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Health Savings Accounts vs Medical Savings Accounts

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Listen Up: It Is All About Personal Responsibility

Stanley Feld M.D.,FACP,MACE

In my last blog I continued my War on Obesity. I started this war in 2007.

There has been little progress in this war because of cultural conditioning and a lack of emphasis on personal responsibility.

Every New Year’s Day millions of Americans make New Year resolutions to lose weight. They are initially successful. They then regain the weight they have lost.

If America is going to solve the healthcare systems unsustainable cost, it is going to have to solve the increasing Obesity problem.

The National Institute of Diabetes (niddk.nih} recently published Overweight and Obesity statistics:

  “More than two-thirds (68.8 percent) of adults are considered to be overweight or obese.”

 “ More than one-third (35.7 percent) of adults are considered to be obese.”

 “ More than 1 in 20 (6.3 percent) have extreme obesity.”

 “ Almost 3 in 4 men (74 percent) are considered to be overweight or obese.”

Each year the obesity problem gets worse. Companies have sprung up selling weight loss formulas. These companies advertise their great success.

However, most of the iconic personalities used in their advertising have regained their weight after experiencing mild or significant weight loss.

This study was conducted by the National Center for Health Statistics of the Centers for Disease Control and Prevention.

NHANES III was designed to provide nationally representative data to estimate the prevalence of major diseases, nutritional disorders, and potential risk factors.

  • Sixty-three percent of men and 55% of women had a body mass index of 25 kg/m2 or greater.

 

  • A graded increase in the prevalence ratio (PR) was observed with increasing severity of overweight and obesity for all of the health outcomes except for coronary heart disease in men and high blood cholesterol level in both men and women.

 

  • With normal-weight individuals as the reference, for individuals with BMIs of at least 40 kg/m2 and who were younger than 55 years, PRs were highest for type 2 diabetes for men (PR, 18.1; 95% confidence interval [CI], 6.7-46.8)

 

  • Women (PR, 12.9; 95% CI, 5.7-28.1]

 

  •  Gallbladder disease for men (PR, 21.1; 95% CI, 4.1-84.2) and women (PR, 5.2; 95% CI, 2.9-8.9).

 

  • Prevalence ratios generally were greater in younger than in older adults.

 

  • The prevalence of having 2 or more health conditions increased with weight status category across all racial and ethnic subgroups.

 

The Prevalence Ratio of Obesity and Type 2 Diabetes is 18.1 for men and 12.9 for women.

Therefore Type 2 Diabetes is very prevalent in both Obese and Overweight men and women.

 

  • Up to 75% of adults with diabetes also have hypertension, and patients with hypertension alone often show evidence of insulin resistance.
  • Hypertension and diabetes are common, intertwined conditions that share a significant overlap in underlying risk factors (including ethnicity, familial, dyslipidemia, and lifestyle determinants) and complications.
  • These complications include microvascular and macrovascular disorders. The macrovascular complications, which are well recognized in patients with longstanding diabetes or hypertension, include coronary artery disease, myocardial infarction, stroke, congestive heart failure, and peripheral vascular disease.
  • Although microvascular complications (retinopathy, nephropathy, and neuropathy) are conventionally linked to hyperglycemia, studies have shown that hypertension constitutes an important risk factor, especially for nephropathy.

Eighty percent of the treatment costs for diabetes and hypertension to the healthcare system is the result of the treatment of the complications of hypertension and diabetes.

In order for a healthcare system to be sustainable diabetes and hypertension must be cured. It is essential that each must be recognized early and treated aggressively.

Patients must be taught to be “the professor of their disease” so they can self-manage the control of their disease. Blood pressures and blood sugar are changing continuously. Patients live with their disease 24/7.

This takes a lot of personal responsibility and personal discipline.

Equally important is the morbidity resulting from the complications of diabetes and hypertension, two diseases that result from obesity.

Complications from the onset of both hypertension and diabetes take about eight years to develop. This is the reason to diagnose and discover Pre-Diabetes at the onset.

  • The shared lifestyle factors in the etiology of hypertension and diabetes provide ample opportunity for non-pharmacological intervention.
  • Thus, the initial approach to the management of both diabetes and hypertension must emphasize weight control, physical activity, and dietary modification.

Lifestyle intervention is remarkably effective in the primary prevention of diabetes and hypertension. These principles also are pertinent to the prevention of downstream macrovascular complications of the two disorders.

This is the where my story of the importance of personal responsibility comes in.

A restaurateur, in his early 50’s, who runs a large restaurant in Dallas, that I frequent, was slowly gaining weight. At 269 lbs. he had difficulty standing on his feet all day long. He was being treated for hypertension and hyperlipidemia (high cholesterol).

His physician told him he must lose weight. He informed him of his risk factors for the complications of these diseases.

This was all he needed hear. The thought of having to quit the job he loved and the possibility of dying from the complications of his diseases was enough to make him decide to loss the weight.

He was told he would be fine if he lost the weight.

He has lost 70 lbs.so far without assistence. He has decided to be personally responsible for his weight loss.

He now gets up at 5 am each morning and exercises for one hour each day before work.

He has stopped eating his wonderful pasta dishes. He eats nothing that is white.

Every time I meet a friend at the restaurant, the restaurateur sits down at our table for a chat. We usually talk about how great he is doing in the weight loss department.

I had initiated an obesity program at Endocrine Associates of Dallas P.A. in the mid 1980s. A California clinical endocrinologist, with whom I did my endocrine fellowship with, had a very successful obesity program. He convinced me to start one at EAD.

Patients on large doses of insulin were totally off insulin after two weeks. It was successful until the patients graduated from the program.

Unfortunately the recidivism rate (regaining weight) was around 80%. This rate was not dissimilar to the national overage at the time.

EAD stopped the program.

In my view there were not enough patients who turned the corner and stuck to the program.

I believe the restaurateur has turned the corner. This fellow has turned the personal responsibility corner to control his food intake and exercise output. I do not believe he will regain his weight.

He has exhibited personal responsibility for his health and well-being.

If only physicians could solve the obesity problem so easily, the cost of healthcare would plummet to sustainable levels.

The development of Type 2 Diabetes Mellitus would also plummet and the cost of the treatment of its complications would vanish.

