Life, Liberty and the Pursuit of Health Care

Unbelievably there are people in this area who so afraid of government that they are willing to destroy the delivery of healthcare to those who actually need it. These people cling to the notion that they don’t want to pay more taxes for anything that has to do with health care.

Let’s start with clearing up some misconception, health insurance does not mean health care. Health insurance is a method of financing, much like credit card, or loan. Or to put it simply, for the people who think Obama is a Communist, health insurance is a tax you pay directly to a corporation. And the corporations make sure they compensate their executives really, really well. Paying for health insurance does not mean we get health care.

Insurance  is supposed to work like this, everyone pays a little into a pool that only a few will ever draw from. But that’s not the way health insurance seems to work these days. Virtually everything medically related is now paid for via insurance. It’s like paying for furniture via your homeowner’s insurance or paying for tires through your auto insurance. It  didn’t start out that way, but somehow in the dusty bins of policy makers in the 1970s, that’s what happened. People stopped paying for routine medical care because suddenly their “insurance” covered it.

Here’s another misconception the cost of health care is not the same as the price of health care. If the average employer-based family health insurance plan is priced  at $12,000 a year, how much is that families medical care costs? Having trouble figuring that out?

Have you ever read a medical  bill? No single line item called “Obscure Medical Treatment:, instead we get a hodgepodge of administrative fees, account fees, and other things on there that have nothing to do with the actual treatment. Imagine if the same process was used to buy groceries. Your six pack of bottled water would have a stocking fee, an administrative fee, an account fee, you’d pay for the packaging separately from the water and you’d have to make an “office visit” after 90 days when you want to buy the six pack again.  Then either you or the grocer would submit your “bill” for the six-pack of water, and some bean counter would think about whether you paid too much for the water, picked  a brand they didn’t like, or shopped at a grocer that wasn’t in their approved list.

We put up with this byzantine payment system because most Americans get health insurance through employers and somewho think that they aren’t paying for it, the employer is. Here’s the startling factoid, guess who is really paying that average employer-based health insurance premiums of $12,000 a year? The employer? No, the employee. Because if the employer didn’t have to pay for health care insurance plans for the employee and family, then the money, which is already desginated as benefist compensation to the employee would then actually go compensate the employee and not the health insurance company recipient it currently is.

Suddenly, its $12,000 extra dollars in income that could be spent on medical care. Or if everyone is healthy, not. Suddenly, if our hypothetical family is paying for medical treatment out of their money, they might be wanting to know what that treatment costs.

There’s a whole series of medical treatments that exist outside of the realm of health insurance that have somehow managed to be cheaper and better while the routine medical care has gotten more expensive and less effective.

Cosmetic surgery, I prefer the old-skool plastic surgery, offers us deep insight into pricing by treatment instead of by procedure. No complicated tests in boob-job land. LASIK eye treatment? A per eye cost. Botox? On sale now. Want to lose weight at a spa? A per week cost, everything included. Why isn’t the rest of our medical care priced so transparently? Why can we pick and choose the $600 per eye LASIK treatment from the $1200 per eye treatment? Why have the costs of LASIK, nose jobs, and eye lifts, all gone down in price in recent years when every other aspect of routine medical care, such as my standard example, the broken arm, gone up?

While medical costs have risen by an average per-capita rate of 40%,  salaries have risen by a per-capita negligible 3%. Go back to the question of who is paying for employer based medical insurance. Those 3% raises, if you’re lucky come out of the compensation pool. The hard work of employees throughout the country essentially gets transferred right to the insurance companies. And here’s the shocking part, most employees don’t end up putting in claims for medical treatment each year that come anywhere close to what is spent on their behalf in insurance. But some do. And it’s that fear of hitting a medical disaster that fuels the need of insurance against an overwhelming financial disaster. But why are so many medical treatments so expensive?

The baffling answer is that the entire pricing and compensation system of health care is based on procedures and not treatments.

Think of it this way, a broken arm being set in a cast is a treatment. The medical office visit, x-ray, mri, blood test, setting the arm, enveloping the arm in a cast, prescriptions for painkillers–those are all procedures. To you, with the broken arm, all you care about is getting your arm set and on your way. But that’s not how it works. All these procedures all require multiple specialists which means everyone has a slice of profit to wring out of your simple broken arm. No one is compensated based on how quickly your arm will mend itself. As the medical treatment gets more complicated, as the symptoms get fuzzier, the amount of procedures replicate like rabbits. Multiple Doctors, means multiple tests, and who really is in charge?

Where once if you sought medical care for a high fever and runny nose, you might have been told to “take a couple of aspirin till the fever breaks, and rest up until you feel better,” we now are confronted with diagnostic tests. These medical tests do nothing to really treat whatever it is you have, and are have become the norm in making diagnoses for the common ailments that have afflicted humans since the beginning of time. So with all the advanced medical knowledge we have attained, with all the new drugs and machines, we have produced doctors who can’t diagnose common ailments without a battery of tests where once a doctor would simply know that 9 times out of 1o, your weird symptoms were just a new manifestation of the common cold.

And if that 1 out of 10 item is an indicator of angina? Why there’s more medical procedures in store, but now you are swept completely out of the realm of being able to judge whether these procedures will actually treat your condition. Does anyone know if angioplasty prevents heart attacks? Stents? By-pass surgery? Is there any evidence that years of life will be added by these procedures, that a simple change in lifestyle through diet and exercise will also achieve? The answer is no one knows. The people making those recommendations for procedures are getting compensated for those procedures, not for recommendations such as laying off the french fries and walking 3 miles every day.

The average cost of an angioplasty in a hospital is maybe $33k. I say maybe, because it’s not like you can easily figure out what the “real” cost is. It’s all a negotiation, between you, the insurance company and the hospital, with you having the least say about the cost. But if you look at the fine print, when the company denies payment, or reimburses a lesser amount than your hospital charges, guess who is on the hook? You are. Not your employer, you. Which explains why the most prevalent cause of bankruptcies in America is medical bills.

Sadly, the debate about health care, and the health care bill, will trot out arguments about political philosophies that have nothing to do with the core problem of our health care system. Our system of financing procedures instead of treatment or prevention is sucking up more money regardless of who “pays” the bill. In the end, we are currently paying outrageous amounts at the expense of higher incomes, at the expense of better health,  because the health care industry corporations, be they insurance or provider, don’t want you to change their profit trough.