Reason vs. Rhetoric: The Health Care Reform Debate

The following is a speech presented last fall by former Lakewood family physician Michael John Kelly to the Lakewood Republican Women’s Club. The speech covered the then upcoming Congressional debate on health care. After closing his Lakewood practice in June, Dr. Kelly joined the staff of the McChord AFB Family Practice Clinic.

During his years of service in Lakewood, Dr. Kelly was a frequent speaker on health care, insurance and other medical field issues that were often controversial. He has authored a number of articles for local and regional publications over the years and engaged in public debates with prominent attorneys and others.

Dr. Kelly received his medical degree from the University Of Cincinnati’s College Of Medicine and did his training at Oregon Health & Science University. Never one to shy away from hot topics, his remarks to the GOP women explains his point of view on health care.

INTRODUCTION

DISCLAIMER: This is NOT a town hall meeting. I am not a racist, fascist or reactionary member of the mob. I am also not a swastika waving, neo-Nazi or a member of the Hitler Youth no matter what Gore Vidal says. Former President Jimmy Carter insults me when he blasts administration critics, as fear-mongering racists. PLEASE!

It is an honor and privilege to address your organization about this very vital and important issue. I appreciate the invitation extended to me by Charlotte Carrell representing your Republican Club.

Your leadership invited me because of their confidence that I might be able to clear some of the smoke and break some of the mirrors that have obscured this issue of Health Care Reform. Thank you for your confidence, I hope to meet your expectations.

On a more personal note, this is an opportunity at redemption for me. Just last June I made many of you medical orphans as I closed my Lakewood practice to work at McChord AFB Family Practice Clinic. Permit me to atone by being very topical, informative and energizing.

Before we begin let us take a moment to acknowledge the five-member Nobel committee for a job well done. The recognition they bestowed is certainly long overdue. And so hats off to Elizabeth Blackburn, Carol Greider and Jack Szostak, the three American scientists awarded the 2009 Nobel Prize in Medicine on October 5th for discovering how chromosomes act to protect themselves from degrading when cells divide. Way to go, Nobel Committee!

Tonight I propose to discuss the underpinnings of the reform movement itself and why much of it is fable rather than fact. I hope to give you tools to counter much of that confusing rhetoric. We will delve into the proposed solutions put forth by the present administration – and suggest a reasoned, appropriate and fiscally sound alternative. All that in just 4 hours! What a bargain! Pillows will be passed out, of course …

What is missing in the fire and flourish of debate so far is what the doctors think of all this. How many of you have discussed health care reform with your doctor? I don’t pretend to speak for organized medicine, but I can tell you that other physicians share many of my comments.

And about those comments – my statements reflect my own views, not the positions taken by any organization.

Many of medicine’s specialists have already made known their feelings known about the administration’s plans for health care reform:

The Allergists voted to scratch it
The dermatologists advised not to make any rash moves.

The gastroenterologists had sort of a gut feeling about it, but
the neurologists thought the administration had a lot of nerve.
The obstetricians felt they were all laboring under a misconception.

The ophthalmologists considered the idea short sighted –
the pathologists yelled, “Over my dead body!” while
the pediatricians said, “Oh, grow up!”

The psychiatrists thought the who idea was madness,
the radiologists could see right through it, but
the surgeons decided to wash their hands of the whole thing.

The internists thought it was a bitter pill to swallow, while
the plastic surgeons said, “This puts a whole new face on the matter.”

The podiatrists thought was a step forward, but
the urologists felt the scheme wouldn’t hold water.

The anesthesiologists thought the whole idea was a gas, but
the cardiologists didn’t have the heart to say no.

In the end, the proctologists left the decision up to
the assholes in Washington.

My impression is that most Americans have decided sometime, between the oath of office on January 20 and now, to NOT leave the decision up to the administration and the congress.

But it seems like the tone of the debate is between

• the badly misinformed
• the rigidly ideological &
• the actively hallucinating.

Good thing those three people aren’t with us tonight. The 28th District Republican Club members have always been both knowledgeable and politically active. I hope my comments are useful for your continued political efforts.

