My solution to our healthcare mess

In my first post, I explained what is wrong with our healthcare system, the specific underlying issues that have caused the doctor shortage and the skyrocketing costs in both the healthcare and related insurance industries. Now it’s time to tackle the solutions.

There’s a saying in the tech industry: fast, cheap, good, pick any two. Same thing here, only worse. We haven’t had a free market in healthcare for decades—my lifetime at least—so we don’t know what one should look like. What we currently have is incredibly fragile and so heavily interconnected that removing one piece will have boatloads of unintended consequences, most of which will likely be bad. We don’t have enough money or expertise to buy a fast way to something good, so it’s going to take time to get a reasonably stable system. Heck, it took us 70+ years to get here; why should we think we can get out of it in less than a decade?

Here are some possibilities:

Repeal Obamacare.

There are other ways to manage pre-existing conditions. For example:

Two Simple Ways to Cover Pre-Existing Conditions or

Turning the Exchanges into Real Markets

Ditch the Medicare pricing structure and go to a voucher system for Medicare patients.

That way insurers can no longer use the pricing structure as the basis for their payments (goodbye CMS!), and Medicare patients can find doctors in areas where they currently can’t because fewer and fewer doctors take Medicare patients. I’m not necessarily a fan of voucher systems, and this may end up causing problems later, but CMS has to go first.

Incentivize a parallel cash-only system.

The key pieces of this strategy would include transparency (full price for the procedure up front and preferably searchable on the web) and either no provider-insurance contact or the insurer agrees to pay the same price as the cash-paying patient. This will create a more robust system in parallel to the current system so that if and when our current system collapses, the skeleton of a cash system will be in place. We already have the first few “bones” in place—check out the Surgery Center of Oklahoma as an example.

Break the government’s monopoly on subsidizing doctors’ residencies.

Because the teaching hospitals don’t directly pay for residencies, they can’t establish a value for them. This will cause a short-term shortage of doctors while the healthcare industry comes up with a new system. This is one of the messiest parts of the solution, and the government cannot help for fear of creating the very dependency it’s trying to get rid of. The longer we wait, the worse it’s going to get. There are more details to this, some of which are mentioned in a commentary by Jake Novak on CNBC from April 2014. His summation: “Of course, no one wants a bunch of quacks out there pretending to know how to treat sick people. But breaking down some of these barriers won’t lead to that kind of scenario by a long shot. Capping insurance liabilities, reducing the frequency of re-certification tests, opening up opportunities for more private-sector investment in residency programs, etc., are all things the government can do to get out of the darn way of potentially thousands of future doctors.”  See Doctor Shortages-Here’s the Real Culprit.

If you want to solve the shortage of doctors in record time, get the Gates Foundation/other philanthropic groups to fund the education of Americans who want to become doctors, even to the point of sending them to other countries with reputable medical schools to overcome the institutional limitations of the teaching schools and residencies here in the U.S. Make this the big philanthropic goal of the decade. Aim for at least 100,000 doctors by 2025, which will be more than the predicted shortage. Of course, since it takes something like 14 years to get a medical degree, residency and license, we’ll have to figure out a way to shorten the duration.

Pull out our wallets to voluntarily help those who will be worse off during the worst of the instability.

The system is already incredibly unstable, but the government keeps throwing up temporary props that slow the collapse, giving us time to get used to the lowered expectations of each stage. My solution of necessity removes many of those props so that we can actually install a fix, and that means changes coming faster than we can get used to them. We are morally responsible to help first our family, then our friends, and outward from there. We determine how much we can help. People will fall through the cracks, but how is that any different from now with cracks you could float an aircraft carrier through? The goal is to create a stable, robust and anti-fragile healthcare system that will by its very structure have fewer cracks to fall through in the first place.

Repeal laws that make it more difficult to create co-ops/insurance pools based on mutual interest.

Expect 50% of those co-ops to fail in 5 years because it’s new and because groups with good intentions but bad business plans will enter and fail quickly. If more co-ops don’t enter the market to replace them, the laws are still too strict. Repeal more laws.

Make personal health insurance premiums equal to employer-based premiums in the tax code.

My preferred choice is to eliminate the income tax and convert to a consumption-based tax like the Fair Tax.

Allow citizens to buy health insurance over state lines.

Because coverages are mandated at the state level, and because some states still allow the sale of non-ACA compatible catastrophic plans, it would be helpful if a person who lived in a state that disallows this type of bare bones coverage, to be able to purchase it elsewhere.

Add levels of medical licensure.

