Tim's Health Care Position
The cost of health care has soared in the US since 2001, with some authorities estimating that families are looking at a 78% increase in medical insurance premiums. More and more small business owners are having to abandon offering health care benefits to their employees, putting additional strain on an over burdened system. Where does it end? What can be done?
First, no single, simple remedy will suffice. Several actions must be taken, simultaneously for us to save our health care system, which despite all of its problems, still offers the best medical care in the world. The reason all the actions below must be taken together is simple: they are interdependent, .. These actions, in aggregate, will significantly reduce the overall cost of healthcare to businesses and citizens.
#1. Tort Reform – Patients who are harmed by negligence within the medical system have every right to litigate. Many awards by juries, however, go far beyond compensating patients for situations where they may have been injured from a mistake on the part of the hospital or health care provider. With some attorneys receiving up to 40% of their client’s award, there is a strong motivation for attorneys to seek settlements far beyond what it takes to pay for remedying the error. Frivolous lawsuits and multimillion dollar jury awards have also had the unintended consequence of increasing the medical liability insurance providers must pay to practice medicine. Medical providers must then pass the cost increases on to patients. In some specialties the increase in medical liability insurance has been so great that many providers have been forced to exit the practice of medicine. Tort reform and caps on awards are desperately needed.
#2. Over-utilization of Technology – To limit the threat of litigation, health care providers order extensive series of high cost, high tech tests for patients. They do this not because the test is essential for making a sound medical decision, but rather to avoid potentially career ending legal consequences should a patient have a bad outcome from a medical diagnosis/treatment. The consequence is that extremely expensive tests are frequently performed in addition to standard procedures, in an effort to cover even the remote possibility of litigation. The practicing of “defensive medicine” greatly increases overall costs to the health care system.
#3. Over-utilization of emergency services - Emergency care is extremely expensive compared to the care offered by primary care providers. When a patient walks in to an emergency department with a non-life threatening health problem, everyone pays the price.
The cost to treat a sore throat in the emergency department may be 8-10 times the cost at a primary care provider’s office or an urgent care facility. By law, emergency departments cannot turn people away, even if they have no ability to pay for the services they receive. Frequently, emergency departments become the access point for charity care, which is both the most expensive and the most wasteful way possible to offer medical services.
#4. Patient Accountability and Aligned Incentives - Insurance costs are driven by utilization rates and the costs of procedures. If the patient has no incentive to use their benefits wisely, few will try to conserve these limited and expensive resources. For example, if it does not cost the patient any more (out of pocket) to go to the emergency room rather than their family practice physician, they will go to the facility that is most convenient for them at the moment. Incentives must be instituted to encourage patients to utilize their health care benefits wisely.
#5. Healthy Lifestyles – Patients must take some accountability for their health and lifestyles. For patients who lead healthy lifestyles and utilize the system properly, insurance companies must offer rewards for those behaviors. People who choose to pursue risky behaviors (e.g. smoking) or fail to utilize the system properly (go to the emergency department with a sore throat or minor issue) need to pay more for their health care coverage.
#6. Continuation of Insurance Coverage - Insurance companies, at the same time, should not be allowed to “cherry-pick.” That is, only enroll those who have no health care issues or drop them when they develop health problems. In order to work properly, insurance depends upon spreading the risk pool to as large a group as possible. In this manner, many people pay a little for insurance coverage for large segments of the population, rather than a few people (or employers) paying a lot to cover those who can’t obtain insurance.
