U-Pay Health Care

Give people the means and incentive to spend wisely.

by Bruce Schimmel

My friend Frank and I rarely agree on politics. I say left, he says right. But in the matter of health care, we are beginning to see things the same way. Which could be cause for hope in these polarized times.

That the right and the left should find common ground is, of course, President Obama's hope for his health-care conference, scheduled to start at 10 a.m. Feb. 25. Here's my prediction: If what's trotted out is a light version of what everyone already hates, that train won't leave the station. Who wants a Band-Aid fix, in which a government struggles to rein in insurance companies, when it can't even control the cost of Medicaid and Medicare?

Frank knows health care's failures firsthand. As an emergency room doc, he works in rural hospitals, where much of what comes in isn't an emergency at all. In addition to those really in crisis, Frank treats patients with chronic problems, from heart disease to obesity. Migrant workers with the flu, widowers with pains, slackers jonesing for a buzz. Good, bad, sinful and sinned against, none would be in Frank's ER if they could get decent health care anywhere else.

So, what to do? For a while, Frank and I held our noses and considered single payer. Cut out the insurance companies, and have the government do the paying. Better, at least, than being beholden to corporations who gamble with lives for profit.

Recently, though, we saw a piece by David Goldhill in The Atlantic (September 2009), which proposes a single payer of another sort. It's a revolutionary return to very old idea: Patients should pay their doctors directly, and doctors should work for patients.

At the core of Goldhill's proposal is an individual health-care savings account, an idea first floated by Republicans. Everyone would have a mandatory individual health-care savings account, whose cash reserves would be set by law.

Instead of an employer paying your premiums to an insurance company, that money would go to your individual account, for you to spend on bona fide medical services. (People with little means would pay what they could afford.) And just as the FDIC regulates a bank's cash-on-hand, should a catastrophe cause you to blow through your account, the government would be the insurer of last resort.

If patients paid doctors, the cost of services would be far more transparent than the current murky mess. Not knowing the real cost robs us — as patients and people — of an opportunity to act responsibly. We are pawns in a system that, perversely, encourages us to spend without limit. And spend we do. Almost 18 percent of America's gross domestic product, some $2.6 trillion, is spent on health care. That's an average of over $8,500 for every man, woman and child in America, in a nation where more than 44 million people — one in seven — have no insurance coverage at all.

If everyone paid their own way, and everyone paid the same fixed and posted prices, you'd see a return to a fair and more flexible market — an open marketplace driven by local people and priorities that would promote innovation, including preventative care.

Let people do their own paying, and they'll have an incentive to spend wisely, and take better care of themselves. And that would allow my friend Frank to spend more time saving lives, instead of patching up people that a bad system has spit out.

(bruce@schimmel.com)