02/18/2013
Patient Power — Healthcare for the Information Age
Imagine being able to buy medical services the way you book a vacation, where you can search the web for the best destinations, check out features, benefits, ratings and prices, choose the perfect experience, then pay with a mouse-click. You can also choose a travel agent to help you decide where to go, what to do, and how to get the best deal. Either way, it’s your money, so you get to choose what you want and save by shopping for best value.
America’s healthcare system, which is by far the most expensive in the world, has few choices and no bargains. It was built for the industrial age, when workers looked to unions and to their employers for direction. Government responded with new “progressive” programs like federal income tax, social security, Medicare, Medicaid and employer-paid health benefits, and new bureaucracies began to rule America as controllers and enforcers.
The nature of government is to grow in size and power. From the beginning, government’s goal for healthcare was a European-style “single payer” system that gives total control of every person’s medical care to the government. While the cost of healthcare controlled by the government/insurance industry cartel has grown seven times faster than the American population, it has failed America’s poor and needy—and everyone else.
The cost of healthcare is the greatest contributor to our national debt, and the greatest threat to the economy of our states and our nation. After taking low salaries to get health benefits, the average American family finds it impossible to save. Parents work more jobs and more hours just to survive. For millions, the American dream is out of reach. Hundreds of thousands of American families who have health insurance have been bankrupted by premiums, taxes, co-pays and by excluded conditions and care.
By wasting more than a trillion dollars each year on overhead, unnecessary procedures, fraud and abuse, the government/insurance cartel has caused hundreds of thousands of companies to reduce benefits or go out of business. Medicare, Medicaid and Social Security are coming due to fail.
Instead of facing the fact that their top-down, centrally-controlled system has failed, our government still dreams of a single-payer, universal healthcare utopia. Now, after passing the Patient Protection and Affordable Care Act (aka ObamaCare), our federal government needs only the acquiescence of the states to become the only option, and to increase US healthcare spending by another $1.4 trillion each year to $4.6 trillion each year by 2020.
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Fortunately, Idaho and other states can still put a stop to the greatest tax increase and transfer of power in US history. We must act quickly to keep Idaho’s right to control our own healthcare, and replace the failed system with an alternative that could possibly save each Idaho family hundreds of thousands of dollars for future health needs and retirement.
The Patient Power plan eliminates government/insurance industry control and overhead for most consumers. It will reduce unnecessary healthcare consumption and costs and return insurance to its proper role of protecting against catastrophic events. Monitored personal savings accounts will give Medicare and Medicaid recipients an opportunity to accrue personal savings through healthy behavior and prudent healthcare choices. State government and private industry will save billions of dollars as patients become consumers, each protecting his or her savings against waste, fraud and abuse. And, healthcare providers will finally compete for customers on an open and level playing field, the heart of getting prices in line with the services provided.
To understand how Patient Power works, let’s look how we lost control of our healthcare. Money is power. In the 1960s, Government’s first step was to separate healthcare consumers from their buying power through taxes, insurance premiums and regulations, and to choke off patients’ ability to choose best value in a free market. Prices and quality of medical procedures and services are hidden. Prescriptions, authorizations, gate-keepers, price-fixing and mandated services make comparison shopping impossible. Choices and access are limited or absent. The insurance system invites over-consumption, and outright fraud. If it’s “covered by insurance” there is no reason for doctors or patients to forego any treatment. The Rand Institute shows that 30+% of care is unnecessary because it’s “free.”
Bureaucratic rules and regulations to control costs created a healthcare monster that almost doubles the cost of care. According to the US Census Bureau, only 58 cents of every healthcare dollar pays for medical goods and services. The other 42 cents pays for government and insurance industry administration. Half a million federal, state and insurance bureaucrats control every detail of every person’s medical care and another half a million commercial, private provider and hospital administrative and medical billing staff create records, seek approvals and negotiate payment.
Today, the central-control system wastes or over-consumes half of our $3 trillion national annual healthcare expenditure. This is enough to provide affordable healthcare to every needy person, and still reduce our national debt by more than a trillion dollars each year.
