Empowering Delawareans Through Transparent, Patient-Driven Health Care Choices

By: Jane Brady, Chair, A Better Delaware 

A Better Delaware does not often comment on national issues, but in the case of health care, there is no more significant power that can impact Delaware citizens more than the federal government policies regarding the provision of, and billing for, health care services.

You may have followed the current debate about whether the federal government should continue to provide subsidies under the inaptly named Affordable Care Act (Obamacare). The system is becoming more unaffordable as time goes on, and the structural flaws that are contributing to that decline have not been addressed by Congress. Worse, they are not part of the current discussion. Much of the problem stems from direct payments to insurance companies, resulting in the patients being, generally, unaware of what the health care they receive actually costs.

There are a number of ideas about what might work.  Multiple experts have recommended a change to the structure that would put patients and insured in more control of what health care choices they make and how their health care dollars are spent.

One choice is to expand Health Savings Accounts (HSAs).  While there are some HSAs in the marketplace today, they have restrictions. The plans currently allow an individual to establish an account into which they can make deposits that can be withdrawn later, tax free, for certain medical expenses, such as deductibles or copayments.  It can follow you from job to job, but there are limits on the amount you may contribute each year, and you cannot continue to contribute from six months before you go on Medicare or retire.

Recently, Anthony LoSasso, a health economist, proposed a structured plan called a Health Freedom Account (HFA).  That plan would not so much address how much the government subsidies are, but how they are allowed to be used by the individual insured.  As LoSasso explains it, the government would provide a defined contribution for low-income individuals, the amount of which would be tied to the Consumer Price Index (CPI). This would eliminate the automatic increases currently in Obamacare and save money.  LoSasso proposes that if an insured selects a plan that costs less than the subsidy, the excess would be deposited into the HFA, which would then be available for other health care costs.

Everyone, whether they support Obamacare, Medicare and Medicaid as they are, or want to change the delivery of health care, believes that the cost of health care is too high.  A significant factor is the fact that, because of the direct billing to insurers, patients are unaware of the value of what they are receiving. They have little to no information about cost in advance of a medical procedure or visit and cannot make informed decisions in selecting a health care provider, for everything from regular checkups to elective surgery.  That has to change. If we are to reap the benefits of patient driven care, we must adopt a system in which the patient or insured makes the choices of what is in their health care plan, can choose those services they need, and avoid paying for those they do not.

Think about it. You don’t go into the store and buy something not knowing the price.  You don’t pick up a bag labeled “meat’ and take home whatever is in it.  You would not think of hiring a contractor to fix your front door without asking if the bill would be $50 or $500. Healthcare is the only service that is provided regularly, where you don’t know what the bill will be. And to be truthful, many of us don’t care because our exposure is limited to a $20 co-pay. Knowing what things cost directs our choices, and if the money to pay for a medical procedure was coming out of an account, the balance of which we were aware, we would make an effort to get the best value for that money.

We should have a law that requires patients to know what procedures cost at the different facilities, like an MRI or a knee replacement? Well, we have those laws on the books, both at the federal and state level, and they are not enforced. Compliance is poor, and accountability is almost non-existent.  We need to change that.

Moving to patient directed care will be challenging. The industries that benefit from the near dictatorial authority with regard to the cost of health care will not give up that power easily. But our citizens deserve the opportunity to know what the cost is for a procedure and where they can get the best value.  Their choices will not only save them money but save money for the taxpayers as well.

Jane Brady serves as Chair of A Better Delaware. She previously served as Attorney General of Delaware and as a Judge of the Delaware Superior Court.