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Today President Obama released details on the latest iteration of health reform.  CNN published an article on the new proposal here.

Before I begin my thoughts on the matter, let me say this.  I have a major problem with calling it health care reform.  Health care is not the issue.  People can say what they want about the insurance system and how we pay for health care.  Say what you will about the health culture and how people take care of themselves.  I would point to the data on cancer survival, where the US far outpaces any other country, as evidence that we know how to take care of sick people.

As for this latest proposal, there’s one major, major flaw that will do nothing to help the situation.  The plan requires everyone to buy health insurance in an effort to spread out the costs of the system.  It also prevents insurance companies from denying a person coverage on the basis of a pre-existing condition.  This is all well and good, except you have to enforce the insurance requirement right?  The latest proposal would eventually put the penalty at $695 or 2.5% of salary, whichever is greater.  This is lower than most insurance premiums.  There’s no incentive to avoid the penalty in favor of purchasing insurance.  The astute, and healthy, individual is free to save money by paying the penalty, then when illness hits, buy insurance, since the pre-existing condition won’t disqualify coverage.  This will increase the costs born by those that are using a greater proportion of the resources as companies are no longer off-setting those costs with young, healthy individuals.

To me this is like rearranging deck chairs on the titanic.  It’s trying to tweak what is consistently being called a broken system.  This won’t “bend the cost curve”, to borrow the phrase politicians like to use.  For the past few years, whenever this discussion comes up, I maintain health insurance should be more like car insurance.  Make primary care a cash-based business.  You don’t use care insurance to get an oil change.  You don’t even use it for more expensive maintenance like getting new tires.  Why should you use it for your annual physical?  Making primary care cash-only does several things.  It increases transparency in costs, physicians can compete for business and patients can choose the lowest cost.  It decreases the overhead of these physicians.  They no longer have to have an employee or service solely for the purpose of billing (and arguing with) insurance companies.  So much paperwork has developed for insurance purposes only.  Decreasing these headaches is what will drive more people into primary care instead of sub-specialties.

In addition to this, health insurance should be opened up across state lines and bought on your own accord, as you pay a premium associated with your risk, just like every other kind of insurance.  There’s no reason for the 40-year old triathlete in prime physical fitness to pay the same premium as the 40-year old obese smoker that’s had heart disease since 35.  Reward people for taking care of themselves.

Addendum: The Wall Street Journal on Friday published an article that delves into great analysis of the current plans circulating in progress.  It exposes some of the faulty arguments people use to say we need reform (not saying we don’t, I just disagree with a lot of the popular arguments) and shows how the current plans will not decrease spending, but increase it through a variety of misguided mechanisms.  Click here to read the full article.  Thanks to MedRants for posting this article on twitter.

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