Medical Saving Accounts for all Insurance Products for all Patients

Stanley Feld M.D.,FACP,MACE

If we as a society do not become innovative about healthcare delivery, medical care in this country will deteriorate.

The Medical Savings Accounts described in the last posting can be utilized as a motivational tool for patients. A true Consumer Driven System can have a positive impact on cost and quality. I hope to demonstrate that total cost will decrease and quality of care will increase.

With 46.7 million people uninsured, America has a problem. I estimate that 30 million people can afford to pay the true cost of a high deductible insurance. The cost of insurance to an individual not in a group plan is not tax deductible. The group plans are tax deductible to the employer.

A simple change in the tax law would correct this. Additionally, if an individual has a preexisting illness, presently the insurance industry can elect to refuse offering a policy, rate the premium or exclude that illness from the insurance offered. The insurance industry can not do that in a group plan. If they have a group with many patients at risk they can try to raise the premium.

The insurance premium for individuals should be the same as corporate rates. The insurance rates should be transparent in order to shop for rates. The rates should also be calculated as a community rate rather than as and individual rate. A fifty year old male with hypertension, high cholesterol and moderate obesity is at increased risk for a myocardial infarction and the need for chronic cardiac care. In the present system he would be refused an individual insurance policy. If he could get one any care related to his heart disease would be excluded.

A simple regulation mandating community rating would correct the problem of discriminatory rates and ratings. In the Medical Saving Account System, the 55 year old patient would be guaranteed a high deductible policy which could be purchased with after tax dollars.

The system could be set up so that patient could apply and receive state or federal subsidy. This simple change could cure our Medicaid problem. The Medicaid system presently spends more per patient than it would cost the government using an effective Medical Savings Account system. The Medical Saving Account system would also encourage patient compliance. The patient would not longer be a burden to the state because costs could decrease.

The key is motivating the patient to be responsible for his care. He would be in control of purchasing his care and to adhering to the care recommended. There have been many pilot programs rewarding expectant mothers on Medicaid. If the mothers participated and fulfilled their obligations for prenatal care, the fetal and post partum complication rates fell dramatically. The neonatal and post partum care costs plummeted. The reward of some pilots was simply free formula for the first year of the infant’s life.

Consumer driven responsibility for one’s medical care is an invigorating concept to patients long abused by a hierarchical bureaucratic power seeking healthcare system. The power should be given back to the consumer.

One can see how the system could work in Medicare patients. The government subsidizes the insurance of people over 65 years old. Constantly, the government must raise the insurance premium the elderly pay. Ninety percent of Medicare’s payments are for the complication of the chronic diseases. If the system were set up to reward the elderly for effective self management of their chronic disease many unnecessary costly complications could be avoided. The patients could be motivated by the money accumulating in their Medical Saving Account. Since they are retired they could use the unused trust money as a supplement to their Social Security. More on the mechanism of the various plans in the future.

Will it work? Absolutely!!

We will see “Patient Power” in action when Wal-Mart rolls out the $4 per month for generic drugs nation wide. The elderly will force their physicians to order generic drugs. The CVS and Walgreen will also be forced to decrease the cost of their generic drugs. The Medicare Part D fiasco will evaporate. There will be no need for Medicare D. It will be cheaper to buy the medication from Wal-Mart. The price of brand name medication will decrease because of the price competition. Adherence to medication regimes will increase because patients can once again afford their medication.