Empower Georgians with Tools of Effective, Efficient,
Confident Navigation of the Healthcare System
Georgians Know Cost Drivers: YES.
Advise Patient Actual Procedure Cost Before Registration: YES.
All Adults Understand Care Never Free: YES.
Horses pull carts. Georgians recognize that health insurance premiums and out-of-pocket costs are budget-breaking expenses. These expenses are carts, not horses. Budget-breaking payments to hospitals and physicians are the horses in this story. Only if payments decrease can premiums follow along.
First a story; then some background.
My insurance company paid $10,000 to a pathology doctor. The payment seemed exorbitant to me. When I called my insurance company to ask what services had been on the bill, the employee replied “an answer to your question would violate the pathology doctor’s privacy.” She would not tell me how her company had spent my money. I called the pathology. His employee replied “there was a keying error. We billed for 33 services instead of 3. We have already sent a refund.” Think about the facts. My insurance company tried to cover-up its mistake. It had paid for a ridiculous, impossible amount of healthcare. It never told me about the refund it received. After I assigned benefits, I had no stop payment right and no right to question what had been done.
The background: The patient employs a health insurance company to manage payment of healthcare bills. These companies create nothing. They are specialized banks that accept deposits and give withdrawals. These banks call your “deposits” premiums. These banks call your “withdrawal checks” assignment of benefits. Your check is included on the papers the receptionist asks you to sign before you receive any care. Unlike other bankers, health insurers give you, their customer, no “stop payment” mechanism.
The heavy regulation of medicine precludes effective free-market competition of cost. Regulation also increases cost. The healthcare industry is as much a monopoly industry as is an electric utility or a municipal water service. Auto accidents, gunshot wounds, third degree burns, heart attacks, strokes, diabetic comas, low-white-cell fevers cause unplanned need for healthcare. The individual goes to the nearest hospital or doctor.
The patient can’t compare actual cost of a procedure between hospitals or physicians. The “suggested retail price” is the price from which each individual insurance company negotiates its own individual discount. These discounts are individual proprietary information and protected by “gag clauses”. The government receives the largest discount. My Medicare discounts seem to be 40 to 90 percent. For example, Medicare reduced a $1600 “suggested retail price” to $125. The better the discount, the less budget-breaking the premiums and co-pays I needs to pay.
Another story and some more background.
Everyone buys pizza. Similar pizzas cost one price. The first grouping is size. Within that grouping the larger the number of toppings on the pizza, the higher the price. An employee who prices the pizza for 6 toppings, but only puts on 3 toppings is stealing. The customer who swipes his credit card can see the pizza and the toppings. He will not pay for more toppings than he can see. The pizza store clerk and the customer both know that the cash register slip or the credit card slip are an accurate representation of the pizza that was purchased. The cash register slip can be compared to the credit card receipt for days or longer. The pizza has been eaten and the topping number can’t be recounted. In the next two paragraphs the doctor-patient encounter is the pizza and the written medical record is the cash register slip. or the credit card slip.
The Background: If you want to control your healthcare costs, you have to care about the facts in this paragraph! If you can purchase pizza, you can make these facts work for yourself. Doctors and hospitals communicate with insurance companies in numerical codes that group similar encounters; the grouping determines the payment amount. An insurance company audit of an individual service for which it has issued a payment check is confirmation that this numerical code is an accurate representation of the written medical record. The patient is divided into 10 or 11 named body parts; the history records which parts are talked about; the physical exam records findings of manual probing or thumping or listening. Seven parts of history and of physical when I practiced was “complex” and I was paid accordingly; only two or three parts would be “limited”; my check would be less. The auditor counts body parts. You, too, can count. Learn what to count, make a written record.
Only the patient and the doctor were present during an office visit and only the two of them know what was discussed or examined. Your insurance company cannot learn that from the written medical record. Its auditor does not ask you, the patient, what happened. He only counts. The written record is assumed by the insurance company and by the legal system to be true. Any inaccuracy the patient alleges is shrugged off as the patient doesn’t know. The payment check stands.
A final story, then legislation.
