Archive for January, 2014

If it were solely up to you, how would you set up Healthcare Reform in the US?

January 20, 2014

Several years ago I jotted down the ideas below as steps which, if implemented, would address at least a couple of the biggest issues in medical insurance and healthcare delivery: cost and access. There are rumblings in Washington that the Republicans will present their formal plan, this Spring, for replacing the Affordable Care Act.  Wouldn’t it be nice to have some input on those ideas?

You know that I am an optimist trapped in a cynic’s body so my hopes of replacing the ACA with a workable solution are real but also guarded. But, what if you were asked for meaningful input in designing a workable solution. Could you do it?

Since jotting down the 12 points below I realize that I have not addressed healthcare financing for the chronically poor and I know I have left many issues untouched so we need to address that. However, I think these ideas put in place the framework to address:

  • Those that want to buy insurance but are un-insurable
  • Those that don’t want to buy or will wait until they have a problem to buy insurance.
  • Guaranteed acceptance
  • How to push premiums lower
  • How to push unit cost of healthcare lower
  • Total transparency

So, let’s work together to develop the core outline of what Congress could build if it truly tried to bring about the best reforms for our system. Please give us your input to improve upon these 12 points as well as address issues that we have not addressed or not addressed well.

It may be fun and interesting but who knows we might even make a difference.

Since we are all used to the ACA mandates of kids to 26, unlimited lifetime, and wellness or preventive let’s leave those in. Also let’s eliminate the Medical Loss Ratio (MLR) limits since no other industry in the world has its profit margin restricted like insurers do. Other than that let’s assume we have a blank canvas upon which we can draw our ideas.

Here are 12 basic ideas to include in a bill to replace the ACA:

  1. Make health insurance premium 100% tax deductible for anyone who pays it.
  2. Make all fully-insured plans for individuals and families guaranteed issue but with a reasonable Pre-existing period for no prior coverage. Pre-ex period: 12 months.
  3. Group plans of 2+ employees remain guaranteed issue with No Loss-No Gain Take over.
  4. Allow carriers a reasonable corridor for Risk Adjustment Factors (30%). Also let insurers determine their area rating factors based on their data and statistics.
  5. Tort reform: Loser Pays and/or Fixed Attorneys at 15%.
  6. Allow carriers and plans to sell across state lines. (Possibly the most difficult of all.)
  7. No new benefit mandates from states or Feds for five years plus allow insurers freedom to build plans as they determine.
  8. Make HRAs and MERPs permissible and available to implement on all plans.
  9. All insurers must publish and release statistics and experience data.
  10. Universal enrollment forms for all group plans and all individual/family plans.
  11. Health plan commission set at level 7% and does not increase as premium does.
  12. Providers must post their rates per service. Hospitals must post their outcome statistics as well as infections, error rates, and other outcome data.

I also think we need to build in incentives for employers to support wellness plans. If we want to bend the cost curve downward we must address behavior and expectations through real wellness and benefit structure.

You see that I did not address coverage for the poor as I mentioned above. Setting a poverty level which grants access to Medi-Cal (Medicaid for outside Cal) is important but must be accomplished without discouraging folks from working their way out of that circumstance.

So, there is our starting point. I encourage you to give this some thought and to give us your input. If we put something together worthwhile then who knows; we might make a difference.

Let me know what you think.

Mark Reynolds, RHU