Doctors at “house party” deplore destructive “reform” ideas | AAPS News of the Day Blog

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The Obama team has allowed a mere two weeks, over the busy holiday season, for collecting all the “input” they need for rapidly forcing a radical “health system reform” plan through Congress. House parties are explicitly designed to elicit tearjerkers showing the “need” for precisely the changes that the Obama/Kennedy/Daschle/Baucus/”stakeholders” forces intend to implement.

On very short notice, AAPS organized a virtual house party, with input from a number of specialties around the country. The doctors warned that the monopolistic stranglehold of big insurers would be tightened, as the insurance industry traded its support for a mandate forcing some 45 million new customers to buy its product.

Universal “coverage” would be a “currency without a marketplace,” like in Massachusetts, without the personnel and facilities to cope with burgeoning demand from healthy, newly entitled consumers. Careful diagnosis and personalized treatment would be further diminished, to be replaced by 11-minute shotgun visits with minimally trained, protocol-wielding physician extenders.

The Hippocratic Oath is already a joke, stated one pathologist, because it is impossible in many cases to comply. Resistance to the destruction of medicine gets one branded as a “disruptive physician.”

Information technology, the panacea for all problems, is a hugely expensive debacle as currently being implemented, physicians say. Physicians are turned into data entry clerks, yet the relevant data may be impossible to find.

Patients may not care that their primary-care physician is only earning $30,000/yr while working harder than ever, but may soon find that what they consider a $10 office visit is not available at any price.

Myths about superior care under socialized medicine, administrative cost savings, the vast potential of the “medical home,” the benefits of “evidence-based medicine,” and other widely believed fantasies need to be debunked by physicians, stated Dr. Jane Orient, AAPS executive director, who moderated the conference.

Powerful special interests are lined up behind the proposed program, and few are left to speak against it. It is vital that Americans hear from their doctors.

Please add your comments below to the edited transcript of the meeting.

20 thoughts on “Doctors at “house party” deplore destructive “reform” ideas”

  1. Hi again;

    I participated in that forum. Thanks for airing some of what I fervently (foolishly?) hope our politicians will hear.

    The disintegration of Primary Care is happening as I type this and will be truly frightening in its depth & scope as it unfolds…Yet our “leadership” both medical & political refuse to deal with it in a constructive manner.

    As the recent “financial collapse” illustrates, it will have to become a “crisis” before anything is done – and once that has occurred, it will take 10 years to fix, and countless lives impacted or lost.

    As Yeats said…

    …Things fall apart; the centre cannot hold;

  2. Standing around with our pants down, complaining, sniping and opposing, will get us nowhere.
    1. There is an irreconcilable conflict of interest between insurance companies and healthcare. Insurance companies are about making money. Healthcare is about taking care of people. Insurance companies make money by receiving premiums, loaning out the money and denying health care. Further, almost $.50 of every healthcare dollar now spent goes to insurance companies “overhead”.
    2. Governmental bureaucracies are not reconcilable with successful healthcare either. The first priority of any bureaucracy is self-perpetuation. The first priority of its employees is job-preservation. Neither relate to serving people.

    50 years of experience with the Veterans Administration demonstrates indisputably that government is never going to successfully and efficiently deliver effective healthcare. Medicare is all about preserving Medicare (or funding other things of current political priority). Medicaid is all about state systems of taking care of poor people. Both are the victims of the ebbs and flows of politics. Both treat physicians like indentured servants and/or committers of criminal fraud.

    3. The only alternative must be something truly new. I have written Dr. Orient with a detailed proposal called “A radical new Approach to Healthcare.” She didn’t like it but kept her reasons to herself. It proposes that Congress charter a hybrid entity (something like the Federal Reserve). Controlled by Commissioners appointed to limited terms, with employees whose careers would depend upon successful real service to real people, it would be funded outside the politics of the Congressional budgetary process. Excluding families below the poverty income line, dependent children, the aged and the disabled, it would cost approximately $150/month per person, paid directly to the system with no politics and no insurance company overhead. It would be required to negotiate its rates of payment for physician services, medications and devices, directly with providers, on a level playing field of supply and demand. No special interest privileges or price havens.

