The hospital should then give the patient directions and availability information of the nearest urgent care unit. Advice to see a doctor the next day usually is not good advise because of the appointment system doctor’s use.
Computers can also be created to send vital signs to a doctor or nurse so they can determine if there is an emergency.
With the patient responsible for paying the bill, out of their HSA, because of the high deductible, they will be encouraged not to abuse the system and seek help at the appropriate facility. Hospital emergency rooms would then be available for patients that have a life threatening illness or injury.
The treatment of non-life threatening illnesses or injuries in the hospital emergency rooms is a major money stream for hospitals. Hospitals should be denied payment if they do not follow this policy change.
Unless all people involved, from the patient, doctor, to the hospital, have a little “skin” involved, the price of health care will continue to rise at a faster rate than other cost in the economy. A perfect example of this is the home mortgage industry. The banks, mortgage brokers and financial institutions were not exposed to the risk and the eventual cost of the housing bubble after they sold the mortgages to investors and government supported agencies.
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