Let me be clear: whenever I criticize our elected officials, including the President I am professing my disagreement with policy not person. Let’s fix the problem, not denigrate the individual.

Let’s begin with THE STIMULUS – HR 1 – aka THE AMERICAN RECOVERY & REINVESTMENT ACT of 2009

This is supposed to be about health care reform, so why am I bringing up the “stimulus” bill? ANS: Because it contains significant elements of health reform

– AND OUR CONGRESS VOTED & FUNDED IT WITHOUT READING IT!

Remember the time line?

• Barack Obama is sworn in as President on January 20
• HR 1 is introduced 6 days later on Jan 26
• House of Representatives passes it 2 days later on Jan 28
• US Senate passes it 15 days later on Feb 10
• The President signs it 7 days after that on Feb 17.

Total time: 28 days! Whew!!

Hidden within that STIMULUS package were two very important health care reform items unseen as it was passed:

The bill established a new bureaucracy –
The Federal Coordinating Council for Comparative Effectiveness Research – AKA THE FCCCER with a budget of $1.1 billion dollars.

It also created a Department of Health Information Technology with a budget of $20 billion.

A little audience participation seems in order here. Every time I refer to the FCCCER, I will point to you and you say, the FEDERAL COORDINATING COUNCIL FOR COMPARATIVE EFFECTIVENESS RESEARCH, OK? Let’s try it once. …GOOD. (can tell them about Tom Dashle’s idea about long titles)

One of the goals of the FCCCER (pause & point) the Federal Coordinating Council for Comparative Effectiveness Research is to apply a cost – effectiveness standard set up by the Federal Council modeled after a rationing board in Great Britain known as the National Institute for Clinical Excellence – NICE. NICE relies on an evaluation from the Orwellian-sounding “quality-adjusted life year” (QALY) to determine if a medical intervention is a “reasonable value for money.”

The FCCCER, (pause & point) the Federal Coordinating Council for Comparative Effectiveness Research like NICE, is expected to approve or reject treatments using a formula that divides the cost of the treatment by the number of years the patient is likely to benefit. It may also try to slow the development and use of new medications and technologies because they are driving up costs.

In Great Britain NICE, which is part of the National Health Service (NHS), is the single entity responsible for providing guidance on the use of new and existing drugs, treatments, and procedures and also weighs what it calls, “economic evidence” or how well the medicine or treatment works in relation to how much it costs.

Dr. David Blumenthal, the National Coordinator of Health Information Technology will utilize his $20 billion from HR 1 to lead a board who will track your medical treatments electronically. The government further plans to network thousands of hospitals, doctors’ offices, and laboratories.

Putting the government in charge of such a massive and complex endeavor is to guarantee a regulatory mess. Especially since there are already at least 12 different federal agencies with overlapping oversight when it comes to health care technology.
There is concern that another purpose of the office of HIT is to monitor treatments through the EMR to make sure your doctor is doing what the federal government deems appropriate and cost effective. The goal is to reduce costs by guiding your doctor’s medical decisions.

So Health Care reform got a running start less than a month after the inauguration – AND WE DIDN’T EVEN KNOW IT AT THE TIME!

Overview

We have been told that we must radically reform our present system of health care NOW because it’s broke.

Just look at the numbers that show the US ranks 29th in life expectancy, 42nd in infant mortality and 37th overall by the WHO. And we’ve got 47 million Americans without health insurance. These are the statistics very frequently referred to when discussing the need to reform our present system.

Regarding infant mortality, defined as the number of deaths per 1,000 live births, the US ranks 42nd in the world behind Portugal, Slovenia, Malta, & Cuba.

Regarding life expectancy the US comes in a dismal 29th behind Bosnia, Jordan and Cypress.

The WHO puts the US at an unflattering 37th for overall health care out of 191 countries – according to the WHO, Costa Rica, Morocco & Cypress have better health care systems than the US.

Experts claim with these “facts” socialized medicine is much better at taking care of all the people’s medical needs. Only by adopting government health insurance do Americans have a glimmer of a chance of improving patient outcomes and cutting costs.

