In the last week, a very interesting study was released on
Bankruptcy. Turns out, the majority of people who file bankruptcy, resort to this unfortunate option because of medical bills. It landed ahead of divorce and credit card debt.
This comes at a time when 45 million Americans, including 11 million children, have no health insurance. These people without health insurance cost the total health system more, because they do not get preventative care and only use services in times of crisis. Often, they resort to bankruptcy to deal with high medical costs that they cannot pay.
Medicare is also situated in a precarious position. Like Social Security, all workers are taxed with Medicare taxes and this money goes into a fund that pays for medical care for senior citizens. Like Social Security, there is a trust fund that buys bonds from the government because the fund collects more than it currently pays out. Unlike Social Security, it is estimated that the Medicare Trust Fund will run out of money in 2029, less than 25 years away (the Social Security trust fund is expected to be depleted in 2052 using CBO numbers).
In addition to these issues, businesses face rapidly increasing costs to provide their employees with medical insurance. These increasing costs are being passed on to the employees in the form of higher premiums and reduced benefits.
There is a solution to all of these issues, one that already has the infrastructure to complete the radical change, one that will bring down the cost of medical care, cover every citizen, and ensure that the healthcare system in America remains the best in the world.
Solving these issues relies on a public-private partnership to insure all Americans with several key features.
- The Medicare administration will no longer handle payment of medical claims to doctors and hospitals. The Medicare administration will be converted into the Medical Security Commission. This commission will collect payroll taxes and distribute funds to insurance companies, who will handle the medical payments.
- Private insurers, who are better at managing costs, more efficient at detecting fraud, and who already contract with doctors, hospitals and pharmaceutical companies, will be enlisted to continue what they are doing. They will contract with the Medical Security Commission to provide group coverage to all interested citizens. They will contract with physician groups, hospitals, pharmaceutical companies, and other healthcare providers and will handle payments for services to these providers.
- Employers will no longer make payments to insurance companies. Rather than companies paying insurance costs directly to insurance companies and making Medicare payments to the government, payroll taxes and employer healthcare costs will be bundled and paid in to the Medical Security Commission. In this way, small businesses are empowered to provide competitive benefits to their employees because they are not rated and charged as part of a small group, but pay a fixed cost that is the same as any employer.
- Individuals will receive a Medical Security Commission credit to be used to sign up for insurance with the company of their choosing. A company will not be able to deny coverage or terminate coverage for an individual. Consumers would also be able to purchase additional coverage above the provided standard coverage that would reduce co-pays and other out of pocket costs.
- Healthcare providers will collect payments for every service they provide. There will be no default. Their costs will go down because they will no longer have to rely on actuarial calculations of rates of default on payments and adjust their pricing for other patients to cover the losses.
- Tax codes will be simplified because out of pocket expenses will be standardized. There will be a cap on annual out of pocket costs and, therefore, there will be no healthcare exemption in the tax code. While this can be viewed as regressive, these same people will be paying a lower amount of money into the system and will receive a benefit that is a larger percentage of their income as a benefit.
What is not to like about this plan?
Conservatives may not like the idea of providing healthcare to every citizen and claim that it is creating a huge new bureaucracy, like Hillarycare, but it doesn't. It relies on public-private partnerships to manage healthcare, much like using Halliburton to provide meals to soldiers in Iraq. It is also much like their voucher system for schools, it provides insurance choice.
Insurance companies may not like the lack of ability to increase prices at their discretion, but, Halliburton and the other defense contractors don't seem to have issue with guvmint contracts.
Businesses may strenuously object to having a set cost for employee insurance coverage, but they should love the leg-up given to small businesses.
Healthcare providers are sure to object to collecting from every patient, NOT!!!
Frameshop time: How do we frame this and get people on board?
What do we call something like this?
Is this even a worthwhile idea coming from the grassroots?
Am I wasting my time here?
I think that a dKos is a place where ideas like this can be discussed, numbers added (I know there are a lot of smart people out there) and a real plan put together and passed on to people like Dean, Kerry, Pelosi, Reid, and Boxer.
I look forward to your comments and suggestions.
As always, recommendations are appreciated.