Here is the basic idea:
Every person in America will have to have access to health care via the following options: the Government Health Plan, health insurance companies/cooperatives or a self-insured option. Once a year you have the choice of moving to a different plan during an open enrollment period. None of these plans are employer based - your employer pays nothing for your health care. You pay for the plan, it is yours, it goes where you go.
- Government Health Plan. Anyone may join the GHP and receive full health care, as determined by primary care doctors (physicians, dentists, eye-doctors). In return, every person will pay 8% of their taxable income, capping out at $6,000.00 per family. The GHP is for everyone in America and wraps in all federal funds for medicare, veteran's benefits, SCHPS, etc. - in short all federal funds currently directed at health care. The GHP would replace those programs. This plan also has a deductible of $1,000.00 per family that may be taken out pre-tax and put into a health savings account. The deductible goes towards anything (dental, vision, regular checkups, co-pays for medicine, etc). The only exception to paying the deductible is for those on social security, who would not have to pay the deductible (but still would have to pay for the GHP or other plan out of their taxable income). The GHP is set at 8% and cannot be moved by anything other than an act of Congress. The deductible method of paying for medical services (not medications), as opposed to the co-pay method, puts the first $1,000.00 of every family's health care at their own disposal, and hence health care providers (even Dentists) can compete for those dollars. After the deductible the GHP kicks in and the GHP negotiated rate applies. Every health care provider must accept GHP. The government portion of GHP is essentially to take the money in, pay the money out and act as a net for any short-fall. Contractors like MSPRC (Medicare Secondary Payer Recovery Contractor) with medicare may still be used.
- Health Insurance Companies, Co-ops or an Exchange. Companies in the health insurance industry will have to compete against the other plans. Anyone may choose them during the open enrollment period. They may charge clients more than 8% or less, whatever legal method allows them to compete. They may negotiate rates the same as they do today. Non-profit cooperatives that function like mutual insurance companies (ex. FM Global) might be a beneficial direction. In this scenario, should the premiums far eclipse payments, a refund or premium reduction in the following year would result. An immediate benefit of this plan to these companies is that they get to keep the same clients if they change jobs or start a business. Another benefit is that because everyone will have to choose one of these plans, companies will get the opportunity to compete for 40-50 MILLION more potential customers. A down-side is that the exclusion for pre-existing conditions will no longer exist.
- Self-Insured. If anyone wants to pay for health care themselves, they may choose a self-pay option, and any amount you choose would be deposited pre-tax into an interest bearing health savings account. These dollars belong to the individual or family and accrue as long as they are not spent. The money is for health care only, however. If the cost of health care for that individual or family exceeds 8% of their income, or even more than $6,000.00, unlike the GHP that individual or family must pay everything. One benefit is the ability to negotiate prices past the $1,000.00 deductible with which GHP holders will be able to shop and negotiate.
Additional details:
- Eventually, every person with any plan must have a primary care doctor listed, and must be known by that doctor. The goal is to get people out of the ER as their primary care.
- Standardized health forms approved by a Health Industry Regulation Panel, or HIRP, a panel of doctors, health care administrators and politicians who will also create a cost index by setting advised rates for services (that the GHP may not pay less than), establish cost regions for the index, mandate easy-pay methods with reasonable payment deadlines and initiate an appeal process for doctors needing more money for services rendered to a client due to extenuating circumstances. This plan assumes the amounts currently dictated by medicare will increase to a reasonable amount.
- Ability to deposit funds into health savings account in case $1,000.00 worth of services before the deductible accumulates (for GHP holders). Charitable organizations may be needed to help those who are not able to do this.
- Americans currently pay 1.45% of every paycheck to a medicare tax. If the GHP is chosen, the net increase would only be 6.55% (8% - 1.45%, capping out at 6k) over what Americans current pay (and likely don't use because they have other insurance). The medicare tax itself would be repealed.
- Medicare, as we know it today, to become the GHP, may begin to completely pay for itself.
- VA Hospitals can possibly become GHP hospitals, or maybe even regular hospitals.
- If 1/3 of the US population, 100M people, used the GHP, and the median income is $50,000.00/year, then the average family would pay $4,000.00 into this plan. That equals $400B (to be used by just those 100M). Add that amount to a $1,000.00 per family deductible (possibly an extra 50B) before those amounts are used in addition to the market stabilization that would be caused by this plan and I think you would have a plan that would easily pay for itself. The 8% might even have to be decreased after a while.
- Stimulate the economy. Businesses would immediately benefit from not having to pay anything towards health costs, to include the 1.45% medicare tax on businesses.
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