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Profound Idea Worth Knowing: The "Impossible" Healthcare Solution: Go Back to Cash

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August 02, 2009 – Comments (13)

The "Impossible" Healthcare Solution: Go Back to Cash   (July 29, 2009)


The expansion of health insurance and government entitlements created "free money" and thus the explosion of healthcare costs. The solution is simple and "impossible": we all pay cash.

Here's why healthcare (a.k.a. sick-care) costs cannot be reduced; the entire system is based on vast pools of "free money." The corporate-America or union/government employee who goes to the doctor pays a few dollars for a visit and drugs; the "real cost" is of no concern. Ditto the "real costs" charged to Medicare and Medicaid.

The link between the "consumer" of healthcare and the provider has been broken for decades. There is no "free market" in healthcare--there isn't any market at all. We live in a Kafka-esque nightmare system in which "some are more equal than others" and hundreds of thousands of dollars are lavished on worthless tests, procedures and medications for two reasons:

1. because there's "free money" to pay the bills

2. so-called "defensive medicine" in which worthless tests are administered to stave off random (sometimes valid, sometimes nuisance) malpractice lawsuits.

There is a solution so simple and so radical that it is "impossible" (and of course you're reading it here): shut down insurance and all government entitlements, and return to the "golden era" of the 1950s when everyone paid cash for healthcare.

The rest is here:

http://www.oftwominds.com/blogjuly09/healthcare07-09.html

13 Comments – Post Your Own

#1) On August 02, 2009 at 2:40 AM, FleaBagger (29.59) wrote:

This is a refreshing read after Steve and Mr. Weiner's "if people vote for it, it must be good" rants. Thanks!

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#2) On August 02, 2009 at 11:14 AM, devoish (98.42) wrote:

Abitare,

Congratulations.

You got seven "recs" for the idea that healthcare was affordable until insurance came along and drove up the price.

To believe that I would have to believe that prior to insurance people could afford healthcare.

And decided to buy insurance anyway.

Perhaps USA history goes something more like this:

Medical quality improved.

Then costs rose.

Then insurance was developed to pay for it.

Then private insurers kept voting themselves bigger and bigger paychecks.

Now the cost of private insurance is 190% or more of the cost of publicly delivered models in Canada and Europe.

Perhaps, compared to private insurance, publicly run insurance models are a  resounding success.

HR676

 

 

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#3) On August 02, 2009 at 11:50 AM, Judochop172 (27.43) wrote:

Talk about a pain in the back.

http://www.telegraph.co.uk/health/healthnews/5955840/Patients-forced-to-live-in-agony-after-NHS-refuses-to-pay-for-painkilling-injections.html

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#4) On August 02, 2009 at 5:23 PM, angusthermopylae (39.25) wrote:

Finally!  I can understand all the reasons it probably won't happen, but it's a solution that gets to the heart of the matter.

I haven't gone through and confirmed the pricing and inflation quoted, but if even half is true, it pretty much shoots both sides of the debate in the face:  Republicans are ignoring the real cause of the issue (or claiming "there is no problem"), and the Democrat proposal is like curing alcoholism by providing cheaper booze....if it's cheaper at all.

+1 from me, and if you start a "Cash for Care" campaign, I'll be right there with you.

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#5) On August 02, 2009 at 5:24 PM, abitare (71.93) wrote:

devoish,

I am aligned here:

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#6) On August 02, 2009 at 6:02 PM, uclayoda87 (29.22) wrote:

There are primary care groups in Seattle who do not take insurance but charge a very affordable yearly or monthly fee for unlimited office services.  They encourage their patients to also carry a high deductible catastrophic insurance plan for hospitalizations.  Overall this cost a lot less.  A primary care physician who runs one of these groups was interviewed on Fox news.  He also reportedly spoke to members of Congress, who of course were not interested in a plan that saves money and provides good care.

 

Concierge medicine an "affordable option"

 

A bill poised to land on the governor's desk ends the legal confusion over retainer-fee doctors, but it is unlikely to quell objections from ethicists and economists over the controversial practice.

 

By Carol M. Ostrom

 

Seattle Times health reporter

April 15, 2007

For years, doctors who started so-called "concierge" medical practices, offering personalized care in return for fixed retainer fees, have existed in legal limbo.

State regulators have argued that the arrangement is essentially medical insurance and should be subject to the same rules. Doctors and patients insist it's the antithesis of insurance: middleman-free deals between patients and doctors.

