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Monday, January 05, 2015 6:00 PM

Ten Easy Obamacare Fixes

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"Medicare for All" Problems

In the past few days I posted reader responses to Single-Payer "Medicare for All" Proposal; Live and Let Die; Why Does Single-Payer "Work" in Europe?

We heard from "Ken", a medical doctor in US Doctor Comments on Single-Payer "Medicare for All" Proposal.

We also heard comments from "David" a US Expatriate living in Europe, and "Peter" a Canadian Expatriate living in the US in my post US and Canadian Expatriates Comment on US Healthcare.

No Easy Solution? 

Peter from Canada says there are no easy solutions.

I disagree.  I believe there are plenty of solutions, some short-term, some long-term, all of them free-market based. Here are my eight proposals.

1. Freedom to Choose

In the fearmongering preceding the Obamacare vote, Republicans trumped up the notion of "death panels" and healthcare rationing, the "R" word.

The real issue is the "freedom to choose".

For example: I do not want to be kept alive if I am brain-dead or nearly so. Moreover, if my odds of survival are low and I am going to live the rest of my life in misery following some accident or cancer, then let me go. In return, I should pay far less for a policy that allows just that, given that an inordinate number of expenses occur in the last few months of someone's life.

The time to think about such issues is before problems happen, not after.

Others may disagree with my choices. And that is fine. But, those who want to be kept alive with extraordinary procedures, and those who have less than two years to live yet expect major treatment, should pay for that privilege.

Under Obamacare, healthy 20-year-olds pay excessively high rates, effectively subsidizing everyone else, whether that would be their actual choice or not.

One size does not fit all. Nor do arbitrary distinctions like Gold, Silver, and Bronze plans.

The more services you demand, and the more circumstances in which you demand them, (Obamacare fails to address the latter), the more you should pay.

2. Non-Emergency Surgery

Most major operations can be performed 50-80% cheaper in India, Europe, or the Caribbean.

For example, heart surgery in the US that may cost $30,000 (or far more), can be had in India for as little as $8,000 (see my post on Medical Tourism).

Except in the case of emergencies, such surgeries ought to be performed in the most cost-effective place.

Want to demand healthcare treatment in the US? OK but you should pay for it with higher healthcare premiums.

3. Drug Costs

It's time to eliminate drug import restrictions. There is no reason the US should be subsidizing prescription costs for the rest of the world.

4. Published Rates for Services

When you go into a store to buy a coat, it has a price. When you go to a car dealer there is a list price that everyone bargains from.

In contrast, most US consumers do not see the price for healthcare services. Worse yet, those who are above their yearly payout cap as well as those on Medicare with extended coverage, do not even care.

While I do not propose the government pass laws that force doctors to publish rates, it would be easy enough for the insurance industry to demand doctors do just that so that people can shop around.

5. Network Doctors

People like their own personal doctor. So do I. Want a non-network doctor? Under the current setup, you pay more for a non-network doctor even if that doctor is better qualified and willing to provide a service at a lower published rate!

Surely there is room for improvement here, starting with published rates for services and the definition of "network" doctor.

6. Cost of Education

The cost of education in the US is prohibitive. Then, following graduation, many doctors who do not go into private practice suffer through prolonged internship with low pay.

By the time doctors start benefiting from their education, most are so overloaded with debt that they have to charge high prices to cover the cost of accumulated debts and interest.

I believe we are undersupplied with doctors (wait times seem to indicate just that). I also propose the AMA wants to keep it that way. In fact, the entire healthcare industry wants to keep it that way because it eliminates competition and keeps costs up.

More visas for foreign doctors, accreditation for US citizens educated in other countries, and elimination of student aid that does little but make debt slaves out of students would all help.

7. Non-Emergency Procedures

Why does it take an MD to stitch a small wound or put a band-aid on a cut? There are many procedures that nurses could do at far lower cost.

Yes, I realize we pay a doctor for diagnosis. Yet, I suspect many nurses would be at least as good as doctors on the diagnosis score, even if nurses cannot perform major surgery.

I am not sure where the line moves, but I am sure there is adequate scope for moving the line as to what nurses and other healthcare professionals can handle.

8. Medical Fraud

Medicare fraud is rampant. So is disability insurance. I have written about Disability Fraud at least a dozen times.

60 Minutes: Mainstream Media Finally Catches on to Disability Fraud: 60 Minutes Reports on "Disability USA"

Steve Kroft on 60 Minutes reports on the alarming state of the federal disability program, which has exploded in size in the last six years and could become the first federal benefits program to run out of money.

NPR: Unwilling to Work; 25% in Hale County AL Collect Disability, 14 Million Nationwide
How Easy is it to Get Disability?

Hale county's Dr. Timberlake asks a simple question to all his patients. "What grade did you finish?" If you claim "back pain" and do not have a degree, Timberlake believes you are disabled.

