POCKET GOFER 1
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ON HEALTH AND FITNESS IN THE U.S.A.
- SOME BACKGROUND ON HEALTH
- SOME THOUGHTS
- A NEW AND DIFFERENT SYSTEM
- A GENERAL HEALTH AND FITNESS RESOURCE COMPANY
- MEETING OBJECTIONS AND OTHER BARRIERS
- CONCLUSIONS
- A BRIEF BUT EXTREMELY IMPORTANT P.S.
SOME BACKGROUND ON HEALTH
Today we are unproud possessors of the most expensive “health care” system in the world. This makes us wonder why every one of us does not enjoy gangbuster good health.
We spend close to 18 percent of our entire nation’s gross output on health; this comes to something over $1.9 trillion a year. No other rich country spends over 9-10 percent.
However, a survey of quality of health care systems in 191 countries by the World Health Organization gives America 37th place. Big Government and we spend more than anywhere else, for a system that is 37th best. Clearly, something is seriously out of synch.
This pocket gofer will help us to pin down the real problem with our “health care.” It will identify causes. Finally it will point the way to a better system for all of us.
HISTORY: For many millenniums our ancestors were hunters and gatherers. Men and women were kept very physically active just to survive and raise children. As humankind learned to till the soil there was still plenty of hard work for everyone.
During the Industrial Revolution (1750-1850) machines were invented, which drastically reduced physical demands on the average worker. They also raised productivity, which meant that each could be paid more. Living standards leaped upward with increases in purchasing power.
One unpleasant side effect was people migrating to cities and towns to work in factories. Locating people closer together made it easier for microbugs to leap from one body to another. Billions of such leaps caused plagues.
Another side effect is the couch potato. The nature of the human beast is still hard and healthy physical work, but most of us sit in offices, airplanes, cars, and at home, tending machines or watching a variety of screens.
Physically idle bodies have less resistance to disease. Our wonderful brains have capably adapted to changed working and living conditions, but our bodies cannot evolve nearly so rapidly.
Recent developments have added to our country’s apparently growing malaise. In 2015, economists Anne Case and Angus Deaton garnered a lot of media coverage for an academic paper documenting a rise in “deaths of despair” — from alcohol, suicide, and drugs — among American whites, especially middle-aged whites without a college degree. Now they have fleshed out their thoughts on the issue in a book titled Deaths of Despair and the Future of Capitalism.
Their argument is that in order to combat this plague, the U.S. needs to boost wages, bring back unions, fight crony capitalism, and deeply reform the health-care system (our emphasis).
We are just beginning to seize the initiative concerning our health. We are taking back our bodies from the exclusive control of “health care” folks, who surely don’t have all the answers.
THE PROBLEM: Friends, there is a fundamental difficulty with our current system of “health care.” We put this term in quotation marks because the system is largely restricted to helping nature cure sickness and repair injuries. Only 5-6 percent of the mountain of public money spent on “health” goes to health and prevention programs.
It is called “health care,” but it doesn’t deliver health. We will see that it cannot; stay tuned.
Before the Industrial Revolution people worked hard, as we mentioned. When this effort was combined with nutritious food and good rest there was little need for doctoring.
Most minor ailments and injuries were treated at home. Mother knew best and nature did the rest.
Doctors were needed only rarely, and they made house calls. They came to know their patients very well, and could adapt treatments to each patient’s unique individual needs.
Today medical people operate mills. Patients go to doctors, not the reverse.
They go in one end and talk very briefly with several medical people, none of whom really gets to know them. They come out the other end with a piece of paper which demands that they spend a bunch more money on some chemical.
The “health” insurance industry helps but little. These companies are also generally not oriented to health.
The kicker here is that when someone else is paying a patient will often order the steak and lobster when a plate of beans would do the same job. What most of us don’t think about when ill and feeling absolutely miserable is that the “someone else” is us.
Therefore the insurance premiums that we and our employers pay have gone through the roof. Doctors also have little incentive to hold down costs; someone else is paying. So they have operated inefficient facilities and have sometimes padded their bills.
The American Medical Association (AMA) sandbagged the whole mess by restricting the supply of doctors and lobbying the congress to pass laws saying only a licensed doctor can do this procedure and that one. The law of supply and demand dictates that when there are only a few of anything or anyone to do a specific job and the demand is high the price will rise.
It has obviously been working. In a free market we would pay far less for medical services.
Between 1987 and 1997 the AMA slipped $13.8 million to politicians to get them to pass laws favoring doctors. Looks like members can easily afford it. But, just where does patient care fit in?
Late in 1997 the Congress sneaked a beauty into its balanced budget act. It said that a doctor who takes Medicare payments cannot take any additional money from an elderly patient on Medicare even if he/she is willing to pay for extra care not covered.
GOOD GRIEF! Why this ridiculous rule? It goes back to Hillary Clinton’s health plan, which specified absolutely equal treatment for all citizens just like in a country with socialism. Even the British with their socialized medical care are permitted to pay extra if they so choose.
Mrs. Clinton set no precedent. In the past many presidents attempted to cover all citizens. In 1961 Reagan argued that the end result would be socialized medicine, from which “—— will come other government programs that will invade every area of freedom as we have known it in this country until one day … we have socialism.”
Apparently in 1993 believers in Hillarycare thought that Britain’s expensive experience did not apply to the US. She was determined to see that everyone had health coverage, even if she had to force-feed some of them. Citizens torpedoed her plan.
In 2006 MA governor Mitt Romney passed a universal care plan, for which he received many kudos. A year later Romneycare was in the intensive care unit and on its way to a hospice.
And then came house speaker Nancy Pelosi and company with yet another incarnation. As in 1993 folks don’t like the idea nor, apparently, does much of the congress. We guess when you finally stop banging your head against a brick wall it feels good.
Maybe the good lady is a bit thin on American history. In 1912 presidential candidate Theodore Roosevelt endorsed universal health care. Scads of people jumped all over the idea, including insurance companies, pharmacists and — wait for it — doctors.
Mrs. Pelosi wanted universal coverage. This means regulating prices, preventing insurers from cherry-picking customers and lemon-dropping (getting rid of high risk patients). We know of no estimates of how many companies would abandon the business when the new law kicks in, sometime in 2014.
