But you’re right. It is old school nonsense to say that all subsidies be available to public and private businesses alike. Not all insurers are equal, nor all insurance contracts. Some are legalized financial rape.

A far better standard would be that they are available in connection with insurance products that provide equivalent coverage to all insureds: no exclusions for pre-existing injuries or routine preventive care; no undue procedural bottlenecks or reimbursement waits; equivalent reimbursements to care providers; and no pattern of dropping insureds solely because they use their insurance.

Just as important, public plan insureds must have access to the widest variety of service providers AND privates must be prohibited from imposing penalties on care providers who accept public plan patients or incentivizing them to turn them away.

As always, the devil and the opportunity for good or ill lies in the details. This will take several rounds of legislation and years of trial and error to get right. It’s a marathon, not a sprint. Persistence and a valid plan are what’s important, not passing just any old legislation by September or December 2009.

just a nit

The HELP public plan constrains payments to the average fee-for-service in a given locality; now there need to be some protections against provider collusion to increase those average figures, but that is a good benchmark for a market price.

But that doesn’t answer the question about what the menu of services looks like nor whether administrative costs are charged as indirect costs for each service (a source of the $10 aspirin). Some form of bulk pricing of services would reduce administrative cost and facilitate rapid billing, but what would be the basis of negotiation for each type of provider. For example, the public plan could cover all hospital expenses for an acutuarially determined pro-rated number of patients each year, with adjustments carried forward from year to year. One check per year for everyone who is covered. Primary care providers could have a negotiated number of patients from particular zip codes, with adjustments made from year to year. The savings in administrative expense would make up for the loss of cost accounting control consolidated at the federal level. The fixed dollar amount would provide a provider a budget to work within during the year without the nonsense of five-minute provider visits.

And HHS as the plan administrator should have the flexibility to develop these alternative means of pricing. And if they come up with a winning combination, it should be extended to Medicare and Medicaid, with a view of folding those eventually into the public plan.

Medicare became underfunded and the micro-managed fee-for-service schedule was implemented by the Reagan administration to “control Medicare costs”. Neither of these “reforms” have served anyone well.

Fold Medicare into a national single payer plan or expand Medicare to Medicare for All.

$400 Trillion over 10 years can do an awful lot of good.

Now what it can’t do is offer pols the big donations from the BHIP* folks….

Gee…maybe that’s a deal breaker? Ya think?

*BHIP–Big Healthcare Industry Players