Breaking News: Equifax Credit Breach

Clark on health care: We need ‘clear pricing signals’ to control costs

|
Clark on health care: We need ‘clear pricing signals’ to control costs
Team Clark is adamant that we will never write content influenced by or paid for by an advertiser. To support our work, we do make money from some links to companies and deals on our site. Learn more about our guarantee here.
Advertisement

The current debate about health care in our country is like rearranging the deck chairs on the Titanic. It’s plugging one tiny hole on a sinking ship.

Here’s my basic formula for a solution…

Read more: 10 best places to get eyeglasses

My take on the health care debate

Health care spending represents nearly one-fifth of our economy, yet our life expectancy is lagging far behind other developed nations. Meanwhile, we spend a far greater percentage of our nation’s wealth on health care than any other country on the face of the planet!

My belief is that we need far more radical change that what’s being talked about to improve health care outcomes for consumers, give us more choice as consumers and to do something about price.

Get employers out of health care

Part of the problem is that we keep siloing people into groups: You get health care from your employer, she gets it from the VA, he gets it through Medicare and on and on…

What we need instead is think of it as one big 300+ million-person market for health care in the United States. Stop putting us in silos. One of the key steps to achieving this would be to end employer-provided health care. I want to get the employers out of mix.

In fact, instead of government-provided health care or employer-provided health care or buying it on the health care exchanges or whatever else, we as individuals should be responsible for buying our own coverage. If you want to introduce subsidies based on age and income to help people pay for it, that’s fine with me.

Let’s have price transparency

The idea of buying an individual policy, purchased with a voucher, that pays a base amount toward health care — and then you elect what other coverage to buy beyond that base level in the free and open market — is so key.

Unfortunately, it can’t work at this point. That’s because we don’t have price transparency.

If you call to find out the cost of procedure, you can’t do it. The system is diametrically opposed to allowing you to shop by price. Yet consumers need to be armed with tools to shop for care.

With everything else we do in our lives, price is a signal we use to decide what and where to buy. Health care should be the same.

We’re talking about something that’s virtually one-fifth of our economy!

More price discipline is needed

In addition, if you are buying a procedure and you shop for it, the price should be ‘all in.’ No more balance billing!

We have to start with recreating price discipline in the United States health care system to achieve that.

Another part of the solution is that providers and insurers need to be same entity, like what you have with Kaiser Permanente.

We don’t have that right now, so that puts us in a situation where the provider and the insurer argue about the charges…and you get stuck with the balance bill.

Finally, people should have the option to have catastrophic-only policies. We used to have this long ago in our country and it was called a ‘hospital policy’ — coverage for major illnesses, but not routine stuff. For everyday medical stuff, we should shop for and buy care in the open market and pay out of our own pocket.

These are just some of my basic thoughts on health care in our country. There are obviously so many moving pieces I’m not addressing!

Conclusion

The health care debate is being looked at strictly through political party or ideological prisms. Yet I think the most important missing part of the discussion in our country is that health care is a business just like any other.

We must put in place procedures to make it a business like any other and not something subject to the whims of people in Washington.

People say you can’t look at medicine in terms of dollars and cents. But everywhere else in the world else they do. There’s only so much money to go around. The only tool to control costs is clear pricing signals.

That’s the short version of the conversation I believe we need to have in our country. And I’m just including the bare details here.

Feel free to leave your comments on my thoughts below…

Read more: How a medical billing advocate can significantly reduce your costs

Fixing our nation’s health care problems

Advertisement
Clark Howard About the author:
Clark Howard is a consumer expert whose goal is to help you keep more of the money you make. His national radio show and website show you ways to put more money in your pocket, with advice you can trust. More about Clark
View More Articles
  • Show Comments Hide Comments