People's Choice Health Care

An Alternative to ObamaCare that is Not Evil

Health insurance is the problem, not the solution, for spiraling medical costs.

The cost of health care in this country is out of control because the decision-makers are not paying the bills.

The insurance companies are trying to reverse that trend by putting themselves (the bill-payers) into the decision-making seat, which they do by denial of coverage. This (rightly) offends the consumers. ObamaCare seeks to reverse the trend by putting themselves (the bill-payers, which under their plan is now the government) into the decision-making seat, which they will again achieve by denial of coverage. This still offends thinking consumers -- if not today, then certainly within 5-6 years, when it takes full effect. Both efforts are wrong-headed and positively Evil.

I think that we should reverse the trend by making the decision-makers (the consumers of health care) pay the bills. Ultimately they already are, but health insurance equalizes the cost so that there is no direct correlation between health care choices and out-of-pocket costs -- except to the insurance companies. That must change if we are going to solve the problem.

It turns out that most of the people in this country are too stupid to manage their own health care intelligently without some prodding. That is unfortunate, but a predictable consequence of being dead last among industrial nations in math and science education. The amount of coercion needed to solve this problem is fortunately very small. No massive government program like ObamaCare is needed.

We only need to require every citizen to fill out and file for public inspection a simple half-page Health Care Plan, for themselves and all their dependents.

The Health Care Plan

The Health Care Plan has three parts, only two of which require any information from or action by the individual. The third pard is implicitly a default, to cover all medical care costs over and above that which is explicitly provided in the first two parts, or to deny coverage, as the case may be.

Every person, or whoever they are dependent on, can and should be required to file such a form, or else consciously have a government agency file a (blank) default on their behalf. It's a little late to catch people on the census this year, but that would be a good way to get everybody involved.

1. Self-Insurance

The first part designates a bank account which health care providers may examine (by permission of the patient), and debit as payment for services, upon court order or the signature of the patient. Any person may choose to leave this portion blank, which tells the providers that they will be paying cash (or approved credit card) for services at the time rendered, or else they can be refused. Smart consumers will put as much money as they can into this account, because they get to keep and spend in other ways any money not needed for health care. Banks will be eager to offer the best interest rates on such accounts, because of the low maintenance costs.

2. Insurance Company Policy

The second part designates a conventional health insurance company and policy of any kind, for covering expenses not covered by Part 1, to be applied by whatever lawful rules the company and the individual have agreed on. For example, it might be a major medical policy with a large deductable (covered by Part 1), or a full HMO where the co-pay comes out of Part 1, or an employer-paid group account. Or this part can also be left blank, which informs the health care providers that the patient has agreed that no additional services need be rendered when the funds in Part 1 are exhausted.

3. Public Charity

The third part needs no explicit designation by the consumer. Many benevolent people feel the need to provide health care to people who could not otherwise afford it (that is, Part 1 and Part 2 are blank on their public form because they lack the resources to fund them). This is a public good that should be encouraged by tax deductions and tax credits for donors, in such proportion as the government sees fit. The government may from time to time increase or diminish the tax incentives to fund such charities to serve whatever public policy is then popular, and thus effectively increase or diminish (but not completely eliminate, because there will always be some private donors who give regardless of tax incentives) the availability of services to the indigent.

The government can even fund such charities directly if they (and the taxpayers) so choose, but the charities must operate on their own budget, not spending more on care than they have in donations. The ObamaCare "public option" could become such a charity if they wish to forego any coercive payments by the consumers.

These charities can choose to restrict their services to truly needy persons by whatever lawful criteria they publish (that is, not discriminating against patients on the basis of race, religion, or national origin). They might, for example, limit the care to emergencies and to those willing to wait in long lines. Gainfully employed people would prefer to spend a little money to get served more quickly or to have more elective procedures covered. This is a reasonable trade-off.

Why It Could Work

This kind of health care delivery system has several advantages over both ObamaCare and the previous system. First and foremost, it establishes the consumer of medical services as the final arbiter in what kind of services they are willing to pay for, and therefore entitled to consume. That means they will be motivated to plan carefully to save money and therefore have more money to spend on other benefits. Health care providers will similarly be motivated to work with the decision-makers -- who also happen to be the patients or their next of kin -- to offer services that are cost-effective and relatively free from "fraud, waste and abuse." The free-market competition will tend to bring the costs of health care down to actual expenses that people are willing to pay for.

Second, there is an easy transition from the present system. The insurance companies already have in place insurance plans that drop unchanged into Part 2 of the form. They can continue to market their plans to the consumers, and they can continue to build in their own denial-of-care policies as they choose, provided that these policies are made public so the consumer can choose a competing policy that offers more benefits (presumably at monthly higher cost).

Employers can construct their own hybrid self-insurance + major medical plans, and persuade their employees towards frugality by refunding some of the excess unused cash portions to the employees who did not use the benefits. This is different from ObamaCare, which explicitly uses penalty taxation to discourage such cost reduction measures as self-insurance.

The government is free under this program to offer its own "public option" insurance to people under the same criteria it imposes on the other insurance companies, namely, that it must operate under its budget and is not coercive. The insurance companies and the taxpayers might balk at massive government funding of such a plan unless there are reasonable protections built into the program to prevent "fraud, waste and abuse," but as many of us are already aware, merely the fact that it is a government program makes the occurrence of "fraud, waste and abuse" unavoidable.

Why It Won't Work

Government officials have only one quality in common, regardless of political party or religious persuasion, and that is the desire for power over other people, to control their lives. ObamaCare passed because it gives unmitigated power to the Federal government to exercise power over the American people, and to destroy (by new taxes) nonconformists like me.

The People's Choice Health Care plan puts that power back into the hands of the people. It even takes power away from the present insurance companies. Nobody will like this plan -- except the people, who are empowered by it, and who get to save money which they can then spend on other pleasures. It isn't particularly attractive to the poor people. They would still get free health care (as they do today), but it remains inconvenient and hard to get, and it doesn't include luxury services which only the rich can afford today, but would apparently be included in their "free" health care under ObamaCare (that's not true, but there are a lot of lies surrounding ObamaCare, which most people lack the information to recognize).

If the USA were an informed Democracy, then the People's Choice Health Care plan would be the law of the land tomorrow. If the USA were a Republic where our elected representatives and senators had our best interests at heart, then the People's Choice Health Care plan would be the law of the land tomorrow. If the USA were a benevolent dictatorship, then the People's Choice Health Care plan would be the law of the land tomorrow.

If the Republican Party in the USA wanted to take Congress back from the party currently in power, they would promise to repeal ObamaCare and replace it with the People's Choice Health Care plan next year. If the Democratic Party in the USA wanted to stay in power, they would immediately repeal ObamaCare and replace it with the People's Choice Health Care plan this year.

But I fear none of these things are true.

So we are stuck with ObamaCare, the health care fiasco more than 60% of the American people don't want today, and all of us won't want when its draconian measures kick in four or five years from now.

Tom Pittman
2010 May 10

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