Commentary
Medicare offers the health care model that makes sense
by John R. KolstadFrom the perspective of someone running a small business, health insurance is a disaster. My small company pays almost $1,300 per month for a policy for my wife and me, and I don't dare go to the doctor.
The insurance company always seems to find a reason why what I need is not covered. The result is a large and unexpected bill. So I have health insurance, but no health care.
Minnesota has only three companies that provide the vast majority of health insurance. There is no real marketplace, and therefore I have no place to go for an alternative.
If you look at the other industrialized countries you will see that they cover everyone, spend half what we do per person, or less, and have better health outcomes.
Since I started studying the issue 15 years ago, I have been amazed at the lengths to which politicians will go to avoid solving the problem. Current Republican proposals to increase reliance on health savings accounts and to provide tax credits, for example, do nothing to extend coverage to everybody.
The health insurance companies, the drug companies and the medical products industry contribute millions of dollars to political campaigns. This is money that should be going to provide health care. When one side can attempt to sway the debate with money instead of sound reasoning, democracy is not working right.
Why has the health care problem not been solved? Two main reasons: The enormous amount of money involved, and the misinformation being spread by those who benefit from the status quo. There is substantial, credible information available about how to solve the health insurance mess in America. But by and large it doesn't get into the mainstream, so the public doesn't know about it.
Medicare has a 2 percent overhead, compared with the health insurance companies' 24 percent. As a fiscally conservative business person, I prefer to go with the low overhead method.
It is clear to me that the practical approach would be to simply extend Medicare to all. It is already there; it already works; it is far more efficient than the current health insurance companies. Yes, we'd all have to pay a little more into the Medicare fund, but right now my company pays $1,300 per month and I get nothing.
Another advantage to a Medicare-type approach is that the payments into the plan are based on your income. The amount my company pays for health insurance may have no relationship to my ability to pay.
I have noticed a distinction between the two camps in the health care debate. Those recommending a complete overhaul quote multiple studies, the experience of other nations and countless cases of the personal tragedies caused by our current system. The status quo advocates, on the other hand, are great defenders of the free market. They argue that it is best, but offer little evidence.
Large Minnesota corporations self-insure. They create their own funds and pay for their members' health care out of their own pool, and save a great deal of overhead costs. All an insurance company does is take in money from a large pool of people and then make payments to those who file claims. The insurance companies provide no health care.
Minnesota is large enough. We can create one pool of all Minnesotans, collect the money to fund the pool through the existing tax system and then hire a capable, qualified staff to administer and dispense the funds. A bill in the Legislature would do just that.
This is the fiscally conservative way to solve the health insurance problem. We can do this. We must do this. If we do not, the cost of health insurance will devour the state and national economy.
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John R. Kolstad, aka Papa John Kolstad, Minneapolis, is president of Mill City Music and a board member of the Metro Independent Business Alliance, though these comments represent his own views. He is also a candidate for mayor of Minneapolis.
Comments (5)
But he forgot to mention the best reason for his solution. IT GETS BUSINESS out paying for Health care. Or a major savings in expenses and puts the cost of health care back to the people, YES it would increase my taxes some, but look at the increased PROFITS for business over night with no increase in production/sales (except for the health insurance companies- which only really are in business to provide high paying jobs to top executives and do nothing for there stockholders.)
This would put our business back on par with there competitors around the world who do not pay for insurance, but instead have there Governments pay the health care cost.
Greatly increasing our ability to compete around the world and isn't that what the Republicans have been screaming about since Reagan gave them tax cuts in the 1980s?
This is, perhaps, the best commentary on the health care "debate" that I've seen thus far.
Don't tell Rick Perry that I said this; he might kick me out of Texas for thinking rationally.
In my opinion, it is easy to make the insurance companies the target of all things bad in medicine. Our main point of ongoing contact with the medical community is our insurance company. The doctor helps us; the insurance company takes our money and forces us to spend cash for care. In my opinion, rising insurance cost are symptomatic, not the cause of high medical inflation. The issues are really much more complex. The core issue is runaway cost. A detailed look into comparisons noted by John to European programs will demonstrate that the costs by American care providers in rendered services are dramatically higher and the inflation rate for those charges remains double digit. Another point of note is the overhead costs noted by John are not apples to apples comparison. The overhead costs are actually near equal. In many causes, Medicare farms out most of the actual work to insurance companies, leaving it to insurance companies to negotiate with doctors and patients, so the cost per patient transaction is actually much higher.
Limiting what insurance companies can charge will simply force many out of the medical coverage business. They will not operate at a loss. Even if government takes over, if the double digit inflation continues at the care giver level, insurance by the government will not remain affordable.
As any business manager knows, to achieve a long term solution, you must focus on the cause.
The great handicap in working for yourself is that you are required to think for yourself. The vast majority of Americans do not.
An excellent example is today's Doonesbury cartoon wherein Doonesbury's mother attends a demonstration to get government out of the health care business, although she has been receiving Medicare benefits for years. When her son points that out, she responds that she is going to burn her Medicare card!
The benefits of using government to administer national health care are too numerous to list, but the fundamental sticking point is that it would bring down health care costs, which alienates the hospitals, doctors and pharmaceutical suppliers, and curbs the extravagant profits and dividends private insurers are able to exact. The issue is money, not national health.
What do you think is the leading cause of death in the United States? You may say, it must be a disease, such as cancer or heart disease. Whereas it is true that most deaths have something to do with disease, it is actually not the disease itself that kills most people, but the medical treatments administered or prescribed by doctors. In 1995, the Journal of the American Medical Association (JAMA) admitted that doctors are the third leading cause of death (iatrogenic acts), causing 250,000 deaths each year. This disturbing trend has now worsened. Today (as of 2007), doctors are, in fact, the leading cause of death in the United States; or to clarify, it is the many unnecessary procedures and drugs they prescribe, as well as the mishaps and false diagnoses they make. Based on reviews of thousands of published studies and statistics (collected and published by Gary Null, Ph.D, Carolyn Dean, M.D, N.D., Martin Feldman, M.D., Debora Rasio, M.D., Dorothy Smith, Ph.D.),the annual doctor-caused death rate averaged 783,986 in 2007. By comparison, heart disease kills 699,697 annually, and cancer kills 553,251 annually. Since only 5 to 20 percent of all iatrogenic acts are ever reported, the annual rate of doctor-caused deaths may actually be over one million.
It seems everyone wants to blame their pet effect....Government, insurance,or business.
I can't believe that people can't see the cause. Earlier I stated what the third leading cause of death is. That is a fact !!! Those are valid references...The insurance companies actuaries... Read More know this to be a fact, that is why malpractice polices are a law.....that cost is fair.....It should be even higher....the government should be involved, not to manage the system, but to prosecute the villains....and businesses can't hire people who can't manage themselves.
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