A 7/2009 YouGov poll indicated that 40% of citizens think a fundamental change is needed. About 29% think the health care system should be completely rebuilt.
The libertarian/conservative Pacific Research Institute claims that “defensive medicine” (overprescribing to avoid or fight lawsuits after a mistake) wastes around $200 billion a year. The more they prescribe the more doctors make.
The insurance industry lobbied congress to block the Pelosi plan’s public option. The Washington Post has seen storyboards for the ads. They read just like the “Harry and Louise” ads that helped to torpedo Hillarycare. (Predictably, they scored again.)
During 9/2009 we heard of unusually vicious shouting matches in the congress, each party accusing the other of causing gridlock. Members have accused each other of being evil-mongers, dealers in death and un-American.
A lot of citizens believe they mean it. They don’t realize that whenever a bunch of wimps argue over something no one has the guts to stand up and recommend a workable solution.
Those lobbyists with their megabucks whose sponsors want no changes are too hard to resist. Combine these dirty dollars with rigged elections (See Pocket Gofer 3) and they are home free in spite of thinking citizens who are really steamed.
As mentioned, “Health care” already costs nearly 18% of GDP (total value of everything produced in a year). The Council of Economist Advisors forecasts that it will soar to over 1/3 of GDP by 2040.
Under President Clinton welfare was slashed. Experts were amazed at the good results. But with health care the congress apparently wants to go the other way. Maybe the CEA should revise its forecast, up to 1/2 of GDP.
President Obama wanted a health law that is budget-neutral. But congressmen lack the guts to go against “fee for service” and “defensive” medicine, which are terribly inefficient but backed by heavyweight lobbyists.
Krauthammer (News & Observer 11/2009): “The result is an overregulated, overbureaucratized system of surpassing arbitrariness and inefficiency.
In 2007 a Canadian had to go to Buffalo, NY for life-saving surgery. He sued for the right to opt out of Canada’s government-run health care.
In 10/2008 Arizonans voted on Prop 101, which would insert in the state’s constitution a requirement that citizens could freely choose among private health care systems. They could pay directly for lawful care.
The law would also protect Arizonans against infringement on their liberty by the national government. It was defeated by 0.04% of the vote. It may yet set an example for others to fight against increasing government supervision of our lives.
On March 10, 2010 Virginia’s government did a native son Thomas Jefferson thing. It banned mandatory health insurance. In his grave ol’ Tom must have heaved a sigh of relief.
A week later Idaho did the same. There are similar actions in the works in at least 35 states.
The original idea behind insurance was to help an individual, family, company or other organization protect him/her/itself against some terrible catastrophe which could not be anticipated. Everyone insured would pay into a large pool. When some horrible accident or illness hit a member of the pool the necessary money was available.
Good thinking. But “health” insurance has gradually intruded into everything we do medically (kinda like Big Government with rubber gloves). Companies get involved in every routine office visit. They take our premium dollars, skim roughly 25 percent off the top to cover operating expenses and profit, and the rest goes toward benefits.
This means that around 20 percent of what we and our employer pay provides no direct “health” benefits for us (our best guess as to the non-catastrophe part). It also means that healthy citizens help to pay for those who don’t take care of themselves. This reduces unhealthy folks’ incentive to get and stay healthy.
Some folks don’t have coverage. The number,— around 46 million — being flogged by the media includes millions of young and healthy wealthy who choose to insure themselves.
But the poor without coverage go to hospital emergency rooms when sick or injured. Taxpayers are forced to pick up much if not most of the cost.
Competition on price and quality is rare because no one monitors the outcomes of treatment other than the patient, who just figures that someone else is paying so why raise a fuss.
When a repair shop does a poor job on a customer’s car he/she can and probably will bring it back and demand correction at no extra charge. The manager will remedy the problem lest he lose a customer to the competition.
The incentive to improve behavior applies to any insurance situation. Here we argue that it is worse because of the depth of the intrusion of insurance companies into our daily lives.
A doctor may have years and years of training and experience, but we have lived with our body for many years. We figure we know some things about it that he/she doesn’t know, especially when each visit averages, say, 7 minutes. Therefore we think we should have something to say about maintaining its health.
But often all the doc says is “Here. Get this prescription filled and let me know if there are any problems.”
Medical people are simply not oriented to health. Nearly all their training and experience are focused only on curing sickness and fixing injuries.
Therefore we feel sick, go see the doctor, and get some medicine. This may not be best for us because no medical person really knows our body as we do. The outlook for DNA testing looks promising, but its wide application is still a long way off.
But when the gigantic FDA (Food and Drug Administration) approves a new drug bureaucrats assume that every patient receiving it will react in much the same way. Therefore after our recovery many of us are still in the same unhealthy soup in which we were trapped going in.
Therefore the next trip to see the doc is probably not far off. This situation is clearly great for business, but is it good for the customer?
Most of us don’t know that Harry Browne ran for president in 1996 and 2000. In his book Why Government Doesn’t Work he offered some insights:
“In the —– (health care) debate of 1992-94, words like compassion, right, need, and fairness showed up frequently. But a number of relevant words were ignored.
“For example, I never heard the words force or coercion in public discussion ——. And yet the Health Security Act, —— had a great deal to do with force. There are some revealing terms in the proposal — such as prison (which shows up seven times), penalty (111 times), fine (6), enforce (83), prohibit (47), mandatory (24), limit (231), obligation (51), require (901), and so on.
“But if there were no brass knuckles inside the velvet glove, the government wouldn’t be wearing it.” Most of the debate did not involve citizens.
This point applies to every law the government passes: forces some action upon those who don’t want to do it, or tries to stop them from doing what they would like. We freely grant that some such is necessary, but if government only continues to grow bigger decade after decade where is the limit? Pocket Gofer 20 addresses this question.
Mr. Browne’s point is that in the above issue as with so many others discussed in his book only one side gets aired by Big Government when selling it to us. (Fortunately we citizens saw through Hilary’s “health security” fiasco and dumped it.)
We can’t help wondering when governments will learn that the market cannot be denied. It always gets the last laugh.
HEALTH MAINTENANCE ORGANIZATIONS: All is not lost. Recent developments include the popularity of HMOs. We believe these have good potential. Our proposal recognizes this fact.