I receive in the mail an office visit bill for $400. This charge seems excessive since my time with the doctor was 5 minutes. When I called his business office, the answer to my question “why is the charge so much” was ” the doctor examined this, this and this.” To my reply” he did not” came the response “that is what it says”. This scenario does not give the patient control over cost.
Legislation at the state level could empower you the patient with more control of the dollars.
- Healthcare is never free. I support inclusion of a unit about the healthcare system in the high school economics course with the goal of raising recognition of the factors that increase costs and as well analysis of the insurance company system to determine the value of a given healthcare service.
- I support empowering the Insurance Commissioner to create a patient-initiated “stop payment mechanism” of benefits assigned presently at the registration desk before any healthcare is provided.
- Before the state will grant a hospital a license to operate, it accreditation committee reads pages of policy and procedure that if printed and stacked would reach several yards above the floor. The Georgia Medical Board is responsible for enforcing the Medical Practice Act and its rules. At no cost to the patient its investigators evaluate patient reports of perceived substandard service by a physician. I support transferring its investigative responsibility for patients’ complaints of provider conduct that does not conform to hospital policy and procedure to a unit reporting directly to the attorney general. Examples include allegations of sexual abuse or falsification of the medical record, that is a record of more pizza toppings than there actually were.
Fully empowering the patient requires legislation at the federal level. The entity that writes checks commands its recipient’s attention. Today the insurance company writes checks to hospitals and doctors. The written page is the insurance company’s requirement. Hospitals and doctors provide it.
Insurers decide also what healthcare is worth without, it seems, sufficient regard to what Georgian individuals can afford. Hence the sky-high premiums and out-of-pockets co-pays that anger each and every Georgian. Even Medicaid is becoming unaffordable for Georgia taxpayers. Reining in healthcare costs requires overhauling the payment mechanism; patients need empowerment to write checks and swipe credit cards. These patient payers will demand cost transparency the insurance company does not. The doctor’s administrative overhead costs will fall. The cost of medications will fall. The patient will get the biggest bang for their healthcare bucks. These bucks now total $17 out of every $100 in the american economy
It might be possible for Georgia to restructure its employee health benefit along these lines. I have not devised a full plan yet. Send your ideas.
Health Care Surprises
1.When a voter answers my knock on the door, he may have a question for me after he lets me introduce myself including that I am a physician, that for a time I paid bills every Wednesday and that the color purple signifies my position in between the red-right and the blue-left. What about Medicaid expansion a number of people ask?
I would be willing to expand Medicaid under two conditions. First the current 26 billion dollar state budget not be expanded for this purpose. Second the tax cut passed by the 2018 legislature not be rescinded for this purpose. The Congress intended that its 2017 tax cuts put money into our individual wallets; nothing good will happen if the state pickpockets our wallets. The economy is growing this year; this result is the result Congress intended.
To my surprise those criteria can be met.
2.When I say to a voter at his front door that I am making this run for healthcare because people are upset about premiums, out-of-pocket costs and networks, his head bobs a up and down affirmatively. To my reply “an insurance company is a specialized bank whose deposits are called premiums. It can’t write checks if it does not have the money”, a majority of voters reply “well, yes”. “These prices are the cart of your problem; the horse that pulls them is the cost of the checks your insurance company writes to doctors and hospitals.” The voter’s head nods another “yes”.
I have thought for quite a while that a solution to the high cost of our healthcare system is a single-payment model. There would be one sale price for a blood count, a chest x-ray or an appendectomy independent of the retail price or of the payor, that is Medicare, Aetna, Medicaid, Blue Cross, for example. The combined deposit from the patient and the third party into the bank account of a doctor or a hospital would be independent of the payor.
Single payor healthcare will disrupt our traditional funding stream. A single-payment model will not.
Employees will find pay increases visible in their paycheck instead of hidden in increased employer-paid healthcare costs.
To my surprise in-patient hospital charges in Maryland are managed in just this way. It is called single-price payment. Rural hospitals have been stabilized. The Medicare waiver requires that hospital costs are reduced. Medicare allows more for a relative value unit in Maryland than it does in other states. The enabling legislation in Maryland is 1971. Its implementation is much more recent.
Hospitals have liked it. The tweak of funding from volume to capitation is too recent for evaluation of hospital response.
I think Georgians need to study this plan very carefully.