A Solutional Concept to Health Care in America


Introduction

As will become rather obvious, the below is offered at a "summary" or "concept" level. The actual implementation would require much additional work by knowledgeable persons much smarter on the subject than am I.

As we are all aware, the costs and availability of adequate health care in our country have become problematic for a great majority of us.

The Health Care Law, now in effect and viewed as Constitutional by the Supreme Court, is woefully expensive and will tend to disrupt an already "broken" health care system. Since it was signed into law the cost estimates for its implementation have already doubled - and, it doesn't go into effect until 4 years after it was signed into law.

Before proceeding further, take a look at comments made by Paul Ryan during congressional hearings on the Health Care Law back in 2009 (Note: this link is also provided on the main site): Paul Ryan on the costs of the Health Care Law

Only 10% - 12% of the USA population was deemed "in need of help" when the Health Care Law was initiated. A 100% "solution" was seen as necessary for a 10% - 12% problem. From many years of fixing large scale programmatic and financial issues and organizations, I can assure you that such a solution was, and is, the wrong one – you fix only that which is broken and make better the rest. Even in this you do it over a period of time so as to preclude breaking something else as you proceed.

Does the current system (i.e., before the Health Care Law) need a correction? Indeed it does.

As a further introductory note, it is firmly believed that any federal government mandated health care solution, however well intentioned, is unconstitutional (Note: this link is also provided on the main site) - see Health Care Law - unconstitutional? With that being said, since the federal government is doing it anyway, we might as well have a VIABLE solution – one that is affordable and maximizes availability to all.

This offered solutional set will reduce the costs to Medicare and to Medicaid along with a reduction in costs to all. Thus, these solutions will help alleviate the upward spiral of our national debt – as well. Even the millions of persons here illegally will benefit from the solutions we offer.

"Executive Summary" of Benefits of Our Proposed Approach

  • Recognize that a very small number of our population need "expensive" care all the time. In reality, most need to seek medical help for routine issues such as the flu, minor injuries, checkups, yearly flu shots, and the like. Our approach offers relief to all those falling into this category at a truly affordable cost while maximizing physicians ability to treat serious injury/illness.
  • Just as our aging population is increasing, doctors are leaving the field due to prohibitive malpractice insurance costs, advertised reductions in Medicare/Medicaid payments to doctors, and the new regulations being applied by the Health Care Law. Our approach offers litigation limits, thus limited insurance costs, and regulations that are simple, straightforward, and easily met.
  • The cost of pharmaceuticals has risen dramatically – and continues to rise. The federal government, once again, is in the way here. The amount of money pharmaceutical companies must spend – not to mention the time and paperwork required – to bring a new drug to market is staggering. To make a profit, and they are in the business of making a profit after all, they must, by necessity, charge large sums for products. Our approach offers solutions here as well.

The Approach

  1. Maximizing Availability While Reducing Costs
  2. The vast majority of our everyday medical needs do NOT require a physician. These include minor injuries, colds, flu, low-grade fevers, checkups, etc.

    These "routine" needs may be easily be satisfied by registered nurses or licensed practical nurses. Of course such persons should be supervised and/or "licensed" by a physician.

    Imagine the nation with many, many such "doc/nurse-in-a-box" offices. Walmart, and the like, are making a stab at this now. These would be low cost operations with locations set up to serve the local "neighborhood" in which they reside.

    Scheduling an appointment with a doctor can become problematic what with increasing numbers of potential patients and doctors seeking "other opportunities". However, with numerous, local opportunities for "basic" treatments, doctors are freer to take the needed "extra" care necessary for more critical needs.

    The services offered by such "..in-a-box" operations would be established by the supervising physicians. For example, based on diagnosis, a nurse would be "licensed" to give flu shots, due routine checkups, write prescriptions for low-grade fevers, handle minor scrapes and cuts, and the like. Anything diagnosed as beyond the scope of the "..in-a-box" operation would be referred to the supervising doctor for the appropriate appointment.