But we are not home free yet. This recently expanded institution is only the market reacting to the runaway costs of the old system.
The tragedy is that a tiny minority of people always tends to see the negative side of every useful innovation. They raise hell, the news media jump on it, paranoid politicians panic at the prospect of losing votes, and along comes regulation before the market has had a chance to work through the bugs in the new technique.
In this way innovation is denied through political activity an opportunity to realize its full potential of doing good for the mass of people. An industry adviser: “This debate is about choosing a villain, either the managed-care companies or big government.”
No prize for guessing who wins this one. But we need to realize that the losers are not just the HMOs.
Big HMOs can negotiate low prices without loss of quality from hospitals, drug companies, and (especially) doctors. They have reduced the number of unnecessary tests, and also lengths of expensive hospital stays.
Also, they concentrate on preventive care instead of simply curing sickness. Finally, they make better use of information technology and computers to determine what treatments work best and are cost-effective.
Estimated savings resulting from managed care in 1996 were between $23.8 and $37.4 billion. This means employers and employees pay lower premiums and deductibles, and taxpayers save because Medicare folks who choose HMOs cost us less.
But if we allow national and state governments to continue their meddling at least four bad things will happen. Because medical practice advances so rapidly, regulations passed equally rapidly in response to political necessity often do more harm than good. Second, innovation is discouraged.
Third, requiring a minimum hospital stay discourages development of techniques that will get a patient on his/her feet and out sooner and with equal safety. This will increase premiums.
By law hospitals are forced to treat all. Those who can’t pay pass the bill on to insurance companies, voluntary donors or taxpayers. This tends to increase premiums, so it also increases the number of uninsured.
These folks can’t or won’t go see a doctor when a minor ailment or injury hits them, and when treatment is relatively cheap. Instead, they wait until they are really sick and go to a hospital emergency room for free.
Finally, some companies will find that they cannot afford to provide health insurance for their people. Others will need to reduce wages or slow their increase thru hiking deductibles or co-payments.
Today around 46 million citizens are without health insurance. Most are middle class, and three quarters of those of working age are employed.
A quarter has access to health insurance at work, but they choose to pass it up. And then there are the healthy wealthy, who choose to insure themselves.
But the news media continue to hype the big number while inferring that these are poor folks. The poor are covered by Medicare and Medicaid, but government instructs the media to avoid mentioning this because it would cut into the issue’s vote-getting potential.
If there were a serious discussion of the health issue it would include cost, coverage, and quality. These three cannot be productively discussed separately, as they depend on each other. But BIG WASHINGTON isn’t interested in a solution, so it flogs coverage only since that one wins votes and distracts our attention from the actual costs.
Increase quality and costs often increase. Quite aside from quality, increased regulation also pushes up costs because it forces doctors and other medical people to practice “defensive medicine.”
So the question arises, just how much medical care should some of us be forced to pay for, so that a person who cannot afford it can have it? Easy question, we might say: as much as he/she needs.
But need is like beauty; it exists in the eye/judgment of the patient. The great socialist philosopher Karl Marx wrote “From each according to his ability, to each according to his need.” Events have proved that this method of distributing economic resources cannot work because it directly opposes human nature.
Furthermore, if we let the government determine who gets how much of anything human nature will ensure that government officials and their friends get more than anyone else. They live and grow fat on our tax money (see Pocket Gofer 19). This is happening today in our fair land.
But not just this. President GW Bush rejected a proposal by his smoking advisory committee to increase cigarette taxes by two dollars a pack and use the money for an anti-smoking campaign.
Now, Bush knew the Social Security trust funds were in bad shape. He also knew that prematurely dead smokers will not claim retirement benefits. Did he put these two together? We don’t know.
SOME THOUGHTS
During the 1960s Presidents Kennedy and Johnson and their congresses probably had good intentions when they put in place massive government programs presumably aimed at good health for those who could not afford it. Well, at least that is what our representatives wanted us to believe, because they figured this would buy them many votes among us citizens who are concerned about the poor.
Our representatives were not only interested in buying our votes. They wanted to centralize government. Bigger government means more personal power concentrated in Washington, and it is human nature to love personal power.
We should learn something useful from Britain’s experience; citizens of that country have “enjoyed” highly centralized, socialized medical care for decades. The Economist 7/29/2000 commented on a recent tinker with the system: “It is the sixth major reform of the long-suffering NHS (National Health Service) in the past quarter-century.
“And though the extra money may even turn into some gain in output, the new national plan does too little to deal with the system’s most fundamental flaw: a lack of incentive to respond to patient demands.” There is no competition to provide that incentive.
The article then showed how human nature operates in this instance: “But central control is precisely what has most undermined previous attempts at reform.” Friends, here are people entrenched in a bureaucracy who are scared stiff of any real change as it would probably threaten their privileged jobs and perks.
Over the past several years the British government has showered money on its health service; up almost 10 percent a year since 1998. A recent survey showed that directors of three-quarters of all acute-care hospitals were short of money. The NHS expected a deficit of about 800 million pounds ($1.44 billion) for 2005-06.
Should we be surprised? Not hardly. In the case of any bureaucracy without competition there is never enough money.
Besides, throwing money at a problem only reinforces feelings among bureaucrats that they are being rewarded for what they have been doing. Prime Minister Blair warned the NHS that money would only follow reform, but this did not happen.
The prime minister pushed to make the NHS independent. But it is unrealistic to presume that politicians will not meddle in any program financed by the taxpayer. As of November 2006 hospitals and clinics continue to be rated only fair or weak on quality.
This brings us to our theory of accumulation of money. We will see this one rear its ugly head in several pocket gofers.
Take any huge mountain of money accumulated in one place, which stays there for longer than a few months, and is projected to keep growing. This mountain will attract folks of questionable character just as surely as rotting garbage does flies.
If the mountain gets large enough even otherwise honest people will be corrupted. This applies especially when money can travel long distances at the click of a mouse.
That kind of folks includes many lawyers. The cost of medical malpractice lawsuits in America has increased more than 2,000 percent between 1975 and 2003. Half of the $26.5 billion in 2003 was siphoned off by lawyers.
One reason why drug lords get filthy rich is that they are familiar with this theory. Therefore they keep the money moving, laundering it frequently and in different places so a big batch never accumulates in one location. They trust their employees with their money as little as we should trust our politicians with ours.
