Health Care
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by Bob Clasen
We want to help people who need help. But you want to create a system that does not encourage fraud, like the current tort system and Workers Compensation system.
In the free market, the pricing of medical care is determined by the price that the supply is equal to the demand. If you drop the price below market value, the demand exceeds the supply and you have shortages. In England and Canada, I believes that there are many shortages in supply for surgeries and care (MRIs) we consider routine.
If you make medical care free, the demand tends to go towards infinite. If an insurance company, or government program has to pay for my every medical whim, what motive do I have to control my whims? When you pay for your bills, your natural frugalness not to waste your money will control such inclinations.
In the tort system, I see completely different behavior by people who are involved in a car accident, depending upon if they are making a claim or not. If they are not making a claim, the tendency to amass huge sums of medical bills for things like Heat packs and chiropractic care is much diminished. The tort system gives people a financial incentive to obtain unnecessary medical care, both for plaintiffs, doctors and attorneys.
Even with our current system of insurance, there is a weakened control on price inflation. When all my bills are paid by insurance, what do I care what shenanigans my doctor or hospital is pulling with my bills? I think that there is currently a lot of fraud in billing medical, medicare and even insurance companies. If I think that medical care is my "right" I am not going to question any proposed medical test or treatment, no matter how expensive it might be. How dare those greedy corporate insurance companies deny my my right to medical care!!???
If I have to pay my own doctor bill, I will not be inclined to agree without thought to any doubtful treatment proposal. But doctors make money on doubtful treatment proposals. Just to take one example, look at the benefit to surgeons (huge fees) for low back surgery (and hospitals and anaesthetists) compared to the benefit from the surgey, which is quite problematic. (the percentage of success for low back surgery is discouragingly low for a dangerous and invasive procedure). (When you add lawyers and lawsuits into the mix, the decision is further skewed).
Some suggest that we have "medical insurance savings programs" which allows people to keep money they don't spend and to introduce common sense and frugality into medical care decisions. I think this is a good idea.
I think it is a good idea to provide "major medical" insurance but perhaps require people to pay for ordinary medical care. Even the working "poor", who find money for all kinds of luxuries, should be able to put a little money aside for routine medical care.
I agree that the current system in California seems to be that uninsured are using our emergency rooms for their routine medical needs, which is very expensive and inefficient and which is slowly bankrupting our emergency room hospitals.
Should we be giving free medical care to illegal aliens? I doubt it. This give a huge financial incentive for more and more people to pour over the border.
Liberals, as always, have the best of intentions. Compassionate conservatives sympathize with the suffering of the poor. But we need to think about the unintended consequences of giving free medical care to everyone, and we need to try and provide help to the needy in a smart and efficient manner. We can look at the problems that other countries have with socialized medicine, and we need to learn from their mistakes, if possible.
On the other extreme, we also want to refrain from making medicine into a non profit enterprise, because that would kill the goose that laid the best medical egg in the world.
_________________________
by Bob Clasen
We want to help people who need help. But you want to create a system that does not encourage fraud, like the current tort system and Workers Compensation system.
In the free market, the pricing of medical care is determined by the price that the supply is equal to the demand. If you drop the price below market value, the demand exceeds the supply and you have shortages. In England and Canada, I believes that there are many shortages in supply for surgeries and care (MRIs) we consider routine.
If you make medical care free, the demand tends to go towards infinite. If an insurance company, or government program has to pay for my every medical whim, what motive do I have to control my whims? When you pay for your bills, your natural frugalness not to waste your money will control such inclinations.
In the tort system, I see completely different behavior by people who are involved in a car accident, depending upon if they are making a claim or not. If they are not making a claim, the tendency to amass huge sums of medical bills for things like Heat packs and chiropractic care is much diminished. The tort system gives people a financial incentive to obtain unnecessary medical care, both for plaintiffs, doctors and attorneys.