Social change is necessary in restaurants and fast food chains.

People have to be taught to eat wisely in restaurants and at home.

People have to be provided with education about the perils of obesity.

People have to understand the natural history of obesity.

People have to be motivated to not only maintain their health. They have to be given financial incentives to control their health.

This can only be achieved with a consumer driven healthcare system in which people are provided with incentives to control their healthcare dollars.

My ideal medical savings account will provide all the appropriate incentives for all people of all economic levels.

The opinions expressed in the blog “Repairing The Healthcare System” is, mine and mine alone.

All Rights Reserved © 2006 – 2017 “Repairing The Healthcare System” Stanley Feld M.D.,FACP,MACE

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Dear President–elect Trump Part 4

Stanley Feld M.D.,FACP, MACE

In 2008 I thought President Obama was the real deal.

I thought he cared about Americans and cared about repairing the healthcare system. I wrote six letters to him giving him suggestions on how to repair the healthcare system.

Then, I realized he was not interested in the improved delivery of healthcare to all Americans. He was interested in the central government controlling the healthcare system in order to control the people and limit their freedoms.

Obamacare was the answer to his goal. Most physicians did not agree with his plan. Many felt powerless to object. Many felt they should go along to get along.

Many in the healthcare industry figured that greater government involvement in healthcare financing would lead to its economic benefit.

Everyone has been deceived. Everyone is starting to believe that government managed healthcare leading to a better healthcare for all and a better healthcare system is a myth.

In my letters I tried to explain this to President-elect Obama. My explanation fell on deaf ears.

Dear President Obama Part 1

http://stanleyfeldmdmace.typepad.com/repairing_the_healthcare_/2008/11/dear-president-elect-obama.html

Dear President Obama Part 2

http://stanleyfeldmdmace.typepad.com/repairing_the_healthcare_/2008/11/dear-president-elect-obama-part-2.html

Dear President Obama Part 3

http://stanleyfeldmdmace.typepad.com/repairing_the_healthcare_/2008/11/dear-president-elect-obama-part-3.html

Dear President Obama Part 4

http://stanleyfeldmdmace.typepad.com/repairing_the_healthcare_/2008/12/dear-president-elect-obama-part-4.html

Dear President Obama Part 5

http://stanleyfeldmdmace.typepad.com/repairing_the_healthcare_/2008/12/dear-president–elect-barack-obama-part-5.html

Dear President Obama Part 6

http://stanleyfeldmdmace.typepad.com/repairing_the_healthcare_/2008/12/dear-president-elect-obama-part-6-why-dont-you-listen-to-practicing-physicians.html

Over the last seven and a half years I have developed a simple but effective consumer driven healthcare system that should replace Obamacare after it is repealed.

Obamacare is missing the major ingredient necessary to create creating a successful healthcare system.

The healthcare system must be market driven, with consumers being responsible for their healthcare and healthcare dollars. The tool that will accomplish this is my Ideal Medical Saving Account. Please include reading the article  My Ideal Medical Savings Account Is Democratic! among all the articles in the group explaining My Ideal Medical Savings Accounts.

The Republicans in the House got many things right in its legislation to replace Obamacare. However they have left out the three most important elements necessary to Repair the Healthcare System.

The first is the revival of the physician/patients relationship.

Consumers must control their health and their healthcare dollars. America must have a consumer driven healthcare system.

Consumers can be taught to drive the healthcare system though public service education.

Consumers must be taught through public service education to change their eating and exercising habits. The emphasis must be on the health dangers of obesity and its development.

Secondly, consumers must be given financial incentives as outlined by my Ideal Medical Savings Accounts to control their own health and have access to available care available in necessary.

Third, there must be significant tort reform included in the replacement of Obamacare.

If the Republicans simply send you the bill they have passed in the house and you sign it you will have an impending disaster as large as Obamacare.

If you include my suggestions in your bill, you would excite consumers and physicians. All the people who have been hurt by the failures of Obamacare will cheer you.

The repeal of Obamacare is vital. It should only be replaced with a consumer driven healthcare system that I have outlined. It will be economically sustainable. It would win over all conservatives and independents. It would even make progressives rethink their ideology.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.

 All Rights Reserved © 2006 – 2016 “Repairing The Healthcare System” Stanley Feld M.D.,FACP,MACE

  • Naina Katyal

    Really impressed! Everything is very open and very clear clarification of issues. It contains truly facts. Your website is very valuable.
    Desi chhokri kurtis

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Dear President-elect Trump Part 3

Stanley Feld M.D.,FACP, MACE

The following is Part 3 of my review of your healthcare reform platform. You have a viable alternative to Obamacare. Your alternative needs some vital additions.

In my last blog I omitted the link proving that only 1 million people signed up for Obamacare health insurance exchanges.

I apologize for the oversight. Today enrollment is only 2.3 million. I also noticed that the enrollment date was extended to January 30 from December 31 without fanfare. The site I omitted that follows daily enrollment is acasignups.net.

Obamacare is still a long way from the 20 million claimed and the actual 10 million enrolled for 12 months.

The Obama “experts” still believe that Obamacare is viable. They refuse to believe it has been a healthcare disaster as well as a disaster for America’s economy.

Your next proposal is;

  1. Allow individuals to use Health Savings Accounts (HSAs). Contributions into HSAs should be tax-free and should be allowed to accumulate.

Health Savings Accounts (HSAs) should be changed to Medical Savings Accounts (MSAs) to provide better financial incentives for people who choose this form of insurance. The Medical Savings Accounts can easily be customized so that consumers can choose the level of insurance they desire.

The cost of first dollar reinsurance for coverage after the deductible is met plus the MSA contribution is much cheaper than the first dollar coverage Medicaid coverage. The insurance vendor will still make a sizable profit by providing first dollar coverage reinsurance.

The contribution to the MSA should be flexible to provide an adequate amount of money to be put into the savings accounts to provide financial incentivizes to consumers to maintain their health.

Obesity is a huge problem to health maintenance of health. Obesity can be effectively cured behavioral change of consumers.

The incidence of chronic diseases in obese people is five times that of normal weight people. Financial incentives must be provided. The is also the area that social engineering might be helpful.