To illustrate the size of the problem, we ran across a figure several years back. An estimate by law enforcement officials was that various forms of fraud drain around $75 billion a year from Big Government’s Medicare and Medicaid programs.
Medicare alone has more than 60 million beneficiaries and processes about 1.2 billion claims annually through around 62 contractors. There is no practical way to effectively control such a massive bureaucracy. This means massive waste in addition to fraud (around 30 percent of total public spending).
The late Pete Peterson’s 2004 book Running on Empty: “Medicare is a Soviet-style price-setting bureaucracy. To reimburse health care providers for delivering services, it issues ——— thirty checks per second, every hour of every day of the year, according to 45,000 pages of regulations.”
Medicare currently gobbles around 2.5% of GDP each year, or around $325 billion. This huge lump is likely to triple over the next five decades. When President Johnson signed Medicare into law in 1965 he was told it would cost no more than $500 million.
Economist 5/16/2009: “———–recalculation shows that the cost is far more than planned. ——– Social security and Medicare programs for the retired. ———- future unfunded cost ——. It now exceeds $1.04 trillion.”
Career politicians know the lid will blow off some day soon. Each is praying “Not on my watch!” Humorist PJ O’Rourke: “If you think health care is expensive wait till it’s free.”
Friends, this is open season. A few years ago, for just one example, a man set up two dozen phony medical clinics and applied for “provider numbers,” which doctors and companies use to submit bills to Medicare for reimbursement.
No one bothered to check, so this cat’s computer started billing Medicare and the checks flowed in. No problem for the bureaucrats; it’s not their money. In two years of part-time work he cleared $500,000 of our money.
A gold mine like this attracts criminals from everywhere. Many of those in the illegal drug trade abandoned that occupation to jump into Medicare and Medicaid fraud. Drug dealers have commented that, “The money’s better and we live longer.”
Many others entered the business of finding cooperative elderly “patients,” accountants willing to fill out fake claim forms, doctors to sign off on mythical treatments. They made money by selling these names to the fake clinics.
Because with delays in payment many doctors will not accept Medicare patients, the bureaucracy is rewarded for getting benefits paid promptly. Therefore very few questions are asked.
Helluva deal! We almost wish our morality would permit us to buy a piece of this business.
Hurricane Katrina destroyed tens of thousands of jobs. This disaster plus Rita and Wilma added many more people to the Medicaid rolls.
Furthermore Washington contributes $1.30 of our money for every buck our state spends (also of our money). This fact provides an incentive for a state to spend more on Medicaid than it would otherwise.
Unless something serious is done, Medicare, Medicaid, and other programs for the elderly will eventually cripple the central government and therefore our society. We are living longer with every passing decade, and politicians trolling for votes keep increasing health benefits such as prescription drugs (old folks vote a lot).
Something is being done. A new law allows a whistleblower to file a lawsuit against a company (but not government) without notifying it. This protects him/her from abuse.
If the Justice Department decides to pursue the case the company will know, but then the news media may get involved in protecting him/her. Furthermore, the award to a whistleblower can range up to 20 percent of the fine.
This is bringing a lot of them out of the woodwork. A website called wikileaks encourages whistleblowers to post information.
Nevertheless, money in such piles as we have described will always attract looters in spite of laws and regulations. This is why we think both Medicare and Medicaid should be obliterated altogether. See below.
All that said, here comes Obamacare. The bill was rammed thru congress by twisting a couple of rules, even tho over half the people surveyed were against it.
A few days after the vote a USA Today/Gallup poll suggested that citizens might be trending toward approval of the plan. Five days later a Washington Post poll found 50% opposed and 46% in favor.
USA Today/Gallup had another go two days after this and found that 64% thought the plan would cost too much. This is interesting in that the first reaction was probably based in an emotional response to Obama’s silver-tongued pleas, but later reason took over citizens’ thinking. And this is just the beginning.
Members of the energy and commerce committees of the house of representatives flipped their collective lids. Several big companies had applied accounting standard ASC 740 to log billions in new costs resulting from passage of Obamacare.
Columbia University accounting professor Trevor Harris figured that even these huge costs are serious underestimates. We are only mildly surprised because politicians habitually underestimate costs in order to get something passed.
The two committees held hearings in which they chewed out the top executives of those firms. Members all but know the current reform will fail, so they are as usual busy covering their backsides.
What is really goofy about this is Obama’s promise that the new plan would be “budget-neutral.” Not only this, but the plan makes only a token attempt to rein in spiraling costs.
Estimates today show the system wastes $600-850 billion each year due to inefficiencies, unnecessary treatments and lawsuits. Lobbyists employed by the medical and supplier industries will direct money toward preserving this situation.
“Even if I wanted to stop, I just can’t,” said Diana Reimer. She is a ramrod in Freedom Works, a tea party group that is fighting for health care reform.
Everyone will be required to buy insurance and every insurer will be required to provide it regardless of the state of health of the buyer. This top-down command-and-control policy is unconstitutional and may yet be proven so. See PG4.
It is truly said that government is force, but state governments can also play this game. Virginia, Utah and Idaho have outlawed the above mandates, and they are not alone.
George Will (News & Observer 12/5/2010): “The Constitution establishes a government of limited and enumerated powers. Which one empowers congress to force individuals to purchase health insurance and to punish those who do not?”
News & Observer 12/1919:”—- Henry E. Hudson, the federal judge in VA who ruled last week that the individual mandate provision of the new health care law is unconstitutional.”
Economist 12/27/1919: “If the individual mandate is ultimately struck down but the rest of the health reform law is ruled legal, the result will be an unsustainable system.”
If an insurer resents having government run its business and quits, will the army of bureaucrats require it to stay in business? It is interesting to note that the “force” words in Hillarycare were hidden and the bill flopped.
Now we are seeing them hanging out there for all to see and the bill still “passed.”. No wonder thinking folks are bent.
Peter Orzag contributed to Obamacare. He flogged its money-saving potential In a News & Observer piece in 11/10/1919.
The piece carefully avoided mentioning requirements and lobbyists buying favors for their clients. The first is being tested for constitutionality and the second is guaranteed to torpedo the law if the tea partiers don’t get to it first.
