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Any assessment of today’s health care system could best be described as playing the old party game “hot potato.” For those not old enough to recall the rules, it involved multiple players arranged in a circle passing an object to the next person while music was playing. When it stopped, the person holding the hot potato loses, and is thus eliminated. In the present game of health care reform, no one is really talking about fixing the underlying problems. Instead, they want to “tweak” certain parts so the game continues and the hot potato gets tossed along to another generation. Somehow, the common American will be left holding the bag again.

Many industry experts believe the root cause of today’s health care crisis is that market incentives are not aligned. Instead of competitive forces bringing about change and innovation to lower costs and improve the quality of care, the current health structure produces cost shifting, inexcusable medical errors, soaring utilization, and government intervention. Problems and skyrocketing costs get passed from generation to generation in an upward spiral of complication. This process is dooming future generations of Americans.

“If there must be trouble let it be in my day, that my child may have peace.”
~ Thomas Paine

In decades past, many attempts have been made to control inflationary health care pressures. Wage and price controls were instituted in the 1970’s; Voluntary restraints were tried in the 1980’s; Managed-care was initially thought to be our savior in the 1990’s. All failed because they proved to be little more than foolish financial engineering. Now the Obama administration, along with House and Senate leaders, are proposing new government legislation aimed at fixing the system.

However, unless we correct the misaligned economic incentives, the financial burden on our country will continue. All sides (insurance companies, consumers and government) are out of balance. For example, the attitude of most health insurance companies needs to change. Ask any of their executives how long a typical insured stays with their company and they will likely snap a figure off the top of their head. To them, customers are transitory and simply move onto the next carrier in a few short years. This reduces their incentive to invest time, effort, and money to encourage healthy lifestyles or to build a long-term client relationship.

Conversely, the same broken incentives apply on the consumer side. Ask any American how they would want their health benefits to work and the response might be, “I want it to pay 100% of everything all the time.” As it is, the Kaiser Family Foundation estimated that in 2007 employers paid nearly 73% of their employees’ health insurance premiums. First-dollar insurance coverage and employer funded plans have encouraged the overuse of health care services. Over time, people have become accustomed to the small amount they pay out of pocket while the actual costs for care are ignored. Noted MIT economist Amy Finkelstien has studied how America’s third-party insurance system has impacted the market and become the driving force behind our health care spending trends.

Government officials involved in drafting the new health care legislation have yet to discuss their failures. A glaring case in point is the government’s lack of accountability for their past health care cost projections. For example, in 1966 Medicare expenditures were $3 billion. In that same year, the House Ways and Means Committee had projected that costs would rise to $12 billion by 1990. However, ACTUAL Medicare spending in 1990 was $107 billion. That is a whopping miscalculation by 791%!

Although everyone agrees that some health care restructuring is needed, and support remains high for change, Americans should not allow for a redesigned system to emerge that is as bad as the existing one (or worse). Individuals should contact their representatives in Washington DC, in order to help shape the final health care bill. President Obama has put “shared sacrifice” on the table and that is what all parities should accept to ensure that the health care hot potato game ends. This will allow for meaningful market reforms to improve quality, bring about innovation, and reduce long-term costs.

More and more, doctors and other health practitioners are asking patients – even those with insurance – to pay their share of the costs up front, either before they are treated or before they leave the office.

Providers say the practice isn’t entirely new. But with patients now shouldering a greater share of health costs, through insurance plans with higher deductibles, co-pays, and coinsurance, they acknowledge a bigger push to collect fees at the time of service. The providers say that it becomes more difficult to collect from patients after they walk out the door.

Some worry that up-front costs could affect patients’ relationships with their doctors. Other worry they could lead to people delaying or avoiding treatment and care. They also say that dealing with up-front costs in the midst of an illness or health crisis adds stress to an already stressful situation.

We, at Peoples Health Insurance, say that if you have health insurance, you should always ask the provider to bill your insurance carrier so that you can receive the “negotiated” rate for that service. Not unless the office is willing to negotiate a usual, customary, and reasonable rate; also known as UCR.

Finally, we think that cost shifting is going to continue, and therefore, patients must become more savvy about the health care system and learn know how it works. That is one reason why our agency stands taller than other organizations; our agents have a diverse back ground in the health care industry!