Wednesday, January 12, 2011
Daniel J. Summers
This is the middle post of my three-post “Year in Review: The Good, the Bad, and the Ridiculous.” The linked words in that title will take you to the other two posts. Here are the things that I considered bad in 2010.
Wikileaks began as a whistleblower website, where people could release information about injustices. In 2010, they made a leap into classified government documents. Purportedly stolen by PFC Bradley Manning, these documents were not only embarrassing for some government agencies, the information contained in those documents identified informants and other non-public allies in the War or Terror. While the creator of Wikileaks, Julian Assange, is currently in custody (due to some somewhat-questionable sex crime charges), there is little legal enforceability on a citizen of another country disclosing secrets of another. Several US companies have severed ties with the site, and kudos to them for that; however, I believe that the net result of this will be bad.
What I've identified as the most ridiculous quote of 2010 (“We have to pass the bill to find out what's in it”) was spoken in reference to this bill. Going by the formal name of the Patient Protection and Affordable Care Act of 2010 (colloquially known as “Obamacare”), this bill enacted many reforms to our health care system, most notably in the area of insurance coverage. The bill mandates that all people purchase and retain health care insurance (a provision already rule unconstitutional), stipulates that insurers must cover preexisting conditions and may not drop insured people for certain conditions, and provides for the creation of a public co-op. There may be more, but at 1,300+ pages, who knows?
We are already seeing the unintended consequences of this legislation. Insurance rates are going up, with many companies raising rates 25% or more. This shouldn't catch anyone by surprise; what is called “insurance” in the bill is more like a membership. Insurance is a bet against bad things happening, which is the entire reason preexisting conditions aren't covered. Where's the bet when you know the outcome? Insurance rates are not designed for this type of use. (Conspiracy theorists could speculate that those who passed the law knew this. They really wanted public control, but the people didn't want it - instead, they passed a bill that will bankrupt the insurance companies. Then, who rides in to save the day? Liberal government!)
Insurance is but one of the problems with this bill; there are many others where the unintended consequences outweigh the intended benefits. Hopefully, the 112th Congress can undo this monstrosity before most of its provisions become effective. Until then, though, this remains on the bad list.
The FCC Implements Net Neutrality
“Net neutrality” is the concept that network service providers (ISPs, cell carriers, etc.) must treat all network traffic equally. This means that they cannot favor certain types of packets (ex. their own video streaming) while slowing down other packets (ex. competitors' video streaming, voice over IP). While, on the surface, this sound good, it fails to take into account bandwidth considerations, and the consequences of that bandwidth being used up. A TV signal can be broadcast through the air, and whether one TV or a million TVs receive the signal, the signal is the same; however, the same signal received over the Internet must be duplicated once for each end point receiving it - it is a request-response network. It's not as cut-and-dried of an issue as some of its more ardent supporters would like to paint it.
Congress has failed to implement net neutrality legislation, and courts have ruled that the Federal Communications Commission (FCC) has no jurisdiction to implement it on its own. That didn't stop the intrepid FCC, which issued net neutrality guidelines near the end of the year. Hopefully 2011 will find these regulations to be unenforceable; as it stands now, though, these regulations are bad, and have the potential to slow innovation around the network.
I've been asked by some, regarding my last post, what my solution is for the problems that plague our current health care system. I was also accused of being too verbose - so, here is my solution, minus the qualifications that tend to make my explanations longer. So, no griping about sweeping generalizations - just ask for clarification. :) Without further ado, I present Dr. Daniel's Prescription for Health Care Reform.
With the number of people who are in this country legally, we cannot support those who are not. This extends to emergency care as well, because if we leave that open, we'll just have illegals using the ER for their everyday health care. Raises the stakes a little, but we can't afford to fix everyone “for free.” Additionally, insurers must verify citizenship for their standard policyholders. They are still free to obtain health care at their own expense.
End HMO/PPO Discounts
This is the #1 thing that drives the cost of health care for the uninsured. To get what they need, providers have artificially inflated their charges; so, when they apply the HMO/PPO discounts, they get what they wanted to begin with. Make these post-markup, post-discount prices the standard prices, and health care becomes much more affordable, even for the self-insured (AKA uninsured).
Choose Your Own Coverage
There is no reason that a single male should buy a policy that, by law, must cover OB/GYN services. People should have the ability to select only the coverage they need, and companies should have the right to sell it to them. Don't want prescriptions covered? Don't buy the coverage - buy the $10 90-day supply from Wal-Mart instead. This will let premiums be lower for people who only desire catastrophic coverage, and would bring health insurance more in line with homeowner and auto insurance.
Just the Total, Please
There is absolutely no reason that someone should receive 4 bills for one visit. However, go to the ER, and you'll likely end up with a hospital bill, a doctor's group bill, a radiology bill, and maybe even a laboratory bill. Funnel all billing through one of these; the hospital or doctor's office is the one I would pick. This will make it easy to get estimates and totals for the consumer, and I'm sure that, given this requirement, these organizations could come up with an efficient way to make it happen pretty quickly. I see this as a parallel to the standard “Nutrition Facts” labels on food - one bill from one place, with no hidden charges.
There you have it. Take four of these and call me in the morning if pain persists.