House speaker Nancy Pelosi is from San Francisco, a den of welfare-state iniquity. Her great talent laid in dispensing unconstitutional and taxpayer-financed favors to her colleagues in order to win their votes for bills.
She outdid herself in this one; when it passed the news media called her the most powerful woman in the US. She apparently wants to “San Francisco-ize” the entire nation.
The Economist 3/2010: “—– will cost close to a trillion dollars over the next ten years, —- and a heart-stopping prospect when America’s budget deficit is gobbling up nearly 11% of GDP and unemployment seems stuck at close to 10%. If experience is any teacher, — and it surely is here — that trillion is a political number used only for starters.
Economist (3/27/2010): “Business is right to be scared by the costs of Obamacare. ————————–. The most reasonable assumption for Main Street is that health care costs will either continue to grow at the same pace as for the past decade — or accelerate. This is looming disaster for American business.”
Wooldridge (Economist Special Report 4/17/2010) learned about an Indian doctor. “—– Dr. Shetty is building a 2,000-bed hospital in the Cayman Islands, a short flight from Miami, where he will offer surgery at half the price charged by American hospitals.”
The National Association of Free Clinics may have anticipated the crunch even before Obamacare hit society. Customers of the network of 1200 clinics are uninsured citizens, 60% of whom had not seen a doctor in at least a year. They love the thousand or so volunteers who staff each clinic on Saturdays.
What is even more amazing is the high probability that the drug firms and hospitals that sent lobbyists to shape the bill to be favorable to them will themselves get bitten in their pocketbooks. Everyone will lose.
When discussing health care cost, coverage and quality must all be included because each depends on the other two. In this case coverage is provided, unless its constitutionality is questioned. Cost control is not provided. What about quality?
We mentioned that a poor repair job on a car will often be rectified at no charge because the shop manager does not to lose a customer to the competition. In today’s health care there is in effect no competition so doctors and hospitals charge what the traffic will bear.
When it does not know the true total cost of its care the traffic will and does bear a lot. Furthermore every body is different and so responds in a different way to the same med. This means doctors frequently must experiment; this is expensive.
Big Pharma pays for practically all big clinical trials of any new med. Once it gets past the FDA the drug company has no incentive to learn just how and when its product should be used. The grim result is that quality and cost zoom upward hand in hand.
The FDA wants authority to evaluate effectiveness along with safety. Friends, we are pushing against this one with all we have. Given such additional license this huge bureaucracy could expand utterly without limit courtesy of the taxpayer. This is what bureaucracies do.
Government will not monitor how Obamacare works out in practice. Congress has over decades developed the habit of passing legislation and (indirectly) regulation that appears to solve the problem. Whether or not it actually does is of no concern as career politicians harvest yet another batch of votes. Pocket Gofer 3 elaborates.
We conclude that in the old days Mother Nature pretty much kept us healthy and fit. She also did most of the fixing whenever we got sick and doctors made house calls when appropriate.
We didn’t need to be consciously aware of a need for health insurance. Today this need presses upon us.
We have joined the ranks of the whistleblowers.
A NEW AND DIFFERENT SYSTEM
Now that we thoroly understand the problem and its causes, let’s think in terms of what we can do about it. We put this one in our pipe and puffed on it for a while.
Then we devised a health care program that delivers health and fitness. It gets this industry aimed in the direction that we all want.
We begin with the individual person. Knowing the objective, we should logically become more aware of our bodies and how they react to the things we do from day to day. We should develop a routine and follow it, adjusting it as we learn more, until we have created a unique plan that works for each of us.
People are beginning to do this. They are realizing that gradually over the centuries doctors have acquired undeserved power over us. They do this with titles. Few other professions use titles other than Mr., Ms. or Mrs.
They do it with language. Every trade has its jargon, but the medical people have carried it to extremes. (Lawyers do it too.)
They do it with miracle breakthroughs. The news media jump on these, and it seems that in nearly every instance the patient is a poor child.
This strategy preys on our sympathies for the “miracle workers” in the medical profession. Most medical TV shows only stimulate these sympathies.
As we write the Covid-19 plague is upon us. But that, we all hope and pray, will not last.
Economist 2/24/2020 – Coronavirus: Dr; Li Wenliang discovered the virus in
Wuhan, got word out, and he was castigated by the authorities before it killed him.
“There was nationwide soul-searching when the ophthalmologist told Chinese media, days before his death on February 6th in Wuhan, Hubei province, that silencing truth-tellers can make a country sick. (Or a world?)
“Many have read the humiliating letter that police in Wuhan made him sign, agreeing that his truth telling was in fact a lie that ‘gravely disturbed social order.’ Not content with forcing the doctor to deny reality, police added school-bully phrases, asking him to write ‘I can’ and ‘I understand’ when asked if he would now calm down and heed the police, or face legal penalties.
“Lots of patriotic, law-abiding Chinese have glimpsed for themselves the casual, swaggering sadism of a system without accountability, in which the law is just another instrument for frightening the defenseless.”
Historic trends have combined over decades to create a mystique surrounding medicine. This mystique has been used to take control over our bodies from us.
Not to mention our money. We spend far more than the wealthy world’s average on “health,” and yet our life expectancy is less than that average. So much for mystique.
Unless a major change occurs, federal spending on “health” will double as a share of the economy by 2030. This means far higher taxes.
There is no need for this. We have accepted the fact that we must take back our bodies.
Henceforth we will perceive medical people as highly trained technicians, whose services we will utilize as we see fit. And we have determined that we will see them only rarely, because they are no longer in synch with our primary interest.
“An apple a day keeps the doctor away,” goes the old saw. Seeing that we eat an apple a day suggests that we are seizing the initiative for our own health and fitness. We will aim for a diet which is right for us, exercise adapted to our unique needs and wants, adequate rest, disciplined use of alcohol, and kick the tobacco habit.
Do we take this on completely by ourselves? No, there will be others who will help, but only at our request and on our terms. This is because we now have control of our bodies and will therefore request whatever services we want whenever, wherever, and however we want them.
For example, there will be health consultants whom we can utilize as resource people. There will be health classes available, either formal, on the Web, or other social media.
There will be exercise facilities in the home, on the job and elsewhere, including sports for all ages and both genders. There will be guidance for a variety of outdoor experiences.
