Solving the Wrong (Healthcare) Problem

Solving problems (or not) has been a regular theme on here lately.

Today, the Supreme Court ruled the that the “Patient Protection and Affordable Care Act” was constitutional. Let’s move past the platitudes we’ll hear for the next week, and dig a bit deeper: what are we really solving here?

As built, it’s simply to get everyone to buy health insurance.

But unaffordable health insurance is a symptom of a bigger problem: expensive healthcare. The insurance companies, as sleazy as they might be, are simply a middleman in this system.

But why is healthcare so expensive in the US? There are dozens of reasons off the top of my head, but one stands out: As recently as 2009, it was reported:

The United States spends more per capita than any other nation on health care, including $1.5 trillion in medical costs associated with chronic diseases such as diabetes, heart disease, and cancer — diseases that have a direct link to smoking and obesity, the nation’s two largest national risk factors.

The United States is in the business of sick care, not health care. All the incentives are around treating someone once they’ve come down with something, not in preventing the sickness in the first place.

And yet what the PPACA1 is doing is only increasing the likelihood that people might make less financially sound decisions. Someone with a health plan is more likely to make a quick run to the doctor (never less than $100+ here in Texas) for a minor issue, that could just be waited out. This only increases the financial burden on all of us, growing the total cost of healthcare that must be covered.

That runs into yet another issue: the increased administrative load with all the new that medical practices will have to deal with. That’s yet another cost burden that increases the real cost of healthcare.

I want to be clear here: I’m not saying you shouldn’t be going to the doctor if you have cancer, but what about having a the sniffles? Does that warrant a $100+ doctor visit? Maybe, maybe not. I know that having an HSA plan that has me responsible for a large percentage of my cost up to my deductible, versus a small $20 copay makes me think twice about waiting out the sniffles.

Don’t get me wrong, the government is addressing real issues with this legislation, like insurance companies denying pre-existing conditions. But beg the question: why are they denying pre-existing conditions in the first place? It’s not because the people at insurance companies are scumbags, it’s because healthcare is expensive.

Let’s focus on attacking the root cause and not the symptoms.

  1. Is that a valid acronym? []
June 28, 2012