When I was nominated for Congress in 2004, I developed a bipartisan national medical plan. It didn’t get legs for various reasons – one being that it may have been too wonky with too many numbers. Yet, we have to remember there are two kinds of numbers; one of which is the spiritual aspect that says the measure of a society is how well it treats the sick, the lame, the disenfranchised.
This proposal seeks to find an economic approach that satisfies the head and the heart of the individual.
To start, we need to recognize that all sides are correct: true conservatives would say, “we can’t afford it,” while liberals would say, “we can’t afford not to do so.” I’ve been members of both parties and an independent. So the answer to the puzzlement is that we can do both! As we take a 50,000-foot overview, a number of issues pop up.
With all the wonderful newly discovered medical procedures, we have to ask if we can limit some. As an example, my friend said that 50% of a person’s lifetime medical expense occurs in the last two weeks of life. If so, we need to bring such an issue forward or address it as I have in my plan.
Then there is the issue of having no skin in the game. In my previous blog, I cited examples whereby the system does not encourage oversight by the individual. We only ask questions when part of the cost comes from our pocket. Another issue that is evolving is why should people who try to maintain a healthy lifestyle be required to subsidize those who choose otherwise. This is not a new idea, the premium on many life insurance policies varies based upon smoker or non-smoker, blood pressure, weight, etc.
So, here we go:
- The patient would pay $40/mo to a health savings account. Thus, he has skin in the game. They get a free annual exam, and maybe a required physical.
- The patient would annually pay 20% of the first $10,000 (up to $2,000) of the medical cost of which the health savings account can be used. If the bill exceeds the amount in the savings account, they run a deficit since they are established and in the system. We need to trust our citizens. They have skin in the game at this point.
- Next, 100% of the allowed medical costs are paid by the government up to $1 million a lifetime. This ensures that the individual maintains skin in the game since it’s limited. Every dollar spent reduces the unused benefit. Then, an individual could purchase insurance for amounts over $1 million which should be relatively inexpensive. The result is that:
- Employers are no longer in the insurance/health business.
- Governments have somewhat limited exposure.
- Individuals don’t need to live in fear if they change jobs.
- Individuals will have an active voice in each medical decision.
My rough estimate is that the national price tag will be reduced by 25%. My next blog will discuss concepts that could create even more reduced costs for people who choose to follow a healthy lifestyle.
Rich Meyer, Author & Blogger