Monday, September 01, 2008
More on Health Care Reform. Changes to come.
I just want you to know that I have happily worked for insurance companies selling both life and health insurance as well as managing entire units and regions for those companies. Nevertheless, I must call this section, "how the evil insurance companies screwed up everything".
You see, in the 70s and 80s, when insurance companies are able to make ordinals of money on safe interest-bearing investments, they took their eye off the ball and simply reimburse whatever charges doctors and hospitals submitted. This allowed for out of control costs growth and waste. There was no fiscal discipline for decades in healthcare. This is by far not the only cause of the situation, but because the insurance companies acted as insulation between the public and providers, there was never the need to deal with the spiraling costs. Of course, due to the complexity of healthcare, it’s never going to be cheap, and there is no developed nation where health care is quality where it is cheap, although in many places it's less costly and more efficient than it is in the United States.
Now, I don't blame the insurance companies for everything or necessarily even the majority of the current problems. I also wouldn't blame them almost at all if they made a reasonable rational attempt to fix the problems that they did create. But they did not they, like the government, tried Band-Aid fixes that not only do not address the problems that are unfair in their attempts at what meager solutions they offer.
Their cost containment solutions are always aimed at the end providers, ignoring what those providers cost of doing business really is. Now, I have stated myself but I believe we spend enough on healthcare already, but I know that to fix the system to make it operate on these budgets requires major policy retooling. To go to the last end of the providers and say you've got to charge less, we are not paying you any more next year than we did this year, we are only paying for this many days of hospitalization and we won't take into account that people aren't machines and we can't always know exactly what's going on inside them and what the outcome is going to be, are all punitive measures with no rational basis for expecting them to work , or work efficiently. Neither government nor insurance companies get it. There is no simple fix here. Insurance companies place in this business is going to need to change drastically. Insurance companies and HMOs aren't doing a good job, aren't doing the right job and aren't set up correctly for what our healthcare system needs. On a much more superficial basis I am going to begin to lay out here what I do much more comprehensively in my book; and that is how we are going to need to remake the interplay of insurance companies, government funding and healthcare providers into something that works now and will continue to work into the very far foreseeable future.