Obese children are becoming diabetic and hypertensive at a young age. This must be prevented because of the potential explosive cost effect of complications of both diabetes and hypertension on individuals. The overall costs to patients, Medicaid and society will be devastating.

Medicaid must be converted to a system where the recipients are responsible for their health with financial incentives. Only then Medicaid patients will not be treated as a commodity. Service will improve. .

  1. Require price transparency from all healthcare providers, especially doctors and healthcare organizations like clinics and hospitals.

Price transparency is an essential provision for individuals, businesses and groups in order to produce smart consumers of healthcare.

It is also necessary to require insurance companies to provide verifiable price transparency for their administrative costs and their direct patient care costs.

Consumers must be empowered to be responsible and shop for the best healthcare service value. They must look for the best prices for procedures, exams or any other medical related procedure.

The only way to decrease the cost of healthcare services is to produce smart and motivated consumers of healthcare.

The Healthcare System must be converted to a Consumer Driven Healthcare System.

Social networking should be used as the backbone for the establishment of consumer empowerment.

The success of Angie’s list, Trip Advisor and Open Table are a result of social networking.

All medical care is local. Local communities have their individual social networks that empower people in their neighborhood to know which vendors provide the best value in their community.

Healthcare consumers can use this simple procedure to decrease the cost of healthcare and medical care.

This could also be a place where government can lead the way in establishing accurate educational resources.

  1. Block-grant Medicaid to the states.

These block grants can be used by the states to fund MSAs without a threat of increasing state budget deficits or giving up states’ rights to the federal government.

Block grants for social networking should be used to provide incentives to help individual Medicaid patients seek out and eliminate fraud, waste and abuse of some of its local providers.

It would eliminate expensive big data collections that often times are inaccurate for policy making by central federal control.

  1. Remove barriers to entry into free markets for drug providers that offer safe, reliable and cheaper products.

Federal and state governments should help their citizens choose safe, reliable and cheaper products for the treatment of their diseases.

This would help with compliance and adherence to recommended treatment and also decrease the cost of care.

It would provide consumers with information to take responsibility for their own health and healthcare dollars.

  1. Encourage Congress to step away from the special interests and do what is right for America.

One example is allowing consumers access to imported, safe and dependable drugs from overseas. It will stimulate competition for consumer dollars in the U.S. and lower the cost of brand and generic drugs sold here. Drug prices are artificially high in the U.S.

This is only one example of many ways to decrease the cost of drugs in this country.

You have made many proposals to make a lot of important changes to the healthcare system.

Some are good proposals. Some are not very well thought out by your advisors.

You left out Tort Reform, which is one of the most important proposals. Effective Tort Reform will result in a precipitous decrease in the cost of medical care.

It is absurd to let Obamacare “experts” like Ezekiel Emanuel and Jonathan Gruber heckle your “non viable” healthcare reform plan.

However, you are missing the other important elements in reforming the healthcare system. Those elements are the elements of the use of consumer power, consumer initiatives, and consumer incentives.

 By utilizing these elements you will begin to “Drain the Healthcare Swamp.”

Your healthcare changes must include a consumer driven system with an ideal medical saving account. Otherwise, the healthcare system will remain an unmanageable, expensive and abused mess.

You have admitted these proposals are simply a start. You can easily fall into the trap of listening to academicians who have never practiced medicine in a private setting. You need people who understand patients’ needs.

Obamacare has been a disaster that is unsustainable. It is increasing the cost of care week by week, while rationing care and decreasing access to care.

You must repeal and replace Obamacare. No one wants it. You have outlined a viable proposal even if the progressives don’t like it.

It is a good start.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.

 All Rights Reserved © 2006 – 2016 “Repairing The Healthcare System” Stanley Feld M.D.,FACP,MACE

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Dear President-elect Trump Part 3

 

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Donald Trump on Healthcare Reform

Stanley Feld M.D. FACP, MACE

Donald Trump’s healthcare proposals are totally different from Hillary Clinton’s. His proposals are a step in the right direction to Repair the Healthcare System.

His advisors tried to create a market based healthcare system. However, they have omitted the most important elements necessary to align all the stakeholders’ incentives.

Unfortunately, their approach is the usual healthcare policy wonks market based policy approach. They do not focus on the most important stakeholder in the healthcare system.

The consumer is the most important stakeholder in the healthcare system. The consumer should be the driver of the healthcare system.

A market based system should:

  1. Promote of consumer driven healthcare system.
  2. Promote consumers’ responsibility for their health and healthcare dollars.
  3. Promote the physician/patient relationships.
  4. Promote a respect for consumers’ intelligence. Consumers can judge what is best for their healthcare needs.
  5. Promotion of accurate education about a consumers’ disease and provide resources to help consumers make the best choices to treat their diseases and use their and healthcare dollars.

Donald Trump’s web site starts by pointing out the defects in Obamacare. The Obama administration and Hillary Clinton’s spin machine uses the traditional media to promote the erroneous concept that all that is needed to fix Obamacare’s small defects are small modifications and more money.

This is a wild fantasy. The real goal is to completely control the healthcare system.

Donald Trump’s web site starts by declaring that Obamacare must be repealed.

Since March of 2010, the American people have had to suffer under the incredible economic burden of the Affordable Care Act—(Obamacare.”

The average Americans are starting to understand Obamacare economic burden on the economy in general and them individually

“ The Affordable Care Act, (Obamacare), legislation, passed by totally partisan votes in the House and Senate and signed into law by the most divisive and partisan President in American history must be repealed.”

President Obama and majorities in the House and Senate tightly controlled the debate in congress and the traditional media.

Nancy Pelosi said it all when she said “you will not know what is in Obamacare until it has passed.”

“Obamacare has tragically but predictably resulted in runaway costs.”

The runaway costs for the government and individuals were the result of:

“Websites that don’t work, greater rationing of care, higher premiums, less competition and fewer choices.”

Obamacare has raised the economic uncertainty of every single person residing in this country.”

This has resulted from the 10 hidden taxes, along the inhibiting effect on the economy and the uncertainty of the potential mandates, that resulted in and from job losses.

