| So... what's at the core of our healthcare mess? The | | | | the rapacious malpractice attorneys. Ultimately, the |
| doctors and hospitals overcharging? Insurance | | | | result is less service for a higher cost. |
| companies stealing from everyone? Pharmaceutical | | | | Now, most Americans get health insurance through |
| companies paying-off Senators to allow the | | | | their employers (or the government), who pick up |
| continuance of obscene pricing? Medical device | | | | most, if not all of the premium payments. In recent |
| manufacturers creating margins of a million percent? | | | | years, as the cost of insurance has escalated, the |
| The government's ineptitude at administering the | | | | employers have passed more of the costs on to the |
| Medicare program? Well, yes. And no. These are all | | | | employees. So an employee might be paying $50, for |
| contributors (and there are many, many more), but | | | | example, out of each bi-weekly paycheck for health |
| as Curly said to Billy Crystal in City Slickers, it comes | | | | insurance ($1,200/year) plus a $20 co-pay when they |
| down to "One Thing." | | | | see their doctor. But their employer is likely paying |
| Now, it took Billy 1:45 of cinema run time to figure | | | | $20,000/year to their insurance company (or |
| out what that One Thing is. But for the rest of us | | | | self-insured administrator) on their behalf. A nice perk, |
| 300+ million Americans, this healthcare movie is like | | | | but very few employees recognize or appreciate this. |
| watching "Lost" - there's no real answer and there's | | | | They see the health benefit as a "given right" instead |
| no end in sight. So I'm here to give you the answers | | | | of viewing it as additional compensation. I have a |
| to the SATs. | | | | friend who just lost his senior-level Wall Street job, |
| The "One Thing" is entitlement. Every American feels | | | | and his primary complaint is that, in addition to not |
| entitled to receive healthcare services for free. It's | | | | earning income, he now has to pay $25,000/yr for |
| why we constantly complain about $20 copayments | | | | health insurance for his family. In the words of Bruce |
| and deductibles. We think that's unfair. The doctors | | | | Willis, "welcome to the party, pal." He has been |
| and hospitals make enough money. Why should we | | | | incessantly whining because this is a new expense for |
| have to shell out hard-earned cash because we were | | | | him that is unfair. Of course, the fact that he earned |
| unlucky enough to get sick or hurt? I mean, how | | | | a million dollars a year for umpteen years and got |
| much did it really cost the doctor to look in my kid's | | | | health coverage for free didn't seem to soften the |
| ear for 5 seconds and write a stupid prescription? Is | | | | blow for him. Entitlement! |
| the cost of the ink that much? | | | | And then there's the "pass the bill" attitude. Since |
| Most people deny this is the way they feel. They'll tell | | | | insurance is paying the majority of our healthcare bills, |
| you that doctors should get paid well. But the truth | | | | we want to get the most for our money. It's like |
| is, that is EXACTLY how we all feel. We just don't | | | | going out to a fine restaurant with a large group. |
| want to pay for this stuff. So where does this | | | | Everyone subscribes to the Nash Equilibrium concept |
| feeling of entitlement come from? | | | | and orders the most expensive dish and multiple |
| Well, it starts with the insurance companies. There is | | | | drinks, figuring that when the bill is split equally among |
| always going to be a problem when you have a third | | | | the throng, they'll pay less than their fair share |
| party paying the bills. Think of it this way... if your | | | | because those that have consumed less will make-up |
| father is filthy rich and he happily pays all of your bills, | | | | the difference. The only problem is, in healthcare |
| how much attention are you going to pay to prices | | | | everyone is gaming the system. |
| or the amount of stuff that you buy? Well guess | | | | So we all go to the doctor and allow him/her to take |
| what... when it comes to healthcare, most of us have | | | | unnecessary x-rays, perform extra blood tests, do |
| that rich father. Let me 'splain. | | | | unnecessary vascular doppler studies, hearing tests, |
| A couple of generations ago, insurance companies | | | | physical therapy - whatever - because the insurance |
| recognized a new way to make money by wedging | | | | company is paying. What do we care?? |
| their way in between the doctors and the patients. | | | | Well, here's what happens. The bills get passed to |
| The result of this was, and is, a system where | | | | the insurance company and they respond by raising |
| patients see their doctors, and their insurance | | | | the price of coverage, which you and I pay directly, |
| company mails their doctor a check. Free healthcare. | | | | or indirectly in the form of a smaller paycheck from |
| In point of fact, the original "indemnity" plans paid | | | | our employer. And we thought we were getting |
| 80% of the doctor's charges, but the doctors never | | | | away with something - that someone else would |
| bothered to collect the other 20% from the patient | | | | pick-up the tab. In reality, when you litter in |
| because the reimbursement was so good, and | | | | healthcare, you will, at some point, have to clean-up |
| because they didn't want to upset their "customer". | | | | your own mess. The penalty is guaranteed... it's just |
| But then came the '80s Wall Street boom. The | | | | delayed. |
| doctors saw how much money their investment | | | | Now, in the case where Medicare (the government) |
| banker friends were making, and wanted to even the | | | | is the insurer, eventually the system runs out of |
| playing field. So they started charging more for their | | | | money. And they can't pass the loss on to |
| services, unbundling their bills and performing more | | | | employers, so they pass it on to the tax payer - |
| money-generating services and tests. | | | | YOU and ME! So along comes Obama who says we |
| The same greed entered the hospital, pharmaceutical, | | | | have to fix this. Well... there are 3 components of |
| medical device, and other healthcare sectors resulting | | | | healthcare delivery, and to fix the system, all 3 have |
| in an explosive increase in costs to the insurers. The | | | | to lose money. And we all know, nobody likes to lose |
| insurers (never ones to lose money) responded by | | | | money. Those 3 components are 1) Providers [i.e. |
| developing managed care plans (HMOs & PPOs) to | | | | doctors and hospitals]; 2) Insurance companies; and |
| control costs, cutting back on benefits, instituting | | | | 3) Businesses that feed off healthcare like pharma |
| lifetime caps and exemptions for pre-existing | | | | companies, blood labs, imaging centers, medical device |
| conditions, requiring referrals and preauthorizations, | | | | manufacturers, etc. And all three lobby heavily to |
| establishing co-pay requirements, increasing | | | | both sides of the aisle to block this new legislation |
| deductibles and raising premiums. Doctors got paid | | | | that will blow-up the runaway, money-generating |
| less and responded by billing more aggressively and | | | | healthcare gravy train. |
| performing extra tests to protect themselves from | | | | |