On the Health Care Crisis

doctorI interrupt your regularly scheduled programming for a post on the health care crisis.

Also, I have to apologize for being AWOL lately.  I’ve had a lot of potential posts running through my mind–the majority of which I’ve decided are thoughts best kept to myself.  😉  So it’s been hard to find something to write about.

However, this morning a good friend and former professor had this message posted as his Facebook status update:

No one should die because they cannot afford health care, and no one should go broke because they get sick. If you agree, please post this as your status for the rest of the day.

I went ahead and re-posted it, because it’s hard to disagree with the sentiment, but made the following disclaimer immediately afterwards:

I agree, but I believe the solution for 95% of the population is for each person to carry their own private, high-deductible health insurance plan.

I’d like to expand on this, because it’s critical.

Is there a health care crisis in America?  Yes.  Are insurance companies often unscrupulous and difficult to work with? Yes.  Do we need to do something to fix it?  Absolutely.

But a federal mandate to buy a product that is the cause of much of the cost inflation and corruption in the healthcare industry is not a viable solution.  It won’t work.

While I agree that access to quality health care is a fundamental human right, the American people have fundamentally misunderstood what insurance is and what it’s supposed to do.  We have conflated the health care with health insurance.

Friends, insurance is NOT health care.

After doing considerable research on the topic, here is a common-sense proposal that I believe will solve a good portion of the health care problems facing America.

1. Health insurance should NOT be a workplace benefit, but an INDIVIDUAL responsibility. Too many people are glued to jobs they hate because the benefits are “too good to leave.”  Like life, auto, or disability insurance, people should carry their own private, portable policies–allowing them freedom to work when and where they want.  This will also be a MAJOR cost-cutter for employers and business owners, the savings from which they can reinvest back into higher salaries and marketing to grow their businesses, create more jobs and fuel the economy.

2. Most individuals should carry low-premium, high-deductible insurance plans. The private policy Lanny and I carry costs us $150 a month for our entire family.  We have a $7,500 deductible.  Routine office visits like check-ups and regular sicknesses require a $25 co-pay, and generic prescriptions are covered at $10 a piece (though thanks to Wal-Mart, we can get them as low as $5–NO POLICY REQUIRED [thank you, free market]).  All other medical expenses we pay for entirely out of our own pockets.

This is a tremendous benefit to us AND society. Why? We have PERSONAL RESPONSIBILITY and ACCOUNTABILITY for our use of the system. We don’t go running to the ER for every skinned knee…we have an incentive to practice personal wellness and preventative care…and we ask more questions in the doctor’s office: “What will that cost? Why? What are the benefits vs. the risks?” It makes us more responsible, ethical, informed health care consumers.

Look, $7,500 is a lot of money for people like us.  If one of us were to get sick or suffer a major injury and max out the deductible, it would be a burden.  But hospitals are generally very willing to work with you on payment options…and $7,500 is NOT going to ruin us–or ANYONE above the poverty line.

Remember: insurance exists to MITIGATE risk…NOT provide “free” benefits.  There is no such thing as free, nor should there be, in health care or anything else.  What the vast majority of average, healthy people need is protection against financial ruin in the case of a medical emergency, and a clear incentive for personal responsibility and accountability for their own wellness.  Affordable, high deductible plans like the one we carry, do this.

3. There should be protections in place for the exceptions: the extremely impoverished, children, and the critically ill.

This is where there might be room for government intervention (I’d prefer a private solution–or at least a private-government hybrid solution because I generally distrust the government with complex things, but okay).  People who are ill enough that they pose too high a risk for traditional insurance, who are too poor to pay for the premiums or deal with high deductibles, and children of parents in this situation, do need special protection and there should be programs in place to provide it.

PLEASE NOTE, however, that by “extremely impoverished” I mean extremely impoverished. Premiums for the kind of plan I’ve been discussing run anywhere from $40-$100 a person, depending on your age and other health factors.  Most people spend much more than that each month on satellite TV, high-speed Internet, cell phones, Netflix subscriptions, trips to Starbucks, movie tickets, iTunes purchases, eating out, etc.  If you have to cut back on some of your luxuries in order to be responsible for your health, so be it.