As it appears Obamacare is certain to collapse of its own weight, the damage done by the Democrats and President Obama, and abetted by the Supreme Court, will be difficult to repair unless the next President and a Republican congress lead the effort to bring much-needed free market reforms to the healthcare industry.”

Donald Trump concludes that Obamacare cannot be fixed. It must be repealed.

“But none of these positive reforms can be accomplished without Obamacare repeal. On day one of the Trump Administration, we will ask Congress to immediately deliver a full repeal of Obamacare.”

Donald Trump recognizes that simply repealing Obamacare will not fix the healthcare system.

He also recognizes that he must work with Congress to have a series of reforms ready for implementation.

“We will work with Congress to make sure we have a series of reforms ready for implementation that follow free market principles and that will restore economic freedom and certainty to everyone in this country.”

It is refreshing to know that a potential president is willing to work with congress rather than issue executive orders and see if he can get away with them.

“By following free market principles and working together to create sound public policy that will broaden healthcare access, make healthcare more affordable and improve the quality of the care available to all Americans.

Any reform effort must begin with Congress.”

Donald Trump says;

Several reforms will be offered that should be considered by Congress so that on the first day of the Trump Administration, we can start the process of restoring faith in government and economic liberty to the people.

This is the correct process according to the constitution.

It is imperative that Republicans maintain their majorities in the House and Senate in order for Donald Trump to lead legislation to repeal and replace Obamacare.

The following are the suggestions a Trump administration will offer the congress according to his website.

  1. Completely repeal Obamacare.                                                         
  2.  Our elected representatives must eliminate the individual mandate (tax according to the Supreme Court). No person should be required to buy insurance unless he or she wants to.
  3. Modify existing law that inhibits the sale of health insurance across state lines.

Donald Trump assumes eliminating state line restrictions will allow full competition in the healthcare insurance market place. He assumes insurance premium costs will go down and consumer satisfaction will go up. The healthcare insurance companies will try to keep the insurance premiums equally high in all states.

It can only work if consumers can buy insurance they believe they need. Costs of unnecessary insurance should not be piled into one insurance plan fits all. i.e. A post menopausal woman does not need to pay a birth control premium.

4. Allow individuals to fully deduct health insurance premium payments from their tax returns under the current tax system.

Individuals should be allowed to take the same tax deductions as group insurance plans are allowed.

     5. We must review basic options for Medicaid and work with states to ensure that those who want healthcare coverage can have it.

This is where Donald Trump’s proposal weakens. The Medicaid program must be modified. Medicaid recipients should be incorporated into my ideal Medical Saving Account program. The government should act as the funding agent for the eligible poor.

This will put the poor on the same payment footing as everyone else.

The Medicaid eligible poor should be given financial incentives to take charge of their health and healthcare dollars.

Our healthcare system must be moved from a system that fixes you when you are sick or broken into a system that rewards people financially for remaining healthy and controlling their healthcare spending.

It is much cheaper to avoid the cost of emergency care than it is to get sick and have to go to the emergency room.

         6. Allow individuals to use Health Savings Accounts (HSAs). Contributions into HSAs should be tax-free and should be allowed to accumulate.

Health Savings Accounts (HSAs) should be changed to Medical Savings Accounts (MSAs) to provide better financial incentives for people who choose this form of insurance. The Medical Savings Accounts can easily be customized so that consumers can choose the level of insurance they desire.

The contribution to the MSA can be flexible to provide adequate amounts of money to be put into the savings accounts to incentivize consumers to remain healthy.

Obesity is a huge program that must be consumer driven. Obesity must be cure by the patient and his family, not surgery.

Obese children are becoming diabetic and also hypertensive at a young age. This must be stopped because of the potential explosive effect of complications of both diabetes and hypertension on individual and overall costs of medical care.

      7. Require price transparency from all healthcare providers, especially doctors and healthcare organizations like clinics and hospitals.

Price transparency is an essential provision for individuals, businesses and groups. It provides leverage for consumers to be responsible for their healthcare dollars. It is also necessary to require insurance companies to provide verifiable price transparency for their administrative costs and their direct patient care costs

Consumers must be empowered to be responsible and shop for the most value and best prices for procedures, exams or any other medical related procedure.

This is the way to decrease the cost of healthcare services and medical care services.

Social networking should be used as the backbone for the establishment of consumer empowerment.

The success of Angie’s list, Trip Advisor and Open Table are a result of social networking. Local communities have their individual social networks that empower people in their neighborhood to know which vendors provide the best value in their community.

This simple step can be used to decrease the cost of healthcare and medical care.

This could be a place where government can lead the way in establishing this accurate educational resources.

       8. Block-grant Medicaid to the states.

These block grants can be used by the states to fund MSAs without a threat of increasing state budget deficits or giving states rights to the control of the federal government.

Block grants for social networking should be used to provide incentives to help individuals to seek out and eliminate fraud, waste and abuse of some of its local providers. It would eliminate expensive big data collections that many times are inaccurate in decision making by central federal control.

       9. Remove barriers to entry into free markets for drug providers that offer safe, reliable and cheaper products.

Federal and state governments should help its citizen choose safe, reliable and cheaper products for the treatment of their diseases.

It would help with compliance and adherence to recommended treatment and decrease the cost of care.

It would promote consumers taking responsibility for their own health and healthcare dollars.

     10.  Congressss will need the courage to step away from the special interests and do what is right for America.

One example is allowing consumers access to imported, safe and dependable drugs from overseas. It will provide more options to consumers. This is only one example of many that ways to decrease the cost of drugs in this country.

Donald Trump is proposing a lot of important changes.

However, he is missing the important element of consumer power, consumer initiative, and consumer incentives.

His healthcare changes must include a consumer driven system with an ideal medical saving account otherwise the healthcare system will remain an unmanageable, expensive and abused mess.

Donald Trump admits this is simply a start. His start is much more powerful than Hillary Clinton’s proposal to continue and build on Obamacare.

Obamacare has been a disaster that is unsustainable. It is weekly increasing the cost of care while rationing care and decreasing access to care.

 

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.

 All Rights Reserved © 2006 – 2015 “Repairing The Healthcare System” Stanley Feld M.D.,FACP,MACE

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Obamacare Is Increasing Health Savings Account Participation

Stanley Feld M.D.,FACP,MACE

Patients’ responsibility for their health and their healthcare dollars is one of the most important elements in a functioning and cost effective healthcare system.