State lawmakers are now on the verge of finally ending the confusion and opening the door to more such practices. But the controversy is far from over.

A bill poised to land on the governor's desk this week proclaims concierge medicine an "innovative, affordable option," and directs the state insurance commissioner to keep track of the plans but not regulate them.

"We want to liberate primary care to do what it's really meant to do," Seattle physician Erika Bliss urged a state Senate committee in February.

But opponents, including some of the state's largest insurers, called the measure a "wolf in sheep's clothing" that would send the best medicine to wealthier, healthier patients while making it even harder for average families to get decent primary care.

"If you are concerned about the sickest and most vulnerable people in our state ... this isn't going to help that," said Dr. Steve Tarnoff, an associate medical director at Group Health Cooperative.

Fewer patients, more profit

Concierge practices have proliferated nationwide since being pioneered in Seattle more than 10 years ago.

The idea is relatively simple. Doctors don't bill insurance for services. Instead, patients pay a retainer, typically $50 to $250 or more a month. In return, doctors provide primary care — but not specialty or hospital services or prescription drugs — and they limit their patient load to perhaps 600 or 800.

Because the retainers allow doctors to carry many fewer patients and still remain profitable, they can provide around-the-clock access by phone and e-mail, same-day appointments, and can personally coordinate specialty care and give bedside attention in the hospital.

The first such practice in the country was Seattle's MD². It charges $1,300 a month for what it calls "high-touch" care. Doctors there have no more than 50 patients.

The arrangements appeal both to primary-care doctors — who have felt underpaid and overworked, with a typical patient load of 2,000 to 3,000 — and to many patients fed up with impersonal medicine.

From the beginning, though, the trend has drawn aggressive objections from health-care ethicists and economists who warn it could widen the gap in access between the rich and poor.

Four years ago, state Insurance Commissioner Mike Kreidler threatened to shut down the practices unless legislation was passed to allow them.

Terms of the bill

In Washington, Senate Bill 5958 passed the House last week, 90-5, after passing the Senate in slightly different form. It has been sent back to the Senate for concurrence and is expected to go to Gov. Christine Gregoire for her signature.

Under the bill, doctors offering concierge care would have to inform patients what services they provide and that they don't take insurance. They would have to refund fees if they stop seeing a patient.

The doctors would be barred from raising prices more than once a year, but there would be no limit on how high they could raise them. The bill also warns doctors not to cherry-pick healthier patients, but only by saying that doctors can't reject patients "solely" because of health status.

The bill specifies no penalties for violating its provisions. Instead, that would be addressed by the state Medical Quality Assurance Commission under existing "unprofessional conduct" codes.

The insurance commissioner's office would be directed to analyze the effects of concierge practices on overall patient access, health-insurance premiums and patient demographics, and report back to lawmakers in five years.

The legislation does not cover practices that bill insurance but also charge monthly fees for "extras" such as newsletters, cellphone access or other personalized services.

Affordable care?

Supporters argue that direct-fee practices put doctors and patients back in control of their health care.

Bliss, the Seattle doctor, says she wants her family practice to become a place where she can listen, advise and do what's best for her patients without worrying about whether insurance covers it.

Her cousin, Garrison Bliss, a family practitioner who runs Seattle Medical Associates, one of the first concierge practices, has long been lobbying for law changes. The two plan to open another retainer-fee clinic that charges about $55 or $60 a month, which they say would be affordable for uninsured patients.

Garrison Bliss also argues that concierge medicine would encourage more doctors to enter primary care, an area now facing a doctor shortage.

Small-business lobbyists side with the Blisses, saying direct-fee medical care offers an alternative to group-insurance plans.

But others scoff at the notion that such practices would be "affordable" or accessible to seriously sick patients.

"There are an awful lot of people who aren't going to be served under this program, people who really need care," said Bruce Reeves, president of the Washington State Senior Citizens' Lobby. "It seems to us they can cherry-pick whoever they want, and come up with reasons."

Group Health's Tarnoff warned lawmakers in February not to endorse a "wolf in sheep's clothing," saying they were glossing over "real ethical issues" raised by the current legislation.

He said the bill would allow large, for-profit companies to offer essentially a "primary-care insurance product" without any of the regulations or costs imposed on traditional insurers. Those regulations include consumer protection and mandates to contribute to state programs for high-risk or low-income patients.

Fundamentally, Tarnoff argues, it takes a "giant step backward," creating a two-tier health-care system.

