Monday, August 17, 2009

5 Point Health Care Reform Plan


I'm not in favor of government-run healthcare, let me make that clear. America unequivocally has the best care in the world because of innovation born in the private healthcare industry. If we MUST make reforms to appease the political elite and their constituency, here is a plan that would address most of the pressing issues and fairly give everyone a stake in their own healthcare and the systems that provide it. This plan isn't perfect but as Voltaire suggested, "don't let perfect become the enemy of the good."

1. Ensure the viability of the private insurance industry
The worst thing that could happen would be for the existing private insurance industry to wither away. That would ensure a government monopoly and that, as evidenced by history, is not a good thing. This is probably the most contentious issue dividing health care reform advocates and opposition. To bridge this divide, create a set of rules that would explicitly protect the private insurance industry from unfair competition from the government option.

• Prohibit the government from enacting any new taxes on private healthcare plans, their recipients or the groups (employers) who provide them. The goal would be to ensure that the system is not set-up for the purpose of eventual government takeover.

• Give private citizens full tax deductability for individual health care plans and savings accounts.

• Allow inter-state purchase of health insurance. Why in the world is this not allowed? Simple: it is designed to INCREASE insurance costs to help create the "crisis" which, naturally, can only be solved by government. Here's how: the smaller the insurance pool, the generally higher the rates for members of that group.

• Require any new rules or laws to have equal economic impact on the private insurance industry as they would the government run versions. This would reduce the appeal for the government to rewrite the rules to benefit their system at the expense of the private industry.

2. GovCare
Combine Medicare (seniors) and Medicaid (poor) with this new healthcare program (Gapcare?) and call it all GovCare. Streamline the bureacracy and administration of these programs for starters. This should be able to save billions annually.

• Gapcare would cover anyone who meats basic means testing (above Medcaid) and would require them to pay a portion of their monthly premium, perhaps 10-50%. Premium should be fairly low since the government has promised its ability to lower rates by having such a large pool of 30-50 million Americans. Yet a premium must be collected in order for these people to have "skin in the game".

• The rest of the funding for the Gapcare should not come from the general revenue fund nor borrowing. It should come from a combination of savings acheived by putting all the federal healthcare programs under the GovCare roof. It should also come from taxing the foods directly related to a good deal of the nation's health problems. Add a few cents for every high-fructose or liquor beverage along with a few cents for every packaged or prepared food item that derives XX% of its calories from fat or sugar. I'm generally not in favor of any new tax but if you must pay for GovCare, I'd rather it be funded by some of the consumption responsible for our generally lousy state of health. Road work is largely funded by the people who use the roads (fuel taxes and surcharges), why not health care?

• Make all government healthcare options, just that... options. This means allowing seniors to opt-out of the Medicare and allows young adults to go without coverage if they so desire. Just because some politicians deem healthcare a "right" does not mean individuals must be compelled by force of law to accept.

3. Require responsibility
I'm not sure how (legally) this could be legislated but employer-provided health insurance plans should require recipients to pay half of the monthly premium. By creating a larger financial stake in their own health care costs, people are likely to live more healthy (filling another goal of reform) and reduce their individual "health care footprint" on society. It also reduces the cost to many large employers (that currently pay 100%) who may improve the level of plan their group participates in or extend benefits to more employees. This rule would extend to all union and civil service employee insurance programs, regardless of collective bargaining agreements.

4. Let the FDA draw a line in the sand on drugs
One of the big reasons America spends so much of its GDP (about 16%) on health care is that we are taking too many drugs (the legal ones ;) We have truly become a medicated society. Over the last two decades, there has been an explosion of drugs that appeal to the "sniffly nose" crowd. Let the FDA create two drug designations on all new and existing drugs: Life Quality (LQ) and Life Necessity (LN). These would be legitimate medical determinations, not political ones. No insurance program would be permitted to pay for LQ drugs -- not even GovCare. If you want to pay out of pocket for them, fine. The reality is, the drug companies will probably spend less money on R&D for LQ drugs and put more time and effort into real medical breakthroughs.

While they're at it, the FDA should also limit direct-consumer advertising. This might sounds blasphemous coming from someone in the media industry ;) Drug companies currently spend about 30% of their annual revenues on marketing and advertising. This is largely responsible for the huge rise in the use of LQ drugs. The government already regulates advertising for cigarettes and alcohol so this one is no stretch. Limit drug companies to a 10% cap on advertising : revenue.

