Koshnick R. Empower-Patient Accounts: empower patients. Bethany Press International. Bloomington MN. 2022.
Most people want quality health care at a reasonable cost. I have a course of action that would reduce the high medical care costs for primary medical care. Encourage people to pay directly for their primary medical care. Empower-Patient Accounts would allow people to do that.
The government now forces us to buy all medical care through third parties, which is very profitable for third-party payers but makes health care expensive. Third-party payers come with onerous documentation requirements, extensive coding and billing expenses, and extensive regulatory requirements. This adds considerable cost and leads to provider burnout. Much of this would go away if people paid directly for their basic primary medical care.
Larger systems can afford the fixed costs of regulation whereas smaller medical care entities cannot. This forces small clinics to merge into larger systems. Larger medical care facilities with regional dominance are then able to raise prices without fear of competition. Empower-Patient Accounts could reverse this inexorable trend by allowing patients to pay their primary care providers directly.
Morra, D; Nicholson, S, et al in an August 2011 article in Health Affairs on what U.S Physician Practices Versus Canadians spend interacting with payers found that that the average physician spends an average of $82,975 interacting with health plans. A lot of this is through the expense of prior authorizations for drugs. Much of this cost would go away if people had Empower-Patient Accounts that allowed them to pay directly for drugs and primary care.
Robert Kocher, in a 2013 Harvard Business Review Article, “The Downside of Medical Care Job Growth,” showed that from 1990 to 2012 medical care workers had increased by 75 percent, but 95 percent of that growth had been non-provider workers. The ratio of support staff in medicine had increased to sixteen support staff per physician. The median cost per doctor of non-doctor expenses averaged $823,000 per physician in 2013. Much of this cost would go away if people had Empower-Patient Accounts and could pay directly for their primary care.
States could apply for federal waivers to set up E-PA. Then people could then directly pay primary care providers for preventive care and primary care and not have the costs and regulatory burdens of third-party payers. A way to start doing that at less cost than paying for E-PA is to give people say a $500 tax credit for those with taxable incomes or a $500 rebate for people who cannot use tax credits to those who set up direct primary care (DPC) accounts with a provider.
Direct Primary Care (DPC) is a way to give people unlimited access to primary care at reasonable rates. The federal government could give states block grants to help states fund E-PA or give tax credits or rebates for residents who use DPC for their primary and preventive care. This would require federal legislation.
I explain in my recently released book, Empower-Patient Accounts Empower Patient!, how E-PA could reestablish a medical care market and drive health care costs down. Empower-Patient Accounts could start to remove the burden of the cost of health care from employers, reduce health and financial disparities, lower personal and national medical care expenditures, and might even improve people’s health behaviors.
So, back to the original question. Would it be possible to “give people the money and get out of the way”? Why not reestablish a medical market by giving people the money and then get out of the way?
That could work on a state-by-state basis. States would set fund Empower-Patient Accounts for people to pay for direct primary care or directly pay for their primary care, deductibles and pharmacy expenses. Waivers from federal laws would be required. People should not be required to pay for health insurance to cover primary care. It would be much cheaper to pay for primary care and most drugs directly.
The federal government could give block grants to states to fund Empower-Patient Accounts and health savings plans. This would remove the burden of providing health care from businesses, giving them a competitive advantage in a global economy. State high-risk pools and non-profits, like the Lend a Hand that we have in our region, could help people that all through the cracks.
Putting the power of the purse in the hands of the people, rather than disconnecting people from the cost of medical care, could result in enormous cost savings while reestablishing a direct physician-patient relationship, which would improve patient and physician satisfaction. It might even result in people improving their behaviors, where most of the improvement in health occurs!
This is the thrust of the argument I make in my new book: Empower-Patient Accounts Empower Patients!
Robert Koshnick, MD