So those are the so-called “facts”. It’s enough to make you depressed. When your liberal brother-in-law brings these “facts” up how do you answer? We will re-visit these “facts” later tonight and explain why they are wildly incorrect, but in the meantime, be comforted by the words of humorist Josh Billings who once said:

“It ain’t ignorance that causes the trouble in the world – it’s the things people know that ain’t so.”

• Socialized Medicine

Let’s consider the case for socialized medicine. Like participants in a world- wide science fair, world governments, over the decades past, have tested most of the major components of the health-care reform plans currently being considered in Congress. So why not learn from their experience?

As long as you’re not misinformed, rigidly ideological or hallucinating, the results reveal dramatically increased premiums or taxes, spiraling public health-care costs, and reduced access to care. The science fair shows lack of access to latest technology – dwindling doctor supply and long lines. In other words: THE SOCIALIST HEALTH CARE REFORMS HAVE FAILED THEIR SCIENCE FAIR TESTS!

CANADA

Canada has approximately 33 million people with 800,000 on waiting lists at any one time for surgery and other necessary treatments according to “Statistics Canada”. Average waits have gone from 9 weeks 15 years ago to more than 18 weeks now.

As Madame Chief Justice Beverly McLachlin of Canada Supreme Court recently said, “Access to a waiting list is not access to health care.”

Canada has a doctor shortage according to the Organization for Economic Cooperation & Development (OECD). Canada ranks 24 out of 28 OECD countries in doctors per 1,000 people. In 1970 when the government took over the health care system, it ranked 2nd.

Canadians can’t find a PCP. 10% of the population at any one time is actively seeking a primary care physician.

• 11% of physicians trained in Canada move to US – AND WHY NOT?
• The Average Canadian MD earns only 42% of what an MD in the US earns.
• In fact, the Canadian govt. finds it cheaper to bring in International Medical graduates from Pakistan & India rather than trying to keep their own.

Canadians have technology limits compared with other OECD countries:

• Canada 13th out of 28 in access to MRI’s
• Canada 18th out of 28 in access to CT scanners
• Canada 7th in access to mammograms

Canada has limited drug coverage. The Canadian Health Act doesn’t provide universal prescription drug coverage – only requires each province to cover drugs delivered to hospital patients. 66% of Canadians pay out-of-pocket for outpatient drugs.

If we are to adopt the Canadian system let’s compare it to the US:

Cardiovascular disease is still the world’s #1 killer. In the US we rank well ahead of Canada in all categories. According to the OECD, in 2004 the US performed 145.4 coronary bypass surgeries per 100,000 compared with 91.4 in Canada. That same year there were 434 angioplasties performed in the US compared with 138 in Canada. And the heart attack death rate per 100,000 was 40.2 in the US but 41.5 in Canada.

AND YET THERE ARE THOSE WHO WISH TO EMBRACE SUCH A SYSTEM??

Let’s talk about GREAT BRITAIN –

Example: In November 2006 David Burke, 68 year old with colon cancer in remission sought routine follow up dictated by his physicians. His GP referred him for hospital consultation but more than a year later he still hadn’t got his follow up. His “free” check-up had been cancelled 48 times in a row!

• At any one time, more than 1 million Britons in need of medical care are waiting hospital admission
• More than 200,000 are waiting to get on a waiting list
• Each year Britain’s NHS (NAT’L HEALTH SERVICE) cancels around 100,000 operations.
• Britain’s hospitals are in disrepair. Every year more than 100,000 patients contract hospital acquired illnesses & infections. Up to 40% of NHS patients are undernourished while in the hospital

We talked of how Canada compares to the US in regard to cardiovascular statistics, but what about Great Britain? According to statistics compiled by the Organization for Economic Cooperation and Development (OECD) for 2004, Great Britain lags significantly behind:

Statistics reveal a nearly three to one ratio of coronary bypass surgeries per 100,000 population performed in the US compared with Great Britain There were 434 angioplasties performed in the US versus 81 performed in Great Britain. Finally, the heart attack death rate was 40.2 / 100,000 in the US compared with 49.3 in Great Britain.

