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The healthcare system is a racket — direct primary care could fix it

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Everyone has a healthcare horror story.

A hidden charge on the hospital bill. A last minute test or scan that ends up costing four figures. Hours spent on the phone with insurance companies to follow up on a claim and get a reimbursement. Prescriptions costing hundreds of dollars.

And it’s getting more expensive.

Since 2007, the cost of healthcare has risen 21.6 percent, while all other prices in the economy have risen by just 17.3 percent, according to the Kaiser Family Foundation.

It’s become an unfortunate reality for many, and it’s been rightly pushed into the arena of politics.

But despite the well-intended reforms of the past two decades, including the Affordable Care Act, millions are still feeling the pinch. Why?

Too often, talk of healthcare reform is focused on insurance rather than care. It’s less about how the doctor treats your family and more about who foots the bill. Almost no one can get a straight answer about the price of procedures or medicines.

Medical insurance, once a simple way to cover higher-than-normal expenses, has become a catch-all for almost all health spending. It’s no longer about surprise injuries and illnesses. Insurance is now used to cover every ache, pain, anxiety, pill, and more. It’s like using car insurance to cover every oil change, new windshield wiper, or tire.

And in order to recoup the amount they give out, insurance companies must price their options accordingly, which leads to higher prices for consumers. That’s why healthcare expenses in 2016 amounted to 17.8 percent of GDP, higher than any other industrialized country.

At least one new doctor-patient arrangement is promising a revolution in consumer choice by bypassing insurance altogether. It’s called direct primary care, and it’s catching on across the country.

Rather than relying on insurance for ordinary health expenses, these new doctor clinics rely on monthly fees from patients, usually less than $100.

If anything more is required during doctor visits, the prices for every service and test are transparent and don’t vary depending on your plan. By not accepting insurance of any type, each clinic saves on administrative costs and overhead, prioritizing patients over costly insurers.

The results are just as intended: lower costs, more preventive care, and more face time with medical professionals.
Read the full article at the Washington Examiner.

 

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Thomas Jefferson Institute Handbook on Healthcare (2017)

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This Handbook on Healthcare Reform is an effort by the Thomas Jefferson Institute for Public Policy to bring ideas to the table for discussion and legislative debate in order to highlight areas where Virginia and other states can take action to reduce costs, increase availability and thus broaden the number of people who can better afford, thanks to the reforms outlined in this Handbook, to see a doctor.

The Thomas Jefferson Institute worked closely with Dr. Hal Scherz of Atlanta to create this special Handbook on Healthcare Reform. We wanted to bring together the ideas of doctors and other experts in the field of Healthcare on how healthcare can be reasonably reformed so that a better system is the result.

Dr. Scherz reached out to colleagues around the country to write essays on specific areas of healthcare that they felt should be reformed in order to better serve their patients. These doctors work within the current web of regulations and they provide innovative ideas on creating a less bureaucratic system that can improve the overall healthcare delivery system. And we found a few essays from academic healthcare experts to add ideas to this Handbook.

As the founder of “Docs 4 Patient Care,” Dr. Hal Scherz has a deep interest in how healthcare can be improved for all of us and he spent a good deal of time in helping us put this Handbook together. He is well-respected urologist and is deeply interested in improving the healthcare system in this country. We deeply appreciate his time and effort in this project. 5

This Handbook on Healthcare Reform brings ideas to the table for public debate and discussion. It is not an effort to support specific legislation, although it is hoped that the ideas presented herein will become public policy as is the case with Direct Primary Care (DPC) that became state policy earlier this year when Governor Terry McAuliffe signed the legislation into law. This DPC law will allow those in underserved areas to gain better healthcare access if it works as it has in other states. We are proud to have had a small role in putting some of the early pieces together which ultimately resulted in this new law here in Virginia.

Download it here.

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A small but growing movement of doctors that don’t accept insurance and charge a monthly fee could be a model for big employers like Amazon and JPMorgan

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The practices are part of a movement known as direct primary care. Instead of accepting insurance for routine visits and drugs, these practices charge a monthly membership fee — often between $50 and $150 a month — that covers most of what the average patient needs, including visits and drugs at much lower prices. The movement’s been gaining momentum at a time when high-deductible health plans are on the rise.

In most cases, the practices recruit patients on an individual or on a family-by-family basis. But often, employers who cover their employees healthcare have turned to practices as well.