    If AAPS gets behind a truly new alternative, pushes it with AMA and all other professional groups, and with the support of all physicians and all our patients, we can accomplish something. If we do nothing we can be absolutely certain that we will all absolutely become the vassals of insurance companies and the congress, greased by special interest money.

    So, Jane, how about it? If you have a better idea, lets hear it. If not, circulate the proposal to the membership, refine it into something truly new and rational, and get us all behind it.

    Joel Simon Hochman MD

  3. We already have in place a functioning medical system. It will need a little tweeking to make it useful for all. This system allows patients to choose who they want to see. It allows doctors to make a reasonable income. It creates patient responsibility and competition between doctors. Doctors will have to provide good medical care or they will lose the patient to another doctor. This will improve the practice of medicine. This system eliminates the need for extra staff in the office just to deal with insurance. It even leaves the insurance companies in the picture so they don’t have to go under. With some minor changes this system also assures that the poor can access the same doctors as the rich.

    This system is the Health Savings Account. For those who would normally be on Medicare or Medicaid let the government provide the deductible and pay for the high deductible insurance policy and give the patient a credit card to take where ever they wish. Those who can afford it pay their own but have the same card. The money in the account belongs to the patient so they will be careful and discriminating about how it is used. This is not a new idea but would truly be a win-win-win-win (patients-doctors-insurance companies-government) for all.

  4. No Federal system can exist if doctors refuse to be part of the corrupt Ponzi scheme. We are way past the time that physicians should have opted out of Medicare and cancelled their contracts to serve third parties. The most cost effective and universally available health care will be under a system where patients purchase physician and other medical services directly. Providers of medical care services should compete for those services. Charity care should be tax deductible. When physicians force this change (and we can with some resolve), the insurance world will be forced through market pressures to morph into a more policy-holder sensitive marketplace. Creating more bureaucracy is not the answer, eliminating the bureaucracy burden is the simple, ethical and logical answer.

  5. Senator Thomas A. Daschle
    The Atlantic Building
    950 F Street, NW
    Washington, D.C. 20004-1404

    Dear Senator Daschle:

    In line with your and President-Elect Obama’s request, we held a small Community Health Care Discussion recently, and herewith send a report of the results.

    There were 10 persons in attendance, including three women real-estate agents, two homemakers, one restaurant entrepreneur, one community utility CEO, one cardiac device representative, and two physicians. The meeting was held in my home.

    They were asked to discuss the relative merits of four possible health care options:
    -the present mixed system;
    -government-paid universal health care;
    -mandatory employer-based and individual insurance as in Massachusetts, similar to that advocated by President-Elect Obama and reportedly by Senators Baucus and Kennedy; and
    -consumer-directed health care, emphasizing high-deductible policies plus HSAs.

    Opinions were mixed, as expected, but a few general thoughts emerged:
    -The present American health delivery system, while flawed by high cost and spotty access, was nonetheless considered the best in the world;
    -Government-sponsored care was generally viewed as showing a poor record in the 12 developed societies where it is in effect, and it was thought that it would skyrocket costs and that the typical American would accept it reluctantly. The comment was made that the best among these systems were those where a larger private-pay and competition component is allowed.
    -the single experiment to date in mandatory insurance (Massachusetts) was viewed as already producing huge cost and poor access. Reports are that appointments are delayed for 3-4 months and some Harvard doctors are seeing patients in 8-12-person groups, doing histories and exams in public (it is said that the examinations are done without the patients’ removing their clothing).
    -Consumer-directed care was viewed as the most viable option, with patient satisfaction running quite high where it is employed and savings of as much as 33% are being achieved, according to reports, particularly from the Kaiser Family Foundation.

    Actually, I have written a book with references which generally advocates this last possibility: TWO DAYS That Ruined Your Health Care (and how you can provide the cure). It has already sold more than 15,000 copies. The book is enclosed for your consideration.

    Best of luck to you and the new administration in dealing with this critical and difficult problem,

    Sincerely,

    William C. Waters III, MD

    cc: President-Elect Barack Obama
    1013 53rd St E
    Chicago, IL 60615

  6. Yes, the causes for the current medical crisis parallel those of the mortgage business. Politicians demand, by law, counter-productive policies. In medicine, they throw billions of dollars into research (eg the NIH, which alone gets over $20 billion, if memory servers). Then the pols don’t want sick people to benefit from the products of research, because it costs money!