It’s called being an adult.

I do it.  Other people do it.  You can do it, too.

Once people start paying for medical expenses DIRECTLY, and dealing with insurance companies DIRECTLY, just watch as medical costs, insurance hassles, and even premiums “magically” decrease.

That’s because consumers will be much more interested and involved in what’s going on with their health care:  “Are you really going to charge me $25 for that single dose of Ibuprofen?  No thank you, I’ll buy 50 pills myself from Walgreen’s for $4.”

Doctors, hospitals, and private practices will be forced to innovate and market–like the rest of us.  They’ll have to come up with good reasons for consumers to pick them instead of their competitors.  They’ll save literally BILLIONS of dollars a year on insurance paperwork, claims, and insurance hassles, cutting costs overall.

In conclusion, I’d encourage you to watch this 20/20 special with John Stossel.  Definitely major food for thought and well worth your time.

I’d love to get your feedback on my ideas.  Please leave your comments below!


About Katie L

A doubter by nature, a believer by grace.

Posted on September 3, 2009, in News and Current Events and tagged , , , , , , , , . Bookmark the permalink. 6 Comments.

  1. Ah yes, Katie. But of course, you make too much sense. This would not allow the statists in the Federal Govt. to assume control of 15+ % of the US economy and expand the dependent class. That would preserve liberty and free market capitalism and prevent the global fascists from seizing the reigns of industry for their own eutopian ends. And that would prevent us all from facing east to the great god Obama 3 times a day as we give thanks for his beneficience, goodness and glory. No! We can’t let such reason prevail–you freakin’ tea party terrorist, you!

  2. I can’t get into this too much, or I’ll accomplish nothing today. FWIW,

    But why the hell do we assume the government will do a better job?

    AMEN! What’s even worse, is somehow the government thinks they can do a better job!!!

    And what’s going to happen when the government (who has no competition and can spend money they don’t have ad nauseam) is in the health insurance market with legitimate businesses who have to stay in the black? The government’s prices will be lower. Of course they will be. You know they will be. And which option will people choose? Duh, the cheaper one! And thus the government will gradually achieve a complete monopoly of the health insurance market.

    I was unaware that low premium / high deductible plans were so affordable. Honestly, I think every American should have or be working towards having a 3-6 month emergency fund. If people did that, $7,500 would not cripple them financially. We did Dave Ramsey’s “Total Money Makeover” and we VERY quickly built up a $1,000 emergency fund then got out of debt, and now are building a much larger emergency fund.

    As it is, you make a good point – $7,500 is not going to destroy anyone financially – hospitals are indeed very willing to work with people on payment plans. Unfortunately many Americans have a mountain of debt, making any unexpected expenses incredibly difficult to deal with.

    Most people spend much more than that each month on satellite TV, high-speed Internet, cell phones, Netflix subscriptions, trips to Starbucks, movie tickets, iTunes purchases, eating out, etc.

    Not to mention beer, cigarettes, lottery tickets, soda pop, magazine subscriptions, and a host of other things that lots of people spend money on…

  3. Thanks for the feedback, Tom. Completely agree. We’re doing My Total Money Makeover too!!! I love it. We have our mini emergency fund and are working on knocking out all our stupid credit card and school debt.

    I actually did a bit more research and discovered that Idaho (where we live) is one of the least expensive states for high-deductible plans like the one I mentioned. So add to my solution above that plans need to be available AND portable across state lines. It’s absolutely ridiculous some of the restrictions in place now.

  4. I should add that my wife teaches high school chemistry, and I make the chemistry department minimum for grad student stipend, which isn’t a ton, but between the two of us we make a decent income. Others may not be as fortunate, so building up emergency funds can be more of a challenge.

    At least I made more than $1200 last year.. 🙂

  5. AMEN KATIE!!! Thanks for writing this, now I don’t have to. I feel like we have just opened ourselves up as a country to hemorrhage money in the coming years and never see an economic recovery…

  6. Everyone should have a place to live. But that does not mean everyone has the right to be provided with a free luxury townhouse.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: