Thoughts on Health Coverage

I recently read a great article by the Brookings Institute on the tweaks that could be made to the Affordable Care Act (ACA), aka Obamacare, to bring it within the realities of the needs of the country, to fix its basic functional issues and to put it into the realm of acceptability for Republicans. These perceived fixes center around removing or weakening the mandates and giving States more freedom to address the issues, especially with regard to the expansion of Medicaid in the ACA.

One of the issues that seemed to exist underneath the article and within the debate as I have heard it, relates to the costs of serious, long-term catastrophic illness or injury. People who will be treated for the rest of their lives. Some of these people have pre-existing conditions that insurance companies have un-wittingly taken on, forever, under the new ACA rules.

The government has many different healthcare provisions and departments. There are the obvious ones, Medicare, Medicaid, Social Security Disability, and the Veterans Administration, which includes actual care in government-owned hospitals. The government also provides health insurance to all federal workers, including Congress. At the State level, there is worker’s compensation insurance, and State-by-State licensing and regulation of health insurance companies, hospital and physician organizations, the administration of Medicaid, and the provision of other health-related services.

Would it make sense to roll everything into one federal plan? Take the States out of it entirely. One oversight body; the Department of Health and Human Services would make sense. Create one unified plan that applies to everyone.

To reduce the costs associated with health insurance, the government could agree to cover and care for any patient whose healthcare costs exceed some minimum, say $200,000, in a year or $500,000 in the person’s lifetime.

Anyone whose cost of care exceeds the thresholds would be treated by federal doctors and medical personnel in federal hospitals and other facilities to the extent available, or the federal government would pay for their care in private facilities as required.

Federal doctors, staff and hospitals, would be immune from any form of medical malpractice lawsuits, though they could be disciplined to the point of being stripped of their duties and right to practice if appropriate negligence is found. This would reduce the costs associated with carrying insurance. The patient is already in a long-term care scenario and is being cared for by the government for free, so compensatory damages would be covered.

The federal employees’ insurance plan could be offered to any American who wants to buy in. The government’s plan could rely heavily on treatment by government doctors at government facilities, so there would be a lot of room for other private carriers to provide more private care options. The government, however, with its already existing buying power, added to by new insureds, should negotiate long and hard with healthcare providers on costs of care, prescription drug companies on the costs of medications, and with anyone else involved in the healthcare industry. Private insurers could piggy back on the government’s deals, if they desired.

In the end, insurers need only cover costs up to a certain limit, reducing their exposure on all insureds, and only those patients they want to cover. The government plan would handle all others, and everyone would have to buy into something. The government’s insurance plan would cover those on Social Security Disability, Veterans, Medicaid and Medicare, for whom we already have a means of payment. My thoughts on a calorie tax in a prior post could help pay for these services. The poor, the disabled and the old, tend to be the people insurance companies do not want. Mix them into the huge federal workers’ health insurance program, and the costs should be easily absorbed.

One overall program covering as many people as possible, offering high quality catastrophic coverage, paid for by those receiving it, with private coverage for anyone who wants it and everyone the private carriers don’t want. Everyone is covered. Everyone wins.