    Yes, this does resemble a Ponzi scheme, but Mr. Ponzi didn’t hold a gun to his victim’s head, as the govt. does. I therefore created the Charles Ponzi Appreciation Society to call attention to the fact that he suffered for his criminal activity, e.g., by going to jail and dying a pauper. The pols and their pals engaging in similar criminal activity are most often rewarded and not restrained.

  7. The ultimate fall-back position for doctors and patients is this: We must preserve the right to OPT OUT of whatever abomination the Obamacrats try to cram down our throats.

    My hope is that the government will be so busy running AIG, the banking system, Wall Street finance, and the mortgage industry…that they will leave healthcare alone for a while.

    And I use the term “running” very loosely. Most politicians and bureaucrats couldn’t run a hot dog kiosk.

    -Steve

  8. AAPS has a white paper on medical financing in the Fall 2006 issue of the Journal. We, unlike Tom Daschle, do not have One Plan involving a medical czar like the Federal Reserve Chairman, commissioners, price controls (fees “negotiated” with a central planning agency), etc. The “hybrid” plan or the public-private partnership is also called economic fascism, corporate socialism, or corporatism. AAPS is for freedom. In a free market, decisions are made by millions of individuals, not by a central agency. Freedom is required for innovation and new ideas. Corporatism is actually a rather old idea, something like 80 years old. We should pitch it out as a dismal failure. The longing for freedom is eternal, and ours has been eroded to the point that the ideas of 1776 are newly revolutionary.

  9. There are actually many parallels between our failed financial system and the failing medical system. Our direct connection with money (the gold standard) was broken and fiat currency was forced on us. The direct connection between patients and doctors have been broken by insurance companies, government agencies, mandates, paperwork, etc. We were told that a company called the Federal Reserve” really knows what it is doing and can print money willy-nilly to solve any financial crisis. We’re also being told that some “system” can create value in medicine. All we need is “efficiency”, electronic records, “accountability”, etc. The only real value in medicine is the doctor patient relationship, free from the intrusions of our “big brother” government.

  10. It is encouraging to read the comments above supporting Free Choice, Free Markets and Free Will.
    As a talk show host for over 40 years in major markets across the country – as well as being a friend of Dr. Vincent Cangello – I can’t urge you strongly enough to contact those organizations, “think tanks”, who can and do support your ideals: the Cato Institute, Buckeye Institute, Independent Institute, Heritage Foundation, Heartland Institute and many others.
    While I appreciate AAPS, the folks at the organizations mentioned above are people with whom I’ve had the pleasure of having on shows from coast to coast preaching the gospel of Free Choice and Free Markets.
    They have the necessary pipeline to the to spread the word about this skullduggery to play on the “tearjerker” stories to expedite this socialist disaster-in-waiting.
    If your need names/contacts, feel free to contact me. At the same time, get your message out to John Stossel, George Will, Rush Limbaugh, Sean Hannity, Glenn Beck, Neal Boortz and other syndicated columnists and talk show hosts. If you have trouble getting through, let me know. I know these guys personally and will do whatever’s necessary to get you hooked up.
    Brian Wilson
    Brian [email protected]

  11. 1. There may be no solution to the payment problem. Doctors play “Hot Potato” with the uninsured patients, and Medicare forbids cost-shifting within the office: We can no longer be Robin Hood. Perhaps Medicare could change that rule.

    2. Do we accept that our country cannot be “best” when its longevity and infant mortality are not “best”? Do we want a separate scheme for the old, the poor, and the infirm? Do we want Medicaid as a separate plan? Do we want a country that includes everyone?

    3. What would be wrong with allowing each state to conduct its own insurance to compete across state borders with both private insurance and Medicare? People in Massachusetts could buy insurance from another state if it had a better plan. AAPS could publish the administrative costs in all plans.

    5. Why not grant doctors tax credits for free care, starting with state taxes? Approximately 25 states have the Initiative. Let’s consider a pilot project in a smaller state to test whether such a reform improves care, perhaps by improving ‘access.’

    One question would be how to set the value of that care. This problem would arise for doctors treating primarily poor patients, because the tax credit might exceed income.

    6. Why not encourage patients to control their medical records as a matter of Constitutional privacy, with encryption?

    7. The numbers cited in Dr. Waters’ book are compelling. I found a few more ($ 1.2 Trillion waste) and placed them on the website above.