Once again, THIS IS A SYSTEM THAT WE CHOOSE TO EMULATE?

And then there’s Britain’s NICE:
Example: Britain’s Katie Brickell was diagnosed with cervical cancer at age 23, she tried to get a routine pap test three times prior to her diagnosis but was refused because Great Britain’s national government rationing board, the National Institute for Clinical Effectiveness that controls what treatments or tests patients may receive will only pay for screenings for women 25 or older in an effort to cut costs.

Denied this routine test by NICE, Katie’s cancer was found at a late stage. Here, US physicians perform pap tests when the patient becomes sexually active – or at least by age 21. Katie’s cancer is terminal. Her story is not unique, and mirrors the experiences of many of Great Britain’s 61 million citizens trapped in its NHS.

The reasons for the establishment of NICE by Great Britain, to advance evidence-based medicine, root out under-performing doctors, useless treatments and ensure that every treatment, operation or medicine used is the proven best, are the same as voiced by the Obama administration in forming the FCCCER – Federal Coordinating council for Comparative Effectiveness Research.

Although the goals of NICE seemed to be laudable initially its recommendations and guidelines are now used to deny coverage to British citizens on a daily basis.

How will the decisions of the FCCCER – the Federal Coordinating Council for Comparative Effectiveness Research – and its $1.1 billion dollar budget be used in the future?

AS mentioned, NICE relies on the evaluation from the Orwellian-sounding “quality-adjusted life year” (QALY) to determine if a medical intervention is a “reasonable value for money.” In effect, QALYs are used to determine if a medical intervention is a “reasonable value for money.”

For example, in 2008, NICE refused Tarceva for lung cancer despite studies showing it significantly prolongs life as “too expensive.” That same year NICE refused Orencia for RA, a very important clinically proven mediation as “not a cost-effective use of NHS resources.”

One of President Obama’s first acts upon taking office was to provide $1.1 billion through his “stimulus” package for the FCCCER (PAUSE AND POINT) the Federal Coordinating Council for Comparative Effectiveness Research, modeled after UK’s NICE. Remember once again, the bill was passed without legislators reading it, let alone studying its provisions.

The Obama administration requires the information from the FCCCER – (pause and point) the Federal Coordinating Council for Comparative Effectiveness Research. Without having the comparative effectiveness data, there would be no way for the government to approve or disapprove certain drugs or treatments. Therefore, the collection and analysis of this data is a first step to application of the data.

This national board is a first step towards rationing care in the US.

The US is heading down a road where health cost replaces the value of health care. Injecting a government bureaucracy between patient and doctor in the name of cost can only lead to sacrificing care for those whose perceived life value cannot meet the government’s cost/benefit standards.

I had anticipated discussing other European health systems but in as time will allow me only one comment regarding other systems such Switzerland and France, let me say:

European governments have not figured out a way to deliver health care for less money – they’ve simply figured out a way to ration care.

Health statistics

But how can we say we have the best medical system when we are so terrible in life expectancy, infant mortality, not to mention our place as the WHO sees us. Let’s return to them, we’ve let them fester long enough.

US ranks

• 29th in life expectancy
• 42nd in Infant mortality
• 37th out of 191 countries for overall health care by WHO

So how do you defend yourself when your liberal brother-in-law from Walnut Creek waves these statistics in your face as a means of proving that our present system is terrible and must be overhauled?

Let’s start with life expectancy:

Life Expectancy: The debate should center on how the healthcare system impacts life expectancy but it doesn’t. Our life expectancy includes other issues that are never brought up: environmental, genetic, cultural, psychosocial and behavioral. Two of the largest contributors are behavioral – homicides and traffic accidents.

Using 2004 data from the US Dept of Justice you can see how our homicide rate of 5.9 / 100,000 is significantly higher than Canada or Europe.

Obviously, homicides, which are not the result of our health care system impact life expectancy dramatically.

But what about traffic accidents? America once again leads Canada and European fatalities –statistics that greatly affect our overall life expectancy.

