Healthcare: Proposal for US system reform.

Folks, it's really simple. Three simple things can revitalize the US healthcare system. All with no new taxes or government programs.

Problems (feel free to scroll to solution):

1. The American Medical Association operates as a complete monopoly in the US. The AMA does not allow tiered levels of care or "Healthcare provider", unlike almost every competitive marketplace. Doctors from other countries, no matter how advanced the doctor or country, are barred from doing anything beyond nurse duties. To get checked and prescribed a simple drug (i.e. antibiotics or nasal-spray) for a stuffed nose or bad cold requires a fully fledged doctor.

2. Insurance companies suck up much of the "Healthcare dollars" in this country, without actually providing any value to the equation. Even without any major health issues, we are constantly fighting with the insurance company to properly pay for even the most basic and expected procedures. Blue Shield just refused to pay for a standard 5 month ultrasound on my pregnant wife! Of course, that's just their standard tactic which was reversed only after 4 phone calls wasting my time, and consuming paid staffer time at Blue Shield. Of course, both my and the BS staff time were paid for ultimately by a tax on my wages (my company pays most, and I pay part of my premiums).

3. The big pharmaceutical industry spends at least twice as much on advertising and lobbying, as on R&D. (reference: http://www.aarp.org/bulletin/medicare/a2003-06-23-drugindustry-.html). Stats: 13% of revenue goes to R&D, 35% on advertising and lobbying.


Solutions:
1. Break the AMA's monopoly on healthcare in the US. Allow doctors from other countries to compete for our needs. Simply deregulating the AMA's current stranglehold on healthcare here will spur innovation in private practices and lower tier doctors. I'd certainly rather see a trained nurse who can prescribe an antibiotic on the weekend, perhaps paying out of pocket, than wait until Monday when the official "Doctors" are in. I suspect that for many things such as basic care, colds, flues, and wellness exams, we could shave 50% off of the 15 years of training AMA doctors receive with virtually no change in quality.

2. Require employers to fully disclose health care plan costs, and allow responsible adults to choose the best plans for them. If my company is willing to pay $200 / month, I should have the choice of spending $200 on an HMO, or $100 on catestrophic / high deductable insurance and taking the other $100/month in the form of a privately administered tax-free flex-spending account. Let me use that $100 / month to pay directly for the services we need.

The first awesome benefit here is that 9 out of 10 insurance claims would go away, and the insurance companies (at least servicing my account) would need vastly less staff and overhead. Think about the competition that drove down life insurance policies when the internet started. Now, imagine that for healthcare. It's the cost per transaction that is killing us, and with even one child, our insurance company is probably processing at least one transaction per month, even though they would cost only $50 or so at a private practice. This step alone could cut 20% off the cost of US healthcare! (Source: http://content.nejm.org/cgi/content/abstract/324/18/1253 "[administration cost]... 19.3 to 24.1 percent of total spending on health care".)

The second great benefit is that the prices for basic care would be transparent and competitive. If you knew of two great healthcare centers near your home or work, and one charged $75 while the other charged $50 for the same visit, who would you choose? Some might say that the quality would drop, but I say the opposite is true. My cousin in Portland, OR, runs a private fee-based, no insurance practice and business is booming. She actually has a waiting list of families ready to pay $5000 / year simply to have direct access to a real doctor without having to go through three administrative staff before seeing her. She says she now spends much more time with patients, less time filling out paperwork, and both she and her patients are happier.

3. Pass a single regulation disallowing the pharmaceutical industry from advertising products to people who can't legally choose whether to use them. In other words, prescription-only drug advertisements should not be allowed on mass-media. Freedom of speech you say? There is plenty of precedent for this. We don't allow alcohol or tobacco ads on TV while children are usually awake, and similar for violent TV. While some would cry foul, it's crazy to think that paid mass advertising will (or should!) increase the amount of consumers for, say blood-pressure medication. While they would complain, the pharmaceutical companies would enjoy an immediate and substantial reduction in costs.


Summary: These may seem like crazy ideas, but I propose that with extremely lightweight legislation and zero government cost or taxes, we can dramatically improve healthcare across the US. If you even pick any two of these ideas, I think we can easily reduce health care costs by 20%. With all three, I think that percentage is far higher. With the second idea alone, not only would costs be shaved, but I predict the quality of healthcare would quickly rise with individual choice allowed.