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The Three Main Issues in Healthcare Reform August 2, 2010

Posted by Ken in Health Care, Politics.

The healthcare problems we find ourselves facing in America today are rooted in three fundamentally very simple issues:

  1. Healthcare for many Americans is tied to their employment.
  2. Few Americans actually know what the care they receive costs – they know what their insurance co-pay and premiums are, but nothing more.
  3. Americans insist on the latest, newest procedures, drugs, and devices.

The answer to the first issue is that healthcare coverage is tied to employment is the result of the Revenue Act of 1942 which made healthcare benefits tax deducatbale while placing salary caps on many industries. Nowadays, employees demand defined healthcare benefits, maintinag the previous year’s level of services irrespective of cost, and employers are thus at the mercy of the insurance companies who are not motivated to lower healthcare costs.

The second issue is that there is almost no concern to conserve or do any cost benefit analysis done by the patient, causing costs to escalate – once the patient makes their $10-25 copay, they have no interest in considering lower-cost procedures – to them, all cost the same.

The third issue is that America is the home of many of the latest breakthroughs in healthcare and as a people we demand availability to the latest treatments, that raises costs as well.

Further insulating consumers from the cost of their healthcare will not drive down costs.

Squeezing incentives from providers will drive out providers (doctors, etc.) and only make healthcare more scarce, again driving up costs.

The only portion of the current healthcare reform bill that will lower costs (actually, more likely simply contain costs) are the various review boards that will determine the appropriate level of care for a given ailment, and may ration more expensive treatments.



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