Jewish World Review May 28, 2004 / 8 Sivan 5764
Drs. Michael A. Glueck & Robert J. Cihak
Back to the Future: Patient Pays Directly for Medical Care
In the past, your Medicine Men have written about a radical new technique for buying health care. Cash. We've highlighted doctors, such as the founders of SimpleCare.com in Seattle, who charge reasonable prices for cash medical services. They can charge good rates because they charge for medical care only and don't also charge for the expense of bureaucratic insurance services such as filling out medical and insurance paperwork, sending it in, waiting for payment, and so on.
This week we feature another physician who's taking us back to the future. Robert S. Berry, MD, runs the Patmos Clinic in Greenville, Tennessee. The clinic name stands for "Payment At The Moment Of Service" but also harks back to Patmos Island, where the Romans used to dump political prisoners.
The name fits in both ways. Dr. Berry describes his patients as "politically exiled within our health-care system." Even though most are hard workers, most are not covered by medical insurance. Dr. Berry treats them for cash, and advertises his low charges in his local newspaper. His average charge is between $35 and $50, "between an oil change and a brake job" as he puts it.
Dr. Berry recently testified before the Joint Economic Committee of the U.S. Congress. Pay-as-you-go medicine, it seems, is an idea whose time has come again, at least for most non-hospital medical services, and especially for the medically uninsured.
Old-fashioned high deductible insurance makes sense to cover high-ticket items such as major accidents and illnesses.
Even better is coupling a qualifying high-deductible insurance policy with a Health Savings Account (HSA), as newly established in last year's Medicare reform law.
HSA plans are similar to the Medical Savings Account plans established in 1996, but allow more choice and wider participation. People who establish an HSA plan can deposit up to about $4,500 each year, annually adjusted for inflation, in the HAS.
The savings in the HSA are income-tax free when deposited, stay tax-free so long as it is in the account, and remain tax-free if spent on medical care.
The insurance policy half of an HSA plan has a high deductible, up to about $10,000 for a family plan.
So what do HSA plans get us? A package of financing for pay-as-you-go basic medical care, high-deductible health insurance, and savings with a minimum of bureaucratic insurance paperwork, plus income-tax breaks as an added kicker.
The Medicine Men predict several positive outcomes from HSAs. People who buy medical services using their personal HSA funds see they're spending their own money; many will shop around for the best value for their dollars. Health care providers will notice that price is once again a factor in attracting patients and will once again charge competitive rates. This is another way of saying doctors will shift their focus from serving the insurance companies back to serving their patients; your personal medical services will likely improve.
As this catches on, employers and employees will discover HSA plans let them save money, while providing higher salaries and better benefits, including more attractive health insurance options all at the same time.
In his forthcoming book, Take Back the Right, Philip Gold argues that Americans must stop surrendering their lives to those who presume to tell them what their choices must be. Our freedoms, and perhaps our lives, are at stake. We agree wholeheartedly.
So we urge you to investigate the types of HSA packages available to you. The more people who do, the better our health-care system will be. And given the miracle of human freedom and the free market, the more that people want this kind of care and insurance, the more doctors and insurers will provide it.
It's time for us to re-declare our independence and restore promise in our future.
Editor's Note: Robert J. Cihak wrote this week's column.
Michael Arnold Glueck, M.D., is a multiple award winning writer who comments
on medical-legal issues. Robert J. Cihak, M.D., is a Discovery Institute
Senior Fellow and a past president of the Association of American Physicians
and Surgeons. Both JWR contributors are Harvard trained diagnostic radiologists.
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