Health Care with No Fine Print

Is Single Payer the answer to our health care woes? Obamacare? Bernie’s Medicare for All? My answer is my own proposal for Health Care with No Fine Print. Take the financing aspects off the front page and take care of financing behind the scenes. People should be able to get health care whenever and wherever they need it without worrying how exactly how it is financed. And they should never see a bill or make a payment, or pay a premium.

Of course financing is important, but a health care plan should be patient-centered first and foremost. And family-centered.

That said, this informal paper will also present, briefly, some financing options, any of which would be sufficient to enable the overall vision of Health Care with No Fine Print. Let policymakers and administrators fiddle with behind the scenes financing as they see fit. Just as long as patients and their families don’t have to deal with it — in any way.

Think of Health Care with No Fine Print as a Superfund system for health care. Superfund is an EPA program for cleaning up toxic waste sites. It has two major components that work in parallel:

  1. Promptly initiating cleanup of a toxic waste site.
  2. Eventually identifying perpetrators and referring them to DOJ to reclaim the costs of cleanup.

The guarantees that toxic sites get cleaned up promptly and pursues recovery of costs without that recovery process slowing or interfering with cleanup.

A trust fund covers immediate costs until their later recoupment.

The essential elements of Health Care with No Fine Print:

  1. Patient seeks treatment wherever and whenever they need it. No bills. No payments. No fine print. Ever.
  2. Health care providers deliver care as requested. They submit bills to a single regional payment provider.
  3. Each region of the country would have a single centralized payment provider who receives, validates, and pays all bills received from all health care providers in that region.
  4. A region may be a whole state, a portion of a large state, large city, all of a moderate size state, a group of smaller states, or a small or medium size state aligned with a larger state. Cities, areas, and states are free to organize regions as they choose. No federal government involvement required.
  5. Each regional payment provider makes payments from a trust fund financed by federally-insured bonds sufficient to cover at least several years of bills, expenses, and interest on the bonds.
  6. Each regional payment provider seeks recoupment of paid bills, expenses, and bond interest using whatever source the voters of that region select, whether a sales tax, income tax, property tax, hybrid of those sources, or any other source of their choosing. The region, state, or city decides, not the federal government. It is local control, not national control.
  7. A regional cost negotiator would negotiate lower costs for drugs, equipment, etc. on behalf of all health service providers in the region. They would have much greater leverage to do so than any individual health care provider.
  8. Federal government has only two roles: 1) research into best practices for running regional payment providers to provide template plans for their operations, and 2) federal insurance for payment provider trust fund bonds.

That’s it. More details will be provided in a subsequent section.

The essential component of a program for Health Care with No Fine Print is a reasonably large regional centralized payment provider backed by a reasonably large trust fund.

Health care providers would submit bills directly to their regional payment provider. Who would promptly pay the bill out of the trust fund. The patient would be unaware of any of this, including the bill — health care with no bills.

Each regional payment provider would make its own choice as to how to fund the replenishment of the trust fund to cover paid bills, expenses, and interest on the bonds of the trust fund. They might choose a sales tax, income tax, property tax, some hybrid, or any other method that they and not the federal government decide.

The only involvement of the federal government would be to guarantee the solvency of the trust fund bonds and to fund research to produce templates for best practices for setting up the regional payment providers. But once the regional systems are up and running, the federal government is not involved, other than funding advanced research projects.

Details

Adapting the superfund idea to health care, the essential elements of a regional program for Health Care with No Fine Print would be:

