If Capitalism were allowed to fix healthcare...
September 15, 2009
– Comments (19) |
RELATED TICKERS: THC
First why is health care so expensive?
That’s easy, defensive medicine. Let me give you an example. Suppose a drug seeker comes into their local ER with a fake complaint of stomach pain so they can secure a prescription for lortab. They eat up everyone’s time in an emergency room that exists to treat real and serious illness. So what’s the doctor going to do even if this patient has made fifty visits over the last year for the same thing; and he knows the guy is a fake, "just looking for lortab in all the wrong places?" (my song title)
The doctor is going to order blood work, a urine, urine drug screen, a CT scan of the belly with oral and IV contrast, and if the patient is older, they are also going to do the full cardiac workup. This will tie up an ER bed for hours. Does the drug seeker care? The answer is no; he isn’t going to pay; he doesn’t have worry about any of it because federal law prevents the hospital from reporting this theft of care on his credit report. So he can be a deadbeat even if he can pay.
After this multi-thousand dollars work up, the doctor has found nothing but the pain continues according to the drug seeking patient. The doctor will now admit the patient to the hospital for intractable abdominal pain and will order surgery consults and cardiac consults and spread the liability. Why doesn’t the doctor send this guy home? It is a statistical issue. The doctor knows that if he sends this fraud home, and if by some quirk of fate the guy has say an appendix attack two weeks later, then he can be sued by this loser for failure to diagnose. Somehow the jury will tie the two events together and even if the matter doesn’t go to court the insurance company will settle the matter, virtually any matter for 40,000 dollars. Only last year did they pass a law that allows the doctor to continue to fight the case. Prior to this the insurance company could settle and force the doctor to fight his own case and risk his own assets.
You name the case, and I promise I can give you a perfect rationale for turning it into a $100K hospital stay. For example the doctor finds gall stones that were previously diagnosed and known to the patient. Admit them to surgery because a flick of a stone could go retrograde and up the pancreatic duct causing pancreatitis and killing the beta cells of langerhans turning the patient into a life time insulin taking diabetic. It happens all the time.
One doctor had a real patient not a drug seeker that came in with blood in the urine and a report of a raging right flank pain that had disappeared a day previous and followed by blood red urine. The doctor figure it was a kidney stone so he did the urine and did a CT scan. Though the patient had no abdominal pain whatsoever, he did have a ruptured appendix. He was taken to emergency surgery with a good outcome. The non risk adverse doctor never would have ordered that CT scan. Defensive medicine pays off in this case for both the patient and the doctor. But the test was done on a real patient not a durg seeker. Doctors are smart so why not let them do what they do best. Don't make them play this malpractice game with drug seekers. It is extimated that 1/3 of all patients to an ER are drug seekers.
Here is how Capitalism can fix the whole mess: First, there are three classifications of illness that exist:
1) accidents
2) acute illness
3) chronic illness
Accidents happen. But why should citizens pay for some guy that crashes his motorcycle without wearing a helmet or without having adequate accident coverage. A brain injury will require hospital care up into the millions especially if surgery is required. Why should preventable accidents be the burden of the hospital? They shouldn’t. Thus, if you want to drive a motorcycle, then you have to have a very large major medical policy or a large insurance coverage for protection. There is no reason to allow dangerous instrumentalities to pay less when accidents cost more. A smart car may be smart at the gas pump but it is a death trap if you get into an accident even with a midsized pickup truck.
Acute illness could be something like a heart attack or pneumonia or appendix or some severe illness that arises unexpectedly. This can all be managed with a simple major medical policy with a deductable that suits the individual’s financial circumstances. A bond should be required in those that have poor credit ratings.
Chronic illnesses have to be treated by doctors that follow the patient to prevent them from turning into hospitalizations. This is the only type of care that requires an involved ongoing clinical relationship with specialists. It is a small portion of the population which does increase with aging but with aging and natural death, that population is reduced in size; its pretty constant.
The Wal-mart, Target, Publix, Win Dixie Solution: The above companies have prescription drug formularies which are remarkable. Virtually any disease known can be treated from the Wal-Mart or Target formularies. The cost is just $4 for a prescription. Publix and Win Dixie offer free antibiotics. So if you have a prescription from a doctor for the covered antibiotics, it costs you nothing. It is very affordable. It is cheaper than a co-pay.