Despite the fact that my ideal medical savings account (MSAs) would be more effective than health savings accounts (HSAs) in encouraging patient responsibility for their health and healthcare dollars, health savings accounts are flourishing because of Obamacare is costly and has taken freedom of choice away from individuals.

Devenir is a HSA Mutual Fund that accepts and invests HSA trust contributions and invests those contributions. Devenir just published a study that showed that:

1. As of June 30, 2015, the number of HSAs had climbed 23% from the previous year to 14.5 million.”

  “2. Account balances jumped 25% to approximately $28.4 billion over the same time period.”

In 2010 the year Obamacare was passed, there were 5.7 million HSAs with balances totaling $7.7 billion.

The Obamacare bronze plan is the least expensive federal health insurance exchange plan. Its coverage is poor and it has a high deductible that most people cannot afford.

The premium and deductible are only good for patients with pre-existing illnesses that have no other place to purchase insurance. That is the reason the demographic for enrollees from healthcare.gov is so poor.

The government is loosening the noose on HSAs even though it is still restrictive.

“For the 2016 tax year, you can make a deductible HSA contribution of as much as $3,350 if you have qualifying high-deductible self-only coverage or as much as $6,750 if you have qualifying high-deductible family coverage. If you are age 55 or older as of the end of 2016, the maximum deductible contribution goes up by $1,000.

For 2015, the contribution caps are the same, except the maximum deductible contribution for family coverage is $6,650. These amounts are increased by $1,000 if you were 55 or older as of December 31, 2015. You have until April 18, 2016, to make an HSA contribution for the 2015 tax year.”

You must have a qualifying high-deductible health insurance policy — and no other general health coverage — to be eligible for this HSA contribution privilege. For 2015 and 2016, a high-deductible policy is defined as one with a deductible of at least $1,300 for self-only coverage or $2,600 for family coverage.

For 2016, qualifying high-deductible policies can have out-of-pocket maximums of as much as $6,550 for self-only coverage and $13,100 for family coverage. For 2015, these amounts are $6,450 and $12,900, respectively.

If you are eligible to make an HSA contribution for a tax year, the deadline is April 15 of the following year (adjusted for weekends and holidays) to open an account and make a contribution for the earlier year.”

The government has increased the maximum deductible in 2015 and continues to increase in 2016.

For the 2016 tax year, you can make a deductible HSA contribution of as much as $3,350 if you have qualifying high-deductible self-only coverage or as much as $6,750 if you have qualifying high-deductible family coverage.

“ If you are age 55 or older as of the end of 2016, the maximum deductible contribution goes up by $1,000.”

More large companies are Increasingly offering workers high deductible health saving account. However, the employee is responsible for the high deductible and most of the plans are 70/30 coverage after the deductible is reached up to a maximum of $10,000.

Most large and small employers can afford to pay all or some of the high deductible and buy reinsurance for first dollar coverage beyond the deductible.

Both large employers and small employers are offering their employees health savings accounts. The full insurance premiums have become so high that employers are shifting the burden to employees by having the employee pay the deductible and the employer paying the reinsurance.

UnitedHealth has about 40 individual high deductible plans with 70/30 copays over the limit of the deductible. The maximum out of pocket cost is $10,000. The premium for a young married couple without kids is from $125 to $350 per month depending oo the deductible chosen. The premium increases with the number of children.

A great advantage to these plans now is that UnitedHealth has already negotiated the physicians’ and hospitals’ fees for you. The uninsured would pay retail price for the same services.

The cost to small to large companies is relatively difficult to find in an online search.

Most companies are self-insured and would not fall under the rigid coverage rules of Obamacare. The company can decide on the amount of the deductible they would pay for the employee.

The point of all this is health saving accounts are not as good as my ideal medical saving account. HSA’s do not provide enough incentive for employees or individuals to manage their health or healthcare dollars wisely as an MSA would.

A large defect in Obamacare is patients do not have incentive to be wise shoppers of their healthcare. They have restricted choice. They have little incentive to stay healthy because they have an entitlement program available that will take care of their expenses. There is no financial incentive for them to try and reduce the cost of healthcare.

If the consumers managed their health and healthcare dollars well the cost of healthcare would drop because the complications of chronic diseases would decrease to at least 50%.

If Republicans are looking for an alternative plan to the liberals’ and progressives’ inevitable march to a singe party payer system most of the infrastructure is already in place.

Only small modifications to the HSAs have to be made by the congress and the President and America would be on its way to a free market healthcare system.

This alternative healthcare system would align all of the stakeholders incentives including the government’s incentives, if the Obama administration did not want to increase its power by having more control over its people and its people’s freedom of choice.

My ideal Medical Saving Accounts would be democratic and cover everyone.

 The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.

 All Rights Reserved © 2006 – 2015 “Repairing The Healthcare System” Stanley Feld M.D.,FACP,MACE

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Simple, Viable Republican Alternatives To Obamacare

Stanley Feld M.D., FACP, MACE

There are many simple and viable alternatives to Obamacare which Republicans should start considering.

Republicans should seriously consider My Ideal Medical Savings Account as an alterative to Obamacare. It is logical, simple, does not require a large complicated infrastructure and aligns all the stakeholders’ incentives.

It is easy for consumers to understand.

Consumers want to have choices. The dysfunction of our healthcare system has gotten to the point where most consumers don’t have a choice. Consumers simply do not know they lost their freedom of choice and access to care until they get sick.

Consumers think they have adequate healthcare coverage until they get sick. Only 20% of the population gets sick.

The other 80% of the population refuses to think about the problem.

When they do experience illness, the dysfunction in the healthcare system makes them furious. They want to blame someone. Physicians are usually the targets of their frustration.  

Most physicians are trapped in a situation that causes them to fight for their own survival for all the reasons I have previously enumerated. This creates a more dysfunctional healthcare system.

All the stakeholders fight for their own vested interests. These vested interests have become misaligned. The vested interest of the government is to control of the system and decrease its costs.  

Costs cannot be controlled by regulations without consumer involvement.   Consumers of healthcare must understand the effectiveness of their care is dependent on their involvement in their own medical care.