I have thoughts on adding levels of medical licensure (rather like the levels of nursing) to allow more competition at less-than-generalist levels of medicine, but that’s still in the research phase. (My preference would be to reduce licensing to the bare bones so that it’s not such a barrier to entry, but people in general really believe that licensing somehow protects them from bad doctors—rather than protecting the current licensed physicians from competition.)

Address the cost of prescription drugs.

One area the federal government can get involved in is the whole subsidized-prescriptions-in-foreign-countries issue. Let them mitigate the impact on US medicine prices by strong arming other governments or requiring pharmaceutical companies to sell to Americans at the lowest price they offer elsewhere.

School Loans

The issue of school loans and how they increase education costs will need to be addressed, but that’s beyond the scope of my solution.

Tort Reform

The issue of malpractice lawsuits and how they impact doctors who wish to volunteer their time will need to be addressed, but again that’s beyond the scope of my solution.

 Incentivize true catastrophic health plans.

It’s time to make at least part of the insurance industry actual insurance again, rather than prepaid medical. Added in 2017: In general, stop separating the patient from the costs of health care. Only if patients see the money being spent as their money rather than the insurance company’s money will the patients start caring about the cost. I mentioned this in the problems list but forgot to add it to the solutions list.

Technology Improvements

The computer revolution is currently working its way into the medical system. For example, we now have for all intents and purposes the prototype of the tricorder from Star Trek. We also have sensors at the consumer level that can determine what something is made of (does it contain lead?) and if it has any contaminants such as e coli. The driver of these powerful tools? The ubiquitous smartphone. With the advent of successful crowdfunding (God bless Kickstarter!), we also have ways to fund these projects. Since these are nascent technologies, the government has not yet started to regulate them. The goal is to keep it that way as we did for the internet so that they may grow without governmental drag. We’ve already seen the government hampering DNA sequencing at the consumer level by trying to deny us direct access to our own DNA—only a doctor should order that; after all, who are we to order it ourselves? We haven’t gone to medical school to be able to read the results! The upcoming shakeup in the medical industry will be incredible to behold.

That, my friends, was my plan a year ago, when I thought there was no chance of major changes. It was my cri de cœur. At best, I thought we could quietly start setting up the alternate cash-pay system and hope no one noticed and shut it all down.

Now I’m excited. We have a chance to change things for the better, openly and above board! I don’t expect our current crop of Establishment Congressional politicians to take full advantage (they’re already making motions to cave on repealing the ACA, for example), but that’s where we come in. We need to make them aware of the possibilities and let them know we will support changes even as those changes scare us. We need to be the spines that these invertebrates lack.

But that is a post for another day.

When someone needs dental care and starts shopping for insurance

My next post was supposed to be about possible solutions to our healthcare problems, but first…

This is an email Lynne just received from a potential client: “i AM INTERESTERED IN FINDING A DENTAL INSURANCE PLAN FOR MY SON, WHO LIVES IN dENVER. HE CAN’T AFFORD TO PAY, WE WOULD BE PAYING FOR HIM HE IS A 29 YR OLD MALE, WITH IMMEDIATE MAJOR DENTAL NEEDS.”

It’s an excellent example of adverse selection, where people wait until they have a problem before they try to get insurance.

If your first reaction is, “The poor kid! He can’t afford to get health care,” I love your heart. Keep reading.

Dental insurance, per Lynne, is $30 per month. That’s $360 per year. That yearly cost would have protected him from this very situation. In fact, that’s precisely what insurance is designed to do: protect you from the unknown. Specifically, high-cost unknowns. Like major dental.

Now, this 29-year-old man and his mother want complete strangers–namely, insured people–to pay for a known condition.

If you want the cost of dental insurance to go the way of health insurance, then by all means require insurance companies to accept this 29-year-old man who chose not to pay $30 per month for insurance.

Now, what can we do for the man in this situation? Honestly, tell him to get a loan. There could be a GoFundMe involved. Because if we tell him how awful it is that he can’t get insurance, he’ll internalize that it’s not his responsibility. He’ll start believing that it’s unfair to have a necessary bill that is difficult to repay.

Since that’s exactly how we got into this whole healthcare insurance fiasco in the first place, step by well intentioned step, we KNOW what will happen. And I don’t know about you, but I don’t want to have to pay thousands of dollars in dental insurance on top of $10,000-20,0000 in health insurance.

So no pity. No commiseration beyond, “What a sucky situation. Why weren’t you paying your $360 a year? Do you have a good relationship with your banker?” And maybe, “I’ll pitch in $25,” once he’s set his own affairs in order.

Let’s not make the dental care/dental insurance dilemma into another Catch-22.