Show me the money!

I have very mixed feelings when it comes to this article. On one hand it might be a very good idea to limit the overhead of private insurers (assuming of course that the lower health care cost will be passed to the consumer). On the other hand shouldn’t a health care company want to reduce its overhead as a natural course of business rather than being forced to do so by government legislation? I think the bill does well by allowing certain costs to be moved into the cost of health rather than administration which allows it not to be taxed, I think that is wise to include that in the bill.

I did mention last week that I think we can drive down health care costs quite significantly if we do stream line the administrative costs. For example I see no reason why we should not enjoy the amazing 2.2% of cost going to administrative duties which Taiwan enjoys. It would be very easy and cost effective for companies such as well point to institute the health card which they have in Taiwan which stores all medical and billing information. This would be a brilliant way to drive down costs.

By the way this is all assuming that the profits will translate to the consumer which in my opinion needs to be mandated in this bill as well. What I don’t want to see is the oil company model where lower crude oil prices mostly translate into richer executives.

I also wanted to comment on some items I read in the other postings. Claire mentioned eliminating “gatekeepers” as way to reduce costs but I think that gatekeepers are in place to reduce cost because they cut down the time specialists need to be consulted and their time costs the health care system a lot more money. If I m not mistaken that is a way the National Health Service in the UK keeps lowers costs. I agree with Luke in so far as we need to make the records electronic to drive down costs and he is right with his idea on medical equipment again. We can take another lesson from Japan who managed to motivate companies like Toshiba to accommodate its low health care costs by making machines (MRI) which could operate at a much lower cost. The example was an MRI going down in cost from about 1200$ to about 99$ which is staggering.

Regarding the solution to driving down health care sotst I believe the biggest portion lies in cutting down administrative costs however there are other things which could be done as well. Luke’s article had some interesting ideas on how to drive down health care costs and I agree with some and not with others. I am not sure that HMO competition drives down prices because at this point Im sure there is an element of price fixation as well as HMO’s knowing that you need them more than they need you. Since this is mostly true with those who insure themselves privately I think a major way to drive down costs for the consumer is to have the government negotiate on your behalf. In other words between employers and the government every American citizen should be covered at a better price (Obama’s plan).