Posted in Access to healthcare, advance-pricing, Economic Issues, Health Insurance, Healthcare financing, Medicaid, Medical Costs, medical inflation, Medical Practice Models, Medicare, out-of-pocket costs, Patient Choice, Price Tansparency, Quality, Uncategorized

G. Keith Smith, M.D. — Health “Coverage” as a Distraction


I think it is good to be alert to any discussions that are “downstream of a flawed premise.” Let me explain.

When I hear, for instance, that the “flat tax” is preferable to the current income tax, I think to myself that this is a discussion of the knife versus the axe, a conversation far downstream of one addressing government spending or the very legitimacy of denying someone their earnings. After all, victims don’t generally care what the mugger does with their money. They just resent being mugged and no discussion about whether the mugger used a knife or a gun will likely provide any solace.

Similarly, I would argue that arguing for everyone to have health “coverage” is far downstream of the more original problem: the cost of healthcare. To provide “coverage” for everyone in the current climate of gross overcharging primarily serves the interests of those who employ the “what can I get away with” method of medical pricing.

The fierce push back against true price transparency by the cronies in the medical industry makes more sense in this context, as price honesty denies them access to everyone’s blank checkbook as the health cronies are well aware.

Supporters of government-guaranteed “coverage” object with the following arguments.

First, coverage is equated with healthcare. While millions of Canadians streaming across the border to secure their health needs could be used to refute the idea that coverage is synonymous with care, this disconnect has become more apparent in this country. Each passing day reveals Medicaid and Medicare “coverage” to be a “black mark,” an actual obstacle to obtaining care, as these government programs and their associated rationing through price controls and hassles are creating the lines the central planners intended. Physicians are either dropping out of these programs altogether or they are limiting their exposure to patients with this “coverage.”

Another objection points to the relief from financial devastation that having “coverage” represents. Keep in mind that not only are well over half of the bankruptcies in this country medically related, but almost three quarters of those filing for medical bankruptcy have insurance. This points powerfully to cost as the root cause of medical economic ills.

Acknowledging this is a slippery slope for the objector, however, for no economic system better provides for resource allocation than the market and the cronies and their government pals know this as well as anyone.

The market is the only source of price deflation with simultaneous improvement in quality. This powerful competitive mechanism has brought affordability to countless products and services in all industries and has begun to bring rationality to health care pricing as more physicians and facilities honestly post their prices for all to see.

Rather than focus on “coverage,” which allows the cronies to continue their financial feeding frenzy, we should remain unalterably focused on cost. The competition unleashed will result in a medical price deflation the likes of which will cause even the most skeptical objector to re-evaluate the role of “coverage” in the provision of payment for health care.

This is no prediction. This is exactly what is happening here in Oklahoma where so many health professionals have embraced the same market discipline every other industry must endure. The reasonable prices and high quality of care, have had such a wide appeal that Oklahoma City has evolved into a medical tourist destination for many patients far from here, while simultaneously bringing savings in the millions of dollars to those who actually pay for healthcare, locally.

This is my answer to another objection from those who claim the inapplicability of market competition to health care.  Whether the focus on “coverage” is a deliberate distraction by the crony propaganda machine or a well-meaning but misguided attempt to provide better access to care, we must keep our eyes on the “price transparency ball.” The Oklahoma market is already harshly judging those attempting to avoid this gaze and I believe this trend will continue as long as we identify, challenge and reject conclusions downstream of their flawed premises.

Posted in Access to healthcare, Direct-Pay Medicine, Direct-Pay Practice Models, Economic Issues, Health Insurance, Healthcare financing, Independent Physicians, Medical Costs, Patient Choice, Price Tansparency, Self-Insured Companies, Uncategorized

Jay Kempton: An Unorthodox Benefits Solution – Healthcare Americana

Healthcare Americana, Chris is joined by Jay Kempton of The Kempton Group and co-founder of the Free Market Medical Association (FMMA).

Chris and Jay discuss novel ways of implementing employee benefits, why there are barriers to change, and the upcoming FMMA conference.

https://healthcareamericana.com/episode/jay-kempton-an-unorthodox-benefits-solution/

Posted in Access to healthcare, advance-pricing, American Presidents, Consumer-Driven Health Care, Crony Capitalism, Economic Issues, Government Regulations, Healthcare financing, Influence peddling, Medical Costs, News From Washington, out-of-pocket costs, Patient Safety, Policy Issues, Price Tansparency, Uncategorized

Hospitals pledge to fight Trump admin price transparency plan in court | Healthcare Dive

The old aphorism is true, leopards don’t change their spots!

