Stanley Feld M.D.,FACP,MACE

Ann Braly’s ( CEO of WellPoint), article in the Wall Street Journal on February 7,2007 signaled an aggressive campaign by the healthcare insurance industry to force the federal government to subsidize healthcare insurance even more than it is presently.

The healthcare insurance industry wants the passage of Obamacare with the deal President Obama made with them. Part of the deal was to mandate insurance and increase deductibles from 20% to 30%.

“This scheme presented by Obamacare would have been, and might still be, imposed on the rest of the country.”

The original scheme (Obamacare1) was forced to be modified because mandating healthcare insurance was challenged as being unconstitutional.

Thirty two states have passed laws prohibiting healthcare insurance mandates. Mandates would be great for the healthcare insurance industry. They would increase the number of customers insured.

The more insured the lower the actuarial risk. The healthcare industry claims it could lower the cost of healthcare insurance. Obamacare 1 would also increase consumers’ deductibles saving more money for the healthcare insurance industry and increasing the burden to consumers.

At the request of several congressmen last year, including some Democrats, WellPoint mined its own actuarial data to model ObamaCare and found that it would as much as triple premiums for the small businesses and individuals who are most of the company’s customers.

WellPoint is declaring that Obamacare 2 will triple premiums. It is important to note that WellPoint did the math using accounting practices permitted by the government. The result is loading the overhead.

There is no evidence that any congressmen or the President has challenged WellPoint’s estimates until Mrs. Braly’s WSJ interview. No one has challenged the accounting methodology. The government is assuming the healthcare insurance industry numbers are correct. It would also be important to understand the math in the actuarial estimates.

The government should be looking at the defects in accounting methods. It should also look at the accuracy of the actuarial calculation.

“The White House political shop promptly compared WellPoint to a tobacco company.

President Obama uses political sound bytes all the time. His sound bytes have little substance. He should become aware of the fact that the average citizen is tired of his nice sounding rhetoric.

The healthcare insurance industry is ripping off the consumer and the government. The government should make the right accounting rules, incentivize the consumer and physicians to decrease the cost of healthcare and get out of the way.

Four days after Mrs. Braly’s statements about premium increases, Anthem, a California subsidiary of WellPoint, announced it was increasing its insurance premium by 39% for individuals insured.

I knew it would not stop at Anthem in California. The healthcare insurance industry is exempt from antitrust laws. I predicted that WellPoint’s argument is paving the way for other healthcare insurance companies to increase its rates.

“For example, Anthem in Maine was denied an 18.5 percent increase last year and is now requesting that state regulators approve a 23 percent rise.

Michigan’s Blue Cross Blue Shield plan requested approval for premium increases of 56 percent in 2009. And in the state of Washington, rates for some individual health plans increased by up to 40 percent until regulators cracked down.

Other states cited in the report were Connecticut, Oregon and Rhode Island.

The premium increases affect the most vulnerable part of the health insurance market, policies marketed individually to customers buying their own plans.”

The goal of WellPoint is to raise the rates on individual plans which have patients at risk for using healthcare insurance. Its position is the government should pay for the risk and that is the deal they made with President Obama before he changed the deal.

“According to the Census Bureau, only about 9 percent of Americans purchase coverage directly, while nearly 60 percent are covered under employer plans. Family premiums for those with workplace coverage rose 5 percent last year, even as inflation fell 1 percent, but nowhere near the rates seen in the individual market.”

The mandate to the healthcare insurance industry is they must accept all employees regardless of pre existing illness in group plans. They can raise the rates of group plans depending on the demographics of the group rather than community rate the group. Community rating should add a community pressure point to individuals that do not take care of their health.

Older self employed individuals cannot qualify for healthcare insurance under present healthcare insurance company rules. Even if they qualify for insurance these consumers have to pay for insurance with after tax dollars. The existing rules decrease individuals’ ability to afford healthcare insurance.

On top of that the insurance industry demands unconscionable premium increases. The solution is for State Insurance Boards to refuse to grant these companies a license to sell insurance in their state.

Another solution should be making healthcare insurance tax exempt just as employer insurance is tax exempt. Obamacare wants to make all insurance payments non tax exempt to increase government revenue while placing a bigger burden on individuals and groups.