    8. We are faced with a political struggle within our profession (competitive peer-review-for-profit) and a patient-population that disregards American history, in part because of ignorance. See Jack Anderson’s article, “How Did Doctors Become Serfs?” at the same web site. Corporations are not people even if a ruling in ~1876 says they are. We must remind our lawyers that they become patients, as described for a pregnant attorney in 1984 in Brunswick, Georgia. Perhaps attorneys at Horty, Springer, and Mattern might care to research that article.

    9. As a possible short-term solution, google this tocsin by Charles Bond J.D. of Berkeley: “Law and Medicine. The War Is On: Why Your Medical Staff Needs to Incorporate and Obtain Its Own Independent Counsel.”

    10. If you were a college freshman, would you choose a career in U.S. medicine today? The doctor shortage is predicted to reach 200,000 by 2020.

    [email protected]

  12. I read Dr. Waters book and ordered a few copies. A true eye opener. He and Harris have figured it out and these are the best solutions. A blend of patient resoponsibility for their own bills to a certain amount then catastrophic insurance covering only real illnesses and medical necessities. If the government runs this with/and the big insurance beaurocracies, we haven’t seen anything yet. Yes we do need tax credits for indigent care and surgeries. Dr. Butler, most Drs. I ask question #10 the answer is no or probably not. These changes will take time b/c Obama and Co. are going to be tied up with the economy and the war. I see all this coming down in a few years. How the heck did our profession get to such a sorry state?

  13. In response to the comments above:
    1. The current “system” is not a system and is NOT working. “Tweaking it” is a pipe dream.
    2. If we attempt to respond to the current mess by withdrawing from the system, we will end up with just two choices – leaving medicine or having our role dictated to us by legislation – most likely dictated by the insurance industry.
    3. Currently the American health care system is not “the best in the world”. By every objective measure the quality of health care in the United States lags far behind many other nations. The medical profession now lacks much of its previous appeal to young people. Most young people are very much aware of the deep disaffection and dissatisfaction of current practitioners. Most of this negativity is generated by the abuses of insurers and bureaucrats. Until the profession is freed from both, it will only get worse. Health care MUST become universally available. The essential right to the pursuit of happiness cannot be guaranteed without including health care in that quest.
    – “Consumer-directed” health care is unworkable. Health care can only be a partnership between consumers and providers. The trick is to create a system that excludes all others from distorting it.
    – Depending on all consumers to save for their own health care is a myth. It will never happen.
    – Creating the money to pay for health care by simply printing it, will result in yet another bankrupt debacle, like banking.
    – Depending on industry to take on the responsibility will result in what has happened to health care in the automobile industry.
    – Depending on government to be wise, economically meticulous, non-exploitative of providers and consumers, is totally implausible. There simply is no incentive for government to do so.
    – Mandating the control of all health care by insurance companies will benefit only the insurance companies. Massachusetts makes that unarguable.
    4. Politicians have not been and will unlikely ever be, inventive, original or rational. Their priority is re-election and the enjoyment of power and privilege. They do best when they are led to the right decisions by facts, evidence and rationality. We cannot look to them to lead us. Left to their own devices they inevitably end up with legislative variations of the Ponzi scheme, (because the consequences always end up happening on some other politician’s watch, not their own.)
    5. Looking to “opting out” (or the Ostrich strategy) is delusional – see above. If we aren’t involved in the decisions the decisions will be imposed upon us.
    6. Ideologically abhoring “czars”, chairmen, commissioners, price controls (fees “negotiated” ih a central planning agency), etc., “hybrid” plans or public-private partnerships as economic fascism, corporate socialism, or corporatism. while deifying freedom. is lovely ideologizing. It offers no practical solution to accomplishing an effective partnership between consumers and providers, while excluding insurance companies and politicians from distorting the process.

    A practical solution is mandating universal health care, establishing a system partnering consumers and providers in making the essential decisions, and providing a financing system that places the responsibility to make it work on patients and doctors. Such a system will not grow like Topsy. It will have to be legislated.

