This is a revisit in detail of my previous post 10 "Simple" Steps to Health Care Reform. In that post, a commentary on a Huffington Post article about various means of fixing Health Care, I pointed out the only thing that will actually reduce health care costs:
Remove the profit motive.
In businesses, which virtually everything in health care is, the motive is to make a profit. I have no problem with this, provided it's done responsibly. But when it comes to human lives, the profit motive is diametrically opposed to the preservation of life. This motive influences everything from research and development to the rendering of services. In the end, medically-related industries financially thrive at the expense of patients who die due to a lack of affordable health care.
Now, this must be stressed: AFFORDABLE HEALTH CARE. That doesn't mean it's free. That doesn't mean the government pays for everything. Patients will pay for their health care, but at a greatly reduced rate. How reduced? That depends on the ways and means of implementation of this idea of mine.
First of all, the object is to nationalize health care in such a way that the government BUYS OUT all health care and health care related industries. This includes health insurance, health product and equipment manufacturers, drug manufacturers - everything health care related. The whole ball of wax. If you leave ONE of these industries free to make an uncontrolled profit, you don't get the same bang for the buck.
How is this done? First of all, establish a constitutional amendment that states health care is a basic human right. This then allows the rest to follow.
Next, provide financial incentives for education for health-care-related fields. If there's a shortage, give discounts to students looking to enter the field where that shortage exists.
Step three is to legislate caps on profits and total pay. Fix profits at no more than 5% + Inflation and be certain that all costs - including expansions, next year's research, etc. - are included in the operating budgets. Fix pay based on the equivalent civil service pay scales used in government hospitals. Have critical fields (Such as General Practitioners and nurses) paid better than normal to attract more people to that field. Lower the pay for those in glutted fields.
Step Four: Tort reform. Cap putative damages at a reasonable level and provide free care for life. No gigantic pay-outs. This eliminates the need for private sector workers to charge outrageous fees (according to them, to off-set malpractice insurance).
There will be loopholes. There will be those who try to avoid the restrictions. This is human nature and expected. Which leads to the next step: Buy-outs.
Start by closing trading on all public health care-related companies. Freeze stocks at their current levels. Next, use government funds to buy them out one at a time, then nationalize it. Investors lose nothing (assuming they bought when the price was low) and can then reinvest in other industries. Either way, they get SOMETHING back on their investment.
Retain the employees and properties, and put them to work producing their products to be sold at cost plus 10%. Yes, the Government will earn a 10% profit on what they buy - which will be used to help offset the cost of buying the stocks and nationalizing it in the first place. Granted, it's not fast, but this is a long-term solution. Once the cost of the investment to nationalize that business has been recovered, the 10% extra is dropped from the prices and all things from that company from that point on are sold at cost. This also provides incentive for people to shop around a bit and if the other businesses are smart, they'll cut their prices by 5% to undercut the government prices. Eventually, though, the government will be cheaper. In the case of the 5% profit for privatized companies, they can use it for pay bonuses above and beyond current salaries, to provide incentive. It's not a lot, but it's something.
Wash, rinse, repeat.
Everyone keeps their current job (unless they don't like the pay, then they quit of their own accord) and the process continues under new management whose motive isn't profit, but providing affordable health care. With everything being charged at cost plus 10% (at most), huge payouts for damages aren't being laid on insurers and with wages capped, health care becomes a hell of a lot more affordable. Insurers can insure to pay reasonable costs instead of inflated ones. People can shop for insurance companies and save a little more from those that don't try to get a profit but are satisfied with their income and expense balances.
Economists may blanch at the thought of nationalization of such a large sector of the American economy, but here's the low-down in the whys.
First of all, we have no cures. Except for Smallpox, we are still plagued by every other thing that has plagued mankind from day one. Why no cures? It's not that they don't exist. It's that they're not PROFITABLE.
If you get Cancer, you get treatments. The Cancer may go into remission, since you were only treated, but you will live in fear for the rest of your life that it may come back. Then you get more treatments. Treatments are repeated, expensive and not always effective. But they are also immensely profitable for the drug manufacturers.
What if it was a cure? A cure can be even more expensive, but there's no chance of it coming back, no chance of repetition of that income, and making it cost as much as all of the repeated treatments is beyond the means of most everyone - insurers included. Cures are financial dead ends, a potentially large investment for a potentially very small profit.
For-profit insurance companies are, by far, the greatest threat to human life that has ever been visited upon a suffering humanity. With a profit motive, they're literally saying we want to get your money and we don't want to pay out anything. This leads to all sorts of abuses from "pre-existing conditions" to denial of payment after the fact. ANYTHING they can do to keep people from receiving claims, they do. And when they can't do that, they raise their rates based on their own standards. When people can't afford their health care, they often die or go bankrupt.
Even hospitals, doctors and the like all scrimp or over-do, costing billions in over-charges and missed diagnoses.
It all comes down to money. If the actual costs of doing business is all that is being paid for, with shortfalls being covered by the Government, we could use Medicaid and Medicare income to run health care for everyone in a semi-nationalized, but government cost-controlled manner. This would mean more people could afford to pay for their insurance, everyone can get insurred and the government uses existing funds to cover those who can't afford insurance instead of paying exorbitant amounts to line the pockets of companies and corporations.
In the end, the Government runs most health care in industries they paid for and repaid to the American people. Private companies have their costs controlled regarding profit and wages. Investment is curtailed in Health Care (unless the government wants to issue bonds to help raise take-over revenue, which wouldn't be a bad idea) and profit is no longer a factor in the US, but enough financial incentives exist to keep the field manned and staffed.
Granted, this idea needs to be tweaked for practical implementation, but this provides the framework upon which true health care reform can be built.
