A proposal for public Health care

In the below posts I have commented or criticized some of the arguments regarding some proposals for reforming health care. We do have a problem with health care, and the following are proposed principles that I think should guide any plan.

1. Government should strongly encourage people to obtain non-cancelable catastrophic health insurance. By catastrophic health insurance I mean insurance that covers very expensive health care expenses like cancer treatment, kidney dialysis, and the like. It excludes routine doctor's office visits for colds. The insurance premium should increase with age.
We do not ask life insurance to pay for food and shelter which are necessary for life. When we buy auto insurance we do not ask the insurance company to pay for oil changes and other normal maintenance. Why must we health insurance to pay for many health care expenses that most people can paid with savings or income? Catastrophic health insurance is intended to pay for medical expenses for truly catastrophic expenses, like life and auto insurance. Currently everyone pays for the common inexpensive doctor's visits. The person pays with savings or current income, or can pay the insurance company to pay for the doctor's visits, or accepts lower cash income from an employer that pays for insurance. The advantage of people paying directly for one's health care expenses is that a person would look for the most inexpensive form of health care. For example there are urgent care centers or in-store clinics (e.g. at Walmart) that can handle colds, cuts, burns. They are probably more efficient than a doctor's appointment and may be less expensive. Here is more information on walk-in clinics. A walk-in clinic may not always mean inferior medical service. College campuses normally have walk-in clinics for their students and I do not believe they provide inferior minor medical services. In the U.S., where people change jobis and move more often than other countries the combination of catastrophic insurance and using clinics may be attractive alternative for healthy people without family. People should be free to choose how to pay for minor medical expenses. Employers can always provide expanded insurance or the individual can purchase additional insurance to cover non-catastrophic medical expenses.

When consumers directly pay expenses they will less likely waste money. Let me give a couple of examples. A year ago I realized that I could see better with cataract surgery. I could still see pretty well but not very well. If the cost of the surgery was less than $5000, I would be willing to pay for it out of my pocket; if over $5000 I would think about it more. But I'm covered under Medicare, it would cost nothing, so I had the surgery.

The optometrist noticed that my eyelids partially covered the iris of my eyes. He suggested that I have eyelid surgery. I went online and investigated eyelid surgery. There were many websites (by optometristsI think) that advocated eyelid surgery for cosmetic reasons; it makes you look younger or better. There were a few that discussed the medical benefits of eyelid surgery. If I were paying for the surgery and the cost was over $2000, I would probably have undergone the operation. But Medicare paid for it so I had it done for medical reasons. But I suspect there may be a few people who ask for the eyelid surgery for cosmetic reasons.

When we buy life insurance generally the life insurance company cannot cancel the insurance policy when we get sick. It stays in force until one stops paying the premiums. The same is true with health insurance (usually). It stays in force until someone stops paying the premium. But if someone has insurance through his employer and leaves or is laid off, the employer may stop paying the premiums. The former employee may have difficulty in getting new insurance for understandable reasons. The crux of the problem is that the health insurance is attached with the employer rather than the person and payment stops when the employer changes. The major difference between health care delivery in the U.S. and other industrialized countries is that health care is attached person rather than the employer.

The catastrophic insurance should stay in force for the life of the patient or as long as premiums are paid. There would be no possibility of cancellation due to preexisting conditions. If the employed has health benefits, the employer can take over the payments of the catastrophic insurance as well as offering additional insurance. The catastrophic insurance for the child could be paid by the parent's employer or the parents themselves. When the child grows up and gets a job the catastrophic insurance could be paid by the new employer or employee. In any event as long as premiums are paid there would be no danger of exclusion of preexisting conditions. Presently people willingly pay for life insurance and there I think that would just as willing pay for catastrophic health insurance.

The health care insurance premiums should increase with age to reflect the medical needs of each age cohort. Since health care expenses increase sharply with age this would mean that that insurance premiums for younger people are much less than for older people. This, IMHO, is fair. Younger people start with lower incomes when they first enter the job market, then they may want to buy a house, have children, send the children to college. The retired people do not have all these expenses. For most people income tends to rise as one gets older, wealth increases (homes may become paid off) and some important expenses (home mortgage paid off, children finish college) decreases as we get older.

2. Health care should be provided to poor and low income people by the government.

Currently Medicaid provides health care for the poor. Medicaid can be made more efficient, but there iare many people, the illiterate, the homeless, and others who have not signed up for Medicaid and use emergency room for their health care needs (for a glimpse of the people I'm talking about see the quasi novel The Corner: a life in the an Inner-City Neighborhood by Simon and Burns ). It seems probably that the people who do not even sign up for medicaid would not sign up for insurance. For these people I would propose that in some inner cities that free clinics be established for the poor.

3. Every effort should be made to make our health care system less wasteful

Instead of trying to expand health care insurance that covers everyone, the emphasis should be on decreasing the cost of health care. The present trajectory of health care costs is not sustainable and it is hard to argue that expanding insurance coverage will not increase health care costs more. Providing health care and health care costs are two separate issues; both should be addressed.

One obvious, IMHO, place to start is tort reform. It is my firm conviction that there will be less waste if the people making the decisions on health care are affected by the cost of the health care. The decision to visit a doctor or a walk-in clinic should be left to the individual. I think the drug Viagra is covered under Medicare part D. The cost benefit of that drug is best determined by the user. Consider the case where there is an expensive procedure that can quickly cure an ailment, and a less expensive treatment that takes longer to cure. The cost benefit again is best made by the individual involved who pays at least a substantial part of the cost. The government, if desired, may help the needy not by paying call the cost but part of the cost. I do not think that it would be efficient to negotiate lower prices with hospitals and/or doctors. The government program are huge, and they can use their size to negotiate lower prices. But with lower prices you might get lower quality also and force the private insurers, who do not have as much clout as the government, to subsidize government expenditures. See the blog on on government setting prices below.

klee12