Tuesday, August 4, 2009
Daniel J. Summers
I made a Facebook status update earlier today where I said I hoped that the mismanaged “Cash for Clunkers” program (C4C hereafter) had caused some people to think about whether they wanted the same people in charge of their health care. Of course, with the limited space for status updates, and my double-dose of verbosity (which is genetic, I thnk), I really didn't have room to flesh out my thoughts on the matter.
A review would be in order here. C4C is a government program that gives incentives for people to trade in cars deemed older and less fuel-efficient on a new car that is more fuel-efficient. A consumer group has a FAQ. A controversial provision of this bill is that these trade-ins must be completely destroyed - no parts can be salvaged at all, no tires, no body parts, nothing. One of my Facebook friends described the process they used - drain the oil, replace it with water, and run the engine until it seizes up. Anyway, this program was funded at $1 billion to go from July 24th to November 1st of this year. Yet, a short week later, the news begins to break that the program is almost out of money. There is talk of adding another $2 billion - that's $3 billion of our tax dollars to buy and destroy perfectly functional cars, because they don't fit someone's idea of a “good car.”
Regarding the way these cars are being destroyed - this is the classic broken window fallacy, the economic theory that says that vandalism is good for the economy. A boy breaks a window; the shopkeeper must get it replaced. This benefits the window maker, which can benefit others in turn. However, the fallacy is that it does not look at what the money that the shopkeeper had to use to fix the window might have otherwise been used to do. For example, while the window maker advances, the shoe maker and baker, who might have received the money the shopkeeper would have spent, are hurt. (As an aside - wouldn't it be better to keep the window maker in business by providing windows for new business? Oops - that was the greedy capitalist in me.)
Now, let's look at the health care issue. Nearly every proposal I've heard coming from Washington decries the number of uninsured people in this country, how much we pay for health care, and how bad the insurance companies are. There are many ways to go about this; I'll look at each of these in turn. As we do, keep in mind what happened to the “bad” cars in C4C.
We hear bad, bad things about the number of uninsured Americans - the latest numbers have it about 47 million. That's a lot, right? Maybe, but maybe not. One thing that these stats do not take into account is the number of people who choose to be uninsured. Many college students are uninsured by choice (or by lack of giving it a thought - that would have been me right after high school!). The census bureau said that the number of college students was 15.9 million in 2004. How about single people? I certainly didn't worry about health insurance when I was single. The census bureau said in 2007 that of the 92 million single people, 60% had never been married at all, and 15 million were over 65. Certainly not all of these are without insurance, but a good many may very well choose not to have it. That leaves the ones that can't afford it - we'll look at ways to make it more affordable in our third point.
Next up is how much we pay for health care. Yes, just like our military prowess, America is #1 in the world at spending per-capita on health care. We are also #1 in the world at medical advances and technology. These things do not come for free - what is the incentive for a company to develop the newest bang-up drug if they aren't going to be able to make enough money on it to fund the research it took to develop it? Altruism may be nice, but it doesn't put food on the table. While the exchange of money for services seems to be distasteful to some people, you'll look long and hard to find a better motivator. Why do doctors put themselves through years and years of education after most people are already out working? For a few, they may just love their fellow man that much, but for the most part, it's that American dream of making it, and having the things they want. How does one acquire things? Money.
All this talk about money brings us to those evil, horrible insurance companies. I've dealt with them just as many of you have, and it's frustrating to have things denied because a t wasn't crossed or an i dotted. However, let's look at what we expect from insurance. Does homeowner's insurance cover carpet cleaning, painting inside and out, and re-weatherstripping the windows? Does auto insurance cover oil changes, new tires, detailing, and radio upgrades? Then why must any health insurance cover check-ups? The litany of required services on some insurance providers is astounding - and, the consumer has no choice. I don't think I could go to a state in the Union and get an insurance plan that didn't cover maternity; as a male, I really don't think that's coverage I need. People view health insurance completely different from any other insurance. Why is it that, if something exists, people think that their health insurance should cover it? Some of these treatments or experimental procedures weren't even in existence when the policy was written, but people think that they're entitled to them.
This is where affordability comes in. Let insurance companies customize plans, so that people can buy just what they want (catastrophic coverage, for example) and exclude what they don't (TMJ). End the ridiculous “discounted rate” on the billing - doctors have artificially raised their rates because they know that, for the most part, their patients' insurance will only pay a portion of it. The price should be the same for someone paying out-of-pocket as it is for the insurance companies. (Back to auto insurance, does Ford offer Allstate a discount? Yeah right.)
What happens with this is the regular free-market benefits. First, the availability of health care goes up, because the people who opted out of “hypochondriac” coverage will not take up a doctor's time for every sneeze and sniffle. Second, there is an incentive for providers to get into the business, as the playing field is more level and less laden with red tape. Third, people will be so happy that we'll never have to hear about this ridiculous socialized health care mess ever again! (Well, okay, maybe that last one is a stretch.)
Now, let's look at C4C health care. You'll have politicians and government paper-pushers determining what's covered and what isn't, with their decisions holding the force of law. The thresholds will be hard - the qualifying line is drawn in the cement as it hardens. It will cost 10 times what “they” estimate - at least. Wait times will be through the roof, as anyone who qualifies for something will get in line for it, whether they need it or not. Over five or ten years, there will be a shortage of providers, because doctors will decide that law is a much more lucrative field. And, one of the founding principles of our nation will have been sacrificed on the altar of good intentions.