The healthcare reform bill should change the rules so that all insurance is community rated and everyone is qualified to buy insurance regardless of preexisting illness. The bill should create ideal medical savings accounts for everyone so they become responsible for their own health and healthcare dollars.

“Insurers say the push for higher premiums reflects supply and demand. Medical costs keep going up, even in a weak economy. Many healthy people are dropping coverage or switching to bare-bones policies to keep their bills down. That leaves a higher proportion of people with health problems in the risk pool, forcing the steep rate increases.”

This is the reason to start from scratch with the Ideal Medical Savings Account. Medical Savings Accounts are an insurance product Democrats refuse to consider. It will decrease the power of the federal government’s ability to keep the citizens in a state of fear and them in power. (Shock Doctrine).

It is time for us to say we are not going to take this anymore.

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

Stanley Feld M.D.,FACP,MACE

Ann Braly, WellPoint’s CEO, launched a new offensive to protect the vested interests of the healthcare insurance industry now that Obamacare seems to be dead.

The healthcare insurance offensive began with her op- ed article in the Wall Street journal on February 7,2010. Readers will have a deeper understanding of the offensive if they follow the underlined historical links in this article.

It will destroy President Obama’s credibility, the practice of medicine, patient access to care and increase the number of uninsured. It will bankrupt the country if her offensive is successful.

The healthcare insurance industry is killing the goose that laid its golden egg.

WellPoint is the largest U.S. commercial health insurer by membership. Wellpoint’s affiliated health plans are in 14 states and insure over 34 million people or 11.1% of the population.

Wellpoint also has reimbursement contracts with 82% of the nation’s primary-care physicians, 84% of specialists, and 94% of hospitals.

Anthem Blue Cross is California’s largest for-profit insurer and is an affiliate of Wellpoint. Anthem insures 800,000 people.

Four days after Ms. Braly’s article blamed all the other stakeholders for the rising cost of healthcare insurance, Antham announced it will raise member premiums by as much as 39% on March 1.

The parent company, Wellpoint had a net profit of $2.7 billion in the last quarter of 2009 alone.

Since the healthcare insurance industry has an antitrust exemption I expect every other healthcare insurance company will raise its premiums. Extrapolating the profit to the entire population insured, the total net profit in the healthcare insurance industry would be 144 billion dollars. This does not include the inflated and wasted administrative expenses.

Somewhere between 35-65 cents of every healthcare dollar goes to administrative expenses. Assume that 50 cents of every healthcare dollar is expenses plus net profit to the healthcare insurance industry. The healthcare system consumes $2.5 trillion dollars. That means $1.25 trillion dollars goes toward expenses and profit. The profit is distributed to employees and stock holders.

President Obama says;

"I mean, to be fair, the status quo is working for the insurance industry, but it’s not working for the American people," Mr. Obama said recently.”

Ann Braly CEO of Wellpoint says;

“It’s hard to see how WellPoint could be to blame for surging health spending, Mrs. Braly says, when 85 cents out of every premium dollar or more "is paid out in the actual cost of care, doctors, hospitals, suppliers, drugs, devices." Confiscating the 2009 profits of the entire insurance industry would pay for two days of U.S. health care.”

The question is who is incorrect? Are Wellpoint’s financial statements incorrect or is Ann Braly’s sound byte incorrect? I think everyone would agree that $2.7 billion dollars net profit in the last quarter of 2009 is not shabby.

Wellpoint is using a well worn public relations technique by pointing a finger at the other stakeholders. All its administrative costs, additional reserves, and investment costs are included in the “85 cents out of every premium dollar figure.”

Wellpoint makes money on the money withheld from physicians for reimbursement. Wellpoint has held back reimbursement to physicians often. When it was sued in California (at an extra cost to the healthcare system) the settlement was for a fraction of the reimbursement owed. The settlement was a pretty good way of making money.

“You don’t need to be an economist to understand that any middleman interposed between seller and buyer raises the price of a given service or product. Some intermediaries justify this by providing benefits, such as salesmanship, advertising or transport. Others offer physical facilities, such as warehouses. A third group, organized crime, utilizes fear and intimidation to muscle its way into the provider-consumer chain, raking in hefty profits and bloating cost, without providing any benefit at all.”

The healthcare insurance industry is the middleman that controls the healthcare system. The government through Medicare depends on the healthcare insurance industry to be the third party administrator for Medicare. The healthcare insurance industry sets the prices and the benefits using an unscientific social science called actuarial science.

