Monday, August 03, 2009

Easy Health Care Reform

This Obamacare thing is getting out of hand. Promises and accusations are flying around like winged monkey's in Oz. Some people like what they have now and want to keep it.

Assurances aside, the language offered in the House version paints an entirely different picture. One must assume either those telling us we can keep our current coverage haven't read the bill, didn't understand what they read, or are simply lying.

You pick.

Most of the talk so far is about health care reform. There are a couple of problems with that language.

Most folks are satisfied with health care. They like their doctor. They like the ability to direct their care. So why change something that seems to be working?

Almost everyone, at least on the demand side of the equation, will argue the cost of health care is high. Too high in some cases.

None of the proposals or rhetoric do anything to really reduce the cost of health care. Yes, there is talk of savings through efficiencies, but that is mostly just talk. There is very little, if any, real savings in Washington's proposals for health care reform.

Lately the talk has shifted from health care reform to health insurance reform. Let's be honest. All of the talk, as well as the proposals put forth by the House, is really about throwing the current health insurance system out and starting over. The proposals swap insurance carrier bureaucracy with government bureaucracy.

Why is that an improvement?

The problems with our current health insurance system can be summed up very easily.

Some people can't afford health insurance.

Some can afford health insurance but can't find it due to pre-existing conditions.

A few don't like what they have now and want something different.

The solution seems quite simple to me. Capitalize on what works and expand on what exists.

Medicaid is a program for the poor and does a good job of taking care of those on the low end of the wage scale. There are some funding issues, particularly at the state level, but that will be addressed.

Rather than expanding Medicaid to provide free health insurance to those earning up to 400% of the FPL (Federal Poverty Level) as some have proposed, allow low income individuals and families to buy in on a sliding scale.

Free is good when you are on the receiving end but when something is free there is no appreciation of the value. By allowing folks to buy in, using a sliding scale, we preserve the financial integrity of the current system and give those who buy in some "skin in the game".

The next issue that is getting a lot of press is the idea of pre-existing medical conditions. The real reason why carriers will deny some folks based on pre-existing conditions is this. Carriers are not allowed to charge premiums that adequately reflect the true risk of some conditions. States approve plan design and premium levels. If the appropriate premium for an individual exceeds an amount allowed by the state coverage is denied.

We have a program in place for those who are deemed uninsurable. Actually, we have several systems including risk pools, open enrollment, guaranteed issue (in 6 states) and HIPAA conversion.

But there is one other health insurance system that doesn't get much play even though anyone admitted get's full coverage for pre-existing conditions.

If you are disabled and approved for SSDI, after 2 years you can go into Medicare. If Medicare is going to take you after two years of disability why not allow those with pre-existing conditions to buy in to Medicare without waiting 2 years?

Buy in? Most folks think Medicare is free.

Most who qualify for Medicare will receive Part A at no charge. But some can buy in to Medicare.

So if you cannot qualify for medically underwritten health insurance, and don't have access to other options, buy in to Medicare.

Allowing people to buy in to Medicaid and Medicare is much less expensive than the trillion+ amounts thrown around casually by Congress, but it does have a price. That means new taxes.

But instead of taxing the rich, taxing beer, taxing snack food, taxing cigarettes, taxing health insurance or taxing taxes, use a voluntary tax that works quite well.

Create a national lottery.

In many states, lottery funds are in the top five revenue sources. A national lottery is a painless and easy way to fund health care without creating debt for our children and grandchildren.

Keep what works. Allow buy in's to existing health insurance programs. Raise taxes with a voluntary tax.

Smaller cars, better health insurance, Poppa Washington.
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