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How to fix health care in the USA

My brother sent me this report which states that 8% of our medical costs are to pay for uninsured patients health care. He commented:

I had never thought of this issue before, that all of our health care cost are higher because of Health providers shifting the cost of those who they serve that get fee service.

I responded that there certainly is going to be some cost shifting from those that don't pay to those that do, insured or uninsured. However, I'm suspicious of the numbers they produce for a number of reasons.

  • Most people that are uninsured are uninsured by choice; the young who are unlikely to get sick or the foolish
  • Their methodology makes a lot of assumptions. Getting any of them wrong would skew the results one way or another.
  • The "Center for American Progress Action Fund" is a liberal think tank and they are pushing an agenda. The agenda in this case is that there should be universal health care. Having an agenda doesn't meant that the conclusions are wrong, but does make me look at them with a more critical eye.

The way to resolve health care finance problems in this country is to:

  • Eliminate the tax deduction that employers get from providing health insurance. This will help to reduce the disconnect between they payer and the consumer of health care, thereby increasing the attention the consumer gives to what they are consuming and increasing competition
  • Reduce the regulation of the insurance industry. Currently, medical insurance is so highly regulated that every policy is essentially identical. Liberalize the laws so that insurance companies can get creative in their product offerings. This will allow consumers to make choices based on their needs, not the State Insurance Commission's needs.

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