“The health insurance model is closest to the parasitic relationship imposed by the Mafia. Insurance companies provide nothing other than an ambiguous, shifty notion of "protection."

In order to control the healthcare system the healthcare insurance industry has managed to control the process of authorized treatment and reimbursement for the government and private insurance.

Mrs. Braly says;

“To actually be fair, the insurance industry was a cheerleader for the plan, at least until the policy substance congealed sometime in September.”

"Obviously, we’ve been involved in this discussion for a while—more than a year—and if you think about it we came to the table early, early on and said we’re going to be advocates for responsible, sustainable health-care reform done right. We really do have to get at the underlying question of health-care costs."

It is certainly to Wellpoint’s and Mrs. Braly’s advantage to have universal healthcare that is mandated and subsided by the government. Prior to September the healthcare insurance industry had it all set up with President Obama.

Universal healthcare would provide more customers and more premiums. The healthcare insurance industry also worked out a deal with the government to increase the deductibles from 20% to 30% so they could provide affordable healthcare insurance at a lower price.

The $2.7 billion dollars in profit for the last quarter drove me to look at the salaries and stock options posted on the web for officers of Wellpoint. Mrs. Braly’s salary was not available.

CEO, Divisional/Presidents’ salary was 1.18 million and 8.4 million dollars a year.

The CEO and Chairman of the Board made 23.9 milliona year .

Executive VP/CFOs’ made 8.42 million dollars a year.

Geographical CEO/Geographical President/Executive VPs’ made between 15.56- 6.39 per year

The stock options awarded are even higher.

In a March 2007 post I stated that “ UnitedHealthcare claims that costs are out of control. Why? Who paid their CEO $1.8 billion dollars over 8 years? The amount equals $300 million dollars a year or $821,917 a day in salary and benefits to one person. < a href="http://stanleyfeldmdmace.typepad.com/repairing_the_healthcare_/2006/11/administrative_.html">What are the other top executives at UnitedHealthcare receiving in salary and benefits? Do you think these salaries affect the cost of insurance?”

Consumers only realize that health insurance increases yearly. In November 2006 I wrote;

“No leader has the courage to step forward and do something about it. I have emphasized much of the leadership can be exerted at the state level by state boards that license the insurance industry, hospitals and physicians. No one has organized the people to protest. The excuse is that the healthcare system cannot be fixed. It is impossible to control physicians. I believe all these excuses are smoke to cloud the solution. The facilitator stakeholders are simply holding on to what they falsely perceive is their vested interest.
“A theory of limits applies here. In a voluntary market, healthcare purchasers–employers or taxpayers–will tolerate only so much cost growth. Then they’ll recede. It is preposterous to believe the well won’t run dry.”

All of these pricing mismatches and excess non medical value added costs can be eliminated by permitting patients to be in control of their healthcare dollar and selling pure insurance that is fairly priced. The Ideal Medical Savings Account system represents pure insurance in the form of high deductible health insurance and motivation for the patient to become an informed consumer.

The cost of processing claims could be eliminated completely. The service claims could be adjudicated instantly with a credit card. Thousands of diverse businesses adjudicate claims on purchases instantly daily at a low cost. The use of credit cards to pay for Medical Savings Accounts could provide an instant savings of $150 billion dollars in costs in the healthcare system. The losers will be the non competitive insurance companies. The winner will be the bright flexible company that puts the correct 21st century system in place.

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

Stanley Feld M.D.,FACP,MACE

Politicians and healthcare policy makers have not included consumer driven healthcare in the healthcare reform debate. They have not included tort reform in the debate either.

The debate is about a public option. President Obama is going to redefine his meaning of the public option in his message to congress. He will make it sound benign. It will not sound like a government takeover of healthcare. He will omit the details and consequences of the bill.

President Obama must know the government cannot afford a public option. He knows he must control costs somehow. His policy makers believe the only way to control cost is by total government control over the healthcare system. Ultimately the goal is a single party payer system.

This way of thinking about the problem is wrong. Government control does not reduce costs in most projects. It usually increases costs. The President is focused on reducing physicians’ and hospitals’ reimbursement. He believes they are the reason for increasing costs. Medicare has continually decreased reimbursement to physicians and hospitals. Yet costs have increased.

