Poyhonen's Blog

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Posts Tagged ‘subsidized health care system

Health Care and the Government

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Not approving Ryan Care was a narrow escape from an increasingly intrusive government that seems bent on controlling every aspect of American lives.

Most people would prefer to see a doctor when they have an illness or physical complaint. They would not willingly take a sick child to an insurance outlet or government building unless they had no choice. (Imagine taking a feverish baby to the DMV for treatment). Yet when you enter the doctor’s office and notice all the busy people that greet you from behind a desk – what do you think they are doing? They are filling out forms and documenting your access to insurance companies and government agencies who dictate the cost of your visit and the care you are entitled to receive.

Countries having high levels of subsidized health care, France and Italy are good examples; require that everyone pay into the government health fund. In America we all pay 1.45% of income, (hiked by an employer tax of an additional 1.45%), into our Medicare system but only people getting Social Security get the benefits. In 2015 the American Hospital Insurance Trust Fund garnered 275 Billion in taxes and spent 646 billion in services for only 15% of the population, (according to AARP).

So the illustration here is that we already have a universal insurance system that is paid into by every worker but the benefits are only distributed to retired people and the outlays for this insurance scheme exceed the inputs by about 371 billion dollars a year. The numbers get MUCH worse as they are analyzed to include every citizen.

Consider, for a moment, what insurance is supposed to provide. Health insurance is supposed to pay for the professional services, equipment, and drugs provided by licensed physicians and hospitals. In order to Control prices and services the government and insurance companies create rules, regulations, and make an effort at price fixing procedures. They require immense databases to achieve these goals and you can appreciate the health code designation of being bitten by a duck as just another line item under their scrutiny. If you think that is a bit complicated, there is another entry for walking into a lamp post. Too much? How about the designation of having walked into a lamp post for the second time?

Clearly we have too many ducks, lamp posts, and regulatory constrictions that are meant to control costs but inadvertently end up controlling lives and behavior.

Since the insurance is supposed to pay for professionals – take a look at what we could do with the 275 billion collected every year:

Give every licensed physician $100,000 …. .90 billion per year.

Give every registered nurse $30,000 ……… 90 billion per year.

Give every hospital $17 million………….…95 billion per year.

I just ran out of Medicare funds at 275 billion but our government spends over 646 billion on Medicare and adds another 546 billion with Medicaid, (2015 numbers). Where does this money come from? The general fund supplies the extra largess – – in case anyone is noticing our country currently has 20 Trillion in debt.

Well what if we doubled the tax rate for Medicare and now garnered an extra 275 billion for:

$75,000 for every licensed Nurse Practitioner…..…..8.3 billion per year.

$45,000 for every Physician Assistant………………3.2 billion per year.

Drug subsidies………………………………….….263 billion per year.

There – everyone in the USA would now be covered to some extent and to receive the subsidies all the accepting parties would have to do is not turn away any citizen from medical services. The government would no longer be in an insurance business where they have proven to be incredibly inept. The Government involvement would be relegated to a disbursement of collected funds to health professionals. The savings in paperwork, regulating, and oversight would actually save about 30% over current medical costs dictated by insurance. If the extra taxes are too big a burden consider paying the extra 275 billion from the general fund while still reducing the overhead by over half a trillion dollars per year.

Nothing is free, however, and the amounts mentioned will still not cover the total expenses. An average doctor’s earnings are about 160,000 per year and how will they make an income – not to mention the pay of specialists who spent years in getting certified?

Co-pays.

Let doctors, hospitals, drug venders, and specialists charge whatever they desire in the form of co-pays. Some doctors in Kansas are charging $50.00 per month for adults and $10.00 a month for children to cover all medical services and they negotiate a discount of over 80% for drugs used by members who pay the monthly service fee. (Only 100 patients would be needed to add 60,000 per year but facilities and staff are still an expense that requires income). Catastrophic insurance can be purchased to cover the large co-pays that may be demanded for major medical services like cancer treatments, transplants, significant surgeries, expensive drugs, or continuing services like dialysis.

In the future, one might see catastrophic health insurance ‘bundled’ with car and home insurance plans. Medicare, Medicaid, and Obamacare would be gone. Only the Medicare tax would remain. Paperwork would be an addition to the IRS tax form.

There is more the government could do of course – Allow health employees, doctors, assistants, etc. to pay minimal or no taxes for example. Tax free health saving accounts and catastrophic insurance sales across state lines could be allowed and perhaps, someday, be offered by employers that allow employees to carry the account privately or onward to new employers.

And what about the poor people who get sick but have no job, pay no taxes, and have no catastrophic health insurance? The poor will always be with us – that is why we paid the doctors up front. No citizen will be denied service by those who promise first to do no harm.

This style of funding should also spur an interest in more people willing to become doctors which are currently predicted to be 90,000 short by 2025.

Concrete and predictable medical costs have proven to be elusive when payments are made by governments and insurance companies. If someone else is paying – the billing is of little consequence to the patient. In this subsidized system, transparent costs would allow patients to seek the best service at the lowest co-pay. No two hospitals charge alike and most patients only get solid costs after services have been rendered.

No one would like to take a car to a mechanic, who never provides an accurate estimate of charges unless they knew someone else was paying, (insurance company). Fortunately, mechanic mistakes can be expensive but are not usually life threatening. Medical services, conversely, are given very little latitude where judgments fail to achieve desired results. Complex problems are weighed in terms of outcome and risks to the patient vs. costs, profits and risks to the insurance providers. Health providers do make mistakes but such errors are often the product of being human where, in the end, we all return to the manufacturer.

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