Karl Denninger’s 5-Point Plan to Reform U.S. Healthcare

Imaginary view from my office

Healthcare costs represent almost 20% of the U.S. economy, a much higher percentage than seen in other first-world countries. And we’re not getting our money’s worth (judging from average lifespan, for instance).

The Republicans just rolled out a healthcare reform plan to replace Obamacare and address other issues. I haven’t read it. But I have zero confidence in those clowns being able to solve this problem.

Denninger has sussed out a plan that you may enjoy considering if you’re a policy geek. In brief:

  • If you sell “insurance” to anyone in a given state, you must accept all persons in that state on the same terms and at the same price. to open. For acute conditions where adverse selection becomes most important this restriction resolves the problem.
  • All “insurance” companies must offer a true insurance policy covering only unlikely-but-catastrophic events on the same terms as their “full service” policies.
  • All health providers must publish a price list and may not bill or accept payment at anything other than that price; doing so becomes a violation of Robinson-Patman and exposes the provider to civil suit for treble damages.
  • No event caused by the provision of your treatment may be billed to you. Period.
  • If you show up without insurance or ability to pay with a life-threatening condition, you will be treated, but the hospital cannot cost-shift the bill – it instead bills The Federal Government.

He concludes:

“Five points and a fully free-market solution that brings affordable health care coverage to all who can buy it, yet protects those who cannot, while, to the greatest possible extent, forces everyone to bear the cost of their own decisions.

If you choose not to be insured and pay cash you are free to make that choice. If you have a catastrophic illness or injury, insist on treatment but have no means to pay then you are subject to attachment of wages and assets by the IRS, a debt that is only discharged by your death.

Simple, fair, free-market and this path will dramatically control costs as free market competition will be forced to the forefront among health providers who will be compelled to make available their pricing schedules to everyone before they show up for treatment and are presented the bill.”

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