The Disability Deal

Getting disability seems easy enough in some states, and especially easy in Hale County Alabama. But is disability better than minimum wage? The answer is yes. NPR author Chana Joffe-Walt explains: ....
States Promote Fraud: States Have an Incentive to Promote (Not Stop) Disability Fraud; So How Much Fraud Is There?
This all goes back to 1996 when president Bill Clinton promised to "end welfare as we know it". He did indeed do just that, and fraud is the result.


The federal government pays disability, but states pay part of welfare costs. This creates a huge incentive for states to actively promote disability fraud (simply to get people off state-sponsored welfare programs).
Results of Clinton Ending Welfare "As We Know It"

  • Every month 14 million Americans receive a disability check.
  • In 1961 the leading cause of disability was heart disease and strokes, totaling 25.7% of cases. Back pain was 8.3% of cases.
  • In 2011 the leading cause of disability was a hard to disprove back pain, totaling 33.8% of cases. The second leading cause was an equally difficult to disprove "mental illness" at 19.2%. Strokes and heart disease fell to 10.6%.
  • In West Virginia, a whopping 9% of the population collects disability checks. In Arkansas, 8.2% are on disability, and in Alabama and Kentucky, 8.1% collect disability. In Alaska, Hawaii, and Utah, the figure is 2.9%.
  • In Hale County Alabama 1 in 4 receive disability checks.
  • Nearly every case in Hale County Alabama has Dr. Perry Timberlake in common.
  • Those on Supplemental Security Income, a program for children and adults who are both poor and disabled is nearly seven times larger than 30 years ago.
  • Once people go onto disability, they almost never go back to work. Fewer than 1 percent of those who were on the federal program for disabled workers at the beginning of 2011 have returned to the workforce.

Dr. Timberlake asks a simple question to all his patients. "What grade did you finish?" If you claim "back pain" and do not have a degree, Timberlake believes you are disabled.

Timberlake gets paid for his "analysis".

States are willing to go along thanks to Bill Clinton who "ended welfare as we know it", creating an even worse disability fraud scheme in the wake.

There has been no president since then willing to stop fraud at the Federal level.

9. FDA Federal Death Agency

I was at a Casey conference last September and Doug Casey commented the FDA (Food and Drug Administration) ought to be reclassified as the Federal Death Agency.

I do not recall his objections but here are a few things I have noted.

Someone 80% likely to die of Ebola cannot get treatments that have worked in practice because the tests did not go to trial. Shouldn't this decision really be up to the individual?

Instead of a common sense, free-market approach, senator John McCain, Czar Hater, Calls For Ebola Czar.

In the opposite extreme, very expensive drugs get approved that offer no benefit over existing drugs. Doctors are pressured, even bribed by the pharmaceutical companies to prescribe these drugs.

Third, many proven drugs are available in Europe that are not available in the US.

Finally, many extremely expensive drugs (my deceased wife Joanne was on one of them for a year), at best extend life for a few months. In my case, Medicare picked up the tab, but I strongly question the benefits. I am talking about Riluzole (Rilutek).

There seems to be lots of room for improvement in this problem actegory.

10. Be Your Own Healthcare Advocate

My tenth item cannot be legislated, but it is important. Everyone needs to be their own healthcare advocate.

I had my own experience that nearly lead to a $20,000 needless prostate cancer surgery that may have left me incontinent and impotent.

Here are a couple posts on needless surgeries. The second one concerns me specifically.

  1. Unnecessary Surgeries? You Bet! Doctors Treat Patients as ATMs; US Healthcare System Explained in Six Succinct Points

  2. I Beat Prostate Cancer; Mish the Guinea Pig

The best ways to prevent needless surgeries are to become your own healthcare advocate, start questioning things, and get second or third opinions.

11. Tort Reform

I mention tort reform not as one of my easy fixes, but rather because so many people raise the issue that I felt a need to comment on it.

Tort law is what allows someone to sue for damages. The biggest proponents of tort reform are industry groups that wants to bear little to no responsibility for unsafe products.
Remember Ford Motor Company's exploding Pinto gas tanks and Firestone Tire Company's exploding radial tires?  Have we forgotten the devastation wrought by unsafe drugs like Thalidomide and Vioxx and products like the Dalkon Shield?

Inquiring minds may also wish to consider Why Conservatives Should be Against Tort Reform.

In general, pharmaceutical and insurance companies are the biggest proponents of tort reform. Both stand to gain even more than doctors from shielding. 

While I sympathize with doctors regarding the high cost of malpractice insurance, government mandated caps are not the ideal solution. 

Easy to Fix

Those who claim health insurance is "hard" to fix are mistaken. The ten ideas mentioned above are easy enough to implement. Every one of them is a free-market solution that is also compatible with Obamacare!

The 10 items I mentioned are just the beginning. And all of them are compatible with socialized healthcare even though I am sure that is not optimal. Every one of them involves increased competition or more patient awareness.

Making healthcare both better and more affordable is easy. Finding the political will to cooperate in fixing the problems is what's hard.

Mike "Mish" Shedlock

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