Nothing in the world is free, but we’re being told that a lot of expensive health care will be, thanks to ObamaCare. Why would anyone think that this time, government interference will result in anything different?
The savings talked about in this article aren’t an option for anyone eligible for Medicare, because few doctors and virtually no surgical facilities are willing to take their cash since any “provider” who enters into these cash-pay contracts must “opt out” of Medicare for two years.
Jeffrey Singer writes about the benefits of self-pay medicine and the hazards of involving a third party in the Wall Street Journal:
This process taught us a few things. First, most people these days don’t have health “insurance.” They have prepaid health plans. They pay premiums to take advantage of a pre-negotiated fee schedule arranged for and administered by a third party. My patient, on the other hand, had insurance.
Second, even with the markdown for upfront “cash-pay” patients, none of the providers was losing money on my patient. Otherwise they wouldn’t have agreed to the prices. With the third-party payer taken out of the picture, we got a better idea of the market prices for the services. It is the third-party payment system that interferes with true price competition, so “market clearing prices” can’t develop.
Take the examples of Lasik eye surgery or cosmetic surgery. These services are not covered by insurance. Providers compete on the basis of quality, outcomes and price. And prices have continually dropped as quality and services have improved—unlike the rest of health care.
When my patient returned for his post-op visit we discussed the experience. It was clear to both of us that the only way to make health care more affordable is to diminish the role of third-party payers. Let consumers and providers interact through market forces to drive down prices and drive up quality, like we do when we buy groceries, clothing, cars, computers, etc. Drop the focus on prepaid health plans and return to the days of real health insurance—that covers major, unforeseen events, leaving the everyday expenses to the consumer—just like auto and homeowners’ insurance.
A little history: Before I went to Medical school, my husband and I felt lucky to have major medical insurance, to cover hospital bills and some procedures. We paid cash for office visits – less than we pay for co-pays now. My first childbirth wasn’t covered by insurance, but we paid less than $1000, including the hospital and the $300 to the doc. Twenty years ago, I received $1100 (Medicaid) to $1800 (Insurance) for pregnancy and delivery Obstetrical care and the hospital charged about the same. Today, the total is $20,000 or more. (In Texas, 55% of those babies are paid for by you, the taxpayer, through Medicaid.)
While some people think our National problems began back when employers first started offering insurance, at least that was insurance and medical costs remained fairly stable until the late 1960’s. The real problems began when Medicare allowed Congress to collect taxes with a promise of a (hospital, Part A) safety net for those over 65, but spent all the money by “loaning” it to the general budget. From the beginning, Medicare inflated costs by encouraging doctors to raise their fees 10% a year. Private health care costs followed or leaped ahead.
Less than 10 years later, the Democrat Congress invented HMO’s in a failed attempt to control costs – but they still didn’t stop spending Medicare and Social Security dollars. A few years later, there was the very mistaken attempt to limit training to cut the numbers of doctors. The Hill-Burton Act, Stark laws, HIPPA, and on and on, further increased the actual costs, the hassle factors, and government ownership of medical care, while promising more by adding outpatient and drug coverage. Bill Clinton’s Attorney General Janet Reno not only armed Donna Shalala’s Health and Human Services Inspectors, she threatened to prosecute Medicare-eligible patients for contracting private pay agreements with their doctors. She and Shalala held “fraud rallies” in football stadiums with the Director of the FBI, to teach Medicare patients how to turn in their doctors for fraud.
If there is to be a government “solution” (short of getting out of the way), future laws should support innovations like “Direct Primary Care” combined with patient-owned major medical *insurance,* rather than pre-paid health care. For those who truly need help, give tax credits similar to the child credit or even the earned income credit.