Reform 1: Basic level of healthcare coverage for all citizens
Studies have shown that healthcare systems where individuals have strong ongoing relationships with primary care providers, and access to preventative care, are more efficient and cost-effective. Under this reform, the federal government would guarantee that all Americans are insured to receive basic wellness, preventative, and catastrophic care. This basic level of health insurance would only cover individuals’ essential medical needs, and would allow individuals to purchase supplementary insurance with their own money or as part of their employer’s compensation program. A healthcare coverage system of this design would also incorporate both individual choice and private sector competition.
A large percentage of Americans are uninsured, compared to other major nations. The United States spent $7,960 per person on healthcare, compared to $4,218 in Germany. Yet, almost 18% of Americans remain uninsured, while only 0.2% of legal German residents are uninsured, according to NPR.
Hospitals are required to provide emergency room care to everyone, insured or not. In 2010, caring for the uninsured cost hospitals $39.3 billion and accounted for 5.8% of total expenses, according to the American Hospital Association. Providing a basic level of care to all citizens would improve total public health and decrease overall health care cost.
Reform 2: Revise payment practices to be more evidence based
Doctors in the United States are often paid on a fee-for-service basis, which means that they earn money based on the quantity of services provided to patients, not the quality. This reform would begin to change the ways in which government health insurance programs pay doctors, in order to cut back on excessive procedures and reduce costs. For instance, the government would assemble a group of medical professionals to determine – based on the best available research – which procedures are the most effective in any given situation. Health care payment systems would be revised to evidence-based payment versus payment based on activities.
One reason healthcare costs are so high in the United States is the number of unnecessary procedures. Some studies estimate that 30% of all medical care provided in the U.S. shows no demonstrable benefits to patients.
If anything will bankrupt the federal government it will be out-of-control healthcare costs. Projected health spending in 2012 accounted for about 21% of total government spending, and that number is projected to grow to 37% by 2040.
Reform 3: Phase out the tax exclusion for employer-provided health insurance
According to the Census Bureau, 55.3% of Americans receive health coverage through their employers. Yet, although employer-sponsored health insurance is a form of compensation, just like wages or salaries, it is excluded from both the income tax and the payroll tax. Individuals who buy private health insurance for themselves are taxed on their purchase. On the other hand, individuals do not pay such taxes when their employer provides their insurance. This reform would phase out the tax preference for employer provided health insurance and subject it to the same taxation as other forms of compensation.
The tax exclusion of employer-provided health insurance is the biggest tax loophole in the tax code. The Office of Management and Budget projects that based on the laws in effect at the end of 2011, by not taxing employer-provided health insurance, the US government will lose $170.7 billion in tax revenue for 2012 and $1.01 trillion for the period 2013-2017.
This provision of the tax code is partially responsible for America’s rising health costs. Employers are incentivized, for tax reasons, to pay workers with health benefits rather than cash wages and other benefits, which is why healthcare spending on employees is disproportionately high.
Reform 4: Reform medical malpractice laws
Patients who believe that their health care providers have treated them negligently and caused them medical harm can sue for medical malpractice, and in some cases receive jury trials. Under this reform, malpractice claims would be tried in special malpractice courts and decided by judges. To determine whether doctors have acted negligently by choosing to use or forego a particular procedure, these courts would be required to examine evidence about the effectiveness, necessity, and riskiness of the procedure in question. This would help prevent frivolous lawsuits and the defensive medicine, associated with them, which drives up cost.
Current malpractice law gives doctors the incentive to perform as many procedures as possible, no matter how unnecessary or costly. Every time a doctor chooses not to perform a procedure he or she runs the risk of being sued, even if the procedure in question is not medically necessary or cost-effective, or is so called “defensive medicine
By reducing healthcare costs, malpractice reform would bring down government spending. One recent malpractice reform bill considered by the Congress was estimated to save $57 billion over the next ten years.
- 79% supported package of health care reforms
- 68% support the government providing some level of health care coverage for all citizens
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