To some extent decreased reimbursement leads to increased utilization but it is not the principle reason for the increase in utilization. A principle reason is an increase in the need to practice defensive medicine. Plaintiff attorneys deny it. The Massachusetts study confirms that defensive medicine leads to a large increase in utilization and costs.

Physicians are an easy target because they are not well organized. The Democrat controlled government is timid about attacking the plaintiff attorneys and tackling tort reform. Defensive medicine results in about a $700 billion dollar a year cost to the healthcare system. 

Howard Dean said it a few weeks ago. “Congress will not face the issue of tort reform because it does not want to take on plaintiff attorneys.” Consumers can solve this for congress by signing a valid limited liability waiver. Patients can put their own cap on damages. It would not require any courage on the part of congress or the President to face this difficult political issue. All congress and the President have to do is declare the waiver valid.

Texas and California have had the courage to place caps on damages. It has been very successful. If there were caps on damages and they were effective the need for defensive medicine practices would decrease.

The public does not trust congress or the President with control over its healthcare coverage. The public experience with unintended consequences of government control is obvious to all.

Recent examples are the unintended consequences of the bank bailouts, Goldman Sachs bailout, the economic stimulus package promise, the auto bailout, and the war in Afghanistan. All these bailouts are increasing the deficit at the expense of the taxpayers and future generations.

The public mistrusts the healthcare insurance industry as much as it mistrusts the government to control healthcare. The healthcare insurance industry has restricted access to care and rationed care. It has not reimbursed physicians and hospitals in a timely fashion. It has found it is cheaper to pay the negotiated settlement rather the medical bills for its insured.

Nancy Pelosi is right about one thing and only one thing. The real villain is the healthcare insurance industry. However, she does not understand with a public option she is not controlling the healthcare insurance industry fees for administrative services. The government outsources administrative services to the healthcare industry and will still be subject to grotesque administrative services fees.

The healthcare insurance industry has lobbied to change the law to increase co pays to 35-40% of bills so it can lower premiums to affordable levels. Increasing deductibles and lowering premiums would satisfy President Obama’s goal of affordable premiums. At the same time, it will increase the out of pocket cost of medical care for consumers who might need to use their “affordable healthcare insurance.”

The healthcare insurance industry will be forced to offer insurance to consumers with preexisting illness at an affordable cost. Some states have a high risk pool. The premiums in the high risk pools are at least 11/2 times higher than normal premiums and have higher deductibles. High risk patients must be put into the general insurance pool.

There has not been a word in the healthcare reform discussion about patient responsibility for their health. We are in the middle of the worst Obesity epidemic in American history. President Obama should declare a War on Obesity. He should promote legislation that could help eradicate obesity. He should provide patients with financial incentives to eliminate obesity and adhere to prescribed therapy. Obesity is a leading driver of increasing healthcare costs. The costs will only become grater as the obesity epidemic continues.

It is time consumers took control of their own health care dollars and their own health and well being. The defensive medicine/tort reform issue can be solved by consumers. Obesity can be solved with the government rewriting farm subsidies and a substantial public service health campaign to change our eating habits.

A consumer driven healthcare system along with the ideal medical savings accounts could solve many of the healthcare system’s problems without total government control. The government’s job should be to help with educating the public, negotiating prices that are transparent and fair and enforcing regulations to create a level playing field for consumers among the other stakeholders.

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

Stanley Feld M.D.,FACP,MACE

Dear President Obama;

Please listen. The American public doesn’t want the public option. They know America cannot afford another entitlement program. Americans do not want increased taxes. They are afraid China is lending us too much money. If and when they pull out it will be doomsday.

The healthcare insurance industry would love you to get your healthcare reform bill passed. It would increase their profits at taxpayers’ expense. The healthcare insurance industry did it to Massachusetts. The federal government had to bail out Massachusetts. Why not the entire country?

Americans want healthcare reform. They would love to provide universal care, have affordable insurance coverage, and increased quality of care. Your strategy is wrong.

There is another way to accomplish these things. It requires you to have faith in the intelligence of the American public. The strategy would decrease the cost to the healthcare system instantly. It would decrease the obscene costs for administrative services to the healthcare insurance industry. It would diminish the need to develop a massive government bureaucracy.