    There is a system in place to do all this. It is called constitutional government. It balances the executive, legislative and judicial branches equally. If one has no faith in it one needs to leave the United States.
    7. The “doctor-patient” relationship is not going to prevail simply because we worship it as the holy grail. It is going to have to be legislated. See my proposal or come up with a better one.
    8. “Free Choice, Free Markets and Free Will” are not going to happen as the result of ideological worship. A system of healthcare that preserves these things is going to have to be legislated. See my proposal or come up with a better one. If CATO, Buckeye or anyone else can do it, more power to them. They haven’t so far and the clock is seriously ticking. Mr. Obama has a mandate to do something to solve the problem. It IS going to happen. We need to lead in that happening and we won’t by mouthing philosophical pieties.
    9. There IS a financial solution. It consists of adding up the total cost of universal health care, dividing it by the number of people who be covered, excluding those who cannot pay equally – the impoverished, children, the disabled, and the aged – and paying the tab monthly (while keeping the grubby hands of profiteering insurance companies and politically motivated politicians out of the till.) Govern the system by a partnership of consumers and providers at national, state and local levels. Restore the checks and balances between physicians, medical staffs, consumers and the law. Put serious consequences into the system for anyone who abuses it. Live with the consequences and make it work based on the facts. Any other approach is a chimera of wishful thinking and/or political scheming.

    Do all this RIGHT NOW, because unless we do, the college freshmen, in fact, have already made their call. And Medicine is not where they want to go. If we persist in the current direction, the only people left in medicine will be folks that you sure as hell would not want for YOUR doctor.

    Joel Simon Hochman MD
    PS: Hey Jane, are you going to let the members see the actual proposal?

  14. It is sad and scary the way medicine is heading right now,

    Medicare Advantage the new monster is just getting bigger under the new proposed healthcare system,

    You do not need a corrupt medical board like Texas any more for the private insurance to target any physician,

    Now the private insurance is managing the governement healthcare program and is wearing its hat,

    Now, the private insurance could trigger aggressive investigation against any doctor under it’s Medicare Advantage branch using the government money to destroy any doctor they do not like for whatever the reason they could come up with,

    Imagine if the Medicare advantage succeeded in making a miss between you as a provider and the Medicare program,

    They might be even immune like hospitals!

    the new healthcare proposal will make the private insurance companies bigger and more dangerous!

    Very soon the private insurance will be more harmful than hospitals!

    it does not look good for doctors or patients,

    It has to get ugly before the politicians and the legislators figure out that they were fooled by the healthcare industry and the stakholders,

    We going to see more mortalities related because of the broken healthcare system more than we have now (150,000 deaths due to fetal errors in hospitals every year),

    The bad will get ugly and the broken medicine will extend from hospitals to clinics around the country,

    The smill of the corps will be everywhere,

    Lord have mercy!

  15. It is important to remember the Obama/Democrat system is a current distillation of the old time Communist/Facist playbook. They will have a blizzard of “needy vs. greedy” stories endlessly reported and re-reported, they will bolyx up any dissenting view or positive reporatge of opposing views, they will ram through in the middle of the night any of their programs if we are not vigilant and the loyal opposition is asleep at the switch, they will engage in viscious political, legal and possibly even personal eradciation of anyone who poses even the slightest threat- the ground for this has queitly been cultivated in Medicine by “disruptive physician” bylaws ans statutes. They will work on the premise that you can not effectively fight while you are disemboweled. That is the playbook and that is the strategy. Don’t be misled into thinking they have too many other things to worry about like the war and the economy; they will parsimoniuosly include these problem with ours as a “comprehensive” treatment of all problems at once- “just trust them”. They have an army of dedicated elites and useful idiots at the ready to implement any and all changes we allow to occur. The very liberty of every person is on the line.