Consumers’ adherence to treatment is a key component in the effectiveness of medical care.

Medical costs cannot be controlled by government price fixing.

Medical costs cannot be controlled by government restrictions to access of care. Consumers will become sicker resulting in a higher cost illness.

Consumers must be empowered to be intelligent, motivated and responsible consumers of medical care. Only then can healthcare costs be controlled.

A functional healthcare system must provide financial incentives to consumers in order for them to want to be empowered to control costs. Consumers should not be dependent on the government to control costs.

The government must repair the actuary and accounting rules of the healthcare insurance industry. Insurance reserves should not be scored as a loss to justify premium increases.

The healthcare insurance industry takes 40 cents off the top of every insurance dollar that is spent. Consumers with both private insurance and government insurance are only getting 60 cents value for every healthcare dollar spent. The healthcare industry is allowed to do some strange accounting with their required reserves.

If this accounting method were repaired, premium costs would decrease.

Effective malpractice reform would result in a significant decrease in healthcare costs. The Obama administration refuses to believe tort reform is needed.  

Many of the rules written into Obamacare, Medicare, and Medicaid are so screwy they defy common sense and penalize consumers. One glaring rule is Medicare permitting hospitals to admit Medicare patients to the hospital for observation for 48 hours.

Medicare does not pay for Observation admissions. Patients have to pay out of pocket for these admissions.

Consumers must become aware of these screwy rules and protest them. These rules have been written by the Obama administration to save the government money. These rules penalize patients the government professes to help.

Consumers are the only stakeholders that can motivate President Obama and congress to fix the significant points of waste in the healthcare system. Consumers have the power to vote.

I do not believe that President Obama has an interest in repairing the healthcare system. All of his actions signify that he wants the healthcare system to fail. After it fails people will beg the government to completely take over and have a single party payer.

Does anyone trust the government to take over our most valuable asset, our healthcare?

The government take over will also fail because dependent consumers will figure out how to game the system just as food stamp recipient have figured out how to game that inefficient system.

The goal of a sincere administration and congress is to figure out how to motivate consumers to be “PROSUMERS” (productive consumer) with an economic interest in the healthcare system.

Airlines, banks, bookstores, entertainment venues have all figured it out. Why can’t the government help consumers figure it out?

My blog entitled “My Ideal Medical Saving Account Is Democratic” presents a consumer driven healthcare formula. It gives every socioeconomic group the opportunity to be an effective “Prosumer”.

It gives all Prosumers the incentive to be responsible for their health and healthcare dollars.

Below is the blog My Ideal Medical Savings Account Is Democratic!

My Ideal Medical Savings Account Is Democratic!

Stanley Feld M.D.,FACP,MACE

A reader sent this comment; “My Ideal Medical Savings Account (MSA) “was not democratic and leads to restriction of medical care for the less fortunate.'

This comment is totally incorrect. I suspect the comment came from a person who has “an entitlements are good mentality.”

I believe that incentives are good. They lead to innovation. Innovation leads to better ideas.

Healthcare entitlement leads to ever increasing costs, stagnation, restrict freedom of choice and decrease in access to care.

The excellent example of increasing costs, decreasing choice, and decreasing access to care is Medicaid.

The fact that someone is covered by healthcare coverage does not mean they have access to medical care.

 I have written extensively about the virtues of My Ideal Medical Savings Accounts (MSAs). They are different than Health Savings Accounts (HSAs).

HSAs put money not spent in a trust for future healthcare expenses. MSAs take the money out of play for healthcare expenses. MSAs provide a trust fund for the consumer’s retirement.

MSAs provide added incentives over HSAs to obtain and maintain good health.  Obesity is a major factor in the onset of chronic diseases. Consumers must be motivated to avoid obesity to maintain good health. MSAs can provide that incentive.

The MSA’s can replace every form of health insurance at a reduced cost. It limits the risk to the healthcare insurance industry while providing consumers with choice.

This would result in competition among healthcare providers. Competition would bring down the cost of healthcare.

Some people might not like MSA’s because they are liberating. They provide consumers of healthcare with freedom of choice. They also give consumers the opportunity to be responsible for their healthcare dollars while providing them with incentives to take care of their health.

MSAs could be used for private insurance purchasers, group insurance plans, employer self- insurance plans, State Funded self-insurance plans and Medicare and Medicaid.

In each case the funding source is different. The cost of the high deductible insurance is low because the risk is low. 

If it were a $6,000 deductible MSA, the first $6,000 would be placed in a trust for the consumer. Whatever they did not spend would go into a retirement trust.  If they spent over $6,000 they would receive first dollar healthcare insurance coverage. Their trust would obviously receive no money that year.

The incentive would be for consumers to take care of their health so they do not get sick and end up in an expensive emergency room.

If a person had a chronic illness such as asthma, Diabetes Mellitus, or heart disease with a tendency to congestive heart failure and ended up in the emergency room they would use up their $6,000.

If they took care of themselves by spending $3,000 of their $6,000 trust their funding source could afford to give their trust a $1500 reward. The benefit to the funding source is it saved money by the consumer not being admitted to the hospital. The patient stayed healthy and was more productive.

President Obama does not want to try this out. He wants consumers and businesses to be dependent of the central government for everything.

MSAs would lead to consumer independence from central government control of our healthcare. MSAs would put all consumers at whatever socioeconomic level in charge of their own destiny.

The opinions expressed in the blog “Repairing The Healthcare System” is, mine and mine alone

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Republicans who really want to repair the healthcare system should take notice of these suggestions. They should stop proposing complicated alternatives to Obamacare that will not work.

Republicans should start trying to understand the real problems in the healthcare system.

The opinions expressed in the blog “Repairing The Healthcare System” is, mine and mine alone

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I Gave President Obama An Alternative To Obamacare

Stanley Feld M.D.,FACP, MACE

I formulated an alternative to Obamacare in 2006, long before Obamacare existed.  President Obama has ignored a plan that will work and align every stakeholder’s incentive.

Obamacare is failing because President Obama does not know who the customer is in the healthcare system. He is blinded by ideology and the belief that government knows what consumers need.

