Allow patients to manage more of their own healthcare dollars

An estimated 26 million people manage some of their own healthcare dollars through a Health Savings Account (HSA). Although definitive figures are not available, it is possible that the same number manages some of the cost of their own health care through the Health Repayment Arrangement (HRA). Between 33 and 38 million people have a Flexible Spending Account (FSA).

These accounts allow people to make their own decisions about how to use the dollars they spend on health care, rather than following the rules of a health plan administered by an employer, health insurance company or the government. .

Some time ago I explained the pros and cons of these accounts at the Health Issues Blog, an exercise I will not repeat here. Let’s jump to the bottom line: The advantages we had from all three accounts and none of the disadvantages could be if we combined them into one easy-to-use account, with very few restrictions.

(Interestingly, Sen. Ben Sasse (R-NE) has come up with a plan that would move us to this road.)

There are three social benefits of self-directed care. First, people will always be more careful when spending their own money than when spending someone else ‘s money. Second, almost every pleasurable innovation that has taken place in recent years is for services that people buy with their own money. For example, walk-in clinics have emerged so that patients who pay out of pocket can save time and money. Online mail order pharmacies have become competing with local pharmacies for patients who buy their own drugs. Long before Covid hit, telephone consultations, email and telephone conferences were available to millions of patients who paid for the out-of-pocket services. None of these tactics would have been the case if Blue Cross paid all the bills.

Third, when patients spend their own money, they reap the full benefits and bear the full costs of their own decisions. This means that one person’s waste decisions do not impose costs on others. It also means that third-party insurance may be limited to those activities that cannot be easily identified on their own. That makes third-party insurance cheaper and more efficient.

In addition to integrating the three types of medical savings accounts, there are three additional changes that are required. They are explained in more detail in my book, New Way to Care.

It cannot be removed. Under current law, access to a Health Savings Account must be removed. For the year 2121, for example, people have to pay the first $ 1,400 (individually) or $ 2,800 (family) out of pocket or from their HSA, before insurance begins to enter. These only exceptions are specific protection measures.

This makes it very difficult to structure reasonable insurance. Say a diabetic worker. The employer may want to prescribe free medications, as non-compliance with drugs is a major cause of problems with many breast patients. But if the patient is incompetent and ends up in the emergency room, the employer may ask the employee to pay for that cost himself. This type of reasonable insurance design is not possible under the normal HSA rules.

Special Accounts for people with chronic illness. Studies show that breastfeeding patients can often manage their own care, with little patient education, in addition to or better than relying on traditional physician care. If they are allowed to manage their own care, they should be allowed to regulate the dollars that pay for that care. No patient should be forced to do this, but as a reward for patients’ willingness to manage their own care, health plans should be able to deposit money into a patient – controlled account.

One very successful example of patient-led care is the Medicaid Money Counseling and Counseling Program. Starting several decades ago, this program allowed disabled people at home to manage their own budgets. This meant that they had the right to hire and set fire to their attendants and any money they saved could be spent in other ways that would benefit the patient.

Satisfaction rates in this program were in the mid-90th percentile (something rarely seen in any health program anywhere in the world). And because of this success, the program has been expanded. Today, for example, the family of an Alzheimer’s patient can have a budget to manage the patient’s care.

Special Accounts for Primary Care. The ability to talk to a doctor by phone or email or Skype – day or night and on weekends – used to be the only benefit that the rich couldn’t afford. We called it “concierge care”. The benefits are obvious. The coronavirus and other medical problems do not just arise during working hours. And not only is a trip to the emergency room expensive, these days there are health risks as well.

Today, Atlas MD in Wichita offers all primary care – around the clock and via phone, email, Skype, Zoom and Facebook if needed – for $ 50 per month for mother and $ 10 for baby. This “direct primary care,” or DPC, not only offers the full range of primary care services, it helps patients make appointments with specialists, helping them to find discounted rates. on MRI scans and other medical tests and (in the case of Atlas) prescribing sex drugs for less than Medicaid pay in some cases.

This type of care must be an option for people who are suffering from HSA. Under current law no.

Wheel Accounts for Seniors. Health insurance prices and investments are paid into Health Savings Accounts for young people by employer plans with pre-tax dollars. That means that the choice between third-party insurance and individual self-insurance is made at a fair level under tax law. People are free to make these choices regardless of tax implications. Something similar has to happen for the elderly.

Principal fees for Medicare Part B, C and D and for Medigap insurance are all paid in cash after tax. Therefore, high investments to HSA must also be made after tax. The accounts that allow this are called Roth Health Savings Accounts. Deposits are made in dollars after tax, and withdrawals (for whatever reason) are tax free.

Roth HSAs are, therefore, a way to use tax law to promote health insurance for the elderly and disabled without having to make any important decisions.

The choice between self-insurance and third-party insurance would be made at a fair level under tax law. The choice between spending out of the bill on health care or on unhealthy goods and services would also be made at a fair rate. And the choice between spending from the account on anything in the current period and spending on health and unhealthiness in every future would also eliminate the tax law distortion.