Health-care in 3,200 Words or Less

The Democrats still have the upper hand. If they don’t support a bill it can’t pass, but their total control over the legislative process has been broken by the election of a Republican senator from Massachusetts. So those we elect to represent us now have a choice. What we have had for the last year was World Wide Wrestling. Now it is time for chess. My question is, are the Democrats and Republicans going to play politics or statesmanship?

Both parties acknowledge we need health-care reform. There is a legitimate issue as to whether now is the time to pursue it. We have an unprecedented budget deficit, severe unemployment and a shaky economic recovery to deal with. All three of which are arguably more urgent than health-care reform, unless you don’t have health insurance and are or become sick. On the other hand, health-care is on everybody’s mind now. This may be the time to pass a reasonable plan to improve the health-care environment. But are the members of either party willing to set aside extreme positions and pass something reasonable, at the risk of giving the other party a partial victory? I have a few suggestions.

First of all, there needs to be some kind of tort reform. Between malpractice insurance premiums and the need, whether perceived or real, to practice defensive medicine, the cost of litigation drives up the cost of health-care. Actual damages certainly need to be covered, but there ought to be a limit on punitive damages.

Drop the barriers to cross-state purchasing of medical insurance. Let the money flow to where the best coverage, services and prices are. The market will reward those who do well and punish those who don’t.

Make all health insurance premiums tax deductible to the payer of those premiums.

Make it illegal for an insurance company to drop somebody for other than non-payment of premiums, or to deny coverage.

People need help in paying for medical care, but if they are responsible for the cost of care, they will make better health-care decisions. Therefore, make it easier for anybody to buy a high deductible health insurance policy in conjunction with a Health Savings Account (HSA). For those below a certain income level have the government make an annual deposit into their Health Savings Account equal to the premiums plus a portion of the annual deductible. As their income increases above a certain threshold phase out the government paid deposit into their HSA at the rate of $1 lost for every $4 earned over the threshold. Mandate that health-care providers accept payments at low or no interest from patients below some specified income level. These provisions will address the adverse selection problem posed by the mandate to take all comers, as well as eliminate the need to force people to buy insurance that is in the current bill.

Allow insurance companies a reasonable and generous profit, but require that they pay out a certain percentage of revenue in benefits in order to participate in the cross-state sale of their products.

Get rid of the absurd taxes that have been proposed on health-care devices and insurance plans. If you want to hold the cost of something down, you need to lower the cost, not increase it.

There you go. In less than 3,200 words I have just written a comprehensive health-care plan that addresses cost and availability. It does not put the government in the health-care business and it does not gut a system that has produced many of the greatest advances in health-care anywhere in the world. I don’t know what the cost of this would be. It is possible that it could not be implemented until we get the economy rolling better, but it is a whole lot better than what has been proposed to date.