The consumer is the customer. Without consumers of medical care and physicians to provide medical care we would not need a healthcare system.

Consumers and physicians are the primary stakeholders. All the others are secondary stakeholders.

However, physicians receive between 15-20% of the healthcare dollars. Hospitals receive 25% of the healthcare dollars.

Where does the remaining 60% of the healthcare dollars go?

The insurance industry takes at least 40% off the top. The pharmaceutical industry receives 10% and the government wastes 10%.

It is a pity that only 40% of our healthcare dollars is spent on direct medical care. There is much waste and inefficiency built into that direct medical care.

 There is also much waste included in the 60% the secondary stakeholder take off the top.

How else would UnitedHealth’s CEO get paid $1.8 billion dollars in cash and stock options from 1998 to 2006? 

 The excessive insurance industry profits are the direct result of ineffective regulatory agencies controlling insurance pricing.

In 2006 consumer power was demonstrated when UnitedHealth tried to decrease reimbursement to Hospital Corporations of America. HCA protested and threated to quit participation in United Health. Consumer protests followed.

UnitedHealth was the main insurance carrier in the Denver Area. Consumers threated to boycott buying insurance from UnitedHealth. UnitedHealth backed off.

The HCA/United pushback is the first big step. It represents how “Patient Power” should work. Patients should be madder than hell and not want to take it any more.”

In 2006, many of the uninsured were self employed consumers who cannot qualify for insurance because they have a preexisting illness or they are at risk for illness.

The insurance companies refused to sell them insurance. The same consumer in a group insurance plan by law would receive insurance from the same insurance company that turned down the individual.

A self-employed individual can only buy insurance with after tax dollars. A corporate employee receives healthcare insurance coverage with pre-tax dollars.

The same applies for the individual insurance market post Obamacare.

The price of insurance is very high for small businesses. The small business owners do not have the negotiating power of the large corporations.

This results in both the individual and small business not being covered by healthcare insurance. All of the above can be easily fixed.

The problem with Obamacare is the insurance premiums are higher than they were pre- Obamacare. The reasons are obvious.

The only winner is the individual who makes a low enough income to receive a federal subsidy. The loser is the taxpayer.

Obamacare also creates a perverse incentive resulting in people not striving to get ahead.  

In 2006 I wrote:

  
Patients drive the healthcare system. Patients have tremendous power. They must be taught to use that power in order to Repair the Healthcare System.

Patients must use their  “Patient Power” to take control of their healthcare dollars and their health. They should be provided with financial incentives to save the money they spend on medical care.

Neither the healthcare insurance industry nor the government should determine the consumers’ access to care. Patients’ freedom of choice and self- responsibility is the key to Repairing the Healthcare System.

If there are financial incentives consumers will learn to become informed consumers of healthcare. Reliable education must be provided to give consumers the opportunity to become informed consumers.

There are preconditions.

 Prices must be transparent so consumers know what they are buying. The insurance industry should negotiate the price with the physicians and the hospitals. The industry can remain the surrogate broker for the payment of money belonging to the consumer. Consumers’ who overspend will not receive the financial incentive. They will lose their medical saving account money. Patients who have an expensive illness, like diabetes, can be rewarded for spending money if they keep themselves in good health and prevent complications of disease.

The consumers are then the responsible party purchasing their medical care. It is not the healthcare insurance industry or the government.

The healthcare insurance industry or any financial industry with an adequate computer system can be the administrator and adjudicator of payment.

Medicare director Mark McClellan M.D. said that 90% of the healthcare dollar of a specific disease (Diabetes) is spent on the complications of disease. If we reduce the complications of a disease we could save at least 45% of the current healthcare expenditure for that disease.

Obamacare gives this vital fact lip service. It puts the responsibility of outcomes on physicians’ shoulders. If physicians have poor outcomes they get penalized.

The medical outcome is a dual responsibility of both consumers and physicians. Consumers should be made aware of physicians’ outcomes. Some of the poor outcomes are the result of consumers not taking the responsibility to learn about their disease, prevent the complications of their disease, or comply with the treatment recommended. The result is a poor outcome.

Consumer overspending is another important aspect of increasing healthcare costs. Consumers do not have incentive to be cautious with their healthcare dollars because they have been given first dollar coverage. They do not have financial incentives to save money on medical care.

Consumer overspending was best described by Victor Fuchs an economist from Stanford.

He made the case for a Consumer Driven Health Care System.

The Health Saving Accounts that congress has approved in my opinion is impotent. It does not provide a strong enough financial incentive for consumers to want to save money.

The trust account of $1,000 per year is too low to motivate consumers to become wise shoppers. A Medical Savings Account of $6,000 per year begins to represent financial motivation.

 HSA’s represent the same false hope HMO’s and managed care represented in the 1980’s and 1990’s.

 Dr. Fuchs calls it “The Restaurant Check Problem.”

“You go out to a restaurant with a bunch of friends and you sort of understand that you will split the check,” he said.

 “The waiter comes along and says, ‘the lobster looks very good, and how about a soufflé for dessert?’

The restaurant check balloons, but you are not so careful because you figure everyone is splitting it.

“That’s the way medical care gets paid for,” he said.

 Dr. Fuchs added, “We want to spend our money on the things that will bring the most value for the dollar.

When we are spending collective money as we are in health care, then it becomes much more difficult.”

We want Diabetics to spend money for good medical care in order to prevent complications. Prevention of complications will keep Diabetics out of the hospital and out of the emergency room. The result will be a decrease in medical costs.

The consumer driven healthcare plans can be set up to give provide Diabetic consumer the financial motivation to take care of himself. This reward is much cheaper than paying for a hospitalization or emergency room visit.

 If an insurance product is overloaded with salaries, waste, overhead and unnecessary benefits patients will not buy the product.

The insurance product would have to be modified. It would become more cost efficient.

Patients have it in their power to remove the waste and inefficiency in the system.

Some very clever entrepreneur will realize the consumer is the customer. He will develop an insurance product that everyone wants. State governments have the power to encourage development of this product.

The examples in industry in America are numerous. Sam Walton revolutionized retailing in America with Wal-Mart and Sam’s. Michael Dell almost brought IBM to its knees and revolutionized the distribution of information technology.