    There is no replacement for personal responsibility, if you are in a normal mental state, especially in Medicine. The moment you cede responsibility in Medicine, there is some person or group just waiting to exploit, abuse and eliminate you if you do not serve their purposes or become a liability. Why does the Government need to be in control of all your medical records with its secrets and intimacies? All while spending, conservativelyprojected, billion on a system that can not assure safety and total security any better than you or I can? Why can we not give any citizen a $3 thumb drive to hold all their records wherever they go and give it to whom ever THEY wish? And if some individuals lose it and the encryption is broken and the recods exposed- that will be one person and one episode as opposed to criminal access to millions of records at once. The odds of millions of people losing their drives at once, being found, being unencrypted and being divulged is vanishingly small compared to problems arisng from ONE unauthorized break into a central database. Compare this with the loss of your won bank account # and Pin # vs. the recent downloading of all the information from one retailer or the loss of one VA computer. This should be mortifying. even if the penalties are grave and able to be enforced, how does that restore the lost privacy? The governement will legislate its own freedom from responsibility and liability- so who are you made whole again?
    As for governement control of Medicine- the end result is quite simple- if it gets too costky, people will be sacrificed and the budegt will be the priority. We will pay for reserach that will save money, not lives as the latter will cost too much. Off shore enterprises supporting medical treatments needed and wanted will suck away the economic lifeline and brain power of medical expertise in the US leaving a great loss in one of the greatest parts of the country’s economic engine- we will lose several cylinders from that engine gaining savings and losing power. I hope it does not come to this and we can awaken from the dream and not find ourselves in a nightmare.

  16. All the above comments are very good but teeth needs to be put in placed.
    Does anybody eve think of organizing a national day of protest? Physicians will stop deliverig care except for emergencies. This will call everybody attention.
    Isn’t this something that we should talk about and see if it is feasable.

  17. J.S Hochman states in his post

    “There IS a financial solution. It consists of adding up the total cost of universal health care, dividing it by the number of people who be covered, excluding those who cannot pay equally – the impoverished, children, the disabled, and the aged – and paying the tab monthly (while keeping the grubby hands of profiteering insurance companies and politically motivated politicians out of the till.) Govern the system by a partnership of consumers and providers at national, state and local levels. Restore the checks and balances between physicians, medical staffs, consumers and the law. Put serious consequences into the system for anyone who abuses it. Live with the consequences and make it work based on the facts. Any other approach is a chimera of wishful thinking and/or political scheming.”

    Although one can sympathize with his concerns, his solution doesn’t work. Above you have just “reinvented” the health insurance system. All he has done is replaced those “profiteering insurance companies and politically motivated politicians” with a “partnership” of consumers and providers that amount to just another bureaucracy with the power to corrupt and control. “Restoring checks and balances” is a process that cannot be accomplished properly by bureaucracies. It can only be done by free market actions (which Dr. Hochman has apparently discounted).

    I am curious about the statement that U.S. healthcare “lags behind many other countries”. There was no elaboration and I have not heard this from many physicians (other than those paid by the Commonwealth Fund, etc.).

  18. Dr. Hochman fails to realize that we do NOT need something “entirely new” to solve our “crisis.” The free market worked just fine, and would still be working if we had not abandoned it. No need for some experimental “new” system which is really socialism with a new name (kind of like “evidence-based” is the new name for “scientifically proven”). The free market is the ONLY way to assure all individuals get the best care for the best price, with the type and level of care individualized to best meet their particular needs. Yes, “charity” is sometimes needed, and it is a PART of the free market, for both ethical and evil-profitmaking-public-image reasons. But rather than be efficient and doled out appropriately, government-based “charity” becomes a self-inflating industry, which freed from the constraints of the free market, bureaucratizes and destroys the whole health care “system”.

  19. My all-cash-at-time of service family practice is a great pleasure – I really put the patient first (not a third party payer who calls the tune) and feel more appreciation.
    Charging just $50/15 min. visit is financially feasible only by dramatic reduction in overhead, since until most have HSAs they first try what seems free and volume is low.

    Serendipity, the problems are more interesting because most do come to me after first trying their “free”, Kaiser, Medicaid, insurer-directed or ER care for the same illlness.
    Since my time is on the patient’s history, exam and advice, not satisfying a third party (like electronic records), I usually do better (by patient judgement) and am able to help more.

    Try it. You will like it and we can bypass the bureauocracy.

  20. I have posted the following open letter to Obama on my MySpace Blog at
    <>. I will copy it here. It expresses the basic principal that must be followed to arrive at a reasonable system>

    Open Letter to President Obama: Health Care Solution
    Category: News and Politics

    Houston, TX
    April 3, 2009

    Dear Mr. President,

    Here are the basic principals upon which a sound, sustainable and ethical health care system can and should be built:….

    1. It shall be illegal for physicians to contract with anyone other than their patient or patient’s legal representative. There shall be no contracts with the government, with any “managed care” entity or insurance company, or with any other third party…..

