Thursday, September 10, 2009

Who Caused the Healthcare Crisis?

Who caused the Healthcare Crisis? If we go back to the days before insurance, who paid for Healthcare? Prior to the 50’s few had Health insurance. Wage freezes were enacted by congress and signed into law by the president. This was done to curtail inflation. This was an artificial means of controlling inflation. Employers were allowed to offer Health insurance to employee’s tax free as an inducement to work for a company. Pre tax Health insurance is much better than after tax Health insurance.

This caused a decrease in Federal Tax Revenues as taxable income became pre tax benefits. In 1965 Medicare came along and placed a burden on workers. Though small at the time, Medicare could only grow in size and cost. During the 70’s Medicare’s growth was no fast that to save this “efficient” and “great” program from bankruptcy, congress passed legislation that defined Medicare reimbursement rates. These rates have gone from 100% in 1965 to a low of 70% today.

The reduction in reimbursement had to be paid by someone; otherwise the provider would go out of business. The provider than created two tiered pricing: Medicare and private. When Medicaid was passed, a third tier pricing was added. The result was escalating costs. Employers were paying more and so a new market was created, Health Plan Administration. These plans allowed companies to pull their collective size and negotiate with providers for lower rates. This created another pricing level within our healthcare system.

Is it appropriate for a provider to have different pricing levels based on quantity? Yes, when they can save money, increase efficiency and quality based on economy of size. However, when it comes to healthcare, economy of size is a very small component of the cost. A provider sees and treats one patient at a time. Though the more patients he sees increases utilization of staff, material purchases and consumable, it does little for overall efficiency of providing healthcare.

The cause of our healthcare problem is congress. They created the different pricing tiers, removed consumers from evaluating and choosing providers and now want the American people to let them do the same across the nation.

They tax 100% of our economy today. What happens when they are allowed to run 16% of economy?

What happens when they are allowed to run 16% of economy? Can anyone name one government agency that works?

  • Social Security
  • Medicare
  • Post Office
  • Security and Exchange Commission
  • U.S. House of Representatives
  • U.S. Senate

2 Comments:

At 5:35 PM, Anonymous Anonymous said...

Once upon a time the Government had a vast scrap yard in the middle of the Nevada Desert. Congress said, "someone may steal from it at night." So they created a night watchman position and hired a person for the job.

Then Congress said, "How does the watchman do his job without instruction? "So they created a planning department and hired two people, one person to write the instructions, and one person to do time studies and training.

Then Congress said, "How will we know the night watchman is doing the tasks correctly?" So they created a Quality Control department and hired two people. One to do the inspection audits and one to write the reports.

Then Congress said, "How are these people going to get paid?" So they created the following positions, a timekeeper, and a payroll officer… then hired two people.

Then Congress said, "Who will be accountable for all of these people?" So they created an administrative section and hired three people, an Administrative Officer, Assistant Administrative Officer, and a Legal Secretary.

Then Congress said, "We have had this command in operation for one year and we are $380,000 over budget, we must cutback overall cost."

So they laid off the night watchman.


Now, having read that. Read this slowly. Let it sink in. Quietly, we go like sheep to slaughter.


Does anybody remember the reason given for the establishment of the DEPARTMENT OF ENERGY... During the Carter Administration? Anybody? Anything? No? Didn't think so!
Bottom line. We've spent several hundred billion dollars in support of an agency... the reason for which not one person who reads this can remember!

Ready? It was very simple... and, at the time, everybody thought it very appropriate.

The Department of Energy was instituted on 8-04-1977. TO LESSEN OUR DEPENDENCE ON FOREIGN OIL!

Hey, pretty efficient, huh?

AND, NOW, IT'S 2009 -- 32 YEARS LATER -- AND THE BUDGET FOR THIS "NECESSARY" DEPARTMENT IS AT $24.2 BILLION A YEAR.

THEY HAVE 16,000 FEDERAL EMPLOYEES AND APPROXIMATELY 100,000 CONTRACT EMPLOYEES; AND, LOOK AT THE JOB THEY HAVE DONE!

THIS IS WHERE YOU SLAP YOUR FOREHEAD AND SAY, "WHAT WAS I THINKING and what are we doing?"

Ah, yes -- good ole bureaucracy.

And, NOW, we are going to turn the Banking system and the Auto industry and, and Healthcare over to the Government?

May God Help Us -- One and All!!!

 
At 12:59 AM, Anonymous folliculitis said...

The health crisis is the fault of bad organization between the government and hospitals ... I think with a desire and willingness to move can move beyond this issue ....

 

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