    Such an operation would greatly free up the physician for illnesses / issues truly needing a higher level of attention.

    Added to this are the cost benefits of such operations. The "..in-a-box" operations do not need expensive diagnostic/treatment equipment – thus minimizing overhead and operating costs in general. These lower operating costs, of course, would result in dramatic reductions in costs to patients.

    Now, as the operating costs for the "..in-a-box" operations are low and the patient costs are low, then the costs of insurance for this type of service, by design, would go down dramatically. After all, the potential for "malpractice" involving this type of setup is close to non-existent. More on this later in the below discussion on insurance.

    The number of nursing personnel, by design, would increase dramatically. Thus, employment would be offered to skilled nursing professionals as well as receptionists, etc., that might otherwise not exist. Beyond the increased availability of medical services, think of the tax revenue benefits. The more who work the more who pay taxes – both at the local/state level as well as nationally. Everybody wins.

  3. Minimizing Pharmaceutical Costs
  4. I think everyone’s opinion of drug costs is that they are way out of line. If one can go to a Walmart and get a prescription drug for $4.00, then why does that same drug cost $50 at a "regular" drug store? Volume?! OK. Why not get all of our drugs from a "Walmart"? Simply, Walmart does not carry every drug that we may need.

    But, let’s get at the core of the issue. The costs of bringing a new drug to market is a, if not THE, major culprit. It requires millions and millions of dollars to meet the "standards" set forth by the federal government – supposedly for our safety. This doesn’t even consider the large costs associated with the research and development to develop the new drug. As companies are in business to make a profit, they must recoup their costs and make a profit for their stockholders. In a normal business such costs are spread out of the estimated viable "life expectancy" of the product. In the case of a drug this could be in terms of decades. So, they could spread the "up front" costs over a very large time frame. Thus, the cost of any single prescription would, and could, be very low.

    Current government rules only allow 7 years for a company to retain "ownership" of the drug. After that period they must offer up the design of the drug to all. So, they must recoup ALL of the "up front" costs AND make a profit in 7 years. And we wonder why drugs are so expensive.

    Our solutional approach to this issue is rather simple. Pair down the government regulations and "standards" to the minimum necessary to assure safety and efficacy, extend the "right of ownership" of the drug throughout its entire useful life, and offer tax incentives for lowering the price charged to eliminate "up front", accelerated, amortization (in this case consider that, in a home mortgage, the majority of interest is charged during the early months of the loan) and, rather, use a "straight line" method of cost recouping.

    Also, as with the Walmart example, buying in large volume will reduce the costs. Set up a national "clearing house" for the purchase of prescription drugs. The costs for the "clearing house" would actually be funded by the States on a share equal to their population. And, yes, Article One, Section 8, Clause 3 (The Commerce Clause) of our Constitution would be applicable. As such, the federal government would maintain a SMALL oversight role to assure the elimination of corruption and equitable distribution of medicine across the States. Once every 2 years the apportionment of "clearing house" costs to the States would be revised based on the actual usage of the drugs purchased by the "Clearing house". An example: State A, on average, uses $5M of drugs; State B, having roughly the same population as State A, uses $25M. Obviously, State A should pay less than State B. By this revision of who pays and how much equitable distribution of costs would be effected over the "long haul".

    OK. Where do the States obtain the funding to provide for this "clearing house" concept? No one wants higher taxes, after all. The insurance companies offering services in the States would pay for the ability to offer higher benefits at a lower cost to all their customers through this approach. Therefore, the insurance companies would be the ones to actually pay for the "clearing house" concept. Yes, of course, they would amortize these added costs across their customer base. But, since the actual costs of medical care (all medical care, not just drugs) by this approach, would be greatly reduced, customers costs for insurance would be significantly reduced as compared with today.

  5. Malpractice Insurance
  6. Asking any doctor how much malpractice insurance contributes to his/her operating costs, the answer will be "SIGNIFICANTLY".