There will be computerized registries maintained for our convenience. We may contact others who are into diet and exercise combinations that are similar to what we are doing.
We should always keep in mind, however, that in the last analysis it’s on us. We take the initiative, and through learning about ourselves we become the experts. We make our own mystique.
Employers are already pushing health and fitness. They looked at their income statements over the past 10 years and saw expenses for “health” insurance premiums exploding. They are going to love the new system.
Several of the “big tech” firms have already organized their own health and fitness system for their employees and management. This looks encouraging.
We will feel much better about ourselves. As our bodies improve, so also our heads, hearts, and spirits. (All are connected together; see Pocket Gofer 20.)
Let’s get Big Government out of the “health care” business, and keep it out. The government knows even less about our health than does the medical community.
Furthermore, anything the government gets into suffers from the theory of accumulation of money. And it’s our money.
The following discussion covers an institution that does not exist today, so we must speculate. That is, the final form of the institution (all health and fitness resources as a group) is hard to predict at present.
A GENERAL HEALTH AND FITNESS COMPANY
We have split this section into two parts. The first will discuss the internal organization of a typical general company, while the second will go external.
The reason for this approach is that any small and medium-sized business can logically be divided in this way. This is why someone starting a business is often advised to carefully select a partner: one would manage the inside components of the business and the other the outside.
INTERNAL ORGANIZATION: A general health company would be equipped to treat ailments and injuries not treatable at home or in satellites (to be described). Providing guidelines for home treatment is to the mutual advantage of both company and customer family, as this helps to control costs for everyone. This is another trend already started today.
A person or family beginning his/her/their active search for health and fitness would “shop around” by visiting several of these companies and their satellite facilities. Qualified consultants would offer information and guidance concerning their resources, but decisions would be left to the individual customers (not patients).
As he/she gets into a program, consultants would help him analyze feedback information and suggest revisions. Our bodies change continuously, so our program would be updated from time to time.
Consultants would have some understanding of all aspects of health and fitness, including mental, emotional, and spiritual health. Today’s doctors are so over-specialized that they often don’t even understand how different parts of the body interact, much less these other aspects.
They also understand little about alternative treatments such as acupuncture and chiropractic. Such resources would also be available according to demand.
A general health company would be a general contractor. The company would compete with other general companies in recruiting, developing, and retaining the best people on its staff (internal functions).
The company must also get and keep customers, maintain relations with the best suppliers, keep shareholders happy, and do all of these things better than the competition (external functions).
All this takes money, so the company would be interested in maximizing profits. It would do this by minimizing its costs while providing excellent services to its customers at a price that is mutually agreeable. Competition would keep prices from spiraling upward, which is a major problem today.
The top manager would be educated and experienced in both health and fitness and in business management. He/she would himself practice good health and fitness, and he would sell his staff on the same. This is important because it is well known in business that a salesperson cannot effectively sell a product on which he himself has not been sold.
Every staff member would feel that he/she is making a contribution to the health and fitness of every customer. Treatment would be available for sickness or injury, but the big push would be health and fitness. Staff people would help customers to acquire preventive lifestyles, as they would know them personally. See Pocket Gofer 6.
The top manager and staff would plan and organize the facility for top efficiency and effectiveness. The first covers costs, while the second is measured through customer satisfaction.
Even today people with tablets and mobile phones can find a great variety of guides to good health, home treatments for minor problems, and tests to detect these and more serious concerns. Our system builds on today’s trend.
In a 2/13/2005 column Jean Fisher illustrated the trend. “Let’s call it ‘personal responsibility.’ Part one is you, the consumer, shouldering a far greater share of your day-to-day medical expenses. Part two is you doing everything you can to make sure you need as little as possible.”
Fisher went on to illustrate one company’s take: “IBM pays workers who don’t smoke a yearly $150 bonus. ———–. The company pays a second $150 ——complete an exercise challenge.”
EXTERNAL ORGANIZATION: This part covers what managers call marketing. It consists of developing products that people want, making them conveniently available, pricing them right, informing people about them, keeping existing customers, developing good supplier relations, and keeping shareholders happy.
Each general health company would contract for the services of several satellite resources. These would be conveniently located, quite like neighborhood clinics of today but oriented toward health and fitness.
Customers may choose among two or more. A particular satellite may be under contract to more than one general company.
General health companies would provide competitive bids at the request of any prospective customer or family. Customers would have an incentive to shop around for the best deal.
The individual or family would pay the whole fixed monthly price. This means no problem when a change of job occurs. The employer would avoid the cost of its part of the insurance premium, so it can pay the worker more.
Independent companies would be organized to supply useful information to help in making the right decision. Audit teams would examine cooperating general health companies and provide reports for existing and prospective customers.
Managers would be motivated to cooperate. Otherwise they risk losing customers.
Contracts would come up for renewal every five years or so. Dissatisfied customers would look elsewhere, and this knowledge would put pressure on company managers and staff to do the best possible job. The same would apply as well to satellites, because with competition general health companies can get picky too.
Rarely would an illness or injury be so serious as to require treatment which is beyond the capability of a general health company. To plan for this a company would maintain relationships with specialized hospitals, which are very efficient in their narrow areas of activity.
One such facility that exists today performs only hernia operations. It charges about one-third of what an ordinary hospital wants.
Incurable (chronic) ailments would require maintenance in order to keep them in remission as much as practical. General health companies may form associations to jointly finance research toward cures or prevention.
Such associations would find an advantage in financing a couple of competing research facilities. The facility that gets results gets more money.
The human genome has been mapped. What does this mean?
Frankly, we lack details. Apparently in the future specialists should be able to pinpoint the gene that causes a particular chronic illness, and neutralize it so that a person will not inherit the disease. (Research in this area has already begun.)
Today’s government-financed research arrangements are not the best. They are by nature polluted by politics.
We have no hard evidence, only a suspicion. Cancer research has gobbled billions of taxpayer bucks over the past 60 years and with few cures or prevention guidelines to show for all this. (We have seen news of some recent progress.)
Complex problems here, we freely admit. But there are also hundreds of well-paying, steady, and enjoyable jobs in it if scientists can keep that government money coming indefinitely. (But with our plan there would be no government.)