5. Tort Reform
There simply cannot be health care reform without tort reform. If the democrats are sincere about seeing a better system, they must drop their opposition to this. This is a huge contributing factor in escalating health care costs -- the enormous cost of liability insurance to health care professionals. The culprit is the high costs of litigation and compensation payouts for medical tort claims. There is no debate over the cost impact this has on the system. Most tort claims are paid from the pockets of insurance, and because the public pays into insurance, the public is footing the bill for these claims. There should be caps on punitive damages and non-economic awards. While the Democrats have been quick to vilify the insurance and drug companies, they have been breathtakingly silent on this aspect of cost control. Isn't it time to put the health of the country first, President Obama?


  1. You forgot the most vital component: preventing insurance companies from denying coverage for pre-existing conditions. Unless such a provision is made in some fashion, it will be a non-starter.

  2. No, I didn't forget to include such a provision. Healthcare is not a right. Now if you want to make it so, a Constitutional Amendment would be in order. Short of that, private business is more or less free to do business with whom they choose.

    I understand and appreciate your intention to provide healthcare "security" to those who cannot afford it. However, these people by and large already fall under Medicaid. That, and emergency care is refused no one in the United States. You seek to provide a greater level of security to some by restricting the freedom of others. I submit this to you...

    "Those who would give up Essential Liberty to purchase a little Temporary Safety, deserve neither Liberty nor Safety." -- Ben Franklin

  3. Actually the U.S. is ranked 37th in the world in quality healthcare. For profit healthcare is one of the things killing the country

  4. In the preamble of our government it states that we must secure the blessings of liberty to ourselves and our prosterity. That means that we must provide an adequate and livable life for ourselves (meaning people other than those that can afford healthcare, not just you) and our prosterity, meaing our generations to come. Our healthcare plan is not the best in the world as you state factualy in your argument, in fact it is far from it. The private insurance companies do not have our best interests at heart, they have $ signs at the interests if their hearts just like most conservatives. You say that "Healthcare is not a right, and yes that may be true but that is because there wasn't such a thing in 1789 when it was written. Private insurers have made their way into the rankings of our government to make sure that it stayed that way. Well i've got sad news, not for long. The bill will get passed and 10 years from now when you lose your job and develop cancer and don't have the funds for chemo, you'll be singing a different tune my friend. The world needs change, sadly theres not to much wiggle room for conservatives, that means get witht he program or deal with it. "Taking back America" you had America for 8 years and you drove into the ground.

  5. My misguided friend:

    Your misinterpretation of the preamble is profound. Apart from that, the Court has never used the preamble as a decisive factor to adjudicate a case before it. I suppose you can extrapolate anything you want out of it if it suits your agenda. KInd of like, what the meaning of "is", is.

    Based on your statements I can confidently declare you have scant knowledge of history, thus you distort the concept of freedom. Our Liberty was based on individual responsibility first and foremost. This absolute truth has been disregarded by the Left and is now on full display by our growing nanny-state. This is NOT the nation or culture contemplated by the Founders so to use their words to make your case is totally disingenuous.

    I have health insurance and it is good. Do I wish it were cheaper, of course. But do I begrudge the health insurance companies for trying to make money? Absolutely not. Truth be told, that industry has among the lowest profit margins of any industry in America. If you can name me one, just one, government provided service that is cheaper than is available in the private marketplace, I would like to know.

    It seems to me that your incredible and incredulous confidence in Government betrays a lack of confidence in yourself. Benjamin Franklin said it beautifully, "They who can give up essential liberty to obtain a little temporary safety, deserve neither liberty nor safety."

    And to bring it all together, this is what you and your like have done to America... courtesy of Mr. Franklin once again.

    "When the people find they can vote themselves money, that will herald the end of the republic."

    Or perhaps, Thomas Jefferson.. "A wise and frugal government, which shall restrain men from injuring one another, which shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned. This is the sum of good government, and this is necessary to close the circle of our felicity."

    I could go on and on. The point being... you cannot legitimately use any of the words, meanings, thoughts or intent of the Founding Fathers to justify your agenda which, intentional or not, seeks nothing less than the destruction of America.

  6. Early last year, I took inputs from a bunch of conservatives and put together a mostly serious (a little tongue in cheek just to hack off liberals) platform for a fictional American Tradition Party (see the Featured Posts section of my blog). You're health care proposals fit my ideals.