For many large companies, they’re the ones ultimately paying out their employees’ claims. Insurance companies are there in the middle to handle the logistics of getting the claim from one place to another, which means you might not realize your employer’s footing the entire bill on the other end.

“I tell people, JPMorgan Chase already buys a $1.5 billion of medical, and we self-insure,”JPMorgan CEO Jamie Dimon told Business Insider. It’s why his company, along with Amazon and Berkshire Hathaway, two other massive self-insured employers, are looking for new options through a nonprofit healthcare venture. “Think of this, we’re already the insurance company, we’re already making these decisions, and we simply want to do a better job,” Dimon said.

Finding ways to “do a better job” could mean a number of things, from leveraging the number of people they cover to negotiate lower rates, to digging in and upending the way healthcare’s done entirely.

And it’s possible direct primary care could be a consideration. Amazon chief Jeff Bezos was an investor in Qliance, a direct primary-care system based in Washington state that got its start in 2007 and closed in 2017. Amazon in January also reportedly hired a doctor who had run Iora Health’s Seattle practices.

Read the full article at Business Insider.

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The problem with lack of emphasis on primary care in healthcare

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“In the U.S., primary care is nothing more than an assembly line,” he said. “I had to see twenty to twenty-five people a day, and then spend a third of my day coding. The patients were getting eight minutes with me if they were lucky. That’s why I got out. We should stop insuring primary care, and start ensuring that everyone has good primary care.”

Risheet Patel, MD, a direct primary care physician who leads Fishers Direct Family Care in Fishers, Ind., pointed to the lack of focus on primary care in the United States as one of the most important reasons for the gaps.

“When looking at metrics like percentage of primary care providers in the workforce, primary care visits, or dollars spent on primary care, the US falls behind other countries,” he said. “If we want to change the direction of our healthcare system, we need to put more emphasis on primary care along with screening and prevention as opposed to costly testing and treatments.”

The insurance-based healthcare system rewards physicians for ordering tests, treatments, medications, and office visits, driving up the cost of care, he said.

“It’s often hard to get insurance plans to cover preventative counseling, smoking cessation, or weight loss programs,” said Patel. “If we can work to prevent disease progression, we can help reduce the burdens of testing and treatment. However, there is a definite lack of focus in this area.”

Read the full article at Modern Medicine Network.

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Healthcare Industry Experts Forecast Price Transparency Is Coming Soon

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As consumers face higher and higher out-of-pocket costs for healthcare services, they will demand greater value, according to a comprehensive report published by healthcare industry experts Daniel WeinbachRichard Klass, and Justin Irizarry. The three announced the publication of their white paper, “Healthcare Pricing Strategies In A World Of Price Transparency.” The report examines the current status of healthcare price transparency and explains how providers can prepare for a new era where consumers are likely to shop for certain services using price as a key variable in their decision making.

The authors have made the report available for download at http://www.weinbachgroup.com/articles/healthcare-pricing-strategies-in-a-world-of-price-transparency.

The three men developed the report in response to widespread interest following the American Hospital Association’s 2017 conference of healthcare strategy and marketing executives, known as SHSMD, which stands for the Society of Healthcare Strategy and Market Development. They were invited to present at the gathering of more than 2,000 industry decision makers.

“Healthcare pricing remains mysterious and opaque, in large part because of conscious efforts on behalf of the healthcare provider community,” said Daniel Weinbach, president and CEO of The Weinbach Group, a Miami -based marketing firm that specializes in the healthcare industry, and one of the report’s co-authors. “However, when it comes to shoppable services — those services that are widely available and which require the patient to pay a significant share of the cost — we expect to see far more transparency surrounding pricing. Patients will demand it.”

Read the full article on Market Insider.

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If Amazon And Buffett Lift Veil On Health Prices, Insurers Are In Trouble

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Jeff Bezos’ Amazon and Warren Buffett’s Berkshire Hathaway are forming their own healthcare company with JPMorgan Chase to increase transparency for their employees, and that could be bad news for insurers and pharmacy benefit managers.

Health insurance companies and PBMs have long said they want to bring more transparency to the U.S. healthcare system, yet consumers often don’t know the true cost of healthcare. Prices are negotiated in secret and doctors don’t often know what their own services cost or what their patients will be charged.

Details of the new company the three corporate giants want to create remain sketchy, but the idea that they want to bring more transparency is one of the disclosed goals. “Our people want transparency, knowledge and control when it comes to managing their healthcare,” said Jamie Dimon, chairman and CEO of JPMorgan Chase.

Read the full article at Forbes.com.

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