If in a calendar year a person has in excess of $100,000 in medical expense they are transferred over to Medicare, regardless of age.
The remainder of the citizenry is able to choose from a competitive insurance market, which is essentially selling $100,000 “Term” health insurance policies.
That is from Kim Meyers of Northwestern. As she notes in an email to me, this can be combined with health savings accounts and various kinds of deregulation for the coverage of the lesser expenses. You also can raise the Medicare eligiblity age and I would say you could raise it to a very high level indeed.
I view this as the most plausible way of bringing a Singapore-like health care system to the United States.
During the 2004 campaign, John Kerry proposed a very similar plan. Almost every Republican I know supported his plan, at least until they learned it was proposed by a Democrat.
"I have a plan that's going to allow people 55 to 64 to buy-in to Medicare early. And I have a plan that will take the catastrophic cases out of the system, off your backs, pay for it out of a federal fund, which lowers the premiums for everybody in America, makes American business more competitive, and makes health care more affordable."
Unless Kerry's plan included deregulation and increased competition, I doubt it would make health care more affordable. How could it?
The problem is political. Politicans like to spend health care dollars in visible ways that touch lots of people. They do not like to spend a lot of money in invisible ways that affect only a few.
That's why Medicare pays for so many upfront expenses, while leaving seniors exposed for catastrophic ones. It's also why so many other countries overprovide to the healthy and underprovide to the sick.
"If in a calendar year a person has in excess of $100,000 in medical expense they are transferred over to Medicare, regardless of age."
So as soon as I need health care the most, I'm moved to the back of the line? Likely very good for cost savings but not very consumer-friendly.
At minimum, this is much more understandable than the current system.
This might also bring costs down, as many people would self-insure under these cases — and therefore start paying close attention to prices.
It's always disturbing that the trend is towards the reverse of this– plans that cover initial expenses, but cap out.
Apparently people want it that way, though. People appear to HATE the idea of paying for the first dollar of coverage. I know otherwise intelligent people that will gladly pay $1500 extra in premiums in a year instead of having a $1000 higher deductible on otherwise identical plans.
Here in Canada, we pay nothing up front. But there are a lot of back end costs associated with it – affordability is just one metric. I think Americans would be very unhappy with a truly efficient health care system (like a just-in-time system) because then you have no ability to deal with surges. Surges lead to backups, and if you don't have enough downtime the backups become chronic. And once you have chronic backups, the definition of "urgent" changes:
http://www.nationalpost.com/news/Ontario+told+bra…
This doesn't do anything for cost control. What is needed actually is "Rationing" and "Death Panels", but you know how that sounds politically.
I will be interesting to see how how Brewer and Arizona republicans deal with the "Death Panels", it will be nice to see if they are actually brave or just bullies.
$100K is arbitrary. It should be indexed to something. Otherwise, you will have enough inflation to get an inordinate number of people to $100K quickly.
I think I proposed this in a comment back in the spring.
I think the issues are as noted above. Some people would gamble on not buying a policy at all (moral hzd). Insurers would if permitted avoid covering any serious illnesses (Adverse selection). That is pretty easily addressed by simply saying every insurer must cover every person and the buyers have to be in very large risk pools.
No evident cost control.
No real insurance type pricing unless you can factor in pre-existing conditins and risky lifestyles. Which I think we should do but I understand is not the prevailing popular view.
By coincidence, I went to a luncheon speech today by a former official who was very involved in the HCR efforts and he explained the reason why this mechanism isn't an answer. He said high cost patients is where all the cost growth comes from. It seems 5% of all Medicare beneficiariesaccount for 25 % of Medicare expenses and 25% of all Medicare beneficiaries account for 85% of Medicare expenses. So this just shovels more high cost patients into a system that is not controllilng costs to begin with. Most of those costs are for chronic and end of life treatments. So something is needed to restrain patient and provider demand for those high cost treatments.
I view this as the most plausible way of bringing a Singapore-like health care system to the United States.
How are you going to sell this to the for-profit insurers who really earn money taking a cut from every dollar in premium they get as profit? As long as each is competitive, no insurer pays out more or less than the others and so their premiums will be the same. Various product differs will attract buyers at low cost without altering things. (If an insurer figured out the magic pill to cut sickness in half, all the others would find one to match, or go out of business.)
But the biggest hurdle is Singapore has universal coverage, just like all the other nations with equal or better outcomes and significantly lower costs.
The reason for the annual "doc fix" and other issues with Medicare is those dealing with Medicare as patient or provider consider those hit by the price controls to be victims of cuts that are not shared by all. For the Medicare set, who "over" vote, no politician is going to campaign on "to cut taxes we need to impose draconian price controls and ration your Medicare. But really, you are much better off even with this rationing than tens of millions of working poor we simply deny any health care at all until they get sick enough to fall into poverty and qualify for Medicaid. We are treating you really well even with these cuts to Medicare because you vote, while screwing the working poor who don't vote."
With universal coverage, the problem of health care costs become more about shared sacrifice.
But in the US since 1980, the only message that wins elections is "America means no sacrifice". Reagan campaigned against Carter by attacking Carter's honest assessment of the problems the US faced which in the 70s was revealed to be a dependence on imported oil. He then said that with some sacrifice, the US would overcome this and become energy independence and much better off, just as the US had done in WWII and other previous periods of great challenge.
Reagan attacked that with "we are a superpower and the world bents to serve us and we will not sacrifice."
And ever since, those who call for or require sacrifice, even when the sacrifice produces better futures, is punished. Look at what happened to HW Bush, Democrats and the Republicans who worked with them, and Clinton, when they hiked taxes, reduced the deficit and got the economy on really sound footing, delivering jobs and income growth.
Since 2001, tax cut after tax cut wins reelection even as the economy has performed badly over the entire decade compared to the 90s.
The low cost of the Singapore health system, and overall economic performance, is due to everyone sacrificing things – "liberty" – in exchange for "wealth".
It is a very good plan, but we must take care of this because there are people that don t want to do it. <a rel="dofollow" href="http://www.auto-my.ro/piese-auto" title="piese auto"><img src="http://www.all-auto.ro/img/a%20auto" alt="piese auto" vspace="2" border="0" hspace="2">
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