Real Affordable Healthcare Can Be Accomplished

I have an idea on this a two tier system. If people can afford to pay the costs or have company insurance they get to use that. For everyone else a modified Medicaid system this run nationally getting the States out of it with salaried medical providers who get a wage and 5% of the school debts removed per year replacing the payment system for 20 years. The government will negotiate nationally for costs of drugs, medical devices and medical supplies this passed onto providers and the government will be obligated to find the cheapest and satisfactory options and any new option must be significantly better than existing ones to be considered. And the government will have the right to say - NO - and go outside the country for foreign options if a US company isn't competitive. However the sheet size of the market should put a lot of pressure on companies to keep costs down. Its not just one state but all 50, all the territories and all Federal departments such as the armed forced lumped into one customer.

I would fund this will a payroll tax if a company doesn't provide insurance and the self-employed, a deductible and co-pay based on income, existing funds diverted to it including Medicaid and Medicare and a Federal sales tax of 2% as possible ideas.

 

Medicaid's per enrollee is probably cheaper than Medicare since their reimbursement rate is so low.

 

I was using the chart showing sources of Medicare funding. It comes from this article ... http://kff.org/medicare/fact-sheet/medicare-spending-and-financing-fact-sheet/

We know that we and our employers contribute 2.9% of every dollar we earn to Medicare (I rounded that to 3% for ease of discussion). On that bar graph, the one on the far left is all of Medicare's three parts in total. We can see that payroll taxes pay for 38% of the cost. The rest is paid by "General Revenue" (41%) (which is essentially government deficit spending) and premiums (13%) and a few very minor sources. The next graph over is Medicare Part A (hospitalization). You can see that it is heavily funded by those payroll taxes we pay (87%). If you look at the next two graphs to the right, Parts B (services) and D (pharmaceuticals), you can see that those two are not funded by those payroll taxes at all. They are funded by the seniors' premiums and by General Revenue (deficit spending).

The other chart from the JAMA shows how much different age groups account for the medical spending in this country. This was also an important part of the analysis. The source can be found by googling "The anatomy of health care in the United States" and then clicking on the link that starts with ...

The Anatomy of Health Care in the United States
www.commed.vcu.edu/IntroPH/Introduction/2014/Thersocalledsys...

This will open a pdf file, and you can see the entire article.

We wouldn't necessarily have to eliminate individual premiums. It just depends on what we want. If we want health care fully funded by government, then we, the people, must contribute the amount of money necessary for the government to do that, one way or the other. If we want the system partly funded by premiums, we can do that if we want. I'm sure there would be a very spirited debate about how we would pay for "Medicare For All" with everybody, in every income bracket, claiming that they should not be taxed for it, and that everyone else should be taxed more so they don't have to be taxed as much. And I can hear everyone squealing that they are paying too much. There would be much cursing and gnashing of teeth.

Oh my, wouldn't that be fun?

 

Well, I don't dispute that. And for the self-employed, I was not talking about the gross income of the business. I was strictly speaking in terms of the net that the owner actually takes home as income for his personal use.

Understand that I was not necessarily advocating for "Medicare for All". I was simply pointing out that if that's what we want as a society, by majority, this is what it will cost, and that money has to come from somewhere. The research I did was spurred by all the calls we hear for "single payer" and "universal health care". It was also spurred because its supporters champion this system as "the answer" to our health care debate. But I don't think I have ever heard anyone here make an effort to tell how it would be funded and who would pay for it, using specifics, not pie-in-the-sky.

I am sort of a fiscal Nazi in the fact that I believe that we in this country can have what we want if we're willing to pay for it. And if we're not willing to pay for it, we can't have it. So when I hear people saying "I want this" and "I want that" from the government, my first response is to ask them if they are willing to pay for it. And, in this case of health care, I made an effort to show what it would actually cost, and then ask the question.

Cheers

 

Great post, and I agree that it is the actual cost of healthcare that is the real culprit. That and the malpractice insurance that hospitals and docs have to pay for every year. There are a lot of problems with the whole system, and there are no easy answers, but I think the answer is to lower the cost of healthcare itself, and that includes equipment, medication, etc.

http://www.consumerreports.org/cro/...-the-outrageous-cost-of-health-care/index.htm

 

ud, lets think here, ...........take away the means restriction ?

How would you make medicare universal without taking away the age restrictions (totally changing it) ?

 

The only real solution is a single payer system where everyone contributes through their taxes.
Get the insurance companies and their profit motives out of the equation.
Then deal with the fraud and corruption that comes when patients, hospitals or the medical industry try to milk the system.
Promote preventive medicine rather than waiting to treat people after they develop more serious problems.
It's not rocket science, and the economic sense of making sure that a country's population has effective healthcare is a no-brainer.
It is far cheaper to provide good healthcare to people than to deal with the lost productivity and unnecessary social degredation that results from neglecting health care in society.

 

Part D was a gift to Big Pharma.
I am 70, and never signed up for Part D, as I figured it wouldn't be worth it. the "rules" are ridiculous and confusing and written to favor the drug companies.

 

I am 61, and, to be honest, I haven't researched it yet. I will when the time comes to move onto Medicare. I just assumed that Part D gave some help with pharmaceuticals, and I just figured it in to the overall equation to figure out the cost of Medicare-for-all.

 

An interesting side note is that if we did this, and the people actually paid for it as I suggested, we would virtually wipe out annual deficit spending by the federal government.

 

I would even feel safer just copying the Canadian system from top to bottom, and then make modifications to ensure that it is better. Even if making it better costs 50% more than Canada's system costs, that would still be a savings to us of 25%.

 

I see you did quite a bit of investigation into this, Seth. It's good information but I have a couple of comments that alter the bottom line a bit. You have mentioned here a 4% profit for medical insurance companies And of course I assume that is 4% of revenue (premiums). But let's also keep medical insurance industry CEO pay in mind and more importantly, the overhead for the health insurance industry is conservatively about 14-22%% of revenue, while that of Medicare is about 2-4% of revenue, depending on who is calculating it. That difference of 10-20% can be added to your 4% profit unless the "overhead" includes profit as calculated.

Hmmm. I've been on Medicare for 5 years and I've never seen a co-pay. Medicare's reimbursement rate is admittedly appalling, however.

However, after all is said and done, we pay far more per capita than any other country. Hence we can do it too. We can cut healthcare costs dramatically if we are willing to bite a big, hard bullet. As an example, we could just copy everything of Canada's health system and our savings would be about 51%. Our costs would be about 49% of what they are now . People like to rant about Canada's waiting times however. So ok, let's then add another 50% to that Canadian figure so we can pay for more doctors and facilities, and we would still be paying 25% less than we are now and be paying just less than Switzerland.

It would require a total restructuring but we can do it. It's only a matter of will. Nothing is stopping us but the will to face and deal with the power of the wealthy who benefit from what we have now.

 

Traditional Medicare is an 80/20 plan, so you should have out of pocket costs. Are you on a Medicare Advantage plan or have a dual plan?

 

Generally overcharging is done by hospitals to to get the best deal they can with both private insurance and Medicare. So for example a hospital will try to charge $15,000 for a pregnancy (that is only $2,000 in other countries) in order to get as much revenue as they can. Insurance companies and Medicare and Medicaid will then try to negotiate lower prices for those services and the more customers they are covering the more bargaining power they have so depending on the insurance company they will have to pay between $5,000 and $10,000 out of $15,000 charge. This charge comes from a charge master book hospitals have that is incredibly complex and will add charges for every service used and is famous for having charges that have nothing to do with price. For example, $36 for a tylenol, $1,000 for just setting foot in the emergency room, etc.

