The U.S. healthcare system has always been a moving target, a system continually in flux. Politicians, bureaucrats, policy wonks, and academics continually view the healthcare landscape as a vision to be adjusted. The picture just isn’t right.
In fact, many in the last decade have called for and partially implemented overhauls to a system they deem as irreparably broken. As evidence, they point to the dismally poor state of Americans’ health and the tragic cases of lost or inadequate health insurance coverage and rising premiums and high deductibles.
The Evidence is Apparent and Mounting
According to a 2016 survey by Commonwealth Fund, Americans’ overall health ranked the lowest compared to ten other wealthy western nations. Americans are more likely to go without health care because of costs, the survey stated. The high cost of health care was also cited as the reason one-third of U.S. adults did not seek care, see a doctor when ill or fill a prescription.
“In comparison to adults in the other ten countries, adults in the United States are sicker and more economically disadvantaged,” the report states. “The United States trailed other countries in making health care affordable and ranked poorly on providing timely access to medical care (except specialist care). Problems were often particularly acute for low-income adults.”
Yet Americans spend nearly $10,000 annually for medical expenses, the highest among developed nations. Spending on health care in the United States exceeds $3 trillion a year. “The U.S. spends more on health care than any other country, but what we get for these significant resources falls short in terms of access to care, affordability and coordination,” said Commonwealth Fund President Dr. David Blumenthal.
And Now More Bad News
Healthcare experts and politicians certainly have a duty to express concern and offer fixes. The system isn’t delivering on its promise and the public is suffering. But how do you fix a system that consumes a sixth the nation’s GDP?
The answer may involve who currently holds the reins of power. President Trump promised to repeal and replace President Obama’s Affordable Care Act and new health legislation is making its way through Congress.
The fix to the massive engine behind the American healthcare system may go back 72 years ago to the McCarran-Ferguson Act, which removed the insurance industry from most federal regulations, especially antitrust measures. The act shifted control of the industry to state legislatures. Over time this led to insurers forming state-by-state monopolies and slowly withdrew marketplace incentives from the industry. Legislators initially intended to dismantle the act after ten years.
The intent of the act was to exempt insurers from federal antitrust laws when they shared patient information across state lines to determine risks.
Without federal authority prohibiting the formation of monopolies, insurers dictate coverage costs on state levels. Eliminating the regulatory exemption brings competition across state lines which would lower costs.
Shoppers have more choices and can make decisions based on coverage options and costs, forcing insurers to accommodate themselves to market forces or risk losing business.
Who Holds the Power?
Repealing the act would lift the regulatory restraints from the insurance industry and expand the marketplace while breaking the hold many insurers have over individual states. It would also shift control from pharmaceutical companies, the biggest moneymakers, to health practitioners.
Under Obama’s Affordable Care Act, insurers could retain nearly a fifth of their earnings but were required to spend the other revenue on patient care. The formula provided an incentive for insurers to audit doctors since that revenue wasn’t included in the percentage caps established under the ACA.
Redirecting the incentives away from doctor audits will foster greater competition by driving insurers to tap into larger pools of potential policy holders across state lines and shift the power back to healthcare practitioners, the logical place for making medical decisions. This will lead to more doctors wanting to join networks.
As an economic principle, the loosening of regulations to allow for greater marketplace competition has worked well in the past. The banking industry underwent economic revitalization following deregulation in the 1980s. The airline industry also experienced an economic resurgence in the late 1970s.
For chiropractors, the horizon shows promise especially for owners who choose to medically integrate their offices and provide cash services. As the industry undergoes deregulation, patients will be compelled to take additional responsibility for their care. That’s where chiropractors will be able to shine by allowing their patients to get a fuller view of the treatment options available.
While changes to healthcare industry are coming slowly, the future appears bright with the potential for increased marketplace competition, lower costs and more individually tailored treatment options.
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