Thursday, July 23, 2009

Why we don't want a safety net.

Healthcare reform is all the rage here in the US. However, people keep talking about it in the wrong terms. There's talk of building a "safety net". We actually already have a safety net - they're called emergency rooms. However, a safety net is like the airbag in your car - it's there for when things go very wrong, and ideally, you want to never, ever use it. I will be extremely happy if I never find out what an airbag deployment feels like.

So no, we don't want a safety net. What we want is something like a balance pole or a set of anti-lock brakes. We want something that will keep us from having to use the "gone-to-hell" option. Here's my suggestion:

Part 1: all healthcare funding providers (insurance, public option, whatever) must offer a physical exam at no cost, a minimum of once a year. No cost means no cost; no deductible, no copay, no "after repayment"; NO cost. The moment this becomes a cost, people will decide not to do it. We're trying to get people to look after themselves better; the less it costs, the more likely they are to do it. So, zero-cost physicals every year. Please note that this is only a "must offer" - there should be no compulsion for anyone to go if they prefer not to.

Part 2: no healthcare provider may deny coverage of anything coming up in the free physical. Let's not provide a "free gift" and then use it to punish people. If something shows up in the annual exam, then it shows up early, while it's still cheap to manage, and it can be prevented from turning into a huge problem that lands the person in a hospital. Yes, this will result in more paying for medication to manage conditions - but that's still a better deal than paying a huge sum for hospital treatment of something that could have been managed if only it had been detected earlier.

Part 3: let's incentivise. Healthcare providers may reduce premiums (if any are payable) for anyone taking advantage of the regular checkups. Let's face it, by taking some responsibility for keeping themselves healthy, they're reducing costs overall. Let's reward them. We need to recognise that healthcare provision is about making sure people who need healthcare get healthcare - it's not supposed to be about maximising shareholder return. I wish the markets would recognise this and value good healthcare outcomes highly - if the best way to maximise shareholder return is to do the right thing for the guy who needs a doctor, then everyone's interests align. As things stand, that's not the case, and so greed pulls the providers in the direction of denying healthcare.

And for those concerned about "bureaucrats deciding what I can be treated for" - would you please explain how that isn't happening right now - except with the bureaucrats being given large bonuses for finding ways to deny you healthcare, with absolutely no accountability, and with no standards for minimal acceptable care? I can't guarantee that government bureaucrats will be any better, but I will state that there is no prospect for there not being a minimum standard if the government takes over. That in itself will be an improvement.

I don't have a perfect plan. Nobody does. However, we need to start fixing what we can, and doing it now. If NASA had waited until they had a perfect plan, we would never have gotten men to the Moon. Let's shoot for the Moon on healthcare.


  1. uh... the healthcare equivalent of the the moon program would be to plan, announce, and deliver free health care to everyone for two days in an empty lot -- and then spend the next twenty years designing the letterhead upon which you planned to propose a design of an ambulance.

  2. Quote:
    "We need to recognise that healthcare provision is about making sure people who need healthcare get healthcare - it's not supposed to be about maximising shareholder return"

    And therein lies the fundamental problem about private commercial healthcare.

    In a commercial system, the number one priority is shareholder return. That's what commercial *means*. Thus private healthcare will *fundamentally* be about maximising profits.

    This doesn't work for things like healthcare, because there's no real consumer choice - a consumer can only choose between dying or paying. Thus the usual supply/demand price caps don't properly apply, similar to how they don't apply to water and electricity.

    In the essential utilities, the only way to prevent this is to regulate end-user pricing.
    - However, this is much more complicated with healthcare because of the companies *knowing* that the best way to make a profit is not to pay out, and to pay out late.
    (Wait long enough and the insured will have died, end of problem)

    This is why civilised nations must have Government-provided healthcare. The government are beholden to the entire electorate, not the minority of shareholders.
    An adjustment of the French system is probably the best - the government provide the cash, but the patient decides where to spend it. Thus hospitals are private but the system is public.
    (The UK NHS is a very fine idea, but loses on the bureaucracy. If they got rid of the excess middle-managers it would be considerably more effective)


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