tricityherald.com / Opinions / Columnists

reprint or license Print E-Mail

Sunday, Aug. 02, 2009

Health care funds need wise management

By Carl Cadwell, In Focus

For health care reform, let's tackle the low-hanging fruit and implement solutions that have shown they can work and are affordable.

There is already enough money in the system. The challenge is to direct more of it toward patient care.

Insurance companies take up to 40 percent of the insurance premium, and 60 percent goes to patient care. I will be glad to send any disbelieving readers our company's experience reporting to back this up.

I can't believe that one can't run an insurance company for half of that by implementing some modernization and streamlining.

It will take gutsy legislation to make this happen. And the money used by these companies to support and lobby candidates is staggering.

The insurance companies' take is the largest single cost in health care. And the 40 percent does not include the administrative requirements of medical practices, clinics and hospitals needed to process insurance claims. The real total administrative costs are over 50 percent.

The medical home model recently opened by Swedish Hospital in Seattle provides primary care to most for $45 per month, unlimited visits. No waiting, same day or next day appointments. No insurance, no billings, no administration.

In addition, relatively inexpensive individual insurance for specialty care is available, or the uninsured are afforded reduced fees for out-of-pocket services. At last, an affordable primary care that is available to anyone.

Make it legislatively possible for this to be done in all states. We are strangled by insurance commissions that favor the large insurance carriers and limit the ability to innovate.

The LyfeBank system offers a portable health care model that for the first time allows multiple employers to participate and travels with the individual. It makes it possible for part-time employees and seasonal workers to have health care coverage paid by employers at reasonable rates.

It can also be done with pretax dollars, further reducing the cost. This can be done through an employer or on an individual basis. LyfeBank is now licensed in 49 states.

What about consumer-driven health care? It can be universal, efficient and end up costing less money. It actually exists in Switzerland, which has health care outcomes comparable to the U.S. and costs that are 40 percent lower.

Switzerland has an individual mandate requiring everyone to be covered by private insurance. No employer or government coverage and the poor are subsidized to help them buy insurance. There are 84 insurance companies bidding for the business of a population of only 7.6 million.

Where does tort reform play into the picture? This is another area of cost escalation to cover the liability. Medical tests that are marginally productive are ordered to protect the service provider from a potential lawsuit. Tort reform needs to be a major player to protect the service provider with limits placed on pain and suffering.

The constraints placed on HSAs (Health Savings Accounts) are preventing the adoption on a large scale. An HSA allows an individual to control the spending from a savings account that the individual or the employer can contribute to. The biggest single problem for widespread adoption is that medications can only be handled as any other expense.

The difference between what the uninsured pays at retail and what an insured individual pays for health care is staggering. So the person who pays for health care out of their pocket is often charged two to three times what a person who has health care is charged through their insurance carrier.

Enact legislation that removes this inequity. It prevents companies from self-insuring because the costs of care are double or triple what an insurance company has negotiated with their preferred providers.

I don't see proponents of health care reform touting massive government-run systems of Medicare/Medicaid and Veterans Administration as shining examples of successes.

The Medicare system is already broken. Our physical therapy clinic is spending most of the administration time dealing with the Medicare delivery system, unable to get paid and doing multiple resubmissions.

And the reimbursement does not cover the cost of delivery with onerous rules of who can deliver what service and on what frequency with multiple re-evaluations.

I am opposed to the proposed federal health care legislation. It is too expensive and would create an even larger, more costly and more inefficient bureaucracy.

There are great solutions available for the dollars already in the health care system.

* Carl Cadwell owns Cadwell Laboratories in Kennewick.

@Nyx.AuthorDisplayName@ wrote on @Nyx.PostedAtTime@:

@Nyx.CommentBody@

@Nyx.Recommender@ @Nyx.AbuseReporter@