It eliminates the influence of lobbyists for vested interests. It would create competition among physicians, hospital systems and healthcare insurance companies. The healthcare insurance industry is drooling over your healthcare reform plan.

Americans know government bureaucracy can be cruel and inefficient. There are too many generalities that are wide open to abuse.

I received this note from a reader summing up America’s mistrust of government control. This person is neither a Republican nor Democrat. He is an American.

Stanley,

To sum up the recent post you can simply remind readers of the laughable old line, "I am from the government and I am here to help".

It was gaggy enough to see all the pigs at the trough getting 100’s of billions.  It will make everyone wretch just watching the same participants helping themselves to trillions of dollars worth of slop.

Heaven help us.  Neither the press nor the Obama fans can see through this smokescreen.  God, haven’t people figured out that when the government doles out money poor people don’t get helped, rich people do.  Does foreign aid help poor people in other countries.  If it did poverty in Africa would have ended decades ago.

Go back to the days of Lyndon Johnson.  We fought the war on poverty and lost that.  We lost the Drug War.  We lost the Vietnam War, we are losing the Afghan and Iraq Wars and we are well on our way to losing the war on the high cost of healthcare.  All of these efforts were lost not because they weren’t laudable goals, but because they were not properly considered.  As you know, some we should not have fought, others we should have fought differently.

Interestingly, the only real win we have had in the last forty years was the war on welfare and it came about because something was taken away, not added. 

Is there a lesson here?

L

How do you accomplish your goals and have the American public trust you once more? You can accomplish your goals of universal care, affordable insurance and increase in quality of care by putting individuals in control of their health and healthcare dollars.

This must sound radical to a liberal. If you permit consumers to drive the healthcare system they will drive the prices down.

How would a consumer driven healthcare system work using an ideal medical savings account?

Employers, states, and the federal government are currently paying healthcare premiums at very high administrative service fees to the healthcare insurance industry. Many self employed are paying the entire healthcare insurance premium with after tax dollars making their cost at least 35% higher than employer based coverage. Most cannot qualify for insurance because of preexisting illness.

The healthcare insurance industry controls the premium dollars. Patients have no financial incentive to be responsible for their health or healthcare dollars. The goal of a consumer driven healthcare system is to create a system that would provide incentives for consumers to be a watchdog for their healthcare dollars.

If these payers gave half of the $12,000 per family per year to consumers and permitted them to keep monies unspent in a retirement account, then patients would be motivated to use their healthcare dollar wisely

If consumers with chronic diseases perform well (weight loss, diabetes control, asthma prevention, COPD and heart disease prevention) and stay out of the ER or hospital because of proper maintenance they should receive a bonus for their retirement fund.

The fees for services would have to be negotiated beforehand as we presently do. All fees should be totally transparent. You would have 300 million people watching and reporting their costs or care.

The remaining $6,000 would buy high deductible coverage that would provide first dollar coverage. The healthcare insurance industry would do very well. If they quit Fidelity or Vanguard could do the bookkeeping.

Think of all the administrative costs saved on the first $6,000. Think of all the middlemen expenses avoided.

Medicare cost per patient in only $6600 per year including the last 30 days of life. The average cost of younger persons is much lower. Cost of care would be decreased because physicians would be paid at point of service. If the cost for medical care was over $6000 for a patient’s care first dollar high deductible insurance would take over.

Medical care is the relationship between the patient and the physician. If you provide the tools and money to create a transparent relationship without middlemen the patients would make the cost decrease as we have seen in other industries. America would have an affordable system.

If the employer became an extender of the physicians care and a patient advocate the costs would drop.

Employers, patients and physicians have the same goals. All are at the mercy of the middlemen (healthcare insurance industry).

This is the American way. It can be done.

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

Stanley Feld M.D.,FACP,MACE

In response to my last post I received this note.

“Stan

This is interesting.  You may like this but it is very obvious that it is just another stall tactic.  If the current bill, with reconciliation, passes, we still have to address these points.  So where are this fellow’s solutions?”

I watched President Obama’s town hall meeting in Grand Junction on Saturday evening. He is a compelling and seductive speaker. If I thought his plan would work and at the same time be budget neutral I might be seduced.

It will not work for the consumer and it will not be budget neutral. He needs a better plan.

What is missing?

President Obama’s generalities are correct. The country needs a system that provides universal care at an affordable cost and an increase in quality. I believe his strategy is wrong. His strategy is reflected in his healthcare reform bill.

