@Billy Oblivion – Actually HIPAA does specify standards in electronic forms, i.e. 270/271. The funny thing is that the government, i.e. Centers for Medicare and Medicaid (CMS), doesn’t follow these rules 100%. Private insurers are more standardized. (at least the ones I’ve seen).

I commented on each of your 6 principles. I like them all and
despite the wording of my comments, think all of your points are
excellent and relevant.

1. Repeal the current law tax exclusion for employer provided health
insurance, and replace it with a $7,500 (single) / $15K (family) flat
deduction for buying health insurance.

What would be just as good would be to require 15% of the salary
to be deposited in an HSA and have companies completely exit the
picture. This is one area where government coercion to save would
be better than government simply taking my money like
the do with Social Security. I would reluctantly support a “You must
put 15% of your salary in an HSA.” That would be 15% of all salaries
of any income level. Government would supply the safety net for
the poor in the form of negative HSA accounts and HCI premium payments.

2. Allow the purchase of health insurance sold anywhere in the U.S.

I state elsewhere, that insurance for anything but the unexpected
is really health redistribution. I would prefer to say that Health
Catastrophic Insurance could be sold anywhere in the US. This
requires overriding state laws which may or may not be
constitutional.

3. Make health insurance portable
Once we have an HSA and HCI and national coverage, it is owned by an individual,
it becomes portable. Also, with an HSA, HCI premiums can be
paid out of HSA while unemployed. [The government safety net
that allows an HSA to have a negative balance.]

4. Expand Health Savings Accounts
This is it. HSA’s are sustainable. Current insurance schemes
whether private or public are not. Higher contribution limits for
HSA might not be needed. Higher voluntary limits for HCI would be a good
thing.

5. Aggressively reform medical liability
AMEN

6. Aggressively slow Medicare and Medicaid spending growth, and use the
savings for long-term deficit reduction

Cost should be the focus of any plan. Insurance is a middleman
and takes the bill payer out of the picture. Combine that with the
“value of service” business model of Medical corporations and we get
very expensive and uneven medical billing.

To accomplish #6, change “value of service” business model to
“cost of service” somehow. [Have to think about that. It is like
changing "income tax" to a "flat tax". You go from the very complex
to the very simple. Laffer in "End of Prosperity" describes how a
flat tax could work. We might be able to achieve the same results,
but lots of careful thought needs to be invested
before a coherent defensible plan can emerge.]

SUMMARY:
Agressive Medical Tort Reform.
HSA’s for planned medical care.
HCI for unexpected medical expenses sold anywhere in US.
Contributions to both are not taxed.
Government cannot get hands on HSA funds.
Insurance is a cause of high cost, not a cure.
Convert medical business model from “value of service” to “cost of service”.

However, after searching around for some prices and being thoroughly surprised, I’m more inclined to find a way to avoid all kinds of insurance, private and public. Insurance in and of itself seems very expensive.

Despite what this excellent article suggests

The Cost Conundrum
http://www.newyorker.com/reporting/2009/06/01/090601fa_fact_gawande?currentPage=all

having individuals acitively participate in paying doctors seems very important to me. Hostpitals and doctors offices charge what they can get. They look on it as “value of service”. The more you can pay, the more they charge. If the individual has no skin in the game because of excellent insurance coverage the costs go up. For example, in Chicago, Rush University Med Ctr reduces prices 50% if bills are repaid. That is a stark reminder of how much insurance and paper work costs. Right there in Chicago is the 2x factor that makes our medical care twice as expensive as Canada and Europe. [Have you ever paid $40 for a box of kleenex in a hostpital?]

Health Savings accounts should be for all planned medical expenses including physical exams, dental cleanings, child birth, vaccinations and anything else that would be considered maintenance and expected. All contributions to them should be deductable. All companies relieved of health care benefit responsibilities ought (!) to increase the salaries of their employees by the amount of savings achieved by no longer having a company paid health plan. HSA’s would cover planned health care and as you suggest, by suitable arrangements, the government could cover the HSA withdrawals for the poor. An additional benefit is that since the government offers such a safety net, when someone becomes unemployed, the HSA money can be used to pay an HCI premium during unemployment.

Health Catastrophic Insurance (HCI), (insurance for unexpected health issues) is the only form of insurance that should be relevant. Exactly how to make sure everyone is covered is a difficult problem because therein lies the rationing issue. However, it wouldn’t be so bad with HSA’s because many healthy people would have substantial amounts of money in their accounts and the accounts would grow faster than Social Security (which has for many a 1% rate of return). HSA would be required to put money in accounts that could only be used for direct pay to medical expenses [devil might be in these details, though]. HSA would be invested in Treasury notes and triple A rated bonds.

I’m guessing, but 15% of gross salary deposited in an HSA and paying for HCI could keep the next generation from contributing anything at all to the enormous entitlement dept. I also believe that the transition to such a plan is expensive but after fully deployed, the 15% number would go down because “value of service” would transform to “cost of service” which is an entirely different business model for medical corporations.

There’s more to this, but the basic scheme is that an individual is responsible for his own health care and the government is involved not at all or as little as possible. Government provides the safety net, but that’s all. The safety net is money not control.

If life expectancy were the only outcome we cared about, this would be an argument in favor of other countries’ systems against our own — we pay more for pretty similar results. But consider a waiting list for a hip transplant. A hip transplant has no effect on life expectancy, unless it brings it down slightly due to the risk that someone put under general anesthesia won’t wake up.

It seems possible to me that we have more deaths from medical errors simply because we have more of those elective sorts of surgery, but I’d be interested in other causes. If there are cheap (not just in the sense of money, but of trade-offs in general) ways of bringing that number down, they would obviously worth doing. If having a single centralized system holding patient records leads to fewer bad drug interactions, though, EMRs can get us those benefits without having to put our trust in a single provider.

@keith, I like what I see so far, but I’ll be a lot more interested in signing on to your plan when you spell out some detail on 5 and especially 6. Just saying you’re going to save money without a serious plan for doing so sounds a bit too much like the current administration (which isn’t to say they invented the tactic).

@Keith: it won’t be 100m+ who pay less taxes (nearly half pay zeo now) more like 50m+ and the amount saved will vary by income. A refundable tax credit is the better option.

I would encourage the refundable tax credit to be at the same levels – $7500/$15000. That will easily cover the health insurance costs for everyone and probably some of the copays as well. Since people can keep what’s left there is incentive to keep costs low(er). Better the people than the banks.

@curious: I’ve seen this comment many times before. I would be curious about other similar statistics. For example, what is the per capita expenditure on food in the US versus other nations. Housing? Transportation? Picking just the health expenditures is suggestive of selective statistics. I am sceptical of many US statistics, foreign stats even less so. Last, if the per capita health expenditures of so many foreign nations are so drastically lower than in the US why are ALL the nations that have national health care having so much trouble with their budgets as a result of health care expenditures?

You could make this even easier by allowing the insurance companies to collect premiums directly from the government, so that there are no out-of-pocket expenses (up to the limit of the tax credit, of course).