  1. Any individual could seek medical or health care from any provider at any time. No fine print on that.
  2. No patient or their family would ever receive a bill for care or have to make any payment for care.
  3. Since there is no billing or payment, patients no longer have copays or deductibles to worry about.
  4. Individuals no longer need health insurance companies.
  5. Individuals would not pay directly for drugs at the pharmacy. The health care provider would arrange for the appropriate medication, arrange for pickup or delivery, and the pharmacy or drug provider would bill the central regional payment provider for payment.
  6. Every major region within a state or across multiple smaller states would set up a centralized payment provider. Larger cities would have their own payment provider, if they so chose. The need is only to have a critical mass of covered patients, taxpayers, consumers, and businesses, to fund payments. No need for federal involvement in actual payment, although the federal government would fund research for template plans for centralized regional payment providers.
  7. Central payment providers across regions may choose to run their own operations or outsource operations to a larger central payment provider.
  8. Centralized payment providers would sell federal-government insured bonds to raise funds for covering payments for some designated number of years. This is the trust fund.
  9. After treatment of a patient, the health care provider simply submits the bill to their local regional centralized payment provider, who promptly pays the bill. Shortly after payment an advanced computer algorithm might opt to challenge the bill, seek clarification or confirmation, and possibly initiate a chargeback to the health care provider if anything is suspicious.
  10. The patient would be unaware of the existence of any centralized payment provider since they would never have to deal directly with them.
  11. The patient would not even ever have to deal with a billing department at the health care provider.
  12. Each region (which might range from a larger city to multiple mural states) would decide for itself how to fund the raising of revenue to cover outflows from their trust fund as well as interest on the bonds. See below for some of the funding options, the simplest being a regional, state, or local sales tax. The federal government would not be involved in this funding process except to fund research for template funding plans which each of the regions are free to accept or reject as they see fit.
  13. A region would be free to occasionally run down their trust fund during periods of excessive demand for health care services in lieu of promptly raising revenue to cover outflows and interest on bounds. They might also seek to sell more bonds to keep the trust fund fully funded for multiple years.
  14. The trust fund for a each region would have a board of trustees who have a fiduciary duty to manage the trust fund in a financially responsible manner, including how many years of health care costs to cover at any moment.
  15. Trust funds would have mandatory transparency and sharing of information with both the public and with all other health trust funds across the country.
  16. Best practices and lessons learned would be shared between all trust funds. The only federal involvement would be to fund research into best practices which individual regions could adopt or reject as they see fit.
  17. The federal bond guarantee would assure that all trust funds have equal access to the financial markets.
  18. The interest rate on the trust fund bonds would be high enough to be appealing to retirees and workers contributing to retirement accounts. This will assure a steady flow of funding to the trust funds.
  19. Retirees and workers would have first choice for purchasing bonds, ahead of institutional investors.
  20. Each regional centralized payment provider would, as a best practice, fund a research arm which would develop new technologies to keep their operations as state of the art as possible. Various regional payment providers might choose to pool or share their research funds to avoid duplication or to leverage their funds. No need for federal involvement. The federal government may fund research to seed development of even more advanced technologies, which would be freely shared with all regional providers.
  21. Each region would also have a regional cost negotiator who would negotiate lower costs for drugs, equipment, etc. on behalf of all health service providers in the region. They would have much greater leverage to do so than any individual health care provider. Regions could combine or pool such efforts as well.
  22. Malpractice insurance — this is an area for future work. Sorry for the lack of detail at this time. The basic idea would be that the regional level would be the optimal level to monitor and deal with local malpractice complaints, as well as to negotiate reasonably low cost malpractice insurance tailored to the needs of the region.
  23. Electronic records would be strongly encouraged, to make it much more feasible for patients to shift between health care providers, such as when their preferred provider is not available (sick, on vacation, retired, or just too busy), when travelling, when moving, or for referral to specialists.
  24. When obtaining health care services outside of their home region, the local payment provider would transparently obtain reimbursement from the patient’s home region payment provider. The hefty size of the trust funds would assure that such occasional roaming charges would not be a financial burden on the local payment provider.
  25. To the degree that any medical care, including prescription drugs, was seen as a burden on the payment provider, the regional payment providers would be large enough that they can fund research programs and competitive bidding to seek to lower costs.
  26. Each household would receive an annual report of the average cost of health care for a family of that size. The report would show a simple graph and trend for costs, with actual and projected growth or decline of average family health care cost. The report would make clear that the household is effectively paying that cost, but simply through indirect means.

Coverage

Just about every imaginable health care cost would be covered:

  1. Primary medical care.
  2. Specialized care.
  3. Checkups.
  4. Surgery.
  5. Physical rehabilitation.
  6. Testing and diagnostics.
  7. Prescription drugs.
  8. Mental health.
  9. Dental health.
  10. Eyecare.
  11. Hearing care.
  12. Preventative care.
  13. Wellness programs.
  14. Nutrition guidance.
  15. Nutritional supplements. Vitamins and minerals.
  16. Exercise guidance.
  17. Prenatal care.
  18. Palliative care.
  19. Long-term care.
  20. Aid for home health care. Training. Equipment. Supplies.
  21. Abortion and family planning — in some but maybe not all regions.
  22. Gender reassignment surgery — in some but maybe not all regions.
  23. Restorative cosmetic surgery.
  24. Organ transplants
  25. Cancer treatment.
  26. Substance abuse treatment.
  27. Experimental drugs.
  28. Experimental treatments.

Hmmm… what about nursing homes, which may have an outsize focus on patients with dementia? Should that be considered health care or simply housing. I’m not sure. Need to think about that some more.

End of life care

Health care providers would be specially trained to provide rational but compassionate and humane end of life care and guidance.

The goal would be to extend life to the extent practical, but respecting the humanity of the patient. No patient would be forced to live longer than they chose. Extreme care would generally be avoided or at least discouraged. Organ transplants would generally not be advised when a patient is too far gone.

Euthanasia?

I’m personally a fan of euthanasia when the patient has completely lost their sense of humanity, but that’s not a part of this proposal at this stage. See my companion paper, Proposed Criteria for Euthanasia. Again, that’s not an element of the proposal of this paper at this stage. But I’d be interested in what people have to say about it.