He is correct in pointing out that the healthcare insurance industry controls the healthcare dollar. His prescription to destroy the healthcare insurance industry is wrong because it will penalize patients. President Obama’s healthcare reform bill is not doing anything to limit the healthcare insurance industry 20% gross administrative fee whether we have a single party payer or a private insurance system.

He promises to get rid of the waste in the system. He claims eliminating the waste will pay for two thirds of the 1.1 trillion dollars his healthcare billion will cost in the next ten years. The remainder will be paid for by taxing people making over $250,000 a year. He needs to redo the math.

President Obama’s system sounds pretty simple. However, it seems the government hardly ever does anything efficiently. The costs are always underestimated. There are always uncontrolled abuses or unintended consequences.

President Obama is ready to create a massive new bureaucracy and employ approximately 110,000 new employees. Bureaucracy is always a prescription for inefficiency.

President Obama is ignoring the waste created by defensive medicine. The total cost of unnecessary testing is about $750 billion dollars a year. Nonetheless, tort reform is off the table. Defensive medicine is blamed on physicians wanting to generate more money for themselves. I think defensive medicine came first, and then physicians figured out how to generate more income in response to decreasing reimbursements for their services and an increase in malpractice lawsuits. Placing a cap on malpractice awards destroyed the malpractice business in Texas and California.

Where is the role of patients’ responsibility for their own health and healthcare. Patients with adequate healthcare insurance are satisfied. The healthcare inflation problem is the result of medical care costing little for the patient with insurance except for the deductibles.

Our healthcare system is a fix the sick system. The healthcare system is not geared to prevent an illness. The administration’s healthcare reform plan speaks of prevention but does not provide incentives to patients or physicians to prevent illness or even deal with the obesity epidemic..

“Consumers are receiving quality medical care at little direct cost to themselves. This creates runaway costs that have to be addressed. But ill-advised reforms can make things much worse.”

The public has no great love for the healthcare insurance industry. Their protests about the healthcare reform bill are not to protect the healthcare insurance industry. It is to protect their freedom of choice. The public does not trust the government to make choices for them.

Both political parties have extremely low approval ratings. President Obama’s approval rating is sinking because of the perception of his half truths and a mounting distrust by independent voters.

“An effective cure begins with an accurate diagnosis, which is sorely lacking in most policy circles. The proposals currently on offer fail to address the fundamental driver of health-care costs.”

President Obama’s public option and increase in bureaucratic decision making is not going to solve our healthcare systems problems. He is not focusing on repairing the perverse incentives that are presently in the dysfunctional healthcare system.

Consumers must solve the healthcare system problems just like they solved the auto industries problems. Government role should be to provide the appropriate regulations to level the playing field.

“The health-care wedge is an economic term that reflects the difference between what health-care costs the specific provider and what the patient actually pays. When health care is subsidized, no one should be surprised that people demand more of it and that the costs to produce it increase.”

The solution is not a public option or a single party payer system. Consumer driven healthcare is the solution through the use of the ideal medical savings account.

“To pay for the subsidy that the administration and Congress propose, revenues have to come from somewhere. The Obama team has come to the conclusion that we should tax small businesses, large employers and the rich.”

President Obama’s plan will not work because the health-care recipients will lose their jobs as businesses can no longer afford their employees. The economy will get worse and the wealthy will flee to tax havens.

General anxiety will increase, patients will get sicker and the healthcare system will be overused creating more debt and more taxes.

A few economic self evident truths are:

1. A free marketplace with appropriate rules encourages innovation and productivity.
2. In the United States profitability is a strong market driver. If inappropriate rules are set up entities will try to figure out how to benefit from the rules to the disadvantage of others.
3. The higher the taxes the lower the productivity. The lower the taxes the higher the productivity.
4. The greater the bureaucracy the lower the added value productivity.
5. Consumers will try to maximize their purchasing power.

“According to research I performed for the Texas Public Policy Foundation, a $1 trillion increase in federal government health subsidies will accelerate health-care inflation, lead to continued growth in health-care expenditures, and diminish our economic growth even further. Despite these costs, some 30 million people will remain uninsured.”

