Hospital hardball?

The City of Dayton spends $25 million a year on health insurance for its employees and dependents. The county may spend just as much. Throw in the other municipalities- and it’s got to total somewhere around $100 million.

That should buy a lot of health care. In fact- since the insurance companies skim off between 25 and 35% for their overhead- buying direct from the medical professionals should instantly give the communities a huge discount.

Now- take it one step further- who brings most of the severely injured patients to the hospital? Our fire departments- that’s right. Imagine, if the ambulances stopped rolling up to the door bringing the hospitals customers? What if they took their customers to “County General” instead? (Hmmmm, remind you of ER on TV?). That’s right- some places have “public hospitals”- that are run as true non-profits and actually serve everyone in the community the same way whether you have insurance or don’t.

There isn’t another business in the United States that can sell you something without stating the price up front. There isn’t another business in the United States that can sell services at one price to members of a private club, and a much higher price to those who aren’t members. In any other business- these practices would be called unfair, monopolistic and anti-competitive as well as discriminatory.

Yet, our duopoly of medical care- continue to build new expensive facilities, with taxpayer support, while paying no property taxes to support the services that actually bring them customers. Pretty nice gig if you can get it.

The cost of health care for our government employees is a big part of what’s breaking the bank. It’s time to reevaluate our health care equation. Here are some suggestions:

  • End discriminatory pricing for the uninsured. Hospitals must charge uninsured patients the same price as for insured patients.
  • Imagine if we treated hospitals the same way we do towing companies, making them bid for the opportunity to treat/tow? The hospital with the highest bid- gets the most patients? It’s time for the hospitals to subsidize their patient delivery systems with a fee back to the city. Otherwise, we will deliver only to publicly owned facilities- or to property that pays taxes (see next suggestion).
  • In the same way that Charter Schools are expected to pay property taxes while public schools do not, hospitals that are privately owned must pay property taxes. The tax break for hospitals, which are making huge property grabs must stop- or only be granted for actual treatment space- and only those treatments that adhere to the equal billing principle above.

The public hospital will provide services at a fixed price system directly to businesses and residents of the co-op/mutual hospital, giving local business a third choice for medical insurance, without the overhead of the private insurance companies. The two choices are a la carte services at the fixed price- where all services must be paid for in advance, or- covered through a mutual pool, from membership in the system (yes- a mutual community insurance pool)- with profits either being reinvested or distributed back to the shareholders. Bonuses would be given to medical practitioners based on the community’s health).

We already have a “public health” authority in the county – but its scope and services are limited to services provided to those who can’t pay – doing a service for the corporate hospitals. It’s time to take the duopoly on.

We can’t afford not to.

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3 Responses

  1. truddick December 7, 2010 / 9:39 am
    Other businesses that aren’t required to state their prices up front:
    Auto dealers.  Oh, they have a sticker price, but secret shoppers have shown that the negotiated price is higher for blacks and women…
    Construction firms.  Oh, they make a bid.  Then there are the overages…
    Defense contractors.  When was the last time a major new piece of military equipment came to the government at or under the original bid?
    Lawyers.  Don’t you know about billable hours, Dave?
     
    Having expressed my issue with your main complaint, I note that the main reason health care costs are outrageous is that, like education, health care suffers from administrative bloat.  When I worked in a hospital four decades ago, the entire administrative staff fit into one small wing; there was only a CEO and a financial staff–and the medical staff made health care policy decisions.  In a few short years, the same hospital picked up an assistant CEO, a CFO (who was a fool), and the administrators started telling the doctors what to do.
    Of course, bigger administrations are now needed to haggle with the for-profit insurance firms.  Get a non-profit insurance option and trim back the administrators to 1950 levels and see where health care costs come down to.
  2. joe_mamma December 7, 2010 / 10:43 am
    I would call administrative bloat more of a symptom than a cause of medical costs.  Most administrative bloat is a result of government (Federal and State) regulation, the employer insurance model (which started because of government regulation) and lawsuits.  Also a significant portion of high costs is driven by standard of living.  Americans have a high standard of living so we are willing to spend more money on health care at least until the government says we can’t.

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