Back in January, I put together some ideas on how to fix healthcare.
I put together six problems and proposed fixes for all of them. I thought it was interesting that most of the comments were about my mention of the Affordable Care Act. The exception was a regular reader who said it was, “Best. Article. Ever.” (*blushing*). I found it notable that no one seemed to argue for the $629 bandage from an emergency room stay or the high cost of medicine because the United States subsidize the rest of the world.
In the last month, the healthcare talk has ratcheted up. That’s probably a direct cause of the House pushing through a bill before the Congressional Budget Office could do analysis on it. It’s expected to get changed in the Senate and then I think it goes back to the House. It seems like a silly process to me because when it gets back to the House, they’ll probably say, “We’ve got it this far, we have to send it through.” So the Senate could do a bunch of things that the House originally didn’t want and the end result would be they have to accept them anyway.
There are worse political systems out there and this one has worked well for a long time, so maybe I’m just off-base here.
If the House can add amendments to their original bill, I can add amendments to my previous healthcare article. And that’s what I’ll do. Some of these are free-form thoughts, not problem solving like before. Let’s dig and see how we can improve health benefits.
Why We Need to Fix Healthcare
Short answer: Warren Buffett says so.
Longer answer: Since the 1950-1960s, corporate taxes went from 4% of the GDP to 2%. Healthcare went from 5% of the GDP to 17%. So while politicians are beating the drum about taxes, it’s silly. Here’s the key quote to the article:
“Our bloated health care system, Mr. Buffett asserted, is the true barrier to America’s world competitiveness as well as ‘the single biggest variable where we keep getting more and more out of whack with the rest of the world.'”
In short, we can’t “Make America Great Again” without fixing healthcare. And fixing healthcare doesn’t necessarily mean a “repeal and replace.” It means addressing those sky-high medicine prices we have subsidizing other countries. I haven’t heard either political party address that. It means a bunch of other things too, many of which I addressed in the previous article.
The only point I want to make here is that we should work on getting that 17% GDP number down to 5% again.
The Price of Doctors’ Education
I was chatting with a high-ranking pharmacist friend of mine about healthcare and I mentioned the cost of medicine. He was quick to point out that it really is the high cost of staffing that makes healthcare so expensive. I think he said that drug costs are only 20% of the problem. He knows a lot more than I do in this area, but it makes sense.
Medical professionals have to go to school for a long time. Colleges and universities have been raising rates for a long time. It seems to me that the medical professionals get out of school with more debt. I know a couple of doctors who have had $250,000 or more of student debt at one point or another. It’s reasonable that they’d want a return on their investment… and it’s reasonable they’d want to get out of the debt fairly quickly.
So it got me thinking, “Is healthcare a bubble within a bubble?” Could it be that at least part of the reason our healthcare is so expensive is simply because we let the costs of education spiral out of control? I view the costs of college today similarly to when people would get interest-only, 50-year fixed mortgages so that they could a home. The main idea seems to be, “With enough loans you can afford anything, which gives us license to greatly raise the price.”
It didn’t work out well for those mortgages and I think we can see it isn’t working well for recent graduates. If my friend is right (and it seems logical enough), it isn’t working well for our quest to create an affordable healthcare system.
What About Teeth?
Ironically, I’m writing this paragraph about 5 minutes away of getting in the car to go to the dentist.
Fortunately, recently published a great article about teeth and dental insurance. There’s a big divide of the “haves” and “have nots” when it comes to dental care.
Oh and the article points out that the average dentist starts out with $260,000 in student loans. I read after I wrote the above section.
I don’t have any magic fix for dental insurance, but I think it should be included with regular healthcare. When 1/3 of Americans are going without insurance and it can lead to greater health problems this needs to be part of the fix as well.
I’m back from the dentist and I guess the military changed dental insurance providers on May 1st. They didn’t have the courtesy to let me know. So my cleaning that had out-of-pocket costs of $0 is now around $30. It’s not a big deal, but it seems like all our dental costs are going to go up. Maybe a different dentist will be in-network and we can get our costs covered 100%. It still seems weird that for years they’d cover 100% and now it’s closer to 66%.
Let’s talk Cigarettes
Quartz Media put out some interesting statistics about cigarettes. The big takeaway for me was this:
People are smoking less – Yay! Cigarette companies are making more money – Boo! How is that happening? Those addicted to cigarettes are willing to pay for the huge increase in costs. Americans spent more on cigarettes than beer and soda combined. Think about that for a minute.
I know there are substantial taxes on cigarettes, but maybe we need to raise them even more to subsidize healthcare. Why are cigarette companies profiting so much on something that grows the high risk pool?
What If… We Just Ate Better?
I don’t want to be all doom and gloom when it comes to healthcare. There’s still a lot of things we can do.
For example, there was a great article covering Michelle Obama’s attempt to get kids healthier foods in school. This is a common sense start to a long term plan for a healthier America. A healthier America means less money spent on healthcare… and cheaper plans and deductibles.
I can find no reason why anyone wouldn’t support that. The only thing that makes any sense to me is that special interests (food companies) are paying off politicians.
Eating healthy doesn’t have to be a long-term solution either.
NPR has a great story about how it’s cost-effective to GIVE away $1000 worth of food a year to people with Type 2 diabetes. They find that spending that $1000 can save them as much as $24,000 in healthcare costs.
I don’t think the patients are complaining about getting free food either. Is it a “hand-out” that some politicians would fight against? Sure! However, lowering the healthcare costs for some, lowers the insurance premiums for all. I wrote a bit about this in my previous article, but this is one clear-cut example of a working system.
What Do Think?
Sound off in the comments below. The great thing is that you don’t have to be political about it. No one is keeping tabs on you. (Also, I don’t think any lobbyists are likely to pay you to write an opinion here.)