Medicare & Medicaid since they have such a large customer base have a lot of negotiation power and will get somewhat lower rates than private insurance but due to those rates being so low about 1/3 of doctors won't accept patients with them but these programs do save taxpayer money by getting good deals and the doctors who do take them obviously do get some profit from accepting them so I don't see any reason to believe that these programs aren't paying enough and tax payers need to pay more for these programs.

In fact our government healthcare is vastly over-priced not underprices compared to other countries and we spend as much to cover 30% of our populations with these programs as other countries do to cover 100% of their populations and Americans pay 2 1/2 times more in healthcare than other developed nations do on average.

And hospitals aren't running out of money any time soon. In fact the medical industry earns the highest profit margin in the entire free market of a whopping 15%. That 15% is on top of the millions we pay hospital executives, the 25% of healthcare spending that goes to administration, and the $350,000 per year we give to specialists on average. Doctors are paid more than any other profession by a very large margin with some even making more than half a million a year.

 

Exactly! Too bad the only bi-partisan things that happen in Washington these days is both the Dems and Rinos obstructing everything Trump attempts. Just the same I believe healthcare can be fixed, it wasn't broken but Obama decided to fixit anyway and now it's FUBAR. Any fix must begin with the repeal of Obamacare. Prior to Obama's insane ****ing with our healthcare it was hands down the best in the world. We need to look back at that and gather all of the components that made it so successful and incorporate them into healthcare now adjusting and tweaking until we get it right. Healthcare must be sacred and not subject to politcs and power grabs. It must be unfettered by the whims of Washington and do the most good for the most people. If there are still those who can't afford it subsidize them but not by decimating healthcare of the majority for the benefit of a few. Such subsdies could be paid for by eliminating waste in other areas such as entitlements that are politically tainted.

 

Problem with that, skippy. is that all new innovation and R&D are gone under government run healthcare.

 

Hi Kode,

What I did was just google around until I found a site listing the profit of various industries. I did not save it. What it listed was the actual profit. I assume this would be the amount of pure profit after all expenses. I was surprised to find out it was only 4% for the health insurance industry. I am also a little skeptical that the overhead for Medicare could be so much less than in the insurance industry. I'm not questioning your truthfulness, but I am questioning the statistic and method of calculating it. Another thing I am aware of is that government can be sort of hard to actually audit accurately. They have some rather arcane and sometimes deceptive ways of reporting their own costs. For example, you could try to find out Medicare's income to operating cost by doing the research, only to find out that what you're being told is the cost of their employees salaries - only. But if you look really closely, if that's possible, you find out that their buildings and equipment come out of some other General Services account. Maybe you find out that the people who clean the buildings, fix the air conditioning and plumbing, buy the computers, the desks, chairs, and other various support personnel are not counted in Medicare's budget. I know this sounds ridiculous, but government is exactly like that. All of those federal employees receive a retirement program and medical benefits, and it wouldn't surprise me a bit to find out that those things come out of some Federal Employees Insurance account rather than the Medicare budget. The other thing that would not be in Medicare's budget is the amount of pre-processing that is done for them by the medical providers and hospitals. My wife, for example, has made a career of doing exactly that in a private hospital/health care system. A large hospital can dedicate very significant resources to doing exactly that. This is why I'm skeptical. And furthermore, what I have observed about government is that government will spend vast amounts of money to be sure that every T is crossed and every I is dotted and that every box is checked. Nothing happens in government unless this is done. Since the budget is not dependent upon making a profit, government doesn't worry about that. You know what they worry about? They worry about crossing the T's, dotting the I's, and checking the boxes. This is how they are judged and rated internally.

Private industry doesn't operate by that priority. Private industry strives to be as efficient as possible and as fast as possible, because efficiency is money, and time is money. My wife, for example, has always been rated by how many accounts she can process per day, and her entire section is rated by how much money they can bring in.

