The Jeffersonian Health Policy Foundation
The American Health Care Plan
A Universal Access Market Based Plan for Comprehensive Reform
- Market Based, Patient Choice Driven
- Primary Market at the Doctor-Patient level
- Level Playing field
- Utilizes incentives, Checks and Balances for Regulation
- Government Enforcement of Rules of Engagement to maintain a level Playing field and Functional Market
- Comprehensive Reform Strategies
- Our Policy Reforms Will Improve The Productivity and Efficiency Of The Health Care System, Make Insurance More Affordable, Reduce Rates Of The Uninsured, And Increase Tax Fairness.
- Corrects Market Dysfunction that Limits Choice, Inflates Costs, and Perpetuates Power Imbalances
- Creates Balanced Health Care Market Forces (Level Playing Field) for all Participants
- Shifts Money and Power from the Bureaucracy to the Patient/Provider
- Refocuses health Care Market on the Provider/Patient; All other participants support that relationship
- Medical Care Managed by the Physician/Patient
- Market Forces Operate on an Individual Level through Incentives, Checks and Balances that are a Part of this Design.
- Utilizes Protocol Health Insurance and Expanded Health Care Savings Accounts
- To Make Markets Work, We Recommend Changes In Five Areas Of Public Policy: insurance design reform, tax reform, Defined Rules of Engagement for Competition, improved provision of information, and malpractice reform.
- Immediate for the Private Sector Self Insured Companies Under ERISA
- Public Sector Requires Legislation
- The Purpose Is To Redesign Health Insurance To Eliminate Many Of The Perverse Incentives And Inefficiencies Of The Current Health Insurance Product And Eliminate many of the Cost Drivers
- Eliminates Third Party Payment, Procedure Driven Medicine
- Uses A New Financing Mechanism: Contingent Claims Contract With Lump Sum Payment
- The Term “Protocol” Means A Diagnosis Or Condition Representing The Primary Morbidity For Which The Patient Is Insured.
- The Term “Complexity Level” Represents Increasing Morbidity And Its Treatment Associated With The Insurable Event And The Presence Or Absence Of Any Co-Morbidity And Its Treatment Associated Within That Particular Protocol
- Uses Doctor Designed Protocols With Complexity Levels Based On Experience And Empirical Data
- Severity Rated Complexity Levels
- The Amount Of The Lump Sum Payment For Each Insurable Event Is A Function of ,or Determined By The Complexity Level And Protocol
- Each Complexity Level Represents Increasing Morbidity Associated With The Insurable Event And The Presence Or Absence Of Any Co-Morbidity Associated With That Particular Protocol.
- Each Complexity Level Is Associated With A Relative Value Scale Number Which Represents The Relative Value Of Each Level Of Necessary Care.
- The Sicker The Patient, The More Money The Patient Will Need To Pay His Medical Bills
- Health Care Is Primarily A Local Market Phenomenon
- The Relative Value Scale Number Is Then Multiplied By A Factor Λ That Floats With Known Local Market-Related Components To Determine The Actual Dollar Amount To Be Transferred As A Lump Sum Payment Into The Patient’s Extended HSA
- Provides Patient With A Lump Sum Payment That Serves As A Budget for the Patient
- Insurance Payment Paid Directly Into Patients Expanded Health Savings Account
- An Expanded Personal And Portable Tax-Free Health Care Savings And Asset Account (EHSA) Is Established For Every American Individual Or Family Using Annual Funding From A Variety Of Sources.
- Twenty-five to thirty percent of the annual funding of the asset account is used by the patient to pay an annual premium for “protocol insurance” to any insurance carrier
- The Remainder Of The Funding Rolls Over From Year To Year And Grows Tax-Free And Can Be Used For Discretionary And Initial Visit (Any Diagnostic Procedures Done Before Any Determination Has Been Made By The Doctor Concerning Diagnosis) Health Care Spending, As Well As Retirement Income By The Beneficiaries Of The Account
- When A Patient Sees A Doctor, The Doctor Examines The Patient And Prepares A Computerized Medical Workup
- Software Downloaded into the Doctor's Computer Evaluates The Work-Up And Determines Information About Which Established “Protocol” And “Complexity Level” The Patient’s Condition Corresponds To
- An Electronic Transfer Of This Information From The Provider’s Office Computer To The Insurance Carrier’s Computer Triggers A “Lump Sum Payment” From The Insurance Carrier Into The Patient’s EHSA
- The Lump Sum Payment Provides The Patient With Enough Money To Be Able To Pay For All Anticipated Expenses (At Fair Market Value) Associated With That Particular Insurable (For Necessary and Non-Discretionary Care only)
- This Insurance Payment Does Not Require A Co-Payment Or Deductible Payment From The Patient
- Patient Pays For All Health Care Expenses Directly Out Of Health Savings Account
- The Entire New Insurance Design And All Of The Software That Comprises This Innovation Is An Interdependent Functional Unit.
- Each Component Of This Innovation Has Been Designed To Create Proper Incentives
- All Americans Should Be Entitled To Deduct Health Insurance And Health Care Expenses As Long As They Purchase Insurance And Maintain An Extended Tax Free Health Savings Account.
- In All Cases, The Deduction Is "Above The Line"—Available Even To Taxpayers Not Itemizing Income Tax Deductions, Or For Those Below 150% Of Poverty, Equivalent Tax Credits.
- The Proposed Policy Also Would Create A Powerful Tax Incentive To Purchase Insurance.
- Deductibility Would Mitigate The Bias Against Individual Insurance
- The Tax Change Would Increase The Fairness Of The Federal Income Tax System
- The Tax Code Could Also Be Changed To Make It Easier For Individuals And Families To Save For Expenses Not Covered By Protocol Insurance
- Under Our Proposal, Funds From An HSA Could Be Used For Any Qualified Health Care Expense, Protocol Health Insurance, Long Term Care Insurance, And Disability Insurance.
- We Propose Setting A $15,000.00 Limit ($7500.00for Individuals) On The Amount That Can Be Deposited In An HSA, Annually
- Allow Individual Preferences Rather Than Government Mandates To Determine People’s Health Insurance Arrangements
- Tax credits for low-income people to offer low-income households financial assistance to purchase health services
REGULATION OF Markets:
- We Propose Two Major Changes To Insurance Regulation: The Creation Of A Federal Market For Health Insurance; And Provision Of A Subsidy For The Insurance Costs Of The Low-Income, Chronically Ill
- We Propose A Subsidy To Help People With Predictably, Persistently High Health Costs To Purchase Insurance In The New Nationwide Market Through A Properly Designed High Risk Pool
- Create A Level Playing Field And Transparency In The Market Place. Have Insurance Carriers Provide Value Per Premium Dollar Ratios To Prospective Buyers
- Redesign And Define The Patient –Doctor Relationship To Balance The Physician’s Selling Expensive Procedures Against The Patient’s Choice To Spend Money In His Asset Savings Account, For Which He May Have Other Use In The Future.
- Creates Demand Side Incentives That Balance Protection Of The Patient From Unforeseen Medical Care Expenditures With Stimulating Cost Conscious Consumer Choice.
- On The Supply Side The Need For Third Party Managed Care Is Eliminated And, With It, All The Distortions And Cost Inflation It Has Created In The Healthcare Market
- We also propose reforms in three additional areas:
- Better Provision Of Information To Providers And Consumers;
- An Explicit Public Goal To Control Anticompetitive Behavior By Doctors, Hospitals, And Insurers; And
- Reforms to the Medical Malpractice System to Reduce Wasteful Treatment and Medical Errors.