Research company scientists would have top management constantly bugging them for results, in contrast to seemingly unlimited taxpayer funds.
COMPETITION, PROFITS AND PROFIT SHARING:
“My competitors do more for me than my friends. My friends are too polite to point out my weaknesses, but my competitors go to great lengths to advertise them. My competitors are efficient, diligent, attentive, and would take my business away from me if they could. They keep me alert and make me search for ways to improve my products and services. If I had no competitors I would be lazy, incompetent, inattentive. I need the discipline they enforce upon me. I salute my competitors. They have been good to me. God bless them all!”
We salute the person who wrote this, unknown to us. It provides an excellent contrast between government and private sector activities.
Profit is the reward for accepting risks. If the risks are high, so also must be the projected profit (and loss, as not all ventures succeed).
The illegal drug business conforms to the definition of profit. Getting caught means prison, so the risks are high. So are the possible profits, obviously, or no one would enter the business.
A well-managed general health company in our proposed system could be competitive while still maintaining a financially healthy operation. The general manager would do this by selling his/her staff not only on good health and fitness, but also on minimizing costs and maximizing customer satisfaction.
Any competent retailer will sing the praises of his/her people who are nice to customers, as this generates vitally needed repeat business. Health and fitness are ongoing concerns, so a continuing healthy relationship with customers is necessary and proper in this business too. (But there is a key difference, as we will quickly see.)
Here is a simple formula: R – C = PR, or REVENUES minus COSTS equals PROFIT. It is clear from scanning this equation that increasing revenues and decreasing costs or holding down increases will increase profits, and so it is.
Costs have been discussed. Therefore we will now show how health companies can increase revenues under the new system.
This business is different from many. Customers, once they take responsibility for their own health and fitness, would over time need less help in order to keep healthy and fit.
Therefore as time passes a general health company and satellites that are effective would experience fewer customer visits that require staff time. Staff people would discover they have time on their hands.
Obviously here is an opportunity to generate additional business. The top manager would not want to lay off highly trained people for doing themselves out of their jobs.
Additional business would be sought. More money would be brought in. Because costs would increase by less, profits would increase.
We see now that the proposed system encourages customers to get and remain healthy. This means they would spend less on health, both our own through reduced payments to the general health company and that of the poor through fewer tax dollars.
But without competition the whole system is reversed. Government programs such as Medicare have bureaucrats running them. Because these people thrive on problems and not solutions, they constantly try to expand programs and thus justify more taxpayer dollars for their programs and themselves (through promotions and perks on the job).
Therefore the proposal seeks to save money for us while the present system seeks to take more of our money. Since 1965 Medicare has done this very well. It has expanded so rapidly that today forecasters are predicting its bankruptcy.
A couple of numbers will scratch the surface of the problem. In 1965 the Congress projected the program’s costs up to $12 billion in 1990 dollars. The actual cost to taxpayers in 1990 was $98 billion.
The Economist 2/1/1997 claimed the tab had got up to $200 billion. Looking at dollars adjusted for inflation, today’s seniors are on average OUT OF POCKET for medical care more than they were before Medicare was dreamed up by Big Government. Hence a need for secondary coverage, which costs yet more.
We will see in Pocket Gofer 15 that this total lack of control over expanding government programs is not restricted to the medical area. All of us, even the healthy, are more out of pocket.
In a healthy society people feel healthy because they have assumed responsibility for their health instead of, as children, leaving it up to someone else. They know their bodies, and so as they age they know when a minor ache will soon pass and when it could be serious.
All this means that old does not have to mean sick. New definitions of “aging” and “elderly” are likely to emerge.
With our proposal extra profits would be distributed to shareholders, and also to staff people. Outstanding individual people would get substantial increases in pay. This is very important, as competitors are looking for such people and would offer excellent pay while trying to hire them away.
In this way a truly dedicated and talented individual might command a salary comparable to what many doctors are getting today. The big difference is that in the new system every buck would be earned through excellence and not through siphoning public funds in a distorted market.
Summarizing, with our proposed system an individual citizen would be sick or injured only rarely. In roughly 70 percent of all such difficulties his/her problem would be minor and thus treatable in the home.
About 20 percent would be handled by a nearby satellite, with maybe nine or ten percent treated by a general health company. Many of us would pass our entire lives without once visiting a specialized hospital as a patient.
We could knock today’s “health” costs of 18 percent of total national output down to …..? Eventually two percent, maybe? This would free up 16 percent of output to go toward raising our living standards. In today’s money this comes to about $1.71 trillion or about $22,840 each year for the average family of four in the USA.
That would buy a lot of new shoes for baby. And maybe save some for the little weasel’s education (see Pocket Gofer 10).
MEETING OBJECTIONS AND OTHER BARRIERS
Concerned folks among us citizens would immediately ask, what about those who are unemployed and/or poor? After we have read and discussed all the pocket gofers we think there would be far fewer unemployed and poor.
But this will take time. Also, no matter what type of government a country uses to guide its citizens’ behavior there will always be some poor people.
Therefore this question is quite appropriate. We address it creatively and with caring in Pocket Gofer 2.
Quite louder objections would come from the many that are happy in the present system. These include clinic, hospital, and laboratory folks, lawyers, insurance companies, lobbyists, career politicians and other looters.
Some of these have formed associations to lobby national and state government officials for favoritism in laws and regulations. These groups have a lot of political power (Pocket Gofer 8).
Other objections will come from the bureaucracy. Many of these Medicare and Medicaid people are deeply and comfortably entrenched in the absence of competition. They will fight this change tooth and nail.
In fact, we might find a rough measure of the potential of our pocket gofer program in the volume of the squawks that blaze forth from Washington and state governments. We may want to cover our heads as the nasties rain down upon us, while they struggle to cover their other ends.
Many of these people have skills that could find productive use in the new system. However, leaving a cushy job in the public sector for the uncertainties of the real world will cause lots of antsy feelings.
We referred above to another barrier, which has been called “regulatory underbrush.” Any new institution makes mistakes as members learn how to operate most efficiently in the marketplace.
Politicians who answer the call for new regulations do not give the market a chance to show what it can do for people. They often figure there are votes in this, so they do it anyway (see Pocket Gofer 3).
