Friend of mine, a doctor and fellow musician, came up with the
following, an intriguing plan to revamp the US health care system from a
practicing physician's perspective.
Be sure to read the entire plan before making any judgments, it's tricky
in few spots.
Dear Mr. President,
Here are the basic principals upon which a sound, sustainable and
ethical health care system can and should be built:....
1. It shall be illegal for physicians to contract with anyone other than
their patient or patient's legal representative. There shall be no
contracts with the government, with any "managed care" entity or
insurance company, or with any other third party.....
2. It shall be illegal for physicians to receive payment directly from a
third party "payor." Payment must come from the patient directly and
shall be made at the time of service.....
3. It shall be illegal for third parties to request discounts from a
physician for their clients. The price for various services is to be
negotiated between patient and physician, as is the case with all other
4. Each American citizen shall have a Health Savings Account established
at birth. The HSA will be maintained with an investment firm or bank,
the accounts being insured by the Federal government to the amount of
$150,000, as are bank deposits. Increases in value on these accounts via
interest, dividends or increases in investment value are not taxed, and
these assets are protected from creditors, as with the usual IRA.
(Regulations will need to be developed regarding the type of investment,
allowing a certain low percentage to be invested in more volatile
investments.) Funds in the HSA can be spent only for Health Care, but
can be passed on to heirs over multiple generations, to be used for the
heir's health care needs. ....
5. Each American citizen shall be able to exclude from taxation the
amount of $5000 per year (adjusted for inflation) for deposit in his or
her Health Savings Account, with catch up contributions allowed if the
prior year's expenses exceeded this amount. There shall be no limit to
the total amount of capital the citizen can accumulate in his or her
6. Businesses may no longer subtract from taxable income any payments to
"insurance companies" for health insurance plans. They can, however,
deposit money yearly into their employees' HSAs as a dedutible business
expense, the yearly maximum contribution per employee to be determined
after study by qualified economists. ....
7. Each American citizen shall have a catastrophic health insurance plan
in place that covers yearly health care expenses over $20,000 (adjusted
yearly for inflation). This plan will be sponsored and financed by the
Federal Government. See below for Comments about administration of this
8. Citizens with income below the poverty level will be provided yearly
with a "tax rebate" from the Federal Government, deposited directly into
9. The government will mandate that each state educate its citizen about
this "self-reliant" system. Every citizen must realize the need for
preventive health care and a healthy lifestyle. They must realize that
prudent use of these funds and maintaining a healthy lifestyle are the
surest route to security. They must be made aware that contribution
yearly to the HSA must come before purchase of consumer goods, a new
car, or a vacation, for example. There will be no free “safety net”
other than the catastrophic coverage.....
10. Citizens who become ill before they have accumulated sufficient
funds in their HSA to cover the "gap" (whose HSA balance falls below
zero in a given year) will be LOANED the needed funds by the Federal
government, to be repaid with interest in the future. This loan will
show up on their credit report and will influence their ability to
borrow for other purposes until it is repaid. ....
This plan relies on human nature to reduce costs. When payment is coming
directly from funds controlled by the patient, the patient will make
wiser choices. There will be less desire to obtain expensive tests that
are marginally indicated for minor complaints or to obtain expensive
tests when less expensive tests will do. Less expensive, but equally
effective, medications will be demanded by the patient..... and so forth.
With this system, the medical profession will be restored to an ethical
status, it being unethical to allow outside influences to intrude on the
physician-patient relationship (as contracts with third parties
invariably do). ....
The public will demand transparency in the pricing of services and will
cease to tolerate overpriced services. ....
The nation will then be pooling health risks that are in the
catastrophic range, rather than simply using the "insurance industry" as
a (leaky) conduit of money from employer to physician or hospital for
everyday care. ....
With prudent living and prudent saving, within five to six years each
citizen will have in their HSA sufficient funds to cover the $20,000
"gap" in any one catastrophic year, and within ten or so years should
have the funds to cover the gap for several years of catastrophic ill
health. With good health and good planning, these funds can be passed
from generation to generation, allowing those families with good health
to become fully covered with only rare intervention by the government. ....
The government can negotiate with the current managed care industry to
obtain management of the catastrophic funds with minimal administrative
expense, or can set up its own administrative agency (to replace the
current CMS, for example) to manage and administer the catastrophic
Physicians will now be free to concentrate on what they do best, care
for patients and maintain their knowledge base, and will no longer have
to waste time dealing with managed care contracts and meaningless
requests from managed care companies. ....
I urge you not to let the powers that be within the current managed care
industry or within the established government agencies to bring pressure
against the adoption of such a rational and beneficial plan.....
Lawrence E. Mallette, MD, PhD, FACP, FACN
Once again, chew on it for a while before rushing to judgment.
Last update: 10/22/08
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