Here is an interesting perspective on controlling health care costs. I copied this from an article on Kaiser Health News talking about states controlling health insurance premium increase requests.
“Tired of complaints that underlying costs are the problem, but hearing no consensus from the health-care industry on how to solve it, Massachusetts Gov. Deval L. Patrick (D) introduced a broad proposal to overhaul the way health care is paid for. Part of the proposal would allow regulators to reject premium increases if insurers pay hospitals, doctors and others more than a limit set by the state.”
Read the above carefully; observe the stupidity of this politician and the mindset of price-fixing. So much for negotiations and competition among health care providers, every provider will expect no less than the limit set by the state. Never mind trying to understand the real issues, just take the short “fix”. On the other hand, this is no surprise as Massachusetts is the state that was the model for national health care which followed the Massachusetts example of expanding coverage before figuring out how to rein in costs or at least mitigate them somewhat.
Federal law already limits the loss ratios that insurance companies can maintain, that is, the percentage of premiums collected that must be paid out in health care claims. Here is a clue for the Governor, underlying costs are the problem, and they have always been the problem. How do I know this, because every large employer in the U.S. is self-insured, there is no insurance, no insurance company profit or loss ratio involved. For decades these health plans (covering about 70 million Americans) have been experiencing the same cost increases and related problems as everyone else. The only reason they may be less expensive is that they cover a working population that tends to be a bit healthier than the general public.
Here are some of the possible consequences of such a proposal:
- There are three components to cost, unit price, volume and intensity. So, if you put the squeeze on what is paid for a given service, what do you think will happen? You guessed it, an extra office visit or two, or perhaps an MRI instead of an X-ray.
- Some physicians will simply drop their participation in plans and thus being “out-of network” will be free to balance bill more patients.
- Massachusetts will be a far less attractive place for new physicians to set up practice, we are after all not talking about squeezing insurance companies we are talking about squeezing health care providers some of whom are already in a bind because of adverse selection caused by the Massachusetts law.
There are many experts out there who understand the underlying problems in health care and what needs to be done to resolve them, why do our politicians insist on ignoring these issues in favor of finding a new scapegoat thus diverting us from the real issues?
Related articles
- Massachusetts health-care reform associated with increased demand for medical safety-net facilities (medicalxpress.com)
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