Friday, February 19, 2010

Dear President Obama and guests of the President’s debate on healthcare reform

I believe it is possible to create a reformed healthcare system with the essential elements desired by both political parties. Please put aside partisan politics, pry open your hearts and minds and listen to what I am actually proposing. I say that because I have found that politicians seldom really listen. Instead, they translate what they hear into something they already planned to say.

We can provide universal healthcare to all U.S. citizens without adding to the deficit, while promoting individual responsibility and preserving a meaningful role for the private insurance industry. I call the system Americare. I know that name is already in use, but I like it.

1. At the center of Americare is a Medicare-for-all basic benefit package covering every U.S. citizen. [Please, dear Republicans, keep listening.] The total cost of providing care for every U.S. citizen for one year would be calculated at Medicare rates, divided by the total number of lives and discounted to 60%, creating a “single payer” annual premium. This premium would be the same for everyone and would thereby cover 60% of the cost of providing universal healthcare coverage. As with Medicare currently, the government would contract with insurance companies to serve as fiscal intermediaries to process and pay claims efficiently. The cost per life would be as low as possible because it would include everyone, including young healthy people who often do not pay for health insurance. This premium would be assessed against everyone but collected in a variety of ways. Those who are covered under Medicare or Medicaid would have the premium paid under those programs. Employees would have half of the premium deducted from their wages with the other half paid by the employer. Self-employed persons would be expected to pay the premium and those who do not would have it assessed against them as a tax. Those covered under unemployment would have this premium paid as a benefit. There would be no tax deduction applicable to payment of the premium.

2. The remaining 40% of the cost of covering every U.S. citizen would then be assigned to a system of payers very similar to the current hodgepodge of governmental and private insurance, and individuals. [Please, dear Democrats, keep listening.] The cost of providing coverage for this 40% “co-insurance” would be assessed based on individual and group loss ratios and risk factors depending on the nature of the coverage. Legislation would prohibit loss of coverage for pre-existing conditions and other nefarious insurance practices, but individuals with higher risk factors would pay higher premiums. If the patient will not quit smoking or lose weight, the premium goes up.

3. There would be no deductibles, but the 40% co-insurance would include mandated individual co-pays so that patients would pay something out-of-pocket each time they accessed healthcare. The individual co-pays would vary based on the underlying co-insurance. Medicaid beneficiaries might pay smaller co-pays than a patient covered under private insurance, but everybody would have to pay something. We cannot cover everyone without making everyone “feel” the cost of utilizing healthcare.

4. In addition to the basic benefit package provided through Americare, governmental and private insurance would be allowed/encouraged/required to offer additional benefits such as vision, dental, etc. A restricted, formulary-driven drug benefit would be provided through Americare and the rates paid to the pharmaceutical companies would be set by the Americare program, just as with all other healthcare providers. Expanded drug formularies would be available for additional premiums. Someone with money to pay for an expanded benefit package or “platinum” service would be allowed to find a willing partner to take his or her money.

5. Medicare would function basically as it does now, but there would be a tremendous savings over the current system because 60% of the Medicare “premium” would be based on the cost-sharing accomplished by putting everyone in the risk pool. The Medicare program would no longer be bankrupting the government. It does mean that young people would, in effect, be helping to pay for care of the elderly, but it is the fairest and most economical way of doing it. Someday those young people will be old. The state Medicaid programs would provide coverage for the 40% co-pay for covered persons—with coverage determined through a combination of federal and state mandates. Employer-funded groups would cover the co-pay through traditional commercial insurance. Self-employed persons would be required to purchase insurance through a newly created insurance exchange to cover the 40% co-pay. Individuals would also be allowed to “self-fund” the mandated insurance requirement through individual HSA investments. State Medicaid programs would be encouraged to create a virtual HSA account for Medicaid recipients to promote healthy life choices and to reduce over utilization. Those who reduced their co-insurance premiums would be allowed to choose additional benefits such as dental and vision coverage, education or child care.

6. In order to control the cost of care, it is important to include economic incentives for patients to reduce over-utilization and to maintain healthy lifestyles, which is why the premiums for the cost of covering the 40% would be based on individual rate factors. Insurers would still have financial incentives to develop innovative programs. Private insurance companies would be required to spend at least 88% of premium revenue on true medical costs (the so-called “medical loss ratio”).

7. In order to foster true competition among hospitals and doctors, Americare would mandate an “any willing provider” rule, but, since the pay would be the same for all providers, the competition would be for quality and efficiency of service. To maintain a level playing field, state and federal tax exemptions granted nonprofit providers would be phased out over four years—unless the provider was a true charity and received no money from patients for care.

