Today the average health insurance premium is $11,000 a year per employee. In 2020 it will be $29,000. Health insurance reform spreads the cost of premiums across three entities– employers, individuals, and the government. Costs are being redistributed to land less on employers and individuals and more on the government.
The cost of healthcare in America is still doubling every 8 years because our population is getting older and sicker and we pay for healthcare based on sickness. Again, the cost is still doubling. The only difference is who pays the checks. We’re still paying for the same inefficiencies, the same profit-focused, not patient-focused, sickness industry. Ultimately, the cost of healthcare will shift to the young people with hopes that by the time we’re old we’ll have solved this cost problem. Unfortunately, we have no guarantee all this money we’re throwing at old people (those writing the legislation) will come back to us.
There are a few high-level components of solving the cost problem with a truly designed “System:”
- Pay doctors for wellness, not sickness. Doctors shouldn’t get paid more for doing a bad job. They should get paid for doing a quality job.
- Ensure the payors (insurance companies) are part of the same company as the deliverers (doctors). That way the providers profit off the right care, not the most care.
- Ensure the patients are also part owners of this “System.” That way, they’ll ask for quality, not quantity. And they’ll sue only when they need to sue because frivolous suits hurt their financial status.
These three components effectively create a closed loop of finite money in and out with all three stakeholders having skin in the game. The question is this…what’s the demographics of the smallest group for which this financially works? And how can this group thrive as a private, profit-driven, competitive wellness company?
Iceland with 300,000 people does this with health expenditures of $3500 per capita. Norway does it with 4.5 million people and $4500 per capita. We spend $8,000 per capita and leave 50 million people with nothing.
The problem is…regulations crafted by Congress and special interests make innovations like these illegal. And that is why this is a dark, dark period in American history.