We may have to twist their arms, and throw out of office those who will not cooperate. We looked into what these blokes have been doing over the past few years, and we flipped out. (See Pocket Gofers 8 and 19: incredible).
Society’s average age is increasing, and under the present system the elderly use tremendous amounts of “health care.” The new program would enable nearly all of us to keep healthy right up to age …..90? 100? Who knows?
Publicity would help, as the first companies get started and begin to show positive results. We note here that a general health company would vaguely resemble today’s HMO, although with more competition and therefore more and less expensive customer choices. And the objective would be health, for a most welcome change.
The Economist, 11/2/1996 weighed in to support the new idea. “A recent study by the Labor Department shows just how dramatically health care costs have fallen as more employees are enrolled in managed care plans and employers shift more of the costs of health care on to their workers.”
What are operating here are incentives to stay healthy. Even though the reality is that a worker “pays” both ends of today’s “health care” premium, he/she doesn’t readily perceive this fact because he never sees the part deducted by the employer prior to receiving his paycheck.
Put it on him, and there is the incentive. Note how this trend ties into our proposal.
Back in 1988-89, health insurance costs were roaring ahead at about 14 percent per year. By 1995 this was down to zero, and 1996 showed a 0.1 percent increase.
BIG GOVERNMENT did not legislate this show stopper, nor did it require managed care in any regulation. The market did it, as a reaction to government programs which enabled the medical community to treat costs as not relevant to the job.
Some 55 million poor and disabled citizens are covered by Medicaid, which is a joint national-state program costing $300 billion annually. Recently some states have stopped paying for care directly.
They are hiring HMOs to do the work. They figure what they would pay for care and offer a fraction of that amount to an HMO. The HMO watches its pennies because when its expenses are kept below that amount the difference is profit.
Human nature being what it is, many people who think they will lose out would try to torpedo the new system. We will help these folks when we can. While it is human nature to resist change, without it there can be no progress.
There is evidence surfacing, which the Economist (11/2010) calls “M-powered.” We might call it remote medicine, where a patient has an operation conducted by a robot while a surgeon located many miles distant manipulates it. Telemedicine is a new tool.
“—- sending text messages to remind Kenyan patients to take their HIV drugs properly —–. —– an m-health scheme that relies on behavioral psychology to give diabetics advice —– more effect than putting them on the leading diabetes drug.”
CONCLUSIONS
The present system of “health care” has lost control of costs, it does not reach nearly everyone who needs care, and it is aimed at the wrong objective. Over the past 150+ years since the Industrial Revolution the needs of people in advanced countries have changed.
We want the good health and fitness of our physically active ancestors of the old farming days, not just curing of sickness. If the system actively sold health and fitness there would be a far smaller need for curing. People would be more productive on the job, they would live longer, happier lives, and they would enjoy higher living standards.
The only justification for higher prices will be luxurious services, which a few us might demand and be willing to pay for. This is the steak and lobster that we mentioned previously. The key difference is that those who receive it will pay for it.
What happens to a society when its citizens start actively thinking health and staying healthy, rather than just passively waiting until they are sick, then going to see a doctor for diagnosis and cure? We don’t know.
None of us is old enough to remember the old days (which were not free of health problems of course). But, food for thought here.
Our logical arguments in support of the proposal suggest that it would be a good start toward building an excellent health and fitness delivery system for the future. Therefore we believe it deserves discussion.
Hmm. Pretty good info here. Maybe we should put this booklet into our mobile phone as we step out the front door.
We vaguely recall reading about an ancient society in which doctors were paid only when their patients stayed well. Our proposal is different from that one. But, is it all that different?
One phone to the next, and then another.
…………. PUBLIUS II
A BRIEF BUT EXTREMELY IMPORTANT P.S.
We are keenly aware of our inability to accurately predict how the American public will respond to our pocket gofers. We hope the response will sweep the country.
If it does, it is absolutely crucial to always remember: NO VIOLENCE. Not even any demonstrations that could turn violent. We may avoid this situation thru use of the Internet and social media as assists to our discussions and debates.
Such provocations would play directly into the hands of the establishment. They would then have an airtight excuse to install a police state.
Many of us don’t realize that Washington would like nothing better than to run a police state (See Pocket Gofer 19). We are convinced that this is where the country is headed. Big Government needs only a reason to act.
We will not provide it. We can and will do this one at the ballot box (but only if we, the citizens personally make sure the vote is free and fair). We must avoid violence.
Throughout history there have been bloody rebellions against oppressive governments whenever people grew sufficiently desperate. For an example we need look no further than 1776.
A stupendous change occurred in 1989, when Mikhail Gorbachev permitted several nearly bloodless rebellions to take place. Friends, we can do this. We need only believe in ourselves and our children.
——— Publius II, a Quaker
TITLES OF OTHER POCKET GOFERS WHICH WE CAN DIG INTO, DISCUSS, CRITICIZE, AND ACT ON:
PG 2 – ON VOLUNTEERISM
PG 3 – ON THE CAREER POLITICIAN IN A DEMOCRACY
PG 4 – ON THE BOTTOM-UP APPROACH TO GETTING THINGS DONE
PG 5 – ON THE COMING OPEN SOCIETY
PG 6 – ON MAKING A CONTRIBUTION
PG 7 – ON CORRUPTION AND ACCOUNTABILITY
PG 8 – ON GOVERNMENT REGULATION OF BUSINESS AND THE PHANTOM
PG 9 – IT’S ALL IN THE FAMILY
PG 10 – ON EDUCATION IN THE U.S.A.
PG 11 – ON THE U.S. AS A WORLD CITIZEN
PG 12 – ON THE U.N. AND POTENTIAL CONFLICTS
PG 13 – ON PERSONAL POWER AND IDEAS
PG 14 – ON RESPECT FOR TAXPAYERS’ MONEY
PG 15 – ON BIG, SMALL, AND GOOD GOVERNMENT
PG 16 – ON DEMOCRACY AND OUR CENTRAL GOVERNMENT
PG 17 – ON LEADERSHIP IN A DEMOCRACY
PG 18 – ON WAR, WEAPONS, AND PEACE
PG 19 – ON THE GRAND DECEPTION
PG 20 – ON LIFE IN A DEMOCRATIC COMMUNITY
PG 21 – PRELIMINARY DRAFT OF A CONSTITUTION