Traffic Accidents:

• In 2006 US had 14.24 fatalities per 100,000
• In 2006 Canada had 9.25, France 7.4, Germany 6.19

Robert Ohsfeldt of Texas A & M and John E. Schneider of the University of Iowa concluded in their book, “The Business of Health: The Role of Competition, Markets and Regulation” 2006: “Americans who don’t die from homicides or car accidents outlive people in every other Western country”

In an article in the NY Times, November 2007, Harvard Economist Greg Manikiw, referring to our Life expectancy placement noted: “Maybe these differences in life expectancy have lessons for traffic laws and gun control but they tell us nothing about our system of health care.”

But what about infant mortality? The US ranks 42nd, a ranking which, it turns out tells us less about the quality of our nation’s health than the statistical differences between what other nations consider a “live birth”.

The WHO defines a LIVE BIRTH: “Any infant that, once removed from its mother, breathes or shows any other evidence of life such as beating of the heart, pulsation of the umbilical cord, or definite movement of voluntary muscles.”

• The US follows the WHO definition – counting the births of all citizens that show any signs of life, regardless of birth weight or prematurity.
• Other nations do not agree with the WHO definition, preferring their own – giving them a statistical advantage to the US.
• FRANCE: The French government requires “a medical certificate stating that the child was born alive and viable” in order to attest to the death of a baby.
• Switzerland: “An infant must be at least 30 cm (about 12 inches) long at birth to be counted as living.”
• France & Belgium: babies born at less than 26 weeks are automatically registered as dead

If the child is not born alive and viable – it does not become part of infant mortality stats.

This can significantly alter statistics that many critics of our health care system use to “prove” the system must be dramatically reformed.

The US has sophisticated neo-natal units that regularly save babies born less than 26 weeks or less than 30 cm long. Such a commitment is not seen in Canada or Europe.

WHO ranking 37 out of 191 ? – what’s up with this ranking? As you might suspect, it is more of a statistical issue than one of medical care.

• A significant portion of our ranking for population health was our overall life expectancy (including traffic accidents and homicides), which we have already discussed.
• Another significant portion of our ranking was the “distribution of health” or “fairness”. By this logic, the WHO felt treating people EXACTLY THE SAME is more important than treating people well.

Thus, so long as everyone is equal – even if they’re equally miserable – a nation will do well in the WHO ranking.

So tell your brother in law, sister in law, or any liberal who will sit still for a few minutes that the US is not 29th in life expectancy or 42nd in infant mortality or 37th out of 191countries according to the WHO.

These inaccurate and misleading placements are repeatedly mentioned by those anxious to change our health care system and improve rankings by plunging into the abyss of socialized medicine and trillion dollar deficits. The statistics are incorrect as is the radical conclusion based upon them.

THE 47 MILLION UNINSURED

OK, but you have to do something about those 47 million uninsured!
Right? I mean, EVERYONE quotes these statistics. They must be correct.
Wrong.

It is interesting to note that the percentage of Americans uninsured has slightly decreased since 1998 according to the US Census Bureau.

According to the 2007 US Census Bureau:

• 1998 16.3% US citizens were uninsured
• 2003 15.6% US citizens were uninsured
• 2007 15.3% US citizens were uninsured

The perception is that the 47 million never have had access to health care and are destitute, the kind of folks who desperately need govt. help. This statistic is constantly referred to as a reason to destroy our present system and embrace socialized care to take care of these 47 million.

Only thing is there is no 47 million uninsured!

People assume the 47 million are chronically uninsured for an entire year or more. This is not the case at all. It reflects the number of people uninsured at a specific point during the year. These are people who may be temporarily between jobs or in transition. They are NOT permanently uninsured.

WHO ARE THE 47 MILLION UNINSURED AMERICANS?

