NCD Medical

We keep discussing health care reform but it appears that the more we talk, the more we are unable to understand the benefits. Although we have made it very complicated and potentially very expensive, we really haven’t come up with solutions that are superior to what we have, or to what other countries have. Other countries have nationalized health care. Everyone is covered, no one pays for care, and there are no private primary care insurance carriers. Many believe this is good, but many others believe it lacks quality, expediency, and promotes rationing. The plans now being proposed in the U.S. Congress are not nationalized health care, but are supposed to be a combination of government sponsored coverage and private insurance coverage for all Americans at lower costs. Unfortunately, none of the plans proposed come close to providing lower costs with quality care. Why can’t we figure out a solution that would improve what we have today? One of the reasons is that we continue to focus on insurance reform and seem to totally disregard reducing the costs of providing health care. When we do talk about reducing costs we talk about reducing Medicare by $500 billion and reducing physician reimbursements. This is crazy and would probably do as much destruction as anything that’s been discussed yet.
Seniors who have spent a lifetime paying Social Security and taxes to insure they would have good health care coverage when they became 65 years old, would rebel if we now reduce benefits to accommodate 15% of the population that does not have coverage.  And although government is quick to respond that the $500 billion will come from reducing fraud and mismanagement in Medicare/Medicaid, the reality is, they haven’t been able to do it in the past and they won’t be able to do it in the future. Reducing reimbursements to physicians would only complicate the problem of not having a sufficient number of doctors to accommodate patients. The addition of a potential 50 million new patients would severely strain the availability of physicians and probably result in rationing and significant consultation delays. Complicating the issue further is some polls have indicated that as many as 45% of the current physicians would choose to retire if this reform were adopted. So what do we do? We must first focus on reducing the cost of health care:

1) We must regulate the cost of care being careful to allow physicians to establish procedures and government to assign reimbursements based upon the historical information documented at Medicare, VA Hospitals, and other government institutions, while comparing data from private facilities, allowing us to establish standard costs for all procedures, drugs, supplies, tests, etc. Once we have established fixed costs we will have the opportunity to stabilize reimbursements and procedures. This will also eliminate public hospital systems from earning substantial profits for their shareholders at the cost of their patients. It will also reduce the unnecessary expansions of non-profit hospital systems that continue to expand by acquiring additional hospitals and medical facilities. Lastly, all insurance providers would be required to adhere to these reimbursement and procedure standards, allowing policy holders, not shareholders, to take advantage of reduced costs. United Healthcare (publicly owned insurance company) earned more than $3 billion in 2008, while Community Health System (public owned hospital system) earned $218 million in 2008, and the Cleveland Clinic (non profit hospital system) expanded by recently acquiring hospitals in Medina, Ohio; Dubai, UAE; and a cancer center in Las Vegas, Nevada. If we simply look at these three organizations as examples, we can understand that the actual cost of care is far less than the price charged. If we would regulate costs for hospitals and insurance providers, health care would become much more affordable and we would achieve significant savings.

2) We must adopt tort reform as a prerequisite to reducing costs. The savings which can be realized by reducing unrestricted awards for health care related litigation can be in the billions of dollars. Today many surgeons pay liability insurance premiums in excess of $200,000 per year. Doctors must be paid extremely high incomes in order to cover these premiums. If you reduce the amount of unwarranted settlements and reduce the insurance premiums physicians and medical facilities are required to pay, the result would be lower reimbursements to both physicians and medical facilities. Once again we achieve significant savings.

3) We must reduce the loss of revenues in Medicare/Medicaid from fraud and mismanagement. These losses are estimated at more than a trillion dollars. Reform legislation being considered suggests we can cut these losses by $500 billion, however there are no specific methods outlined to achieve these cuts. Most Americans believe these cuts will come from reducing services more than fixing fraud and mismanagement. I would propose hiring independent audit groups which derive their compensation by identifying and recovering lost revenue and then retaining a small portion of the revenues identified as their compensation. These activities have been very successful for business when auditing freight and utilities invoices. We would take this major problem out of the hands of government and put it into the hands of capitalists who make a living from recovering over-billed invoices.

4) We must implement health reform, generally referred to today as wellness. The US has been compared to other countries who have nationalized health programs and in some cases their citizens are considered in better health, suggesting that our health care in the US is inferior. I don’t think there is any question that health care in this country far surpasses any other country, unfortunately our health habits do not. We eat too much and exercise too little. Our diets are heavy with fats and carbohydrates. We do not get the proper rest and relaxation. We need a program that focuses on developing better personal health habits and then provides incentives to achieve these goals. The result would be healthier individuals requiring less health care resulting in lower health care costs.

The above programs would reduce healthcare costs and would cost a small percentage of what we are currently considering. Let’s review: 1) regulate health care cost with insurance providers and medical facilities, 2) adopt tort reform, 3) fix Medicare/Medicaid, 4) implement wellness programs.

These are programs that will reduce the cost of health care, what a novel idea! With the money we save I’m sure we could take care of those 15% of Americans who do not have health care coverage – another novel idea!