 My goal is to describe the necessary components of a healthcare insurance product that does not offer another and false hope.

I hope to show the way to develop an insurance product that can work for patients first and then all the other stakeholders.

There is no reason we cannot provide excellent affordable insurance coverage to all including the corporate employed, the small business employed, the self employed, the unemployed, and the Medicare covered seniors, with all the stakeholders making a reasonable profit in a simplified system.

President Obama, I have provided a viable alternative long before you became President.

I also provided this alternative to you when you became President in the letters I wrote to you.

For you to say no one has come up with a better alternative than Obamacare is disingenuous on your part.

I hope you are listening now.

 The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.

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President Obama – Do Something That Could Work!

Stanley Feld M.D.,FACP,MACE

The solution to repairing the healthcare system is simple. The
healthcare system must be consumer driven. If consumers were in control of their
healthcare dollars and were responsible for their health and their healthcare
choices the cost of the healthcare system would decrease to manageable levels.

My ideal Medical Savings Account puts the consumer in charge. Its
success is totally dependent on real transparency by all stakeholders including
healthcare insurance companies, hospital systems and physicians. 

A Health Savings Account does not give consumers enough of an
incentive
to shop for price and quality with the present lack of transparency.
In a transparent healthcare system Medical Saving Accounts would provide more
incentive than Health Savings Accounts.  

Presently President Obama is trying to eliminate Health Savings
Accounts. HSAs are the single greatest threat to his goal for a single party
payer system. They are also the fastest growing healthcare insurance product.

The lack of transparency for hospitals, healthcare insurance
companies, drug companies and physicians must be eliminated. The public must
demand that the healthcare insurance industry make their expenses transparent
so that its exorbitant salaries and profits can be clearly understood.   

There is no reason that this one stakeholder receives 40% of
every premium dollar
spent either by private corporations or the government.
The medical loss ratio as it is presently constructed by the Obama
administration provides 20% for expenses. The other 20% of the $40% is in the
direct patient care column.

The government should help consumers understand these prices and
understand the measurement of quality. Consumers of healthcare must be turned
into Prosumers of healthcare (Productive Consumers.)

When this happens the consumers can become independent
intelligent consumers. Consumers will become independent of government and its
bureaucracy.

The Obama administration wants consumers to be more dependent on
government not less dependent.

Intelligent independent Consumers will force the other
stakeholders to be competitive. Competition will drive healthcare costs down.

Government cost controls will not drive prices down. They will
simply distort prices and cause more spending.

Private sources such as Angie’s list help consumers decide on
which plumber to hire. It is important and creates competition and price
lowering. However the defect in Angie’s list is that it is based on other
consumers’ opinions.

It is not based on specific costs or origins of the cost to the
plumber or the measurement of the plumber’s skill. It only deals with price and
consumer satisfaction. Angie’s list does make plumbers competitive.

Competition for consumers will bring down the cost of healthcare.
 By forcing consolidation of doctors and
hospitals Obamacare will decrease competition and increase prices.

 Healthcare
policy wonks dismiss this concept because they believe consumers are not smart
enough or interested enough in learning to be intelligent healthcare consumers.
They are wrong.

Their thnking is correct if a system exists where consumers are
spending other people’s money. Obamacare is such a system. It will drive costs
up just as the private first dollar coverage system has driven healthcare
prices up.

There is no financial incentive for healthcare consumers to try
to save money and preserve their health.

Obamacare is a huge entitlement with an overwhelming budget that
will be impossible to execute. We have seen that to be true with ever increasing
waivers and the most recent delay in the mandate until 2015.  There will be delays in other critical
portions of Obamacare in the near future. It could be delayed forever because
it cannot be executed.

In my last blog I forgot to mention the delay in forming and
activating the Independent Physician Advisory Board.

Last year I wrote about the Obama administration’s infatuation
with the Canadian Healthcare System. I reviewed the 2011 Fraser report
explaining that the Canadian Healthcare System is unsustainable.


I also wrote about Canadian consumers’ healthcare experiences in
two provinces I visited.  The fact is the
system doesn’t work well and is unsustainable.

The Fraser Institute in a
2011 report concluded that Canada’s health care
system is spending money at an unsustainable rate
. Six of ten Canadian
provinces are on track to spend half of their revenues on health care,
according to the institute.

“In 2011, health care
spending consumed 50 percent of revenues in Canada’s two largest provinces,
Ontario and Quebec.

By 2017, four more
provinces — Saskatchewan, Alberta, British Columbia and New Brunswick — will
spend half of their revenues on health care, according to the institute.

Total federal, provincial
and territorial government health spending has grown by 8.1 percent annually.
Canada’s GDP increased by 6.7 percent during the same period. The math is
obvious. The Canadian healthcare entitlement system is not working.

“In response to the rapidly
rising costs, provincial governments have raised taxes and rationed care,
increasing patient wait times. Provincial drug plans have also more often refused
to pay for most of the drugs that are certified as “safe and effective” by
Health Canada.

“Unsustainable rates of
growth in health care spending crowd out the resources available for other
purposes including education, public safety, and economic growth-enhancing tax
relief,” Fraser Institute Senior Fellow Nadeem Esmail told The Daily Caller
News Foundation in an email.”

Only 20% of the people utilize the healthcare system at any on
time. If consumers know they are entitled to healthcare and the healthcare
system will fix them if they get sick, consumers of healthcare feel protected. The
feelings of eighty percent of consumers who are not sick believe the system is
great until they have to interact with the system. In this system of
entitlement consumers have a tendency to not take care of their health.  This makes them more likely to interact with
the system in the future when they are very sick. The result is increasing
healthcare costs.

Once an entitlement is created it is almost impossible to
eliminate it even though it has proved ineffective and costly.

England’s NHS has shown this to be true. The NHS is struggling
right now to modify the NHS so it works
better for physicians and patients.
However, the new reform rules have been contaminated with so many amendments
that I suspect no progress will be made
.

Consumers are realizing that Obamacare is much too complicated
and impossible to execute. Rather than demanding repeal and eliminating the
concept of instituting an entitlement program, the New York Times is publishing
letters from readers that are demanding a single party payer system to simplify
the system.

Let us stop making the same mistakes over and over again.

 The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone

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