My birthday is in January; so I find myself reviewing my new
health insurance options during the open enrollment period for those covered by
Medicare. (Yes, that’s right. I will be 65.)
Last week, I attended a seminar by a local insurer. The presenter covered all the options –
Medicare Parts A and B, Medicare Advantage, etc. – concisely and
congenially. It was well worth my time
having come away from the various government and AARP websites totally
confused. Obamacare will cause premiums
to rise. Aetna CEO Mark Bertolini says
it will cost his customers about $1 Billion per year. But, I am not complaining.
Regular readers know that I believe that government should
not intervene in private enterprise. So,
why am I looking forward to Medicare?
Well, my premiums will go down 80% after I sign up. Moreover, I have grappled with the free market
for private individual insurance and I’m familiar with its flaws. An insurer has turned me down because my
blood pressure is below normal. My
doctor says I am too healthy. However,
there was no medically qualified person at the insurer to whom I could make my
case. Just a faceless bureaucracy
following a set of guidelines.
Still, I got a chuckle when NBC broke the news about people
having their policies cancelled because Obamacare requires insurers to offer
only those policies that meet new standards.
The news story featured a middle-aged guy whose premium went up 400% in
order to meet those standards, which include coverage for, among other things,
maternity.
Hey, I could afford to chuckle. I have Medicare!
The hodgepodge of regulations that technocrats will shape
from this onerous 2500+ page law will undoubtedly cause us more grief, just as
the Healthcare.gov website has in the first few weeks of implementation.
By now, we shouldn’t be surprised that the government would
spend $375 Million of the taxpayers money to build a website that doesn’t
work. So what if that’s more than double
what Apple invested to develop the iPhone?
Remember those $600 toilet seats on Navy submarines?
What’s the big deal?
The big deal is that the law doesn’t do what its headline
says it will do – make healthcare affordable.
The President has talked about “bending the cost curve”, whatever that
means. But, mandating that young folks
who can’t afford health insurance buy it or be penalized doesn’t bend the cost
curve. It just adds people who don’t go
to the doctor to the insurance pool with the intent of lowering the average
premium.
The real driver of healthcare cost is the fee for service (FFS) payment system. From an economist’s perspective,
if you provide a financial incentive for doctors to perform medical procedures,
they will perform more procedures – especially when there is a bottomless pit of money at the other end of the claims process.
It gets worse. The
best defense against a medical malpractice suit is to follow (or perhaps
“over-follow”) published protocols on each patient. You guessed it. More billable procedures.
However, there’s hope.
The Affordable Care Act authorizes the creation of Accountable Care Organizations (ACO’s) and healthcare providers are beginning to experiment with
this model. Payment would be based on
the quality of care provided rather than the amount of procedures performed. The financial incentives and disincentives are being studied with results that are, to date, inconclusive.
The Center for American Progress suggests other alternatives
such as Bundled Payments, wherein providers would receive a single payment for
each patient based upon medical history.
Patient centered medical homes would restructure primary care to focus
on preventive medicine, patient education and coordination among healthcare
providers. It would encourage preventive
care rather than excessive treatments.
Again, these alternatives to FFS are great ideas as yet
untested. But, they represent potential
free market solution within the government’s framework.
All of this confusion and complexity could easily lead one
to buy into the liberal Democrat idea of Medicare for all. Medicare works well for seniors (and, if you
don’t believe me, see what happens if you try to take it away). Why not extend coverage to every American?
Well, you have to ask how we’ll pay for it. By many estimates, the Medicare Trust Fund will go broke before Baby Boomers go on to their great reward. Clearly, the current 2.7% payroll tax is
insufficient to extend coverage to the population at large.
No doubt, there are many who would propose raising taxes to
close the gap. And, certainly the half
of the population that receives subsidized health insurance would sign up for
that. That includes me – I’m on
Medicare! So, it would be easy to tax
the other half, wouldn’t it?
Wait a minute! That
includes me, too!
WHO WILL LEAD?
