How a Layman Would Fix Health Care in the US

I have been thinking about this a lot lately. The Left talks about health insurance as a basic human right and they make anyone who opposes universal coverage out to be a rotten, selfish bastard. As I have stated, if health care is a basic human right, then food, shelter and sex should be provided to each according to his need, as well.

This posting will stipulate that everyone needs access to health care whether they can afford it or not and whether they have helped pay for it or not. My own feelings on personal responsibility have been made well known. I do not like paying for slackers and moochers. Having said that, there are millions in the US who want to work and either cannot find work or the work that they do have does not provide any sort of health insurance. These people need some sort of protection. As for the moochers, they always seem to find a way.
I am not a professional journalist or researcher, so my facts and figures should be taken with a grain of salt, but I believe that they are pretty accurate. Let me know if I have made a mistake, but don't hate me...
First, let's look at what health care the US Government provides. We have US Military hospitals, VA hospitals, Public Health Service hospitals, TriCare (for military retirees), health care through the Bureau of Indian Affairs, Federal Prison System, Medicare, Medicaid, SCHIP, plus various insurance provided for retirees of the federal government. I am sure I left some out, but it is an extensive list.

I propose that the government consolidate and create a network of first tier health providers throughout the United States. These medical centers, from basic urgent care facilities to full-sized hospitals, would be run by the government. It is already done with the military, VA and PHS centers. Any person with a valid US ID card (including Green Cards since they legitimately pay taxes) would be able to get health care there.

This first tier system would be based on the Wal-Mart model. Except where Wal-Mart is expressly excluded (like Vermont), their stores are within driving distance of just about every American. In fact, if I were in charge, I would contract with Wal-Mart to install a First Tier Urgent Care Center (UCC) in every store in the US.

The biggest complaint I hear from the chronic complainers (is that a treatable disease?) is that because the poor do not have the money to take care of minor issues, the minor issues can escalate to become major problems. For instance, if one of them got a nasty cut on their leg, they would not get treatment until the cut became infected and they would have to get their leg amputated. These ubiquitous UCCs would eliminate this problem (or at least eliminate the excuse.)

"Oh, but we don't have enough doctors to go around" will be the next refrain. Well, let's take a page from the military playbook. If someone wants to go into the medical profession and is willing to commit to a certain number of years working for the public health system, they can get free medical training (doctor, nurse, practitioner). Once their time has been "served", they become free agents and can move on to other fields, or remain within the system.

Medical staff would be paid a commensurate wage for their position. Doctors and nurses would be paid lower in their early years if they are still working off their commitment, but would have their wages increased once they become paid in. Their pay rate would be equivalent to private staff positions. Unions would not be allowed to organize these professionals for pay purposes, but could organize for other collective bargaining issues. Strikes would be explicitly ILLEGAL.

Everyone on government "assistance" medical benefits would have to go to the First Tier system to get care. I say government "assistance" because there are people (military retirees, federal retirees, etc.) who have earned full medical benefits and these benefits will be realized through the Second Tier.

By now, you will have realized that I am proposing a two tier system. Anyone that proposes a single tier system where a street bum get the same health care as Warren Buffet or Bill Gates is delusional. Inasmuch as WIC and EBT provides basic food vs. five star restaurant fare, First Tier health care would be sufficient, if not concierge-level, medicine. You wanted medical care for all, well, there you go...

Those that have worked their whole life and paid into a benefit plan, or have purchased supplemental insurance will have the opportunity to benefit from "traditional" health care. Doctors and hospitals are constantly complaining about being forced to lose money on Medicare/Medicaid patients or on those that wander into the ER looking for basic or emergency care. This problem would go away. For-profit medical offices and hospitals can now focus on providing better care for their paying customers. True emergencies would be handled and then transferred over to a 1T facility after stabilization.

If we do away with for-profit health providers, our overall quality of care will crater. Drug companies as well as medical equipment manufacturers will lose any incentive to innovate. For-profit, private insurance-funded health care will continue to push the envelope to find new methods and new cures. Public-supported health care will strive to get by on budgets that are never quite enough.

Can you think of anything in government, besides military and aerospace research, that innovates? Government's default position is the opposite of innovation. Its position is to retain the status quo because that is where the money and patronage is. Look at how the Postal Service wants to reorganize and re-engineer, but is stymied by politicians. Look at the reticence toward killing ethanol subsidies when it is a truly horrible policy. Look at how difficult it is to remove harmful tax policies. Look at the FBI's or the FAA's multi-decade attempt to modernize their computer systems. It is just a simple human fact, if you are spending someone else's money, there is little stewardship of it.

