In all the noise and roar, and fresh acqusations of "trojan horse" legislation, there is hardly any way that a health care plan that is truly good for the people will emerge. History is poised to repeat itself -- be the future for us a Soviet-style health care or the failures of socialist-European health care -- it looks like the collective voice of Washington will prevent the American people from developing a superior, American-made system.
Like "Horton Hears a Who", perhaps there is one Congressman, or one radio talk-show host, or some public staffer who can get Personal Payor into the public debate.
Personal Payor healthcare is a graduated way to make health care affordable for all. Rather than the government trying to set up an entire new way to distribute health care -- which is just some professors' pipe dreams of how they want to see the world work -- personal payor converts our current system to one that is directly fair to the people, remains a profitable and free-enterprise business for insurers, and contains government costs.
What is "Personal Payor" Health Care?
Personal Payor Health Care uses free-enterprise health care insurance balanced with societial goals provided by the government in a non-socialistic and non-communistic way. Personal Payor works by applying three basic principles to existing and new health insurance plans:
1) it reduces or eliminates the concept of "group" versus "individual" health insurance by funding basic, but specific levels of health care for everyone
2) it eliminates direct intervention by the government into an individual's own health care
3) it requires all members in the same plan to pay the same amount for their health care
How does "Personal Payor" Health Care really work?
Any health care plan that is offered by an insurance company is potentially eligible to participate in the government "Personal Payor" program. Although some other government program or programs may exist for a public health care option, under the pure form of "Personal Payor" the government does not provide a public option through the Personal Payor program.
One condition for participation of a health care plan is that all participants pay the same amount for their insurance, regardless of pre-existing conditions. Ultimately, a compromise Personal Payor system may impose a twelve month waiting period on pre-existing conditions (such as is required under Texas law) or allow an age-based rate scale. These variations, however, are not a part of the Personal Payor system in its pure form.
An eligible health care plan then qualifies for one or more government entitlements for its plan participants, based on the total number of participants in the plan. Generally, the more participants the more entitlements are available. In one variation, different plans having the same premiums to their participants would be eligible to be aggregated for the purpose of adding the total number of participants together.
Individuals and families may belong to more than one health care plan in order to combine benefits.
The government entitlements are a basket of different subsidies offered to the eligible health care plans. Each entitlement covers a specific type of diagnosed condition, diagnostic plan, preventative or wellness procedure. These entitlements may be added, amended, or deleted based on a standardized governmental regulatory process and legislative funding.
The following table lists an example set of entitlements:
| Required plan size | Condition, Procedure, or Diagnosis | Amount of Govt Subsidy |
| 5,000,000 | Experimental drug therapy for X | $100,000 |
| 1,000,000 | Heart Bypass | $30,000 |
| 100,000 | Course of Treatment for Breast Cancer | $75,000 |
| 10,000 | Insulin Dependent Diabetes | $3,000 |
| 1,000 | Up to Five doctor Visits | $25 co-pay $350 |
| 100 | One CBC | $100 |
| 10 | One wellness checkup | $100 |
The actual list of conditions is to be based on the public's desire to have universal access to care for particular ailments. In a departure from tradional insurance-style accounting, they constitute packages of goods and services and not individual consumables and procedures. The subsidiation is not based on an itemization of consumables and procedures that are consumed in the course of diagnosing and treating the ailment. The subsidy is provided for the condition or diagnosis as a package, leaving the private sector freedom to technologically advance the actual goods and services that make up the package of care provided.
So, how does Personal Payor work in practice?
A plan become eligible for one or more subsidies -- that is, one or more packages covering various conditions, wellness, or diagnostic needs -- such that the insurance provider receives the subsidies so long as it maintains the mimimum number in the plan. In this way, for example, the insurance provider is price protected even if a disproportionate number of the plan's participants have the same ailment.
The plan participant, the individual, is able to choose an insurance plan based on the coverage it provides. More plans will be available to a broader base of people, as each insurance plan will strive to maintain the maximum number of participants in order to receive and maintain eligibilty for as many of the subsidy packages as possible. This will push cost per participant down while also favoring plans having the best coverage and simpliest terms and lowest processing costs. The more expensive medical procedures and ailments will subsidize at larger participant plan sizes, meaning a competition for participation from lower income households. Expensive plans, out of reach to the lower and middle class due to expensive premiums, will not meet the minimum participation requirements and will remain unsubsidized. On the other hand, certain types of health care, such as flu shots, mammograms and colonoscopies, which are seen by the public as warranting universal access, will be subsidized at relatively small minimum participant sizes. They will, therefore, be more universally accessible through a multitude of available health care programs.
Although the concept of Personal Payor is initially hard to understand, its effects will have a tremendous effect on not only the United States, but the rest of the world. It is the one program that is insulated from the defects of socialism and communism, yet also avoids the harsh side-effects of an unregulated, winner-take-all system. It minimizes government intrusion into the private sector and into the lives of its citizens, yet provides the compassion and authority for the government to guide the standard of care and the access to that standard of care. Personal Payor does not prevent the governments from launching separate programs to provide additional assistance to remaining disadvantaged groups. Personal Payor does not prevent any person, group, plan, or company from continuing to provide any current or future insurance plan in any form. Personal Payor does, however, greatly incentivize any plan that provides equal cost and equal access to all its participants. Personal payor does, also, greatly incentivize any plan that is economical and efficient enough to generate a large participant base -- that incentivation being increased subsidies for expensive or rare procedures. The Personal Payor system is able to differentiate the truly universal elements of health care, such as mammograms, by providing subsidiation even to those plans with a small participation base. Personal Payor, unlike all the other proposed health care plans, enables funding of new technologies and new ideas for advancing the level of care and new ideas for cutting health care costs.
Personal Payor also is the only system that provides a built-in mechanism to encourage cost savings rather than maximizing reimbursable claims. This is because subsidies are not based on goods and services received, as reimbursements are based today, but rather the subsidy is a total amount provided for the occurance of a particular ailment, major procedure, diagnostic or wellness function. Thus, it keeps the government out of the business of counting the number of sponges used and the acceptable price to reimburse for each sponge. If a bypass is necessary, then the overall procedure gets a subsidy at the insurance provider level, where it can be averaged out over many bypass procedures and be immune to variations in cost or complexity from individual to individual.
So in summary, Personal Payor Health Care is:
1) A list of major medical conditions, procedures, or diagnosis that the government deems worthy of insuring widespread or by universal coverage -- these are "packages"
2) A mimimum participant requirement is assigned for each package
3) A health care plan is eligible for a government subsidy for a package if their plan provides the same coverage terms at the same price to at least the minimum number of participants as required for that package -- all participants must have the same plan at the same price
4) The minimum participant requirement is generally greater for rarer and experimental packages and generally lower for packages designed for universal access
5) Few, if any, limitations on pre-existing conditions -- the plan can be group or "individual", that meaning having little or no effect under Personal Payor as all plans will become an effective group plan in order to qualify for any subsidies
6) Inssurance companies will be free to have participant qualifications, such as non-smoker or office worker, or a plan for a particular corporation -- but their limited number of participants will dictate eligibility for package subsidies
7) Participants may join more than one health care plan, as some plans may appear that are focused on particular conditions or extremes -- the current distinction between catastrophic or major medical insurance and comprehensive insurance will beccome less distinct when Persoanl Payor becomes available
8) Personal Payor does not preclude additional government programs to aid severely disadvantaged groups
(c) 2009 Knobloch. All rights reserved. Contact for publication permission. http://www.charlesknobloch.blogspot.com/
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