    Let’s do a fair assumption here: no doctor wants to make an error causing ill to a patient. However, mistakes happen either through genuine accident, neglect, or even out-and-out incompetence.

    As it is now, the costs of malpractice insurance are far in excess of what anyone might consider reasonable. But, anyone can sue. This causes expense to be experienced for the defense – win, loose, or draw. As such, insurance rates are necessarily high to offset litigation.

    Our approach offers a reasonable, viable solution. In summary, it goes like this:

    Limits on Litigation Exposure

    For all issues resulting from accident, neglect and/or incompetence financial risk will be limited to all medical costs incurred during and after the event for as long as the resulting condition persists as well as lost income (at the current rate) for twice the duration of the condition’s persistence.

    In addition to the above, for events resulting from neglect and/or incompetence resulting in permanent injury, a financial risk exposure is set at $5m.

    As we are all aware, people will sue knowing that it is cheaper for insurance companies to "pay" rather than ‘go to trial". To combat this rising issue of "frivolous" lawsuits, the following will apply:

    Upon the determination that a "frivolous" lawsuit" has ensued, the plaintiff will be liable for all legal fees on both sides of the argument including payment for "time lost" for any doctor and/or employee required to defend the suit.

    In addition, for any doctor (or other medical professional) found liable for accident, neglect, and/or incompetence resulting in permanent injury three times within a 5 years time frame their license to practice will be revoked permanently.

    The above would be implemented as stated – no "well, in this case it’s a little different" kind of thing. There is no negotiating in this – it is what it is.

    With this approach the financial risks are fairly easily determinable; thus, insurance rates are more easily determinable resulting in a dramatic reduction in malpractice insurance rates. When "the sky’s the limit" on potential risk, it is very hard to determine "reasonable" rates; when the risk is quantifiable, rates may be established that are reasonable, fair, and afforable.

  7. Insurance Plans and Rates for All
  8. As with malpractice insurance, personal insurance, by design, become greatly reduced. The availability of "..in-a-box" medical care, lower cost of prescription drugs, and more affordable physician care all go toward reduced costs being born by insurance companies.

    Rates would be established based on the company’s entire customer base – independent of State of residence. Therefore, if one lives in CA, the rates would be the same as a person living in GA, as an example.

    As a note, for those who are not covered by an insurance plan, the charges to such a person would be at the actual cost of treatment. There would be no restriction as to from whence a person comes. However, as it would be unfair for a person to receive treatment for which no insurance plan exists, actual costs would be incurred.

    It is envisioned that "tailorable" plans be initiated which would allow us all to pick and choose the level of care we truly need – beyond the current "catastrophic only" and "everything" insurance options. Thus, for persons with known, higher risks the costs would be higher than for those with low risks. For example, those with medical histories involving a majority of cases for which the "..in-a-box" centers would be adequate, their rates would be much, much lower than, say, a person whose history involves repeated treatments for a heart condition.

    Should a person on the lower rate structure require a more serious level of care, say once every 5 years, these would be covered at the lower rates. However, should a condition present itself where the risk of continued higher care be necessitated, that person would be moved to a higher rate category. Each of the varying rate categories would have a "built-in" rate structure to cover a person who required the higher rates but could not afford it – up to a predefined limit.

    The "extra" monies charged by the insurance companies to cover those not able to pay would be collected and treated as "profit". Such profit would be treated as "non-taxable" profit. However, such "profit" could not be used for anything but to cover otherwise uncollectible rates. As such, anyone using the "I can’t pay" ploy (real or not) more than twice in any 3 month timeframe would be referred to the nearest emergency room for treatment. Payment for the treatment of such persons would be TBD at this time.


    SUMMARY

    The whole intent of this concept is to provide a wide array of modifications to the way health care is administered today.

    The additions of treatment availability options, reductions in insurance costs to both physicians and patients, potential or otherwise, and a reform to litigation all go to lowering costs. In addition, these contribute to a widening of medical treatment opportunities for us all.