Moreover, getting medical care has not only become more expensive, but also more complicated and difficult to navigate.
Consider this: Every year, Americans of all ages, incomes, and education levels buy millions of new and used cars without the slightest knowledge of all the intricacies of engines, transmissions, and all of the software that makes cars run. Yet even without this knowledge, the American people seamlessly buy hundreds of billions of dollars worth of cars annually, because the public can do their online search for expert opinions from Consumer Reports, Edmunds and Kelly Blue Book, to make informed decisions.
But when it comes to medical care, medical/health care experts tell us that there is “asymmetry” in the medical sector and so the public cannot make an informed decision. In other words, the public does not have the same information as doctors and hospitals. This lack of transparency in purchasing Medicare, and employees’ reliance on employer-based insurance to pay bills, keeps them out of the real costs.
The way we pay for our medical services violates a fundamental economic principle – that is, in a market transaction between a willing buyer (in this case a patient) and a supplier (a doctor or hospital), transparency allows the buyer the ability to judge the value of a service provided or goods purchased.
The good news for both employers and employees is that America is headed in the direction of Medicare “consumption.” With costs rising, employers have been voting their dollars by opting out of the traditional medical insurance market.
Fortunately, promising alternatives to traditional medical insurance have emerged. Here are some examples:
- Restore the doctor-patient relationship.
Doctors are increasingly frustrated with the role insurance companies play in approving the procedures and medications they prescribe to their patients. After all, the doctor had one-on-one contact with the patient and had the experience to judge what was needed; The insurance company representative has neither. Efforts are underway, as are direct primary care and concierge medicine, where patients pay a set monthly rate to get to the doctor the same or next day, taking the insurance broker out of the equation. Specialist treatments are referred to other physicians, and surgeries are performed in an outpatient center or hospital.
- Transparent pricing.
The Duty Free Medical Association (FMMA) is at the forefront of the Medicare revolution. Founded by Jay Kempton, owner of The Kempton Group Administrators, and Dr. Keith Smith, medical director of the Surgical Center of Oklahoma (SCO), the association lowers the cost of Medicare, while exposing the overall increase in fees by hospitals and traditional medical practices. Tired of butting heads with hospital officials, Dr. Smith and Steve Lantier set up a cash-only clinic and brought into the fold other surgeons who wanted to practice medicine without reasoning from insurance companies or bureaucrats. One uninsured patient who needed a mastectomy charged the hospital $19,000—10 times higher than the rate charged by the SCO. The group proves that a market-based environment provides effective and value-based medical care.
- Self insurance.
With the inflation of Medicare and the resulting high cost of medical insurance premiums, more and more employers are beginning to cut out insurance companies by self-insuring. in the largest American companies, 82 percent of employeesCovered in whole or in part by self-insured plans. A self-insured group plan allows employers to customize insurance coverage for employees. Depending on the company’s demographics and culture, a self-funded plan could include benefits your employees would like to see covered, such as dental, vision, prescription medication, chiropractic or acupuncture.
By investigating the options now available through medical entrepreneurs, employers can reduce medical insurance costs and put money in their employees’ pockets—an attractive feature in today’s tight job market—without having to skimp on medical care.
By Murray Sabrin.
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