Americans spend more on healthcare as a percentage of GDP than any other country.for 10 years to 2020, premiums rose 47% and deductibles jumped nearly 69%. Even with employer-based health insurance benefits, employees now pay an average of nearly $6,000 compared to an average of $22,221 in employer family coverage.
Moreover, getting medical care has not only become more expensive, it has also become increasingly complex and difficult to navigate.
Think about it: Americans buy millions of new and used cars every year, regardless of age, income, or education level, but about the complexity of the engine, transmission, and all the software that makes a car run. I have absolutely no knowledge of But even without this knowledge, Americans seamlessly buy hundreds of billions of dollars in cars each year. That’s because you can research online for expert opinions from Consumer Reports, Edmunds, and Kelly Blue Book so you can make an informed choice.
But when it comes to medical care, medical/healthcare experts say there is an “asymmetry” in the medical sector and therefore the general public is unable to make informed decisions. The public does not have the same information as doctors and hospitals. This lack of transparency in healthcare purchases, and employees’ reliance on employer-based insurance to pay bills, further distances employees from their true costs.
The way we pay for health services violates basic economic principles. In other words, in a market transaction between a willing buyer (in this case a patient) and a provider (doctor or hospital), transparency allows the buyer to: Determine the value of services provided or goods purchased.
The good news for both employers and employees is that America is moving in the direction of healthcare consumption. The cost is so high that employers have voted with their own money by opting out of the traditional medical insurance market.
Fortunately, promising alternatives to traditional medical insurance are emerging. Here are some examples.
- Restoring the doctor-patient relationship.
Physicians are increasingly frustrated with the role insurance companies play in approving the procedures and medications they prescribe for their patients. After all, a doctor has one-on-one contact with a patient and has the expertise to determine what is needed. Insurance company representatives have neither. Initiatives such as Direct Primary Care and Concierge Medicine are underway. In such initiatives, patients pay a set monthly fee for same-day or next-day doctor access, taking insurance intermediaries out of the equation. Specialized treatment is referred to other doctors, and surgery is performed in an outpatient center or hospital. - transparent pricing.
The Free Market Medical Association (FMMA) is one of the pioneers of the medical revolution. Founded by Jay Kempton, owner of The Kempton Group Administrators, and Dr. Keith Smith, his director of medicine at the Surgery Center of Oklahoma (SCO), the association helps hospitals and traditional hospitals reduce healthcare costs while reveals overall overcharges due to medical practice. Dr. Tired of banging heads with hospital administrators. Smith and Steve Lantier created a cash-only clinic and recruited other surgeons who wanted to practice medicine without interference from insurance companies and bureaucracy. One of her uninsured patients who needed a breast mass removed, the hospital estimated him at $19,000. This is 10 times his price charged at SCO. This group proves that a more market-based environment delivers efficient, value-based care. - self insurance.
Due to medical inflation and the associated high medical premiums, more and more employers are ditching insurers with self-insurance. In large American companies, 82% of employeesFully or partially covered by self-insurance. Self-insured group plans allow employers to customize their employees’ insurance coverage. Depending on the company’s demographic and culture, self-funded plans may include benefits that employees wish to cover, such as dental, vision, prescription drugs, chiropractic or acupuncture.
By exploring the options now available through medical entrepreneurs, employers can reduce the cost of medical insurance and put money in the pockets of their employees. This is an attractive advantage in today’s tight labor market, without having to save on medical bills.
By Murray Sabrin.
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