As readers of my blog will know, I had despaired that the Medicare cost problem could be solved by any other way than going to a socialized European/Canadian system. But I just read a plan that just might be a better solution. Written by a member of the paper’s Board of Contributors, Don Campbell, “Ration care with Medicare credits” would retain most of the popular features of Medicare while engaging the hidden hand of the market to hold down prices and foster competition. It contains that missing, essential element that I have so often longed for in my posts, a motive for the patient to care about costs.
Campbell uses a scary word in his title, “ration”. But if you follow the link to his essay you will see that it’s not that bad, and for that matter you will also see the opinion of a doctor that ” . . . we already ration health care, people just don’t understand it.” Now I’m not quite sure what he meant by that, but I suspect he’s referring to the subtle ways of influencing end of life decisions. But one thing comes through clearly: the upwardly accelerating costs of health care in America are unsustainable. (Repetitious, I know, but ever so important.) He offers this argument about that:
A recent study by the Urban Institute found that a typical working couple retiring this year will get about three times as many dollars in Medicare services as they paid in Medicare taxes. What part of that upside-down equation do people not understand?
Campbell likens his plan to the “cap and trade” system proposed for limiting carbon emissions. Here for convenience is his plan as he presents it:
•Assign new Medicare enrollees a credit for total benefits capped at, say, $150,000 that would be adjusted for inflation annually. After the credit’s exhausted, they’d be on their own. (This introduces the dreaded means-testing because some recipients would have paid in more than that in Medicare taxes, but even more would have paid in less, sometimes much less.)
•Permit beneficiaries to buy or sell Medicare credits, at whatever discount that could be negotiated, that could then be redeemed for services at full value. They could also donate them directly to others, or to “credit banks” run by non-profits and religious organizations.
•Limit the percentage of one’s credits that could be sold, so that no beneficiary could fritter away all his or her allotment on flat-screen TVs or Caribbean cruises.
I like it, how about you? I think this might require a little tough love to discourage the present use of ER’s as an alternative. EMTALA needs to be modified. How about establishing a minimum out-of-pocket charge which could be made more amenable to collection than medical bills are now? Charity could be engaged to that end as well, for the truly down and out.
As Campbell alludes near the end of his essay, the plan could make for some very interesting marketing of credits. I urge you to follow the link above and read his essay – it isn’t very long. The most appealing aspect of the Campbell plan to me is that people would care enough to shop around. Get rid of the red tape, minimize the paperwork, track the credits, watch the market work. This could even promote more use of “concierge care”, something I have previously touted. And just think. If this works, the ACA might be modified along the same lines for people too young for Medicare!
There must be a flaw here and I’m sure someone will tell me what it is. Hurry – I think I’m getting hopeful all over again.