Tuesday, January 06, 2009

Healthcare and Health Insurance II

First, let me state why I am writing on this topic. I normally write about the Episcopal Church or about faith in general. As a Deacon in the Episcopal Church, I am charged with making known to the Church "the needs, concerns, and hopes of the world." In the United States, health care is a big concern and as I stated earlier, I am employed in the healthcare IT world.

In the part I, I discussed Health Care as a scarese resource, the purpose of insurance to indemnify against unexpected and catastrophic loss, and the modern use of health insurance to pay for routine care. In this post, I will discuss some possible solutions for health insurance and some ways we can increase the efficiency of delivering health care in the United States.

First, we should not be using insurance to pay for routine medical care. Doctor's visits, well baby care, eye exams, and the like should not be covered by health insurance. To reduce transaction costs, these should not even be submitted to the insurance company, but should be paid out of pocket by the patients. We should reserve insurance for things like surgery, cancer, true emergency room visits and other unplanned events where the cost is prohibitive for most people. We can do this be limiting the procedures and services covered by insurance.

Next, we need a way to make insurance more portable. HIPAA (the Healthcare Insurance Portability and Accountability Act) went a long way towards doing this. One of the problems with changing health insurance is the coverage of "pre-existing conditions." If we chance health insurance to cover only catastrophic items, it would bring down the cost of insurance (as well as the cost of delivering care) and people would be more able and willing to carry personal insurance. Because insurance covers so much today bridging the gap between jobs is very expensive. Five years ago, I took a leave of absence for 7 weeks to take a unit of CPE. My cost for insurance duing that 7 weeks was over $2400. I believe that we can get a catastrophic policy for significantly less.

Finally, we need to find ways to cover the uninsured for and to pay for those who cannot afford healthcare. That will be the subject of part III.

YBIC,
Phil Snyder

4 comments:

robroy said...

Unfortunately, the cost of an office visit to me is $200-$400. I see a great deal of medicaid. They have a $2 copay. I continue to see Medicaid even though I lose money on each patient. Almost all the other specialists either restrict their practice to less than one or two Medicaid patients a day. I am an idiot who has a calling to serve the poor.

One of the frustrating thing about Medicaid patients is their disregard for mine or others time. The no-show rate is much higher. They will also not show for surgeries which leaves dozens of people and the surgical facility in a lurch costing thousands. (Invariably, they all have cell phones though.)

Pax

plsdeacon said...

robroy,
First, may God bless you as you continue to minister to the poor. The question I have for you is why is a simple office visit over $200? Rent is a certain amount. Depreciation on equipment factors into the office visit. Staff is a certain amount.

What do you suggest we do to lessen the cost and improve the delivery of health care?

YBIC,
Phil Snyder

robroy said...

Dear Deacon Phil,

My wife keeps the books and I try to keep myself blissfully ignorant about finances and stick to medicine.

But our largest expense, by far, is staff. I have two and a half FTEs that do insurance busy work and the others do a lot of extra work to satisfy the "bean counters."

We hired one of my daughter's friends to help catch up with some of the unpaid insurance claims. My eyes were opened up by her experience in dealing with insurance companies which she would relate to me. The insurance company people would routinely keep her on hold for thirty minutes or more. Sometimes they would fairly obviously intentionally disconnect the phone. The fairly routinely underpay by $3 bucks or $30 bucks just to see whether we are sleeping. Similarly they deny claims that they paid the previous week. They analyze offices to see how aggressive the medical staff pursues restitution, so we go after 50 cents underpayments. It is incredibly wasteful. No other part of my office is so wasteful. That is the fat that needs to be cut.

Pax

plsdeacon said...

I work on the payor side of health insurance and the product I support helps insurance companies pay claims and I've worked with a number of insurance companies in the 12 years I've done this. I take it that you are a specialist or surgeon because you spoke of surgery. Coding the contracts for specialists and surgeons is incredibly complex and is determined by the contract with the provider. It is very easy to get the order wrong. Is the % of billed after the copay or before? Is it net of other reductions or contractual obligations? Is there a withhold for end of year settlement?

This is why I suggest that we use insurance only for catastrophic coverage. You have 100 hours a week in labor to do nothing but deal with insurance claims.

YBIC,
Phil Snyder