There is a lot of rhetoric and arm-twisting regarding the Obama health care plan. President Obama is scheduled to appear on television tonight to rally support for his plan. Although there are claims of partisan bickering, it is the “Blue Dog” Democrats who are holding up this plan. They, like most Americans, want to see real cost containment in health care, instead of an expensive boondoggle.
I usually avoid political posts, so I will try to keep this strictly related to finances. The cost of our health care is unsustainable, considering the number of people retiring and others using Medicare services. If we don’t come up with some sound financial solutions, Medicare may become insolvent. Plus, there are an estimated 45 million people who are uninsured and medical costs are the single largest cause of personal bankruptcies. This has become a huge problem that will affect everyone at some point.
Why Costs are so High
Political Clout – Our politicians are primarily to blame for high medical costs. Powerful special interests in the legal, medical and insurance industries are enriching themselves at our expense, with the aid of our elected representatives. These special interests have a vested interest in maintaining the status quo, which has been very lucrative for them. Politicians have a vested interest in getting re-elected and they welcome the campaign contributions. None of this works in the favor of affordable health care.
Administrative Overhead – One huge component of cost inflation is administrative overhead. There are dozens of proprietary medical systems which don’t integrate to the standardized EMR systems. And, there are many different codes, forms and insurance plans, which contribute to medical mistakes and make billing a nightmare. Standardization has been slow to occur and the costs of computerized medical systems are staggering for large organizations.
Medical Malpractice – Another heavy cost that is passed onto the consumer is in the legal and insurance costs of medical malpractice. Granted, there are medical mistakes and patients are sometimes harmed by the health care system. But, our litigious society and an abundance of aggressive lawyers aren’t helping to contain medical costs.
Drug Costs – The U.S. is one of very few countries in the western world that allow advertising of prescription drugs and this is a recent change. A number of years ago, you didn’t see commercials on TV telling you to “ask your doctor” for drugs. This simply wasn’t allowed and it shouldn’t be now. There are also a lot of “promotional” programs that reward doctors for prescribing drugs. There are a lot of new drugs that are less effective and more expensive than their predecessors. Also, a suspicious number of new drugs must be taken for life, instead of being taken for a couple of days or weeks. Finally, prescription drugs are more expensive in the U.S than they are in other countries, even though they are often made right here. All of these things add up to skyrocketing prescription drug costs with no relief in sight.
What is Wrong with the Obama Plan
I applaud President Obama for recognizing that there is a crisis in the coverage and cost of health care in America. Unfortunately, his plan does virtually nothing to contain costs and instead cuts everyone in for a big share of taxpayer money. This is supposed to be paid for by the rich, but this cost will ultimately fall on the working class. And, the last thing we need is our Government becoming our health insurance company. Just look at all of the fraud in Medicare and you will get an idea of how effective this plan would be. And, if you are worried about the quality of health care provided by the Government, you can gauge that by the health care provided to our Veterans. I foresee a lot more problems than solutions.
My Solutions to the Crisis
Direct Provider Model – I selected Kaiser for my health care benefit, because they provide the health care directly. This means that I don’t pay an insurance company in addition to the provider. By cutting an insurance company out of the loop, medical costs are greatly reduced. In addition, there is greatly reduced administrative overhead, because the provider doesn’t have to fill out dozens of unique forms to get paid by dozens of insurance plans. And, I don’t receive letters from doctors who didn’t get paid by the insurance companies, who rejected the claims. Although you give up some freedom in choosing your medical care, the reduction in costs and hassles are well worth it.
Cost Containment – One scary aspect of an HMO provider is that they have incentives to cut costs, even if it means cutting necessary medical procedures. The alternative, which is equally scary, is a system of providers who have incentives to run up costs, even if it means providing medical procedures which may not be necessary. This is not a pleasant choice to think about. But, medical costs must be contained, so a model that provides incentives for controlling costs makes a lot of sense.
Health & Prevention – This may sound like an absurd claim and I have no scientific basis for making it. But, I personally believe we could cut our long-term health care costs by at least 20% just by removing six key ingredients from our food supply. (nitrates/nitrites, hydrogenated oils, artificial sweeteners, corn sweeteners, MSG and preservatives such as Sodium Benzoate, BHA and BHT) If we could reduce the epidemic numbers in cases of diabetes, obesity, heart disease, strokes and cancer, this would not only reduce medical costs, but improve our quality of life.
Alternative Medicine – More and more Americans are aware of the issues and limitations related to our traditional form of medicine, including the nasty side effects of synthetic drugs. It’s a crime that very little research is being conducted on natural remedies and alternative forms of medicine. There is no doubt in my mind that these options are being limited by vested interests in the status quo. People would welcome these alternative solutions, but they simply aren’t available through traditional medical channels.
The Bottom Line
The bottom line is that there isn’t an easy solution to our health care crisis. We can’t continue to pay 16% of our GNP for health care, we can’t have millions of uninsured citizens and we can’t have the looming disaster called Medicare bankrupt out Government. What we really need is a vibrant, private direct provider system, with portable benefits and no pre-existing conditions. We need to eliminate the proprietary nature of health care and standardize medical records, forms and coverages.
Unfortunately, the current Obama proposals are bloated, inefficient and costly corporate giveaways. We simply can’t afford that if we are going to remain healthy and solvent as a nation.
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