A Simple Pragmatic Health Insurance Reform Plan

I’m writing this while sitting in a hospital waiting room while my father has a tumor removed. Obama is on the tv discussing the death of Ted Kennedy. So, this topic is heavy on the mind.

I have a simple, yet drastic, plan to solve the health insurance issue. Note, I did not say health care issue. That is a political term meant to fool you into thinking this is about your care. It is not. It’s about how you pay for that care. Stay focused people.

Eliminate The Middle Man

Eliminate all health insurance as we know it whether it be employer based or self insured. It’s an uber waste. Replace the current system with mandatory catastrophic insurance. Put the limit at 8k. Why 8k? This is the amount of money the average family will save per year by eliminating their insurance payment. If you have an unlikely procedure that requires more than 8k it will be covered. The rest of your routine care will be paid for out of pocket. This out of pocket cost is a fraction of what you currently pay per month. Replacing the current system, and preventing Obama’s proposed system, will save billions of dollars. Take this savings and transfer it directly to wellness programs. Stop treating the symptoms of this issue and find a cure. Sound simple? That’s because it is. You’re so used to this being complex. There’s a very good financial reason for that.

What would this do?

It would empower you to be the decision maker about how you pay for your health care. You’d pay for your care the same way you’d pay for anything else, with sound mind and complete freedom of choice. A choice with your best interest in mind. This would create a true free market where Hospitals and Doctors are competing for your business. Cost for care would plummet due to this increased competition. It would also create a direct relationship between you and your care provider without the bureaucracy that currently stands between you. This plan would also keep government from further expanding it’s power and reach into your personal life. It would remove the proposed billion dollar band-aid they plan to throw at the problem. This plan would transform American attitude towards wellness, creating a more mindful responsible America. Even though this plan will save you thousands of dollars per year, attitudes change once you’re pulling out your wallet every time you go for care. This plan would save the taxpayer billions of dollars. These dollars should be transferred into wellness programs that will further reduce the need for out of pocket and catastrophic use. This plan would decimate the wild cost of drugs. Again, the free market would reign in drug companies who charge a premium because they know it is insurance subsidized. People would shop and buy generic. Finally, this plan would eliminate the financial burden on your employer to cover some or all of your insurance. Why would you want to eliminate your boss paying for your care? Simple. It’s a nice thought that your employer is paying for you altruistically, but that’s simply not the case. The money your employer is using to pay for your care comes from somewhere. Eliminate their burden and you’d receive more than the standard cost of living raise. In other words, that money comes out of your paycheck one way or the other. Under this plan, you’d get it back.

Sounds good, but what about those that can’t afford the 8k?

Though more people will be able to afford the small monthly payment for catastrophic care, some people will still struggle to make the payment. The government should subsidize these families to cover them for catastrophic care thus freeing up their wallets for normal maintenance.

Conclusion

There is a reason insurance companies don’t offer true catastrophic care. It’s not profitable. Catastrophic insurance would cost a fraction of your old premium. The average American never comes close to using the money they pay in to insurance. If they did, insurance companies would cease to exist due to bankruptcy. Insurance is a profit business. We trust ourselves to purchase everything else in this world. Why not trust ourselves with the thing that matters most? Why trust an insurance company to buy your care for you? Finally, why trust the government? They’re a profit business as well. They speak of change in terms of metaphors, not actual pragmatic results based change. The guiding principle of any reform should be to put the consumer, not the insurer or the government, at the center of the system. I urge you to push for a sensible approach to reform.