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For these three entities that oppose the new HHS price transparency rules, and for many others to be sure, there is no incentive to hold down healthcare care costs. In fact, the incentives of the current system of healthcare financing are such that it’s in their favor for prices to always go up.

In all cases, whether it be a percentage of claim cost, percentage of premium or percent of discount margin, these same price-hiding crony pals continue to benefit financially when the price of medical care rises.

https://www.healthcaredive.com/news/hospitals-pledge-to-fight-trump-admin-price-transparency-plan-in-court/567474/

Posted in Access to healthcare, Direct-Pay Medicine, Economic Issues, Health Insurance, Healthcare financing, medical inflation, out-of-pocket costs, Re-Pricing Scams, Uncategorized

Pillars of the FMMA | Free Market Medical Association

1. PRICE

  • PRICE is NOT a product. CARE is the product.
  • Selling access to pricingis anti-free market.
  • Discount brokers” who get paid by selling “savings” are not transparent.

2. VALUE

  • VALUE is established when the buyer and seller agree on a FULLY DISCLOSED, mutually beneficial price for care.
  • If a vendor adds or changes that price IN ANY WAY, those amounts should be truthfully disclosed

3. EQUALITY

  • PRICE EQUALITY is the basis of a free market.
  • Cash is KING.
  • Any willing cash buyer should be offered the same price regardless of any factor.

https://fmma.org/pillars/

Posted in Access to healthcare, advance-pricing, Direct-Pay Practice Models, Economic Issues, Education, Employee Benefits, Free-Market, Health Insurance, Healthcare financing, Independent Physicians, Influence peddling, Liberty, Medical Costs, medical inflation, Medical Practice Models, Patient Choice, Policy Issues, Price Tansparency, The Quadruple Aim, The Triple Aim, third-party payments, Uncategorized

Annual Conference | Free Market Medical Association

Forum for Healthcare Freedom is proud to be a Mobile App & WiFi Sponsor for the 2019 Free Market Medical Association annual conference, to be held at the Hyatt Regency in downtown Dallas, TX.

Since 2014, the mission of the FMMA has transformed from Education to Insurrection.  Our mission is to rouse and provoke those suffering because of the broken system and motivate them to fight back.

The 2019 Conference speakers will motivate, energize, influence, and empower attendees to eliminate the option of retreat, reject the status quo, and emancipate themselves from the deteriorating ship.

We have an incredible lineup of general session speakers, including our Keynote Luncheon speaker, the Honorable Ron Paul, M.D.  All attendees will find something of value in one of our eight breakout sessions covering topics such as Incorporating the Free Market into your Benefit Plan, HMOs & the Free Market, Pricing of Specialty Care, Lies Employer’s Believe, Creating Bundled Pricing, and more! The conference will close with our Founder Panel where Dr. Keith Smith and Jay Kempton will present Burning the Ships: Going All In!

Space is limited, so register today!

Source: Annual Conference | Free Market Medical Association

Posted in Access to healthcare, Affordable Care Act (ObamaCare), CPT billing, Direct-Pay Medicine, Direct-Pay Practice Models, Economic Issues, Employee Benefits, Free-Market, Health Insurance, Healthcare financing, Individual Market, Medical Costs, medical inflation, Medical Practice Models, out-of-pocket costs, Patient Choice, Policy Issues, Price Tansparency, Self-Insured Companies, Self-Insured Plans, Third-Party Free Practices, Uncategorized

DPC and Self-Insured Employers: Counting the Costs

“In the department of economy, an act, a habit, an institution, a law, gives birth not only to an effect, but to a series of effects. Of these effects, the first only is immediate; it manifests itself simultaneously with its cause—it is seen. The others unfold in succession—they are not seen: it is well for us, if they are foreseen. Between a good and a bad economist this constitutes the whole difference—the one takes account of the visible effect; the other takes account both of the effects which are seen, and also of those which it is necessary to foresee. Now this difference is enormous, for it almost always happens that when the immediate consequence is favourable, the ultimate consequences are fatal, and the converse.” Frederic Bastiat

The results of the immediate/ intended effects (the seen) and the subsequent/ unintended effects (the unseen) of U.S. healthcare policy are clearly instantiated by examining the way we use, and misuse, health insurance. Despite the ostensibly good intentions to improve access by expanding coverage for various medical services, the “ultimate consequences are fatal, and the converse.”

