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Tag: Blake Ashby

Healthcare Reform Even the Tea Party Could Support

flying cadeuciiThe Affordable Care Act (ACA) is the law of the land, and nothing the Tea Party does is likely to lead to its repeal.  But the ACA can be amended to make it less objectionable, and it wouldn’t be that hard.  We just need to modify it to allow Tea Partiers (and others) to form their own healthcare groups.

All insurance, including healthcare insurance, works by forming risk pools.  The members of the pool contribute to a pool of money which is then used to pay the claims by the members.  Most participants pay in more than they use.  In healthcare most people pay more money into the pool than the cost of the care they receive.  A few people receive far more care than they pay for.

For risk pools to work, boundaries have to be drawn around what is paid for by the risk pool.  As an example car insurance policies place a limit on how much they will pay for any one accident.  It’s nice to think that as a rich country we don’t have to draw boundaries around healthcare, that we should be able to pay for any possible medical treatment, but we can’t.  We already spend almost twice as much on healthcare as other nations and if costs keep increasing eventually it will bankrupt our country.

Many people blame private insurance companies for our expensive healthcare system, but insurers actually have very little to do with rising costs.  Instead advancing medical technology is the primary cause.  Our for-profit medical technology industry has made amazing advances in treatment and care that have allowed us to save people that used to die.  But its primary goal is still profit.  Every year the industry comes up with new procedures or refinements.  Most provide only incremental improvements in care but they all come with a higher price tag.  Every year the industry spends billions of dollars – yes, billions – successfully encouraging doctors to recommend the new procedures.  And it’s about to get much, much worse.  There is a flood of new treatments and targeted drugs getting ready to hit the market.  Some will undoubtedly be true advances, but all are likely to cost tens and even hundreds of thousands of dollars per treatment.

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