In reading these comments I keep thinking that much of what is proposed is already here, in principle, and that is in the form of HSA compatible plans.
Each insured has access to an annual preventive care exam / Dr. visit ( here in California) with little or no cost to the insured. When health care is needed the insured has up-front costs in the form of a annual deductible (chosen from the many levels offered in the marketplace)with annual out-of-pocket costs limited to a fixed amount. There are plans that provide 100% coverage once the deductible has been met, including Rx costs.
This type of insurance brings the end consumer back into the equation and they decide how frequently they access care. In the case of a catastrophic medical need they are provided the level of care needed without the fear of “breaking the bank” financially.
If we are concerned about lower income folks being able to access this type of coverage then let’s offer a voucher or, a “health stamps” to aid these folks and provide them with access to affordable care too.
If it is simplicity we are looking for while addressing universal access to care at affordable rates, this to me fits the bill.
Coupled with this concept would be a health education campaign to provide all citizens with valuable information to make informed well reasoned decisions about their lifestyles, and the ability to take responsibility for their lifestyle decisions.

BUT I also like the (my) idea of getting rid of health insurance period (I believe health insurance contributes GREATLY to the COST of HEALTH CARE as well as lack of responsibility for one’s health – one’s lifestyle choices): Let the payment-for-service return to the laps of the PROVIDER and the PATIENT. Patients will shop for VALUE; competition amongst all care givers will increase (including non-Western care). This will drive costs down to where they belong. Catastrophic health care delivery costs will follow.

More to think about, but it’s worth considering.

I have been proposing the below-described health plan to our country ( USA ) for several years but it doesn’t seem to be getting much traction. Maybe you will see more merit in it and can use some of the ideas.

Health delivery plans have deductibles which discourage many patients from seeking medical advice. After the deductible is met, many patients “want the works,” demanding many additional tests, medications, treatments and surgeries, even though they might be (and frequently are) inappropriate, costly, and dangerous.

A solution is to make a certain amount of money available to everyone depending on one’s wealth . This is similar to Safeway’s plan touted by their CEO Steve Burd. He calls it “skin in the game.” He gets it.

Then patients will not hesitate to seek the initial medical advice or care. After that, the patient will need to pay a graduated percentage (from 0 to 100%, again depending on their wealth) of the cost for tests, medications, treatments, surgeries or return visits. The result: patients will not hesitate to get the initial medical opinion (low or no cost to the patient), but they will aggressively question the need for any tests, medications, treatments, etc. (significant cost to the patient). Only then will the patient have an incentive to limit costs.

A second, necessary, major part of a workable plan is to require doctors to limit the tests, medications, treatments and surgeries to a list of the most likely diagnoses arranged in a decreasing order of probability as offered by my computer-assisted diagnosis program http://www.computeassistdiagnosis.blogspot.com (or a better program if you can ever find a better one). Without such a list, doctors tend to order costly, some dangerous, and some unnecessary tests and treatments. For example, too many doctors order a CAT scan of the head for headaches, even though it is rarely needed to make the correct diagnosis. Head CATs cost around $2000.00. Multiply that by the millions of patients having headaches. If the doctor or patient wants to pursue diagnoses not on the list, the doctor can be required to seek authorization; or the patient can pay more for the extras.

Some advantages of this plan are:

* Proceeding quickly to the CORRECT DIAGNOSIS.

* The doctor is easily, objectively, and accurately held accountable for his recommendations.

* Decreasing the morbidity/mortality by millions of patients and cutting the cost of medical care by billions of dollars.

* Fewer tests lead to fewer false positive tests. False positive tests contribute to: missing the correct diagnosis, more testing, additional incorrect diagnoses, incorrect treatment, more illness, and more expense.

* Because medications frequently cause side effects (illness), they are usually high on the list. Consequently fewer medications will be prescribed which results in less illness and billions of dollars saved.

* Many private, federal and state plans already in effect can easily incorporate these features. And they have the actuarial expertise to produce an array of new, similar plans.

Those doctors who supplement their income with unnecessary tests, medications, treatments and surgeries will undoubtedly complain; but they have no legitimate argument. The other doctors will probably become more efficient, have increased incomes, and have more time to relax and enjoy their practice.

THIS COUNTRY CAN PROVIDE MEDICAL COVERAGE FOR EVERYONE, for the all-important first medical visit. Payment for tests, medications, treatments and surgeries after the initial money allotment is depleted, can be obtained by buying a plan proportional to their wants, their needs and their ability to pay. (There should be a whole array of plans, from the basic, minimum, inexpensive coverage to the maximum and consequently expensive coverage.) For example, elderly patients might not want to pay for a plan that covers organ transplants, open heart surgery, extensive chemotherapy or irradiation.

Therefore, utilizing tailored health insurance, HEALTH INSURANCE IS AVAILABLE AND AFFORDABLE TO EVERYONE.

KEY WORDS:

1. No deductibles

2. Graduated percentage of cost

3. Lists

David E. Wade, MD

466 S. Goodlet

Memphis, Tennessee 38117

In my opinion, we don’t want products that continue to pay most of the costs, for that simply perpetuates needless health care usage and inflation.
The way to drive down costs is to reduce demand, by providing fewer covered dollars, not more.

It might be interesting to see how costs plummet, once people demonstrate their inability to pay without a lot of subsidies, whether on the front end with lower premiums or deductibles, or on the back end, with less insurance.
Don Levit

I think you are completely confused. The government pays the premiums. The income of the person only determines the deductable. So a poor person only has a lower deductable. He doesn’t care what the premium is, since the government pays that.

The government can afford this because deductables would be so high. A person with an annual income of 100,000 would have a deductable of $15,000. How much does health insurance cost with an annual deductable of that amount? I bet not much.

Of course, when the person gets sick, their income would fall and the deductable would fall and the cost to the government would go up. But I assume the economist proposing this has put some thought into that.

So are you confused or am I?

James

Interstingly, these are the same problems I hinted at in my previous post on short term uninsurance.

Offering subsidies for insurance which is too costly does nothing to resolve the problem. In fact, insurance under this scenario exacerbates the problem.

We must offer 2 benefits in health insurance, which are currently not available for the public.
1. A defined contribution plan, in which coverage varies by contributions paid, less claims made.
2. The ability to lower premiums, or even skip premiums, without the entire plan being wiped out.
Don Levit

Plus, welfare-optimizing pricing is determined by the marginal consumer and the marginal supplier. I think it more likely to approximate this result with a flat, hard-dollar, refundable tax credit than 15% of income as deductible. First, it allows the market to determine how much should be out of pocket and how much insurance. Imagine two people undergoing the same treatment under the 15% rule: The high-income person pays for 10 courses of treatment before hitting his deductible, but the low-income person hits it after two courses of treatment. One consumer is clearly facing a bad incentive!