Our insurance-based third-party payer protocols have pernicious and nefarious economic consequences on our healthcare system. This manifests as rampant healthcare inflation catalyzed by the macroeconomic market distortions of the 3rd party payer effect and perpetuated by the microeconomic price-obscuring distortions of the billing cycle.

Stated differently, we have taken the concept of insurance, designed to pay out rare higher-priced claims on unpredictable events, and turned it into a product whose design promotes an incentive for everyone to use it as often as possible.

Insurance is sustainable only when the financial risks of individually rare events are spread over a large population. When it also becomes a funding source for anticipated and affordable events, combined with a perverse incentive to utilize it to the margin, the result is the creation of a perpetual payout fund. The costs of sustaining this model are never satisfied, being squeezed by patients who are chasing the benefits and providers who chase the billing codes for reimbursement.

As evidence for the negative consequence of misusing insurance as a pass-through system for virtually every healthcare expense (accelerated by passage of the ACA), we can examine the employer-sponsored group market premiums. From 2007 – 2017 the average premium for family coverage increased by 55% and employee contribution rate as a share of premium cost increased by 74% over the same 10-year period; while median household income went up by only 3%.

To add financial injury to insult, the percentage of employees with an out-of-pocket maximum of greater than $3,000 doubled, going from 30% to 60% of employees.
From kfforg.

“Eighty-one percent of covered workers have a general annual deductible for single coverage that must be met before most services are paid for by the plan. Among covered workers with a general annual deductible, the average deductible amount for single coverage is $1,505…”

The average deductible for covered workers is higher in small firms than in large firms ($2,120 vs. $1,276) …

Over the last five years, however, the percentage of covered workers with a general annual deductible of $1,000 or more for single coverage has grown substantially, increasing from 34% in 2012 to 51% in 2017.

Thirty-seven percent of covered workers in small firms are in a plan with a deductible of at least $2,000, compared to 15% for covered workers in large firms.

In the ACA individual market insurance exchanges, single coverage premiums (unsubsidized) increased by 62% and family coverage premiums increased by 75% just since implementation of ObamaCare!

Our third-party payer system has created a dependency paradox; the same funding method that contributes to runaway costs also causes us to be more dependent on it for access. This guarantees that Healthcare will cost significantly more than the sum of its individual parts, and will continue to escalate faster than our ability to pay for it.

Even if American doctors took a 50% pay cut and we could eliminate the spend equal to all care during last 12 months of life (retrospective knowledge of course), we would still spend more per capita on healthcare than any other country. All components of healthcare spending add to cost of care. But the overwhelming cost drivers for the U.S. healthcare system are embedded so deeply within the way we access and pay for medical services that we often overlook them, choosing instead to blame the symptoms for the disease rather than the disease for the symptoms.

Self-insured employer health plans are in a unique position to break out of this dependency paradox. As discussed in part 2 of this series, by contracting with a Direct Primary Care practice and re-routing subsequent encounters away from the more expensive insurance-based protocols, Self-insured employers can utilize creative plan designs to cut costs and improve employee satisfaction.

Considering that approximately 65% of 160 million employees who have insurance in the workplace are covered under a self-funded plan, representing over 100 million lives, the aggregate savings can be substantial even after accounting for membership costs.

Let’s compare traditional insurance-based coverage for primary care vs a self-funded model with DPC at the hub and count the costs.
In broad context, the large volume of data from the Qliance experience, and supported by other self-insured employer’s experiences, efficient primary care via the DPC model reduces unnecessary downstream care by approximately 50%, with the resultant cost savings. The caveat being, as we double the number of primary care visits combined with longer visits to adequately address problems, the need for emergent visits, ER visits and specialty intervention drop significantly.

Consider that between 2002 and 2016, medical costs for a family of four in an employer-sponsored PPO plan increased 180%, with the percentage of employees facing out-of-pocket maximums of $3,000 or more have doubled! Given that household income has barely budged in real dollars since 2002, these increases are clearly not sustainable. By contrast, the auto insurance market (a real indemnity product) increased by only 17% from 2007 – 2016, while deductible offering ranges remained stable, averaging $500.

The introduction of DPC has deflated these cost escalations considerably.

In the individual market, data from several sources bears this out. CovenantMD, a Direct Primary Care practice in Lancaster, PA illustrates the potential savings based on a typical family’s utilization.

