Every 2020 Democratic presidential candidate on the debate stage Tuesday said they would deal with soaring healthcare costs by either bringing drug prices down (very vague on how) or sticking it to private providers for bilking patients.
Billionaire Tom Steyer said fixing the problem is a matter of “break[ing] the corporate stranglehold” on health insurers.
Vermont Sen. Bernie Sanders said we would “have to stand up to the healthcare industry.”
This is mostly or all a distraction.
There are a lot of problems with our healthcare system, which is really bad — recall President Trump ignorantly declaring, “Who knew healthcare could be so complicated?” — but the biggest ones are caused by disastrous government policies. That’s not to say there are no good government policies, just that the good ones usually aren’t that popular or easy to understand.
Here’s a complicated one, conveniently created by the government by way of Medicare. Any new healthcare law will have to put a cap on the amount of “codes” that can be submitted from a hospital or doctor’s office to an insurance company, with an exception for life-threatening or other extreme incidents. And those abnormal occasions will have to be audited by insurers. Disputes can be settled in court.
Codes are how healthcare providers negotiate reimbursements from insurers. They were first established as a way for healthcare providers to bill the government for Medicare patients, but the system since been adopted industrywide for even private-insurance patients.
When a patient sees a doctor, every procedure and instrument deployed during that visit comes with a code that the doctor jots down and submits to the insurer for payment. This is why patients often complain that they don’t understand why they’re repeatedly subjected to unnecessary tests, procedures, and checks. It’s because the doctor or hospital can then charge the insurer more.
The New York Times covered this magnificently in 2017:
Fix that problem and you fix a lot of the ballooning costs associated with health insurance.
Trump, like President Barack Obama before him, says he wants to protect people with “preexisting conditions,” which is in direct conflict with the purpose of insurance to begin with. This idea has probably been baked into what the U.S. population expects of healthcare now, and that’s OK. But it comes with a price.
That price is a requirement that we all have insurance by law. And having insurance by law means there’s a penalty if you don’t have it. And the penalty of not having it has to be more severe than the cost of paying for insurance.
This doesn’t sound very fun, does it? No, and it’s what Obama tried to do with the so-called “individual mandate,” a very minor penalty on those who don’t have insurance. But if we’re going to do that, it has to go much further than what Obama did. No lawmaker will do that, though.
Too bad. It’s the only way we can have a healthcare system that takes care of everyone and insures that everyone gets the treatment that they need.
No Democrat will lay that out for the public, so don’t believe them when they pretend to have the answers.