Paperwork

Centralized billing with a single, centralized regional payment provider will eliminate a huge amount of paperwork.

The patient and their family would see no paperwork at all. Other than that annual report of average household cost in the region, but that’s for information and doesn’t require any action. And it may commonly be delivered electronically anyway.

The link between health care providers and their regional centralized payment provider should be 100% purely electronic and digital so that providers should see absolutely no paperwork as well.

Some doctors may still choose to do handwritten notes and chart annotations, but even that can be readily digitized down the road.

Electronic digital medical records are the absolutely only way to go.

This is not a plan, yet

This informal paper is really only a preliminary proposal, not a full plan.

So I won’t refer to it as my plan, but as my proposal.

Maybe that’s a minor distinction to some, but the important thing is that this paper contains only the major elements of a Health Care with No Fine Print program, with only the intention of getting the ball rolling rather than a fully-detailed plan needed for actual implementation.

More details

It was not my intention to delve into all the many fine details that would be needed to actually turn Health Care with No Fine Print from an informal proposal into a detailed plan.

Further details will follow if there is sufficient interest in the basic proposal first.

Cost control

The regional cost negotiator would be the front line for cost control.

The theory of a regional cost negotiator is that they have sufficient size to successfully negotiate reasonably low costs for drugs, equipment, etc.

Malpractice insurance

This is an area for future work. Sorry for the lack of detail at this time.

The basic idea would be that the regional level would be the optimal level to monitor and deal with local malpractice complaints, as well as to negotiate reasonably low cost malpractice insurance tailored to the needs of the region.

Isn’t this really just Single Payer?

Umm… uh… uh… okay, I admit it — my proposed Health Care with No Fine Print is indeed a Single Payer approach to health care and health insurance.

But, it’s still not a national Single Payer health insurance system, like Bernie’s Medicare for All.

The point of a regional approach is that it allows individual states, cities, or regions to adopt financing and care standards to local needs, rather than a nationwide one-size-fits-all approach.

In fact, the difficulty of passing, implementing, managing, and financing a universal Medicare system seems so overwhelming that politically it is far less likely. Or at least not any time soon.

No skin in the game?

My proposal calls for absolutely zero out of pocket cost to the consumer. And that includes no monthly premiums.

Even Bernie’s Medicare for All plan calls for families to be paying monthly premiums. For example, under his plan his web site says a family making $50,000 would pay $466 per year.

Some might argue that people need to have some skin in the game to keep costs down, but I don’t see that as necessary. Or to be effective.

Annual report of average cost to household

Rather than charging families monthly or annual premiums, my proposal would simply provide an annual report of the average cost of health care for a family of that size in their region.

The report would show a simple graph and trend, with actual and projected growth or decline of average family health care cost in that region.

Comparisons to other nearby regions as well as all regions in the country will also be provided. This will enable and empower people to engage with their local and regional politicians if there are local or regional issues that need to be addressed to bring health care costs down.

And the report would make clear in plain language that the family is indeed paying that cost, simply through indirect means such as sales tax, income tax, property tax, or whatever revenue generation method the regional payment provider is using to recover costs.

Medicare for All?

U.S. Senator Bernie Sanders of Vermont is pitching his Medicare for All plan, but I think my No Fine Print proposal is better.

It’s not clear how much of Bernie’s plan is really Medicare as we know it versus a complete revamp and reinvention of Medicare that really is Medicare only in name only.

I don’t see any Part A, Part B, Part C, Part D, or Medicare Advantage mentioned at all in his description.

Four aspects of Bernie’s plan that are in common with my proposal are:

  1. It’s Universal. Okay, my proposal would only be universal in regions that adopt my proposal and it could be some time before all regions of the country are online so that my proposal is truly universal, but Bernie’s plan would only be universal when he gets a bill passed through Congress, which seems very unlikely.
  2. Better coverage. Coverage for everything related to health care. His plan says “will cover the entire continuum of health care.” No difference there.
  3. No fine print. At least the claim is there, buried in Bernie’s plan. His plan says “Patients … will be able to get the care they need without having to read any fine print.”
  4. Easy access. No agonizing over where to go, who you can see, or any hassles over payment or bills. Bernie’s plan says “As a patient, all you need to do is go to the doctor and show your insurance card.” Ditto for my proposal, except that my proposal doesn’t even have a card — your normal ID would be sufficient.

That’s where the similarities end.

The major distinction is that Bernie’s plan requires full national buy-in before anything can happen, while my proposal allows incremental adoption.

Bernie wants a federally administered program while my proposal is for a regionally administered program.

Local control

Local control. That’s the goal. My goal.

Let the people of the region have a say in their own health care, regardless of what people elsewhere in the country might want.