8. The Americare program would create incentive payment programs to encourage quality and to create cost efficiencies. The program would encourage the creation of accountable care organizations, pooling providers into contracted affiliations rewarded for reducing the cost of care. Americare would mandate pay for performance incentives and would create economic disincentives for inefficient or poor quality care. However, instead of focusing reforms on mass-produced, “one size fits all” database-driven, mandated clinical pathways, Americare would promote the development of a nation-wide army of general practitioners, better trained and more highly compensated than specialists. Patients would be required to choose a general practice physician to supervise their care. These general practice physicians would be paid a monthly capitated rate for every patient assigned to them as the patient’s “medical home.” Chronic disease management and wellness care would be covered under the capitated rate, but acute care would be paid according to a fee schedule. The 40% co-insurance would not cover care accessed by the patient outside the medical home unless the general practice physician authorized it. Patients would be allowed to establish a medical home with any physician, but “home jumping” would be discouraged by financial disincentives.

9. There would be a four-year transition period to give private insurance companies and healthcare providers time to adjust to lower profitability.

10. Americare would be regulated by a national panel composed of representatives from all the stakeholders: patients, private insurance, governmental insurance, hospitals, physicians, CMS, etc.

Insurance and pharmaceutical companies will scream that they will go broke. The good ones won’t. They will make a rationale return for a legitimate service or product. Mega health systems will cry that they will close—that it is impossible to provide quality care on Medicare payment rates. No doubt less money will be spent on new facilities and new equipment for many years, but the healthcare delivery system will adapt and survive. Americare is one of those compromises that everyone would hate and complain about bitterly, but it would work.

Paul Taylor

Wednesday, February 17, 2010

Tax Advice: What To Do When Receiving An Erroneous 1099

Courtesy of Amazon.com

Springfield, MO – Though normally adverse to publicity, best selling poet and novelist, Paul Taylor, CEO of Ozarks Community Hospital, who is also one of the nation’s leading experts on healthcare reform, has decided to speak out against the conspiracy to suppress his work orchestrated by what he refers to as the dominant cultural hegemony. Mr. Taylor claims he has obtained proof by virtue of recently released official U.S. government documents that he is in fact one of Amazon’s most successful authors even though the media has refused to recognize his work.

Sarah Montgomery, one of his press agents working tirelessly to break through the official code of silence that has until now smothered his success, offered this personal insight into the drama that unfolded today in Springfield, Missouri: “Paul walked into the media room and threw down a pile of 1099s he got from Amazon in the mail yesterday. His royalties amounted to almost a million dollars last year. You know, some of us on team Paul were beginning to have doubts that the struggle was worth it. He kept telling us that his groundbreaking poetry and narrative fiction would change the world once we got the word out to the public at large, but, sometimes, when you are on the front lines fighting to promote avant-garde literature, you begin to have doubts. We all believed in Paul but it is certainly reassuring to see objective evidence validating our commitment to keep battling for him.”

Mr. Taylor spoke today at an impromptu gathering of his employed supporters: “I knew there was tremendous grass-root support for my work but I had no idea how strong the movement had grown until I received 1099 statements mailed to me directly from Amazon stating that Amazon.com and a number of its subsidiaries have paid me royalties on book sales in 2009 totaling $943,454.49. I hope to receive the checks soon because I have to pay the taxes on that income by April 15th.”

Mr. Taylor published two books in 2008: Grid, a prose poem that has been called the most important work in American poetry since Leaves of Grass by Walt Whitman, and Rehabitation, an experiment in narrative fiction that fuses novel and screenplay in an emotional thriller loosely based on Taylor family history that may soon become a major motion picture. Until he received notice of the 2009 royalties earned through sales of his work, Mr. Taylor had made less than $100 on sales of his books through Amazon.
“I am really excited that the books have begun to sell so well,” Taylor added. “I had slated Tom Hanks to star as the father in Rehabitation, to be directed by Ron Howard and produced by Steve Spielberg, but I was becoming concerned that Hollywood would lose interest if sales did not pick up.”

Janet Taylor, Taylor’s wife who is also CFO of Ozarks Community Hospital, commented: “I understood Diane Lane was supposed to play the wife in Rehabitation but I was concerned that if they didn’t start shooting the film pretty soon, they would have to go with someone younger.”

Taylor does not have much time to savor his success. “I have been contacted by one of President Obama’s people through an email I received to offer my thoughts on healthcare reform heading into the televised debate coming up next week. I have devised a comprehensive reform package that would completely solve the nation’s healthcare crisis by providing universal healthcare at no additional expense to the taxpayers while promoting individual responsibility and preserving a continuing role for private insurance in the payment system. I have to work out a few last kinks before delivering my white paper to the President.”

Paul Taylor is the CEO and general counsel for Ozarks Community Hospital. Paul Taylor’s Grid and Rehabitation are available on Amazon. His healthcare thoughts are discussed at http://ochhealthcarereform.blogspot.com/.

This Amazon tax error is widespread among authors. Read more here: http://answers.yahoo.com/question/index?qid=20100216122421AASbM8a.