Despite its failure, Government’s second step was to expand and entrench the central control system with 2,700 pages of new regulations and 170+ new government agencies. The Patient Protection and Affordable Care Act creates an absolute monopoly that will permanently shelter the government cartel from innovation and competition. The federal government plans to force citizens to pre-pay Health Insurance Exchanges for medical care that they may not need or want, at a price that will jump from two times the actual cost to three or four times the average cost of care. Deceptively called a “premium,” this is a TAX to pay for the 5% of patients who consume 50% of healthcare. It will be paid to tens of millions of folks who earn up to four times the poverty level, and for millions more who suffer from obesity, diabetes, heart disease and lung disease because the current “All you can eat buffet” system provides no incentive to choose a healthy lifestyle.
The extra cost is not the worst of it. The Act will subject all Americans to absolute control of their health choices by federal and state bureaucrats, and release of information, both personal and financial, to agencies such as the IRS. This includes employment records, healthcare spending, medical records, bank accounts and assets.
The Patient Power Plan is a voluntary alternative to commercial insurance that uses a system of personal healthcare Internet portals in patients’ homes, in doctors’ offices and in the facilities of other providers of medical goods and services. It was developed by Dr. Loel Fenwick and Dr. Richard Sugden, and is protected by a patent application.
Personal healthcare portals give consumers control of their healthcare choices and provide medical information, comparable effectiveness of various medical options, control over their medical records, control of savings and payments, health status monitoring and access to “health navigators” who help patients make cost-effective health choices.
In 2012 employers paid $12,144 for a family of four, and the family paid $5,114 (plus $3,470 in out-of-pocket expenses) for insured healthcare. This is more than $20,720 a year, and more than $800,000 over a 40 year working career. In the Patient Power plan, employers and employees instead pay post-tax contributions of only $12,500 a year, which is approximately $500,000 over 40 years, into consumer-owned Insured Contingency Escrow (ICE) accounts that are dedicated to paying for specified expenses including health care.
ICE account holders will shop and pay for a lifetime average of less than $200,000 for medical care, and buy true catastrophic insurance to help pay for
expenses beyond their ICE balance. At current insurance costs, family savings will total nearly $170,000.
The Patient Power plan will start with pilot programs in states where legislators can provide a level playing field, where citizens are free and able to choose the care they want, and where providers, insurers and businesses are free to compete with the access, quality, service and pricing that consumers value. With changes in federal and state law, the plan could be also offered to recipients of Medicare, Medicaid and other government programs.
The federal government’s third and final step to complete its monopoly over American healthcare is implementation of state health insurance exchanges. These will require states to enforce control over the health, choice and economic freedom of every citizen in their state—in other words, do the dirty work for the federal government.
The beneficiaries of the trillion-dollar overhead, which are the federal government, the insurance industry and the hospital industry, have spent more than a billion dollars lobbying to protect their revenue and control. Lobbying for an Idaho health insurance exchange has been intense, and with practically no discussion of alternative plans.
Governor Otter now wants to establish a state insurance exchange. This would make the State of Idaho the enabling tool and enforcer of a federal monopoly against its own citizens. Only a state exchange gives the federal government power to use the State of Idaho to force Idaho citizens to purchase expensive “insurance” that is actually a tax, for medical care that they do not need or want, and cannot afford—or to turn them over to the IRS! A state insurance exchange would shut the door to any alternative, including a consumer controlled, free- market plan that could each year save the Idaho government more than $300 million, save Idaho employers more than $200 million, save Idaho citizens more than one billion dollars, and provide affordable healthcare to every Idaho citizen.
States are under no obligation to comply with the federal demand that they establish a state exchange. Neither is the state obligated to allow the federal government to require Idaho citizens to comply with federal exchanges. Idaho should just say “No!” and instead take the lead by implementing a Patient Power pilot program to demonstrate how a common-sense information-age healthcare can provide affordable healthcare for all Americans.
There is still time for our legislature to reject both a state and a federal exchange. The recent U.S. Supreme Court NFIB vs. Sebelius ruling confirms, “The States are separate and independent sovereigns, and they have to act like it.” 26 states have refused state insurance exchanges or have invoked their constitutional right not to submit to federal blandishments such as the Affordable Care Act. Now we need our legislators and governor to look beyond short-term interests and to defend Idaho’s future in the most important and closely watched decision ever to be made by the Idaho legislature.
Dr. Loel Fenwick is a healthcare innovator in Priest Lake, Idaho, who invented the birthing bed and the
birthing room system. His healthcare companies implemented the maternity system now standard in America and other countries. Dr. Richard Sugden is a family physician in Jackson, and healthcare leader in Wyoming. He founded numerous successful ventures including Teton Data Systems, which allows doctors to search all major medical textbooks online.