Rather than expanding the role of government in the health-care market, Congress should implement a consumer driven approach to health-care reform. A consumer driven approach focuses on the consumers being the policemen for their own healthcare dollar. If would focus on the doctor relationship and empower the patients and their physicians to make effective and economical choices.

The patients would be proactive rather
than passive. The result will be an increase in efficiency in the healthcare system rather than a further decrease.

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

Stanley Feld M.D.,FACE,MACE

It is not fair to criticize the Republican Party’s healthcare proposal without providing the reader with the source material. The source material comes from Senator Tom Coburn’s web site. My negative comments should be judged in light of the original proposal. The executive summary follows.

Preventing Disease and Promoting Healthier Lifestyles

· Critical investments in public health and disease prevention will go a long way in restraining

health care costs and improving the quality of Americans’ lives. The Patient’s Choice Act of 2009 would:

• Encourage increased coordination of federal prevention efforts and bring long‐overdue accountability to these programs

• Require CDC to undertake a national campaign highlighting science‐based health promotion strategies

• Equip recipients of Supplemental Nutritional Benefits with easily understandable information about nutritious food options and target the use of food stamps to healthy food choices

• Invest $50 million annually for increased vaccine availability and bonus grants to states that achieve 90 percent or greater coverage of CDC‐recommended vaccines

• Provide incentives for states to reduce rates of chronic disease like heart disease and diabetes

All of the above proposals should be executed. How will they be implemented? The Republicans do not have a plan but not having a plan does not make the Democrat’s plan a good one.

Creating Affordable and Accessible Health Insurance Options

Our health care system should be easier to navigate and provide integrated care in a more equitable manner. A vibrant market for health insurance that is consistent and fair will allow all Americans access to health coverage.

How will Republicans make a vibrant market for healthcare insurance? How will people who cannot afford healthcare insurance pay for it? The tax credits might help a little. However, if you do not have the cash you cannot pay for the insurance.

The Patient’s Choice Act of 2009 would encourage states to establish rational and reasonable consumer protections, including the following:

• Creates State Health Insurance Exchanges to give Americans a one‐stop marketplace to compare different health insurance policies and select the one that meets their unique needs

• Gives Americans the same standard health benefits as Members of Congress, so all Americans have a wide range of choices

• Protects the most vulnerable Americans to ensure that no individual would be turned down by a participating Exchange insurers based on age or health

What will the premium be for those with preexisting illnesses? Will the premiums be higher for patients with preexisting illnesses? The high risk pool premiums have been very expensive.

• Creates a non‐profit, independent board to risk adjust among participating insurance companies to penalize companies that “cherry pick” health patients and reward insurers that encourage prevention/wellness and cover patients with pre‐existing conditions.

• Expands coverage through auto‐enrollment at state and medical points of service, for individuals who do not select a plan at the beginning of the year

This is an empty statement. How will this be administered? The devil is in the details and there are no details presented.

• Gives states the ability to band together in regional pooling arrangements, as well as the creation of robust high risk pools, reinsurance markets, or risk adjustment mechanisms to cover those deemed ‘uninsurable’

Risk pooling has been tried and has been unsuccessful. It has been an excuse to allow the insurance industry to spread the risk. The proposal also implies variable premiums.

Equalizes the Tax Treatment of Health Care, Empowering All Americans with Real Access to Coverage

Economic analysts across the political divide agree that the tax code is stacked in favor of the wealthy and those who get their health coverage through their employers, discriminating against the self‐employed, the unemployed, and small businesses. The Patients’ Choice Act of 2009 would restore fairness in the tax code and give every American, regardless of employment status, the ability to purchase health insurance by:

• Providing an advanceable and refundable tax credit of $2,300 per individual or $5,700 per family

• Improving the operation of Health Savings Accounts [HSAs] by allowing health insurance premiums to be paid with HSAs without a tax penalty

• Allowing preventative services to be covered by High Deductible Health Plans

• Increasing the amount of money an HSA owner may annually contribute to their account

Healthcare insurance premiums are $14,000.00 a year for a family. A $5,700.00 tax credit does not cover it. It also assumes the consumer has enough income to have a $5,700.00 be tax liability. Citizens are not subject to income tax if they make up to $38,000.00 year. HSA’s retain the healthcare dollar to be used for future spending on healthcare. The healthcare insurance industry retains control over the premium and the healthcare dollars. It is not a pro consumer proposal. It does not offer financial incentives to consumers .

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