They compared the total costs incurred using a Bronze ACA plan with $6K individual/$12K family deductibles without and with a DPC membership at CovenantMD. Pairing a Bronze Plan with a DPC membership at CovenantMD resulted in an out-of-pocket savings of $7,267, even after the cost of the membership was counted. That is a 65% reduction in out-of-pocket costs!

Zenith Direct Care did a similar analysis for a typical family of five with an 80/20 plan with $3,000 deductible. They compared annual costs for this scenario with a Zenith Direct Care membership plus a Health Cost-share Plan (health-sharing member). Estimated out-of-pocket costs with the traditional insurance alone was $18,343 compared to $6,160 with the Zenith/HCS combination. A savings of 66%!

Next, let’s explore the advantages of utilizing DPC in a self-funded plan in place of insurance-based primary care by looking at lab and pharmaceuticals prices.

Core Family Practice, a DPC practice in Kennett Square, PA, compared a 90-day supply of four common primary care medications purchased through Aetna’s Mail-order supplier with the prices their members pay for same quantity. The annual cost for the Aetna mail-order came to $2,248.68 compared to only $850.80 for the same medications from Core’s generic supplier, which were dispensed in the office. That $1,397.88 savings equates to a 61% reduction in out-of-pocket costs for the married couple! They also looked at the costs of obtaining three sets of commonly ordered lab tests for the same couple. Out-of-pocket costs using their high-deductible plan (QHDHP) was $480 in lab test responsibility. The same tests drawn and paid at time of services to Core FP totaled $63.17 yielding an incredible 87% reduction.

A similar level of savings for direct-pay lab tests was noted in data published in 2014 by CMT journal comparing lab fees charged to a Direct Pay practice by the lab vs. the CPT billed charges by the lab (assuming patient had no coverage or had not met their deductible). For five common blood tests the savings was 89% by not using insurance, with lab billed charges of approximately $782 compared to a direct pay cost of $80. Plum Health, a direct primary care practice in Detroit, shows similarly impressive lab test savings of 87% on six common blood tests; $811 vs $106.

The evidence is overwhelming. With DPC at the hub of the benefits package, combined with proper utilization of insurance, Self-insured employers and employees are enjoying undeniable and significant cost savings.

Using DPC as a free-market-friendly alternative to traditional insurance-accessed primary care not only saves employers directly on coverage costs, but the model has a huge impact in reducing patients’ out-of-pocket costs incurred from laboratory tests, pharmaceuticals and imaging services.

Many Self-insured companies are beginning to discover the value and savings in this approach, while breaking free of the coverage trap and the myth that health insurance equates to health care; and the realization that so-called “access” to inflated pricing and the phony discounts used to fleece the buyer is no longer a conversation they are willing to have.

Consider the costs (of continuing the status quo) counted!

http://ushealthmedia.com/dpc-and-self-insured-employers-counting-the-costs/

Posted in Access to healthcare, Affordable Care Act (ObamaCare), Direct-Pay Practice Models, Employee Benefits, Employer Mandate, Employer-Sponsored Health Plans, Essential Benefits under the ACA, Health Insurance, Health Reimbursement Arrangement (HRA), Health Savings Accounts (HSA's), Healthcare financing, Individual Mandate, Policy Issues, Tax Policy, Uncategorized

Healthcare: What to Watch For

“…it is important for employers to be fully aware of what the regulations may impact them to safeguard against inadvertently putting themselves, or their employees, in an untenable situation.

It is important for an employer looking to offer an unconventional or untraditional benefit package to speak with an independent health plan attorney or CPA (not employed by the agency selling the program) regarding potential liability and compliance with federal and state laws regarding employer sponsored health plans.

Can your employee afford to reimburse the IRS for taxes not collected on an inappropriately structured HSA? Can your business afford a fine of $100 per day per employee for every day that the unqualified arrangement was offered? These are just some of the potential liabilities.”

http://ushealthmedia.com/healthcare-what-to-watch-for/

Posted in Access to healthcare, advance-pricing, Direct-Pay Medicine, Economic Issues, Free-Market, Healthcare financing, Medical Costs, Patient Safety, Price Tansparency, Uncategorized

Pillars of the FMMA | Free Market Medical Association

The Pillars of the FMMA were created due to the wildly varying definitions of free market and transparency.  As this movement grows, many want to utilize the work of the true free market warriors to create new programs, products, and schemes that are not truly free market, or transparent.  All members agree to abide by the literal definition of the Pillars, and the spirit and intent in which they were created.

Join FMMA Now

Source: Pillars of the FMMA | Free Market Medical Association