• 10 million are not Americans – they are not US citizens. And the administration’s reform is not designed to cover them. Although they lack health insurance they can get free care through emergency departments anywhere in the US.
• 18 million earn > $50,000 / year (of that group 10 million – more than half – earn > $75,000 / year. These are the “INVINCIBLES” – young people who feel they will not get ill. They are the voluntarily uninsured and choose not to purchase health insurance but pocket the monthly premiums. They represent those 19 to 29 and are the fastest growing uninsured portion of the population.
• 14 million are fully eligible – These are poor and low-income people fully eligible for the generous assistance of Medicaid, Medicare and SCHIP but THEY DON’T SIGN UP! No matter what health care reform occurs, it will not help those who don’t sign up. 70% of uninsured children are eligible for Medicaid or SCHIP but have not done the paper work. 27% of non-elderly uninsured Americans eligible for Medicaid haven’t enrolled.

So according to the US Census Bureau, that accounts for 42 million. What about the remaining 5 million?

• 5 million working poor – This should be the true focus of our health care efforts. They are chronically uninsured working poor covered for emergency care but not preventive care. To create a stifling bureaucracy with an estimated $1 trillion price tag to rescue this group is legislative malpractice.

They need coverage they can afford which will cover catastrophic events. It entails creating affordable basic coverage without mandates that will allow individuals to purchase insurance across state lines.

The Administration’s Solutions:

Exact details seem to change daily but I would like to mention some highlights:

• According to the recent Congressional Budget Office (CBO) analysis, the Senate Finance Committee’s health care bill will cost an estimated $829B (over 10 years) cover 94% of all eligible Americans – leaving out approximately 25 million uninsured Americans, and reduce federal deficits by $81 billion in 10 years.

A report by PriewaterhouseCoopers released yesterday October 12 said that Senate healthcare legislation would lead to increases in annual insurance premiums of as much as $4,000 by 2019.

• White House Spokesman Reid Cherlin said the CBO analysis “confirms that we can provide stability and security for Americans with insurance and affordable options for uninsured Americans without adding a dime to the deficit and saving money over the long term”.

A weak mandate coupled with measures preventing insurers from baring people with pre-existing conditions will fuel rapidly rising costs and will add many more dimes to the deficit with no savings.

• Beginning in 2013 the measure would require millions of Americans to purchase private insurance for the first time. Failure to obey the requirement would result in penalties of up to $1,900. Failure to pay the fine could result in jail time for up to one year and a fine of $25,000!

You call this the “American Way?” And the IRS would be the government agency coming after you.

• Trim $500 billion from Medicare over 10 years

The unfunded liability for Medicare today is at least $45 Trillion, and it may be as high as $67 Trillion! Thus trimming $500 billion is a drop in the bucket!

• Eliminate $400 billion of fraud in Medicare

The government has had its chance.

• In reality the government would not “compete” with the private plans at all. It would set its tax subsidized pricing well below private plans and “crowd out” the private insurance carriers leaving the government as the only health care insurer.

• Medicare reimburses hospitals at 70% and physicians at 80% of the private insurance rate. By eliminating the private carriers, hospitals and doctors who are now cost shifting their losses to private insurance plans would be forced to close their doors! This would greatly decrease access to primary and specialty care!

• With the government in complete control of our health care system, prices and reimbursements would be fixed and subject to Congressional politics every session, access and benefits would be dictated by bureaucrats, and ultimately rationing would occur, probably, as in Canada, through the use of patient waiting lists and as in Great Britain as with the use of outright rationing through NICE.

• I believe we are truly at the brink of losing what is left of our health care choice and market competition in health care in the US.

• If passed the administration’s plan will destroy the private market and will force all US citizens into a government controlled health care program.

Conservative Solutions

So if we do not go along with the present administration’s plans what can we do?

Our system is far from perfect, but not so imperfect that it needs drastic, radical and ridiculous renovation. Reform is needed but to accomplish this the health care system requires less government interference – not more! Only with a freer market can we lower costs and achieve quality universal health care. With universal choice in health care, we will reach our goal of universal coverage.

Overarching principle: Make insurance affordable and accessible to all.

Here are a few ideas to lead us to affordable, high quality, accessible health care:

Change the Tax Code: Give individuals the same tax break that companies already receive when buying health coverage. This would level the playing field.

• Reform the tax code to provide refundable tax credits – $2,500 for individuals and $5,000 for families
• Change the tax code to allow income tax deductions for health care expenditures – $7,500 for individuals and $15,000 for families.