Even with our current system of insurance, there is a weakened control on price inflation. When all my bills are paid by insurance, what do I care what shenanigans my doctor or hospital is pulling with my bills? I think that there is currently a lot of fraud in billing medical, medicare and even insurance companies. If I think that medical care is my "right" I am not going to question any proposed medical test or treatment, no matter how expensive it might be. How dare those greedy corporate insurance companies deny my my right to medical care!!???
If I have to pay my own doctor bill, I will not be inclined to agree without thought to any doubtful treatment proposal. But doctors make money on doubtful treatment proposals. Just to take one example, look at the benefit to surgeons (huge fees) for low back surgery (and hospitals and anaesthetists) compared to the benefit from the surgey, which is quite problematic. (the percentage of success for low back surgery is discouragingly low for a dangerous and invasive procedure). (When you add lawyers and lawsuits into the mix, the decision is further skewed).
Some suggest that we have "medical insurance savings programs" which allows people to keep money they don't spend and to introduce common sense and frugality into medical care decisions. I think this is a good idea.
I think it is a good idea to provide "major medical" insurance but perhaps require people to pay for ordinary medical care. Even the working "poor", who find money for all kinds of luxuries, should be able to put a little money aside for routine medical care.
I agree that the current system in California seems to be that uninsured are using our emergency rooms for their routine medical needs, which is very expensive and inefficient and which is slowly bankrupting our emergency room hospitals.
Should we be giving free medical care to illegal aliens? I doubt it. This give a huge financial incentive for more and more people to pour over the border.
Liberals, as always, have the best of intentions. Compassionate conservatives sympathize with the suffering of the poor. But we need to think about the unintended consequences of giving free medical care to everyone, and we need to try and provide help to the needy in a smart and efficient manner. We can look at the problems that other countries have with socialized medicine, and we need to learn from their mistakes, if possible.
On the other extreme, we also want to refrain from making medicine into a non profit enterprise, because that would kill the goose that laid the best medical egg in the world.
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Comments
First, I am not proposing that there are no co-pays or no market forces at work.Second let's not pretend that first year economic theory is out the door because a portion of my voucher system is paid for by the governement. If vouchers are viable for education, why not health care. Why can't there be competitors for the vouchers?
Addressing one of your points, my father, a wealth gentlemen of mature years spent his final years going to one or more doctors appointment every week. He had medicare and a supplemental policy. He went every week to one doctor or another. Most of this was paid for by the government or his supplemental policy. I don't think he would have been any less deterred if he had a little less money. But copays would effect some individuals. This is not my system, this is medicare today...the existing system.
Addressing a point I raised in my original post, an individual I knew 15 years ago was an employee of PG&E. He discovered he was HIV positive about the time he lost his job. Short term he looked for another job. Then he discovered he had a preexisting condition and would have problems with coverage. Rather than get a legitimate job, he worked for some one I know for cash under the table. This is someone with an MBA. He was able to beat the system by not paying taxes, not contributing to the SSAN system, and fraudulently qualified for SSI. This entitled him to better health care than I received from my HMO. Humans are stupid, and if you design a system that encourages fraud, you will encourage self interest including fraud.
So do we go back to the middle ages? In order to combat fraud and abuse, we eliminate the system for the poor as Rush Limbaugh suggests? Or are we a more humane society that believes that we don't treat the poor as so much dirty tissue.
So, why is it that we cannot have the government, though tax dollars provide vouchers that would be redeemed with private carriers willing to provide a minimum service. There is no reason there couldn't be a deductible to discourage turning doctors appointments in to a social exercise.
I think comparing the hypothetical US system to systems in other countries is just a way of avoiding a real discussion. But has any really study been conducted to show universal care wouldn't be cost effective. Preventive care is not encouraged by some health systems. The added cost resulting from seeking care late may prove to totally offset the supposed saving by not providing such coverage.
I don't have any principled problem with some kind of medical car voucher system for the poor, which tries to deal reasonably with my practical worries about creating the proper incentives.
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