As for Kreidler, the state insurance commissioner, the current measure is a far cry from the original intent to regulate the practices under insurance codes.

Even so, Kreidler is satisfied, said Beth Berendt, one of his deputies. Kreidler doesn't want to stifle innovation — just protect patients, she said.

"We just want a bill so we can get our arms around the practices," Berendt said, and be able to monitor and evaluate the impact.

"If there are problems, consumers will know they can come to us for assistance."

 

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#7) On August 02, 2009 at 6:14 PM, uclayoda87 (29.22) wrote:

 

June 17, 2009

 

A New Plan for Health Care

 

Dr. Jay Parkinson and Dr. Garrison Bliss on the idea of promoting the concierge care.

Here is the Fox news interview.

 

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#8) On August 02, 2009 at 9:13 PM, Alex1963 (28.43) wrote:

Abitare,

Well I watched both. Of course they are from 20008 so not too timely for today's debate.

My tongue in cheek quick response

"Profound Idea.Truly Impractical Solution. Go Back To The Drawing Board, Abitare"  

Here are my mostly serious comments and questions

- Comparing the free market delivery of healthcare to FEMA delivering low cost cell phones is assinine. That was without a doubt the dumbest & most irritating thing I have ever heard him say. You cannot buy your health care components cheaper from China or India.  Nor do you make a custom phone for each person as you basically do with healthcare. To the extent we can we already do outsource and streamline.  (You also can't miniaturize health care or have it play "Who Let The Dogs Out" but that's a different problem. Apparently we might make it portable tho :)

- I liked his point about opening up more medicine to nurses & alternative practioners and disciplines aagainst the protectionism of Drs for their industry. But even insurers are insisting this be done and have done so over years. i.e. I can now see a chiropractor under my policy despite the AMAs vehement opposition to this for decades. So nothing radical or innovative from Dr.Paul there.

- He totally wriggled on the direct question of "do you advocate eliminating medicare and medicaid." I got the sense he wants them gone over time and would encourage younger people to self insure and then eliminate over 20-30-40 years. Hmmm. My question then is does he advocate for parity of care? Clearly he does not and the wealthy would have far better coverage than the poor, and middle class. I disagree with this. In the end either it costs us all to cover those w/o good care or we admit we simply refuse to take care of those who can't afford it. We either admit that health care is a drain on our economy and a moral imperatrive or we take the "survival of the fittest" "Let them pay cash" approach. His discomfiture with the question was obvious.

- He really has no plan for the poor except "save a bit so you can afford a catastrophic policy" Wow. Both heartwarming and effective. Clearly another assinine comment. Let's use that solution for all the things modern society requires of us that the poor cannot afford or have access to starting with the shitty education most urban and rural poor get. "Save a little and go to private school." or "Save a bit and buy a car so you can expand you job choices..." Is he loco? No. But out of touch with ordinary americans? Oh yeah!

- He does not address the role Gov't could play in navigating the increasing complexity of medical choices and treatments. IMO the days of your family Dr being able to handle anything but routine stuff is long gone. As is their ability to stay abreast of all the research etc on prevention, symptoms. Which is why there must be some kind of central clearing house for this information administered by an entity large enought to manage it without a profit motive. Who can ensure a parity of care across the country (so Alabama does end up a ghost town) wihile policing for abuse of the system. And no I'm not thinking of Walmart, privateers. I'm thinking of a different Uncle Sam.

He even made the point of how much cheaper insurance costs are for gov't workers as compared to a poor person trying to get the same, or even any, coverage. But he did so inadvertantly just like the Republicans do when they argue that the Gov't can't run an effectiveefficient and affordable program while simultaneously claimimg a gov't run health plan will bankrupt all the private insurance companies. Really? Both? How odd. Like matter and antimatter, I guess

- Also, I would like to see him forgo his insurance as a Congressman and illustrate his self pay plan himself. Now that would buy him some credibility. But not much even so because he's a medical Dr and no doubt can easily afford it. Also his evasion on the question of whether anyone in his family was or has ever been uninsured was very lame as well. He did duck that beautifully, IMO. The old guy still has some moves :o)

- I'd welcome his proposals to cut overseas spending and think he is a vaulable asset in Congress but tossing people utterly and completely to the free market for health care. No way

- Also I am really sick of him saying that Gov't doesn't create anything, makes it more expensive than the free market. That is Austrian School, libertarian baloney. 1st of all the gov't does not "steal" peoples money. Think of Gov't as a giant corporation being paid voluntarily by it's citizens to run things which the free market cannot or should not be trusted with. It's a sevice co. Like an accounting firm. CPA's don't "make" anything either. Or a psycholgist. Lame line of argument. Hey I'd like free food too or no tolls but I when I drive on the tollway or walk into a supermarket I don't rail against the tyranny of having to pay for those goods or services. Well its the same with national safety, national defense, public education and so on. Health care hopefully.

