To fix healthcare, let's get rid of insurance companies
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I left the practice of anesthesia 10 years before the Affordable Care Act (ACA) became law. American medicine was the best in the world when one had full access to all it had to offer, but it was being crushed by the massive interference of insurance companies, Medicare, Medicaid, politicians, hospital administrators, greedy practitioners, run-amok lawyers, etc. The American public could not understand why hospitals charged $60 for an aspirin, why bills from neurosurgeons ran to six figures, or why insurance companies denied obviously essential care.

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The reason is simple: Medicine has been treated in the same way that we treat every other difficult problem in this country. As the overall situation deteriorated, we turned it over to politicians, businessmen and special-interest groups. There was no attempt to address the generic causes for inequities in the system; falsehoods were perpetrated to allow fake solutions; select people got rich; and medicine, as globally practiced in this country, deteriorated.

This is not to say that there haven't been great strides. When I was a medical student, people with Hodgkin's disease or testicular cancer simply died. Those days, mercifully, are long gone. But dealing with more common problems, like diverticulitis or total hip replacement, can become a nightmare blizzard of paperwork that worsens the patient's already severe discomfort.

The underpinnings of many efforts to fix the system are based on the biggest of all lies concerning medical care: that it is not available when people are uninsured. Certainly in my state (New Jersey), and pretty much everywhere else, sick people can walk into emergency rooms and get care, regardless of financial condition.

One may rightfully argue that this is not an efficient way to deliver care, but one is much more likely to find a deficiency of care in any particular geographical area because of lack of physicians or facilities.

Healthcare used to be a simple proposition; just ask you grandparents. General practitioners were a part of the landscape in the same way as the cop on the beat or the local barber. An office visit cost a couple of bucks, and the guy even made house calls. Hospitals were much more the stuff of horror movies, but people did have operations and survive. The profession was a calling for most (quacks have always been with us), and there was a reverence for doctors and nurses that served everyone well.

When I discussed with colleagues twice my age what had caused the most pervasive changes, they repeatedly pointed to three factors.

First, doctors divested from owning the hospitals, which led to an ever-increasing intrusion by businessmen into simple healthcare delivery. Decision-making was more and more a matter of dollars and cents.

Second, Medicare arrived. Before then, if an elderly person walked into an office and then said, "I can't pay," there was no charge. I've known many doctors who treated people for free and charged wealthy patients heftier fees. The ethics may not have been perfect, but no one complained. When Medicare began, doctors were bemused at the idea that government was willing to pay them for what they would do for free. They were too naive to realize that this would be the vehicle for government's pervasive interference in how they practiced.

Third, the lawyers found a new and lucrative source of income. Malpractice law as practiced is too big a mess to discuss here, but one can acknowledge that it has added layers of unnecessary testing, butt-covering, unconscionable malpractice insurance premiums, etc.

Medicine, like education, defense, infrastructure and immigration, has become one more problem that gets Band-Aids slapped on it by politicians who are not willing or knowledgeable enough to even attempt a meaningful overhaul. The ACA is a perfect example. The fact that it still relies on insurance companies is one area of failure.

Some decades ago, American retailers realized that they didn't need middlemen, known as distributors, to do business. They could simply go directly to manufacturers and save a level of expense. Sometimes they pocketed the difference; sometimes they passed the savings on to consumers.

Insurance companies are distributors, and so, are anachronistic. They cure no one. They scrape off billions of dollars of profits that could be used to lower the cost of medicine. They survive through their lobbyists in Washington.

Does abolishing insurance companies mean single-payer, government-run medicine? Not at all. Hospitals and practitioners could set up entities that write their own insurance. Premiums could be adjusted to include indigent care. In metropolitan areas where there are many systems, consumers could choose. Medicine is already practiced successfully in many places using this system. The government could oversee to prevent price gouging and shoddy practice.

The complexity of fixing medicine is certainly beyond my ability. But why not start with removing the one entity that everyone complains about: the insurance companies?

Blady, M.D., is a former program officer for the Under Secretary of Defense for Policy and senior analyst for the Under Secretary of Defense for Intelligence.


The views expressed by contributors are their own and not the views of The Hill.