Many on the left accuse conservatives of hating government. It isn't that we hate government, we just hate the leviathan that it becomes. When Obama says that he will cut bureaucracy and red tape in order to assist New Jersey and New York in the aftermath of Hurricane Sandy, he tacitly admits that business-as-usual government policies hamper progress and the only way to be efficient is to cut it all out. Same with tax policy. The way that government induces desired behavior is by removing standard policies and procedures. The default is to impede progress via "sand in the gearbox".
It is actually amusing that liberals now call themselves progressives. Perhaps the only progressivity they desire is in removing taboos toward normative social behavior, but I digress.
If we construct a two tier health system (as if we don't already have one), how will it work? Well, obviously, we cannot expect the First Tier (1T) system to have sophisticated, cutting edge facilities. If 1T patients need Second Tier (2T) facilities, the government will have to decide if it will fund the services and then it will have to contract with the 2T facility to provide them just like any other contract work. If this sounds like rationing, well... it is. You cannot have unlimited benefits on a limited budget. If we were to convert the whole health system into a single tier, egalitarian system, then the standard and quality will trend toward the lowest level, not the highest (see public schools.)

So, how do we pay for this and what about employer-funded insurance? Good question. The devil is always in the details isn't it? Many on the left blame the inability of Medicare to sustain itself on the greed of the medical system. By having the government directly run the 1T system, these problems should vanish, right? I don't really believe that will happen, but I think that by the 1T system providing the 95% solution for most needs, the costs can actually be kept low because the paperwork requirement of supporting huge numbers of insurance plans and compliance will be eliminated.

A single, nationwide computer system should be implemented to administer this system. (The Urgent Care facility that I often use, has a very simple, yet comprehensive text-based computer system that handles my history, my records, my billing and my prescriptions, along with printing out the doctor's recommendations. It doesn't have to be difficult...) Standard procedures, like a franchiser would require of a franchisee can guide the activities of the centers. Heck, put someone like Michael Gerber (of E-Myth fame) in charge of administration.

Standard employer-provided insurance could be phased out.To replace it would be a law allowing the deduction of medical insurance payments from your taxes. Employers could continue to provide this money, pre-tax, but the employee would not be tied to whatever plan the employer chose. The new form of health insurance would become a supplemental plan. If someone had a supplemental plan, and they chose to go to a 2T facility, the amount of money that would have gone to the 1T system would be applied to the 2T facility with the balance provided by the supplemental insurance company. What this would do is relieve a LOT of pressure from the 1T system and the amount provided by the government would be nominal.
I wouldn't even object to some means-testing at the upper end as long as the payroll taxes to pay for this system would top out like FICA currently does.
These supplemental policies could address such things as doctor's office visits, hospital visits, major medical, etc. The individual would decide how much of the 2T system they want to plan on using. If they are content with going to the Wal-Mart UCC for sniffles, cuts and scrapes, they can buy a policy that allows them to go to 2T for more serious problems. This would truly put the consumer in the driver's seat and if the consumer doesn't want to bother with it, then he/she doesn't purchase supplemental insurance. It is that easy.

Pre-existing conditions would be written out of the system. During the period of time between our current screwed up system and my Grand Plan, the government would just have to suck it up and pay for these maladies. They ain't going away... In the total universe of our vast health care system, pre-existings are not that big of a problem anyway if everyone is in the system.

What if you are on a supplemental plan (SP) and you lose your job? You go back onto the 1T system. Once you can afford to begin paying for your SP, you regain the benefits, but you will have a one year wait for any major issues. This will keep people from gaming the system without throwing everyone under the bus. Dental plans routinely do this when it comes to orthodontics and crowns.

Did I leave anything out? I am sure I did. I am not smart enough to figure out how much this thing would cost. In fact, I don't think anyone is. Maybe we could look at Canada, Australia, or other countries as a guide, but I think we have a lot of uniqueness that would come into play with this system in the US. Having said that, if the system was run like McDonalds or Wal-Mart, I think we could get a huge bang for the buck. We could impede doctor-shopping for drugs, use economies of scale, implement universal electronic medical records, track down or red-line people that are not eligible, etc.

What about the states??? Where do they fit in this whole picture? Well... that is a sticky wicket. Even though this plan is extra-constitutional (in other words, it really is not allowed by the Constitution), the states would have little to do with it except for contributing on a per-capita basis like they do with Medicare. Perhaps the more progressive states could layer additional services onto the base federal services. Services such as abortion on demand, addiction counseling, dental, cosmetic surgery, etc. If you like high taxes and want to provide face lifts to ugly people, then move to California. If you want to just stay well and have normal medical care (and low taxes) move to Texas.

Whatever is done will not satisfy everyone. Our current medical insurance system is a train wreck. As much as I dislike Obamacare, I can certainly see why it was desired. By decoupling insurance from the employer, it becomes a lot more accountable to individual purchasers. This can only be a good thing.

I look forward to your comments. Just keep them civil.


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