Monday, June 22, 2009

HEALTH CARE #3

When I started this project I anticipated at the most two to three days writing. However there are no simple answers and it seems to be growing like Topsy. I don’t think that I have scratched the surface so please bear with me. There may be some interruptions in continuity for other matters but I hope to express my concepts. I know many will disagree with me and your comments on this subject will be welcomed and posted many with my own exposition. .

As a started to write this “episode” on 6/20/09 the headline in the Times read “House Unveils Health Bill, Minus Key Details” (boldface mine).

The article states that the bill is 825 pages. Obviously that will take some time to read and understand. We the ignorant will be dependent for analysis by media writers in the same manner that the congressmen rely on their staff.

This Bill seems to have major differences from the Senate proposals. There will undoubtedly be a long period talks, revisions, compromises and adjustments before a realistic program emerges.

We will await President Obama’s interview on Wednesday 10PM CHANNEL 7 to have a better idea about the direction he hopes to go. Above all we must remember the failure of the ill conceived Clinton proposals.

In the meantime there are certain basics that we can accept and understand; a study by the Deloitte Institute repeats what has already been ascertained that out of a total population of approximately 307 million, 45 million Americans lack basic health insurance, and 25 million more are uninsured. That is a little less than 25% of the population are health care paupers. Additionally adults receive recommended care only 55% of the time.

The much publicized Kennedy plan will only affect about 16 million of those listed above. It is more talk than show.

We should also accept the premise that Health Care is not a RIGHT but should be the responsibility of the community for the benefit of the community. The term community meaning the country.

There are indisputable facts of life such as that one can pay too much for a commodity, and one is never sure of receiving value for what one pays. Also one will never receive more value than one is willing to spend. These three axioms are the engines that will run any comprehensive health care program.

The costs of any health care program are dependent on four categorizes; Consumers, Providers, Creators, Overseers. All can impact on resources and I will try to address anon.

There is the element of financing. The estimated 1.6 trillion dollars over 10 years or average 160 billion per year has already proven by the bean counters to be too low. The obtaining the funds are questionable. A recent study showed that 43% of tax payers were opposed and only 25% in favor of increased taxes for health care. The remainder 32% were on the fence and it can be assumed that when their pocket book is involved they too will take a negative position.

The taxes suggested included increased income tax, taxes on health care benefits, employer taxation graduated by company size with some exemption for small employers. Any of the above or other innovative ideas will mean increase cost to the individual with a lowering of dispensable income.

Unless there will be an unlimited influx of capital there will be a finite amount of resources available which can result in rationing delivery of quality health care. That may take the form of delays or denials in more than the basic needs.

There are many models that must be considered; Universal Federal System with or without op out provisions, Private Panel Plans, Private Insurance Programs, and a mixture of any or all. Everyone has its pros and cons which I propose to give my input in following posts.

The financing is crucial because that will determine what can be delivered. In a purely Universal Federal Plan the money will come from some form of taxation. It could be an added income tax, which would mean large increases at the upper end over the lower. To be effective all loopholes will have to be closed and that has never been done.

Or a VAT –not sales tax- could be the source. This would probably place the load on the middle class. Another source of taxation would be on the employer’s payroll. This could have a disproportionate negative effect on the small 10 or less employee business. And some accommodation would have to be met.
From Wikipedia: (Value added tax (VAT), or goods and services tax (GST) is a consumption tax levied on value added. In contrast to sales tax, VAT is neutral with respect to the number of passages that there are between the producer and the final consumer; where sales tax is levied on total value at each stage, the result is a cascade (downstream taxes levied on upstream taxes). A VAT is an indirect tax, in that the tax is collected from someone who does not bear the entire cost of the tax.) The VAT is a popular tax n mechanism in Europe and Canada.

The risk based actuarial format which private insurers use creates an excessive burden on individuals as they age and on those with known medical conditions. The fairest alternative would be to do the actuarial studies yearly to determine the total amount needed then create a tax or premium rate based on for example a minimum three population segments; the largest and that with the highest premium would be the 20-65 age work group. The second would be the over 65 age group at a decreased premium. The third would be the under 20 age group. again at a slightly decreased rate. I have not included other groups such as those unemployable by illness or other disability, and therefore are not income producers.

This financing problem will most likely need a combination of financial resources, and I am sure there will be a lot of opposition to whatever plan(s) is adopted.

If you have been able to follow my convoluted rambling discourse you will understand that you have just begun to appreciate the enormity of the financial program as to obtaining funds. I know I have just touched the surface but will next go back to the cost engines.

4 comments:

  1. What concerns me with any "health care plan" reform is the focus is on treating an illness after it has occurred.

    Many, many maladies are due to people's lifestyle choices -- the smoker, the drinker, the reckless driver, the promiscuous, the glutton, the idle, etc.

    None of us are perfect or without vices or poor choices -- but, if our society focused on prevention and education -- our health care costs would significantly reduce.

    Study after study show that have an active lifestyle, moderation, and proper food choices points to a healthier old age -- where most of the poor choices made duing youth and middle age show up in our older population.

    People have accidents, diseases and physical conditions that they have no control over -- but many health issues occur as a direct result in poor lifestyle choices.

    Should this nation go into debt or tax the healthy and productive to support the poor choices of others?

    I don't know the answer. I had an uncle who smoked his entire life, spent the last ten years of his life on oxygen and many hospital visits (paid by health insurance), and ended his life gasping for breath in the hospital. I loved and cared for him, but those ten, painful and expensive years could have been avoided if he had made one simple choice.

    Olive

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  2. Hey, Doc,

    Re: "Growing like Topsy"

    In Uncle Tom's Cabin, Topsy is unaware of how she came to be, and suspects she wasn't born, but just "grow'd."

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  3. To 2:29 PM, Thank you for refreshing my memory as to the origin of the phrase. Obviously,this exerc ise was never conceived or born but jusr grew randomly.As of this moment I have no idea about when or where it will be finished. I am afraid that may also be true of Obama's Health Reformation.

    To Olive While it may be true that life style plays an important part in the ultimate use of our resources it is only one of many factors. I think RNA&DNA through our genes has a greater impact.Imagine the cost impact when we try to play god and manipulate the genetic makeuup.

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  4. Would "Olive" be Olive Lynch by any chance? I thought she moved - is she still around? Whatever happened if anything to her "Buy Muhlenberg" sideshow?

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