"Co-pay" may not have been appropriate, but there are deductibles with Medicare. The point of course was that Medicare is not totally free at the point of service.

Maybe we can do it for less, but I am quite sure Americans will want nothing but the best, and they'll not want to wait.

I agree with you that it is a matter of will, specifically a will to pay for it. We are not good at that, sorry to say. Everyone - at every income level it seems - wants the magical, mystical "someone else" to pay for it. I deliberately used the cost of Medicare as the basis for my cost analysis, so I remain fairly certain that if we want "Medicare for All" we are going to have to be willing to pay for it, and the amount we pay is going to take a bite from everybody. The more you make, the bigger the bite. Consequently, there will be resistance because, any way you slice it, some people are going to be paying a lot more than other people are. They will be paying for themselves, their own family, and other people's families, and I think there will be a lot of resistance to that.

I may have spoken to you before about this, but my preference to all of this would be a mandate that employers pay for medical insurance for their employees and their families. But that is a whole other discussion ...

Seth

 

You do realize you collect a late penalty fee for every month you were eligible for Part D but didn't have it?

If you aren't taking any Rx now, bless you, but buy a cheap plan to stop that late penalty from accumulating. Sooner or later, you may require some help with expensive drugs, and that doughnut hole is scheduled to disappear by 2020. My 2 cents.

 

Tri care is just another layer of administrative paperwork. Every HMO, PPO... every insurance company has different paperwork. Drives costs up.

I used to have VA docs calling me all the time wanting private practice. I didn't see the kinds of problems you are talking about.

 

Not true.

Most R&D is funded by government grants to universities, only a small percentage are funded by venture capital.

 

Hey Seth.

Sure we would want the best, and that is why I suggested spending 50% more after matching Canada's system and performance. Just imagine: 50% more! A little bit of solid will and intention and it would be possible. I'm saying we could actually cut the per capita cost of our healthcare by 25% if we did that. So "the will to pay for it" would not be an issue in that case. The "will" I mentioned is that of the government. It would take a complete revamping of every aspect of healthcare. I won't hold my breath.

 

Well, the whole premise of that study was that we can do it if we want to, but I'm not sure we do.

I look at the way the California State Assembly and Senate played volleyball with a single payer proposal, and neither house was willing to attach a funding method to it. This in a dark blue state where the Democrats have a super majority in both houses and a liberal Democratic governor.

They choked on the funding, Kode. And they are the most dominantly liberal state in the union.

 

Right ... that's why Congress has hamstrung the DEA on fighting the opioid crisis. Lobbyists for Big pharma are on the job.

Healthcare was broken before the ACA.. Obama slowed the spiraling inflation and got more people taken care of.

Esperanca is wrong.. and doesn't understand healthcare at all.

 

The procedure based Medical Billing System is a sink hole that can never be filled by any insurance scheme.
We must first correct the problem of Americans being the most over procedured medical population with no apparent benefit statistically.
I would start by paying the cardiologist the same per minute whether he is catheterizing coronary arteries, leaving none, one, two, or three stents or just teaching a patient about their illness and how to live with it. The same reimbursement per minute. No denial of care based system.
Then procedures might occur on a more rational, less bill inflating manner.



Costs of medicines another topic for later.
But, other nations control the costs of the same pill Americans get ripped off.
The same pill from the same factory.



I find health insurance a scam. A rip off. Another topic.
Paying a $20 co pay for a dollar's worth of generic medicine is absurd.
Not exactly "coverage" when they inflate a price on you.

And so it goes.
It's a sinkhole that can only be relieved by changing the procedure based billing system

Moi

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But that is the problem with doing it one state at a time. Vermont tried and found that the existing federal costs and requirements made it impossible to do at a lower cost. It has to be a national program, and it will probably require a completely different kind of government to do it. More Bernie Sanders; more Keith Ellisons; more Jeff Merkleys. I can't see any Republican or any of most Democrats doing it.