Wednesday, March 26, 2008

The Healthcare debate (Cont)

I didn't realize what a hotbutton issue healthcare was. So, I'll elaborate a little more.

PART I - Prices go up

My brother and I own a towing business as many of you may know. It's a lot sexier than it sounds, and we're only one year into it, but I have gained a lot of perspective on this issue based on the nature the towing business and my tax prep business.

A business offers goods and services to make profit.When the customer pays the business out his/her own pocket, and there is a reasonable amount of competition, the business sells the good or service at the most competitive VALUE. This means that prices stay competitive, and services rendered are striving to be superior to the competition. The consumer is making a decision that serves HIS/HER OWN best interest. The consumer is VERY concious of price, and demands that the VALUE of the service provided be worth as much or even more than price that he/she pays.

If the customer outsources the purchase power of the good or service to an insurance company things then change. The insurance company is now in charge of making purchasing decisions for many consumers. What changes is this, the insurance company is focused more on growing revenues, than it is on minimizing expenses. The insurance company is LESS concious of price than the individual consumer, and therefore, business begins to charge more for the same level of service. In addition, the business caters to the interests of the insurance agent, and woo's him/her with gifts to direct his/her purchasing power to said business. (Not saying that's what we've done but I do need to add that to the marketing plan.)

It works much the same, if not becomes more severe when a gov't contract is involved.

THe reason that healthcare costs are so high, is because we've been running via our health insurance systems for so long. When was the last time that you paid for a medical event out of your own pocket? Why is it that we can afford a room at the REx Motel, but cannot afford a room at the Rex Hospital?

I see it first hand in our towing business. Our most competitive price is when a consumer will pay it directly out their own pocket. We quote them our bottom line price to get the job, because we know they're probably just going down the phone book and quoting prices. The bottomline price is about $65.

Next comes the insurance jobs. The caller from the insurance company is less motivated to save the company money, and more motivated to hurry up and get off the phone and get back to playing solitare or whatever. For the exact same tow, it will usually go for $95 to $100.

Then, when the gov't mandates a tow, like for a DUI, the prices go up further. There are additional expenses to be on call with the police dept. I.E. the insurance is more expensive b/c we do police calls. But the consumer is at our mercy b/c it was the police that put in the call. The cheapest of the police calls is $125.

Currently, there is pending legislation here in Virginia that will further restrict the competition in towing, which will only aide in inflating the prices for the service, which will further inflate the costs of insurance.

The reason that our medical service system seems broken is because we as consumers have stepped away from deciding what a fair and reasonable price is for the service. WE GIVE that power over to the insurance company and decide we'll pay for it in monthly premiums.

If and WHEN we TRANSFER over that power to GOV"T, we've narrowed the competitive field from a few insurance providers, to a MONOPOLY enterprise. The promise from WE the people is the power to make our buying decisions. The PROMISE from Joe the politician is "FREE HEALTHCARE for EVERYONE!" BUT, there's no such thing as a "FREE LUNCH." You're gonna pay for it one way or another. Which is also why our education system is failing. It's been controlled by the gov't for so long, that competition has all but been eliminated, and we then end up with sub-par services rendered. AS we continue to outsource our decision making to fewer and fewer people, whether they be insurance companies or gov't, we pay the price.


PART II - Services go down

Now, the debate is for socialized healthcare. Rachel mentioned growing up in the UK where they've implemented such a system. I lived in Spain, which had socialized healthcare as well. I don't profess to have done an in depth study of the healthcare systems. But I did witness first hand a major difference in the quality and level of service.

When we first arrived, some of the missionaries stated, don't go to the doctors. They're quacks and don't know what they're doing. I shrugged it off, and assumed that they said these things based on missionary urban legend or some other cultural misunderstandings.

AS far as doctors go, I'm a guy that was raised to NEVER go to a doctor unless you were dying. Yes we went for the annual physical or checkup, but we were to save all of our ailments for that annual visit. I once had a broken finger for about 3 weeks before I convinced my dad that he black, purple and blue wasn't goint away. He said: "Tape it to the next one, that's all the doctor would do." I guess it never dawned on my father that the doctor may actually x-ray the finger. It turned out that the knuckle was shattered into a number of small pieces and required surgery to reassemble it with two pins.

Erika has a $12k dollar knee, I have a $12k dollar finger. And it still doesn't work right.

It turns out that a few weeks into the mission, one of my good friends that came out with my group of missionaries named Elder Hale was involved in a car accident. (European drivers is another debate altogether.) They got rear ended. Elder Hale was diagnosed with whip lash and the doctors gave him one of those funny neck brace things to wear.

I would see Elder Hale just a few times a month and I'd always ask him how he was feeling. Of course initially, it was really bad. His neck was in a lot of pain. Then after a few weeks I'd see him again and inquire. His response was surprising b/c he said he was still in a lot of pain and the doctors couldn't figure out what the problem was.

After more than two months of this persistent problem, and no new diagnosis from the doctors there in Spain, Elder Hale, along with the counsel of the mission president, decided he needed to go home and findout what the problem was.

He got home to Utah and within the week, his doctor(s) saw that he had a broken vertbrae in his neck and they had to operate.

Every business has it's crooks. But the crooks make a quick buck and then they're out of business b/c it catches up with them.

We have choices. Here in rural parts of Virginia, it seems there are limited choices. But for awhile, AMC seemed to have a stigma about it and many would drive to UVA.

The best part is having choices. And when we outsource all of that decision making to the Government, our choices will soon be limited.

3 comments:

Rach said...

My mother is ALWAYS visiting the doctors, not to say she is a hypoercondriac or anything, but those are the facts. Anyway, she as you know, also lives in Spain on a little island called Tenerife and I must admit that whilst some of the practices are not as 'up to date' as maybe American practices are, she neverthless has had pretty good care from her doctors, even though they would have a language breakdown sometimes. She has suffered from bronchitis, poor knee cartilidge, gastro, ulcers, arthritis, just to name a few and even a stroke. So I can't knock European health care from personal experience, I too have always had good service in the UK, and have certainly NEVER been turned away or even heard of anyone getting turned away... now if only those british ambulances could stop dawdling, they might get the patients to the hospital on time before they die... I guess we can blame those European drivers eh? ;-)

crashomatic said...

Yes.

That was what I noticed about the spaniards...they were constantly going to the doctor.

Alice Wills Gold said...

I just couldn't make myself read it all, but I have to tell you that you are convincing me to start HSA's for our family.