Further, people do actually vote these people into office based partly on their planks on taxation so his populist pap that gov't is some sort of succubus, especially while he serves in Congress, is disengenuous in the extreme. If he thinks people really think taxes should be eliminated let him try (again) to sell this to America. But they still will not buy it. Not because they are stupid, or fearful or dependent or because special interests will fight him but because it's a dumb, flawed, ridiculous idea. People may like the sound of this especially in hard times but they know instinctively it's simplistic solution which solves nothing and in fact would likely make things much worse. I respect the guy for defending his (sometimes wacky) principles but I just think he doesn't get it. The world he envisons is a fantasy(no offense). Maybe he could be president in the movie Pleasantville but not in this 21st century world and economy. Like McCain he has found an excellent niche and serves a vital role. McCain as the (mostly) honorable scold and Paul as the eccentric amateur economist and kindly conspiracy theorist/anarchist. 

I welcome your response 

Regards

Alex 

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#9) On August 02, 2009 at 9:32 PM, Alex1963 (28.43) wrote:

Sorry so Alabama DOESN'T become a ghost town

Also think of how the economy could thrive if people knew they had the safety net of quality care. What businesses might people open if not shackled to some nowhere, uninspiring job they hate just to get a paycheck and more importantly-get any health insurance much less decent health insurance. You want a free labor market? You want companies fighting for the best workers? Well the current system or any proposal that doesn't involve a public option are basically a gun-to-the-head retention tool for any mid to large company. Especially workers with families. To the point that in a down economy like this one-they virtually own every middle class or lower employee. No wonder corp. america is fighting this tooth and nail. They have a captive workforce with little bargaining power and no nest eggs left. 

Put that in your thinker, privateers

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#10) On August 02, 2009 at 11:34 PM, abitare (71.93) wrote:

ALCON,

There are some good replies here that deserve a response. But I am short on time this week, so I hope you can allow me some time to reply later. 

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#11) On August 02, 2009 at 11:36 PM, abitare (71.93) wrote:

FYI-

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#12) On August 03, 2009 at 10:58 PM, devoish (98.42) wrote:

john stossel might be on TV  but he did less homework than we have done here on CAPS. Sometimes I think that is how you get on TV.

His first claim "when gov  takes charge, innovation stops" we pretty much found unsupported here, and much more than likely the reverse is true. He beats the idea to death later on in the video, but he is still wrong.

The nice lady who makes the claim that "the only way we can get costs down under Gov't care is to control the amount of money we spend on healthcare" is also mistaken. It could be possible to control the costs of "paying" for private insurance whose overhead is 30% as compared to medicares 3%.

Check Stossels "facts". They are suspect. Be careful of the mixing of "healthcare" with "health insurance". The issue in the USA is affordability, accessability and quality. In Canada they can improve wait times (talk about an over blown story) and quality by raising affordability to 55% of what we pay.

His analogy to not waiting at the "privately run" veterinarian system is an appropriate comparison to our "private insurer" model. I wonder what percentage of Canadian dogs do not get mri's, but instead get left out of the system and get the needle.

He points out that Canadians come here for medical care, we do not go there. We passed a law that says our citizens cannot go to Canada to buy drugs, so that claim is debatable also.

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#13) On August 04, 2009 at 10:52 AM, Rehydrogenated (32.49) wrote:

I think it's a great idea. One thing people don't understand is how very little insurance pays for anything. I called my insurance company (who outsourced their call center) to ask about my bill. When i asked about the "insurance adjustments" and asked how much of that the company actually paid she just laughed and said the insurance company doesn't pay a dime. The "adjustments" are all a show. That is BS.

Insurance companies need competition! They need to compete with paying for the doctor directly AND they need to compete with the government. If there is no competition it doesn't matter whether we use our current system or a government system or both. It will be broken. Personally i believe insurance is an anti-product that shouldn't exist in private hands, but if it does, it needs to be competitive. 

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