    2. It shall be illegal for physicians to receive payment directly from a third party “payor.” Payment must come from the patient directly and shall be made at the time of service…..

    3. It shall be illegal for third parties to request discounts from a physician for their clients. The price for various services is to be negotiated between patient and physician, as is the case with all other professions. ….

    4. Each American citizen shall have a Health Savings Account established at birth. The HSA will be maintained with an investment firm or bank, the accounts being insured by the Federal government to the amount of $150,000, as are bank deposits. Increases in value on these accounts via interest, dividends or increases in investment value are not taxed, and these assets are protected from creditors, as with the usual IRA. (Regulations will need to be developed regarding the type of investment, allowing a certain low percentage to be invested in more volatile investments.) Funds in the HSA can be spent only for Health Care, but can be passed on to heirs as would an IRA, to be used for the heir’s health care needs. ….

    5. Each American citizen shall be able to exclude from taxation the amount of $5000 per year (adjusted for inflation) for deposit in his or her Health Savings Account, with catch up contributions allowed if the prior year’s expenses exceeded this amount. There is no limit to the total amount of capital the citizen can accumulate in his or her HSA. ….

    6. Businesses can no longer subtract from taxable income any payments to “insurance companies” for health insurance plans. They can, however, deposit money yearly into thier employees’ HSAs as a salary expense, the yearly maximum contribution per employee to be determined after study by qualified economists. ….

    7. Each American citizen shall have a catastrophic health insurance plan in place that covers yearly health care expenses over $20,000 (adjusted yearly for inflation). This plan will be sponsored and financed by the Federal Government. See Comments about administration of this plan…..

    8. Citizens with income below the poverty level will be provided yearly with a “tax rebate” from the Federal Government, deposited directly into their HSA…..

    9. The government will mandate that the states educate every citizen about this “self-reliant” system. Every citizen must realize the need for preventive health care and a healthy lifestyle. They must realize that prudent use of these funds and maintaining a healthy lifestyle are the surest route to security. They must be made aware that contribution yearly to the HSA must come before purchase of consumer goods, a new car, or a vacation, for example. There will be no free “safety net” other than the catastrophic coverage…..

    10. Citizens who become ill before they have accumulated sufficient funds in their HSA to cover the “gap” (whose HSA balance falls below zero in a given year) will be LOANED the needed funds by the Federal government, to be repaid with interest in the future. This loan will show up on their credit report and will influence their ability to borrow for other purposes until it is repaid. ….

    Comments…..

    This plan relies on human nature to reduce costs. When payment is coming directly from funds controlled by the patient, the patient will make wiser choices. There will be less desire to obtain expensive tests that are marginally indicated for a minor complaint or to obtain expensive tests when less expensive tests will do. Less expensive, but equally effective, medications will be demanded by the patient…..

    With this system, the medical profession will be restored to an ethical status, it being unethical to allow outside influences to intrude on the physician-patient relationship (as contracts with third parties invariably do). ….

    The public will demand transparency and equality in pricing of services and will cease to tolerate overpriced services. ….

    The nation will then be pooling risks that are in the catastrophic range, rather than simply using the “insurance industry” as a (leaky) conduit of money from employer to physician or hospital for everyday care. ….

    With prudent living and prudent saving, within five to six years each citizen will have in their HSA sufficient funds to cover the $20,000 “gap” in any one catastrophic year, and within ten or so years should have the funds to cover the gap for several years of catastrophic ill health. With good health and good planning, these funds can be passed from generation to generation, allowing those families with good health to become fully covered with only rare intervention by the government. ….

    The government can negotiate with the current managed care industry to obtain management of the catastrophic funds with minimal administrative expense, or can set up its own administrative agency (to replace the current CMS, for example) to manage and administer the catastrophic coverage program…..

    Physicians will now be free to concentrate on what they do best, care for patients and maintain their knowledge base, and will no longer have to waste time dealing with managed care contracts and meaningless requests from managed care companies. ….

    I urge you not to let the powers that be within the current managed care industry or withn the established government agencies to bring pressure against the adoption of such a rational and beneficial plan…..

    Respectfully yours,

    Lawrence E. Mallette, MD, PhD, FACP, FACN

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