What about a reasonable cost doctor visit? Blame Medicare and Medicaid for this. Any doctor that cuts you a cash price or a special low rate price has just committed Medicare fraud for every patient he has seen under Medicare and Medicaid. Why? Federal law makes it illegal for the doctor to charge any patient less than he charges a Medicare or Medicaid patients. This is price fixing.
With current reimbursements, a Doctor could see a patient easily for $35. This is because he bills Medicare for a visit at $80 but Medicare will only pay $35. But the Doctor billed Medicare $80 so even though they only get $35, they can’t just charge the patient $35 but must charge at least $80. Sounds stupid and it is.
Just for your edification, how much do you think a heart surgeon gets for a heart bypass surgery? Surprise, he only gets paid $1250. The surgery will take up to 8 hours and will require a lot of follow up etc. That is all he gets for all that special training. Gall Bladders pay about $340. The bottom line is that the doctors are not the cause of the high cost of medicine. Besides before the surgeon sees his first patient, he has to pay $100K in malpractice. It is all about tort reform. But that is not even mentioned in the Obamacare plan.
My ultimate plan to fix medical malpractice costs: This is my unique plan. I have been working on it for years and it couldn’t be simpler to understand. Insure the patient visit not the doctor. Here is how it would work.
A patient comes to see a doctor and at the front window decides if they want the visit covered by medical malpractice. The cost will be a dollar or two extra. If medical malpractice results from that visit, then they may have the right to sue for damages. This will work the same way for surgeries but the cost would be more like ten or twenty dollars. If the patient declines coverage then they are foreclosed from suing PERIOD! They sign a note to that effect. It is just that simple.
Lawyers would want patients to take malpractice coverage, so would insurance companies. Doctors would be relieved once and for all of the outrageous expense of carrying malpractice insurance and could operate vastly more economically practical offices.
It is so simple yet, I have submitted my plan to many politicians with no response. My efforts have been ignored. Democrats and Republicans don’t respond.
So put it all together and fill in the gaps with Capitalism: 1) Insurance companies must be allowed to compete across state lines which the federal government does not presently allow.
2) Cherry picking of healthy individuals offering them low rates should be allowed. Present state and federal laws do not allow this with health care coverage. It works in car insurance and it would work well in heath care insurance.
3) Unlock doctor to allow them to set patient visit costs as they see fit and do not allow Medicare or Medicare to dictate price controls. Let medical centers across the nation compete for patients with lower prices. End the price fixing of the federal government. Everybody benefits. A medical center that does more heart bypass gets better at it and does it for less cost.
4) Have insurance companies bring back major medical insurance plans that cover only accidents and acute illness. These would be dirt cheap unless you invite accidents like wearing no helmet on a motorcycle.
5) Cultivate the buying power of innovative companies like Wal-mart and Target and use their formularies as the fist choice in care. Let them compete.
6) Eliminate malpractice insurance unless the patient pays for it on a per-visit or per-procedure basis. It would be very low cost, essentially negligible, due to the cost reductions for the office visit. Doctors could even include it in the office visits as an incentive to build their practices.
7) Take all high risk patients that suffer chronic illnesses and put them in a high risk pool lottery HMO in which they are assigned an insurance carrier from all those that write major medical policies, the same as they do with teen drivers or people with poor driving records. This policy alone would be subsidized by a tax credit and at age 70 included under Medicare coverage only for those with incomes under $36K a year on a step up graduation.
8) And for indigents they can still get Medicaid with a few caviets. First, they can be randomly drug tested and bucked out for using illegal drugs. If they are obese, they have six months to get that under control and show progress toward improved biometrics. If they abuse the emergency room or engage in drug seeking behavior they may lose Medicaid. Medicaid coverage will be limited to the cost of a major medical policy, 25 doctor visits a year and a 100 script limit on the $4 formulary at Wal-mart or Target or other participating pharmacy. [The goal is to give them what they need but not allow them to abuse the system and generocity of the taxpayers.]
Result: My plan will save trillions over time and costs zero to the taxpayers to implement. It doesn't limit care, it limits the frequency and abuse of care and encourages competition. There is no more right to medical care than there is a right to a burial plot, a deluxe corn row hair transplant like Joe Bidens or breast implants. Inexpensive major medical plans to cover acute illness and accidents is all most Americans will ever need.
RSS Headlines
Fool UK