Free mar­kets Will save health­care

Forbes - - Fact & Comment -

The ul­ti­mate an­swer for cur­ing our mostly dys­func­tional health­care mar­kets is to get the pa­tient in con­trol in­stead of third par­ties, which pri­mar­ily are the gov­ern­ment, large in­sur­ers and, in some cases, large em­ploy­ers. In a gen­uine free mar­ket the cus­tomer is king, and if the sup­plier/busi­ness doesn’t at­tract new buy­ers and sat­isfy ex­ist­ing ones, it will go broke. Pro­duc­tiv­ity is the norm, with prices go­ing down.

But not with health­care. A hos­pi­tal’s rev­enue de­pends on the deals it strikes with in­sur­ers and on not up­set­ting Medi­care and Med­i­caid.

This is just be­gin­ning to change, now that more busi­nesses are mov­ing to high­d­e­ductible health­care in­sur­ance plans and the Oba­macare ex­changes have de­ductibles that make the pri­vate com­pa­nies’ look like Bernie San­ders give­aways. Peo­ple’s outof-pocket med­i­cal ex­penses now come to more than $352 bil­lion a year, not far be­hind what peo­ple spend on the travel in­dus­try, which is ex­pected to reach $370 bil­lion in 2018. A rapidly grow­ing con­sumer mar­ket in health­care is form­ing. Mil­lions are be­com­ing price-con­scious in a way that hasn’t been seen within mem­ory.

Health sav­ings ac­counts (HSAS) have been around for a decade and a half, with more than 22 mil­lion users. The money in each ac­count be­longs to the con­sumer. If you save money by us­ing a generic drug in­stead of one that’s still “on patent,” the money saved is yours, not your em­ployer’s or the gov­ern­ment’s. How­ever, HSAS are bur­dened with un­nec­es­sary re­stric­tions that hob­ble their wider use.

• Make HSAS avail­able to any­one. Cur­rently, you can’t get an HSA un­less you have an in­sur­ance pol­icy that of­fers them, and most still don’t. You should be able to set up an HSA, re­gard­less of the plan you have—or even if you have no plan.

• HSAS should also be avail­able to any­one on Medi­care or Med­i­caid. In fact, Un­cle Sam should of­fer a Medi­care choice, with the feds kick­ing in, say, $10,000 an­nu­ally per ben­e­fi­ciary, with full (or nearly full) cat­a­strophic cov­er­age above that. Such a plan would sharply curb the gross amount of overtest­ing that oc­curs with the el­derly.

• Sharply raise—or sim­ply re­move—the lim­its on HSA con­tri­bu­tions. Th­ese have a ceil­ing of $3,450 for in­di­vid­u­als and $6,900 for fam­ily plans.

• Treat the lim­its on de­ductibles for com­pany plans in a sim­i­lar man­ner. • Cur­tail the re­stric­tions on how HSA monies can be spent. You should be able to tap your ac­count for over-the-counter med­i­ca­tions and well­ness pro­grams.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.