Either change would give all Americans the same tax benefits already enjoyed by those with employer-based insurance. Either one would completely transform the health care market. Workers could purchase their own insurance tax free, and wouldn’t have to worry about losing coverage between jobs. Best of all, individuals could choose the insurance package best suited to their needs, as opposed to their employer’s needs.

Reduce costly government mandates & regulations: Excessive state mandates and regulations – like “guaranteed issue” and “community rating” – drive up the cost of health care. According to the Council for Affordable Health Insurance, mandated benefits can increase the cost of health insurance up to 50 percent.

Some mandates may be defensible but most aren’t. Insurance should not be required to cover treatments like massage therapy, breast reduction, in-vitro fertilization, and hair prosthesis. These are hardly critical components of a good health insurance policy.

Mandated benefits increase the cost of health insurance, reduce choice, and increase the number of people without insurance.

• At last count, early 2009, there were 2133 total mandates among the 50 states, an average of about 42 / state
• WA State has 57 mandates
• The states should all consider issuing a basic insurance plan that provides standard coverage, unburdened by costly mandates.

Mandated benefits increase the cost of health insurance, reduce choice, and increase the number of people without insurance.

Allow the purchase of insurance across state lines: State borders act as regulatory walls, denying Americans access to health insurance plans in other states.

Due to state regulations a standard insurance policy in one state can be more than 5 times more expensive than a standard policy in another state.

• Example: 25 year old from New Jersey would have to shell out about $5,580 each year for a standard health insurance policy that would cost just $960 annually in Kentucky.
• Allowing people to shop around for the best value in the insurance marketplace, we could dramatically lower costs, while expanding the number of options available to consumers.

Expand Health Savings Accounts:

An HSA is a tax-free, interest-accruing savings account that can be used to pay for routine medical expenses. It is purchased in tandem with an inexpensive, qualified, high deductible insurance policy designed to cover major health care costs.

• HSA holders can spend $ tax-free on health care
• HSA funds build up over time and may act as a retirement savings plan
• HSA plans put the “insurance” back into health insurance.
• Six million Americans have HSA – compatible health insurance

As of 2008, individuals are allowed to contribute up to $2,900 each year to their HSA’s – Families up to $5,800. By raising this limit and reducing some restrictions, like the size of the highest allowable deductible, Congress would make HSA’s even more appealing.

Implement Tort Reform:

Defensive medicine costs have been estimated at $200 billion / year. This is the possible savings that could be realized with meaningful medical liability reform.

Containing health care costs is impossible under the current legal structure. Studies repeatedly demonstrate that the current ad hoc system of justice, with verdicts that vary widely from one jury to the next, has spawned a culture of legal fear and self-protection. Also it shows the system fails injured patients – taking an average of 5 years to resolved a case with nearly 60 cents out of every dollar spent going to lawyers or administrative costs.

One answer is special health courts, already common in America as courts for bankruptcy, tax disputes, workers compensation, vaccine liability tribunals and more.

Provide Vouchers for Working Poor:

Reducing regulations and using the free market won’t solve all our health care problems. It would still leave behind those who do not have employer-provided coverage, are chronically ill or who earn too little to afford private insurance but too much to qualify for welfare.

A system similar to the school vouchers developed by Nobel Prize-winning economist Milton Friedman could help the chronically ill and working poor to purchase insurance from a private company or a high-risk state pool. This system looks to help catch those who may “fall through the cracks”.

By providing vouchers, government can ensure that everyone has insurance, without bogging down the health care market in a quagmire of red tape.

Conclusion

America’s health care system is in need of reform, a process that is ongoing and began nearly a century ago. Never before, however have we faced such stark choices.

We can let the government take over and run health care as it has run other public interests including social security, Medicare, Medicaid, and the US Post Office. We can let government interfere in our lives by reducing our health care options, imposing mandates, raising taxes, distorting the open market, and creating unacceptable debt.

OR we can put doctors, patients and consumers in charge by liberating the health care market, maximizing choice, spurring innovation and controlling debt.

Thank you for your kind attention.

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