"Layaway..."

 

After presenting the P.S.Y.C.H plan, I always get the question, "How do we pay for it?"

 

Health care costs are exorbitant and are estranged from the actual costs of providing medical care. My supposition is that these costs are extreme because of so many "hands in the cookie jar" in the form of third-party payors, in addition to administrative costs, greed, sleight of hand, uncoupled personal responsibility, and an overriding sense of entitlement.

 

  • In order to reign in costs, provide transparency, promote fairness, and reward innovation, we must keep in mind "what we know" about how our current health care delivery system is set up (i.e. patients, providers, and places).

  • Next, we must implement the new plan in a systemized fashion, starting with kids (Pediatric P.S.Y.C.H.), the chronically ill (Bridging P.S.Y.C.H.), older folks (Geriatric P.S.Y.C.H.), then the rest of us (Adult P.S.Y.C.H.).

  • Lastly, we let the market forces, personal responsibility, and behavioral modification work their magic.

Steps to Paying the Cost

 

1. Set a price list. For every diagnosis, there are a range of possible costs. Since this cost structure already exists, it is a simple place to start. In fact, we could probably simply decrease the insurance company's price list by 75 percent, and voila! Ideally, a group of providers from all health care dimensions (medicine, mental health, and surgery) would sit down with financial experts and devise an exact price list.

 

  • There should be a delineation between inpatient and outpatient as inpatient stays are inherently more complex than outpatient visits.

  • This should be done on a state-by-state basis thereby building competition for resources and subsequently driving down costs while encouraging states to aggressively manage their own health costs and the health of their population.

  • The process should be extremely transparent for the public to witness.

  • The costs should be hypothetically equal to the actual costs that a patient would directly pay to their treating provider – outside of preventative visits that should be covered by the government, either federal or state.

  • Beyond the basic costs, providers can choose to charge more if they feel they offer a better service or product than other providers. The market will take care of the rest.

 

For example, if a patient comes in for an outpatient viral illness coded to be $25, the patient pays $25. This encourages patients to be good stewards of their finances. If a provider charges $35, the patient will know before they go and can choose to pay or wait and see a different provider for less. This encourages providers to be the best without relegating them to non-payment and bound to an ineffcient system. If a patient ends up being transferred to a hospital, there would be no outpatient fee, and the hospital visit would be covered at 90-100 percent. This allows providers the leeway to use their judgement while educating the patient on what emergent illnesses look like. 

 

2. Create a general health coverage fund. Let’s face it, nothing is free. Every adult – excluding the chronically ill and geriatric populations – should contribute a percentage of their income to funding the system. You might think of it as a “progressive donation!”

 

  • The general health coverage fund covers all preventative care and a percentage of sick visits (see individual P.S.Y.C.H. plans for the breakdown).

  • This fund would be run state-by-state under the direction of a nonprofit entity.

  • Every cent in the fund would be transparently placed on a public website, including the salaries of directors, and any employees of the nonprofit. Citizens will know exactly what’s in the fund and can adjust their behaviors accordingly, just like individual families do with their budgets every month.

  • The 50 nonprofits can then leverage the cost of prescriptions and medical devices directly with Big Pharma and medical device companies thereby pushing down the price. Allowing individual states' nonprofits to contract directly with overseas drug manufactures will drive the price down even further.

  • Crowdsourcing could be set up statewide alllowing philanthropic individuals to help others by donating extra money for that fiscal year.

  • A representative group of patients, providers, and places could meet yearly to adjust pricing to stay fair and assess the health landscape of each state.

  • Of course, money would also be garnered from Medicaid, CHIP, Medicare, VA, DoD, Social Security Disability, employer-funded insurance, health exchange costs, and personal taxes/fees.

 

3. Designate all health insurance provided by current health insurance companies as catastrophic insurance for illnesses deemed the cause of personal decisions. In other words, if you choose to smoke and you end up in the hospital, it is your responsibility to have insurance that will cover the cost of the results of your decision. Again, the price list would already be set, so health insurance companies and facilities would already know what the fees would be. People can then either pay out of pocket or file claims like they currently do. Health insurance companies would continue to use their claims reviewers and could deny payment – which they will do to save money. However, the market will force them to either play ball to continue to exist, or stay profit driven and be replaced by a leaner competitor.

 

4. Provide universal health coverage paid as a percentage out of the general health coverage fund toward payment of catastrophic illness coverage deemed unrelated to personal decisions. For example, if you have been working hard to address your health markers and you still have a heart attack, your efforts will be taken into account when the bill is being paid by the general health coverage fund. Another example would be sickness or injury caused by severe weather, rare infections, or accidental trauma.

 

5. For Adult P.S.Y.C.H. members who cannot financially contribute to the general health coverage fund, their bills may be paid in volunteer time or educational time. Processing recycling, maintaining public spaces, sorting canned goods and donated clothes, studying for the GED, learning to read – these purposeful activities help individuals feel valued, which goes a long way toward social improvement on the whole.

 

 

Visit the blog for more discussions on these ideas.