How To Improve America’s Healthcare

Healthcare in America could use some restructuring. The main issue is cost. Across the board, costs have been increasing at an alarming rate. Some costs are controlled by outside factors (rising prices of oil, etc.) that cannot be controlled by changes to the healthcare industry. However, there are some changes that would not only curtail the rate of increase in costs but actually reduce current costs.

First, we need to look at healthcare just like anything else we purchase where the cost is controlled by supply and demand. Doctors, nurses, and other healthcare workers choose the field as a career job and expect to be paid a fair wage. A wage to be determined by consumer willingness to pay for it. This gives value to the service. Mandated costs by government are not based on demand, negating any value. This causes indifference by supplier and dissatisfaction by the consumer.

Any enterprise run or tightly controlled by government always adds additional costs to the goods or services provided. Invariably these costs out distance the revenues causing a decrease in value of goods and services provided. A system like this cannot sustain itself and eventually will need subsidization by taxes. Taxes collected for other purposes causing them to suffer lack of funds, as is the case with the Social Security System.

Just like not everyone can afford their own house or designer items, not everyone can afford optimum healthcare services. This is a fact of life. No government has been able to circumvent this concept. If the government mandates that a car costing $30,000.00 to build be sold for $10,000.00, future production of that car will not be worth even $10,000.00. The same is with health care. When the government sets the amount of money that a hospital is to receive, the hospital cannot perform the number of consumer demanded services required. It can only perform those that will be paid for within a specific period of time, leaving patients requiring these services waiting until the next period. Some patients will invariably die before required services are provided.

There are two main reasons for the continuous rise of healthcare, the looming threat of lawsuits and lack of competition within the insurance industry.

Many doctors and other healthcare providers must double and even treble their fees in order to pay for malpractice insurance. These costs are constantly being driven higher by lawyers encouraging lawsuits and well meaning jurors awarding outrageously high monetary awards. Imagine that you were ordered to pay millions of dollars to a plaintive for a mistake you made at your job. True a misplaced decimal point or not matching the color of the carpet to the paint for the walls does not carry the consequences of surgical mistake. An award of $100,000,000.00 does not correct a surgical mistake either. It does however increase the cost of healthcare across the nation. National tort reform would keep these awards to a reasonable level. Awards should be made in full for out of pocket expenses incurred by the plaintive, legal fees of the attorneys need to be regulated to a reasonable amount for services rendered, and punitive damages need a ceiling.

By reducing the risk of Malpractice Insurers, healthcare costs could be cut by half or more.

The cost of individual medical insurance (whether paid individually or through employer) is also a large part of healthcare costs in America. This cost is driven partially by the same circumstances as discussed previously but more so by lack of competition. Medical insurers are regulated by individual states. Each state has a small fraction of the number of insurance companies in America. In many instances the same company operating in more than one state is actually operating differently in each state. That is because they have to adhere to different rules and regulations. This curtails competition. Insurance companies are operating according to the dictates of the states rather than in the most efficient way possible. The consumer is dustily short changed and over charged.

By standardizing insurer requirements and liabilities nationally, every insurance company could compete for business in each state. Restrictions on forming monopolies would be needed to keep competition open and one company from dominating the industry. Government is never an equal competitor with private business. It can run deficits and have an unfair advantage since it has the use of tax funds to operate at a loss.

Competition in the market has always been the major factor in keeping costs down. Competition will do the same in health insurance that it has maintained in all industries.

This brings us to pre-existing conditions. No logical person would expect an insurance company to write a policy on a house that has burned down or a car mangled in a crash. Yet many of these same people see nothing wrong in expecting an insurance company insuring someone with a possibly fatal condition. Rather than making insurance payments while they are healthy and getting regular medical checkups, they decided to spend their money on other things, makes no difference whether this is by necessity or just plain self-indulgence. This is not the same as if a person with insurance for a number of years and then changing jobs where there is a different insurance company. But the new insurance company might now be burdened with high medical costs without the benefit of collecting payments that it can use to obtain interest from. Those were collected by the previous insurance company during the healthy period of the insured. This too can be taken care of. Every insurance company must keep a healthy ratio of assets to liabilities. By creating a national asset pool that all insurers contribute to. A company picking up a new insured with a pre-existing condition can claim some of those assets built up with premium payments and interest.

What about the many uninsured (estimates range from 30 to 45 million)? We first must define them. Few of these are in a position to pay for most medical needs they may have. A large portion of the uninsured are fairly young people believing to be healthy and not needing insurance. Without insurance they are very likely to join the balance of uninsured with no means to pay for needed medical care later in life. These people will in evidently become a burden on society one way or another. As a nation based on Judeo-Christian values there is a moral obligation to help. It should not be a government mandate.

There is a way to overcome this also. Nationally, the education system is grossly lacking in teaching self reliance and responsibility. In addition to the various math and other courses, the subject of preparing for the future must become mandatory. They must include money management stressing the importance of having health insurance, providing for retirement, and budget management.

In all the years I attend various educational institutes across America (grammar school, middle school, high school, and various colleges) few offered them and none had them as required courses. Lack of education has created a large group demanding new and more entitlements.

This nation cannot long endure an ever growing consumption of the earnings of others. If this trend continues, America will end up a nation of poor, uninspired, and miserable people living in a socialist state with no prospects for a better future.

When the government provides all, it takes away all freedom and liberty. Freedom and liberty is what made this the greatest country of all time.