Federal control is as far from local control as you could get.

Well, okay, international control would be further away, but thankfully that is not even imagined as a potential option.

One state or region at a time

The real beauty of my proposed approach is that it is not an all or nothing approach that has to be instantly rolled out nationwide all at one.

A single state, a single large city, a single region, or a single cooperative of several small states could get the ball rolling.

One region at a time.

All it takes is one to get it started.

Not everybody wants to be a pioneer, but this is America, so I know that there are some pioneers out there.

Future of medicare and Medicaid

Hmm… if this proposal is so good, why do we need Medicare and Medicaid as well?

Medicare has two trust funds. Plus ongoing payroll taxes.

In all honesty, there is no logical reason to keep Medicare and Medicaid as special standalone health insurance programs once Health Care with No Fine Print is eventually up and running in all regions of the country.

The existing Medicare trust funds could be kept in place and payments made to the regional centralized payment providers when health care is provided to elderly patients.

Medicare has so many confusing options, rules, and penalties. My proposal is simply more appealing.

Future of Veterans Affairs health care system

Ditto for Veteran Affairs health care facilities.

They could eventually be folded into the main health care system.

Granted, some veterans health care facilities are very specialized, but the federal government could fund or subsidize their construction and operation whenever local regional healthcare systems are unable to meet demand for health care services for veterans.

Who’s on first?

Which state, region, city, or collection of states will adopt such an approach first?

I have no idea.

But some possibilities are:

  1. A liberal state such as California, New York, Massachusetts, Vermont, or Illinois.
  2. A large liberal city such as LA, New York City, Boston, San Francisco, or Seattle.
  3. A region such as Silicon Valley or the Bay Area.
  4. District of Columbia. An odd, interesting case, more than a city but less than a state.

When might this approach begin to happen?

Is this approach likely to happen any time soon?

I have no idea.

Bernie’s Medicare for All plan hasn’t seemed to have gained any significant traction, but maybe that’s because it is doomed by being a strictly national one-size-fits-all approach that is simply too big to swallow.

What will be the trigger event to get the ball rolling?

Rather than asking when this proposal might become a reality from a time perspective, it might be more insightful to ask what trigger event could get the ball rolling with sufficient vigor to give it enough inertia to make it to the finish line.

With all of the Republican efforts to hobble Obamacare and Obamacare itself needing adjustments that aren’t going to happen in the next few years, maybe health insurance may face a crisis of some sort in the never few years through insurance companies dropping out of states and rising premiums, so that the people may suddenly demand that something be done.

And maybe at that stage some populist or grassroots effort that isn’t supported by one of the two big national political parties leaps up and reaches for the gold ring.

That doesn’t need to be a national effort, just one small (or large) state, city, or region would be enough to trigger the avalanche.

Exactly what the trigger event is I couldn’t say, just that some sort of trigger event is the likely impetus for real change.

It may take a personality to do this. It might be a single individual with the right combination of vision, mission, passion, and persistence that carries the ball over the goal line.

But it will likely have to be some trigger event. This is not about wonky policy, government budgets, technical efficiency, or the best idea.

The trigger event will have to be something the really and deeply rouses the human spirit.

Let’s give Berniecare a shot first

Hey, I want to be fair. Let’s give Bernie’s Medicare for All plan a shot first.

He formally introduced his plan just about a year ago in January 2016.

Granted, Trump sucked all the oxygen out of the room for the past year.

Even with Trump sucking more oxygen out of the room in 2018, the Democrats have a big election coming up in the fall, so it will be very telling whether they lead with Bernie’s plan or leave in in the back of the bus, gathering dust.

So I see three milestone tests of how serious Democrats, Liberals, and Progressives are about pushing for Bernie’s Medicare for All or any other Single Payer plan:

  1. Midterm election of 2018. Let’s see how the next few months start shaping up.
  2. Presidential election of 2020. Let’s see whether the frontrunners enthusiastically embrace Berniecare.
  3. Midterm election of 2022. It will be do or die time for Berniecare.

Seriously, if the Democrats aren’t pushing hard for Single Payer in a very united way by the fall of 2022, and winning on those efforts, Berniecare will have to be declared as dead.

Maybe then some enterprising states or cities will feel that they have permission to consider my proposal more seriously.

What’s next?

Give Berniecare a fair shot as noted in the preceding section, but give my proposal status as a Plan B backup plan.

The next step is simply for people to sign on and commit to supporting this proposal.

Honestly, as with most of my best ideas, it is not likely that anything will happen, but my role is limited to simply conceptualizing and expressing my ideas to the best of my ability. I’m an idea guy, not a hands-on doer, not a champion, not a persuader, not a sales guy, and definitely not a politician!

If nobody else wants to pick up the ball and run with it, that’s life.

Meanwhile, I will simply move on to my next research and writing project, whatever that might be.