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The GOP Healthcare Bill – The U.S. Senate Version (Part 3)

By: | Tags: , , , , , , | Comments: 0 | July 10th, 2017

“Healthcare can be fixed without higher costs by putting patient care first, taking advantage of the technology that is available to coordinate better care, improving patient control and access to their medical and financial information, and finally a relentless drive for a fully transparent healthcare pricing model. This is the only solution – not thinking we can fix healthcare by controlling healthcare insurance markets. Trying to fix healthcare by addressing insurance markets alone simply masks the real problems. We can either mask the problem or treat the disease.” 

As we have disclosed before, we are economic conservative and socially liberal with a heavy partiality towards free markets. Some of my friends and colleagues think that everything the Obama administration did in healthcare was bad. We, on the other hand, see that the intent and execution may have been flawed, and there was some permanent good value.

In particular, we note:

a. The drive towards digitization of medical records is something that will remain a legacy. Was it done well? In our opinion, no; however, we will never go back to paper records.

b. They tried to experiment on alternative payment models like Accountable Care Organizations (ACO), and allowed for some experimentation on payments. Were they all good or effective? Not really. Even the ACO model is flawed, and it actually costs more to operate in total than a normal fee for service model. Some great ACOs do very well however, an overwhelming majority do not and the net program is not revenue neutral.

c. The reporting requirements to measure quality is a good idea. Did it work as planned? NO! Is it too burdensome to providers, DEFINITELY! Pay for performance and programs like MACRA should be modified, and providers should be paid materially more for gathering the data. Most don’t have the capacity to do it.

d. The Obama administration generally did NOT like managed care. Yet, Managed Care is a great option to improve quality and control cost, all while making health systems get paid to keep patients healthy.

In total, the problem with those plans and both versions of the Republican bill, is that they are not enough, nor are they well-integrated.

Additionally, we do NOT have a real free market or transparency. My favorite issue is MRIs. In the 90s, we managed some MRI facilities, and it was a traumatizing education. An MRI in the U.S. costs twice as much as in Switzerland, a very expensive place for healthcare, and four times as much as Australia. The value can range from $750 – $4,000; in some markets, managed care and Medicaid may even pay less than $300. The consumer has zero impact on pricing. A free and robust market can help change that.

We are not an advocate of price controls. We have always been an advocate of competition and transparency, just as we have been an advocate of putting the patient in the center of the healthcare system. We also advocate making the patient the owner of their medical record, it is their life and wellness, after all.

– Noel J. Guillama, President

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