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February 25, 2010

Follow the Money – Re: Healthcare Reform

Approximately 47 million Americans are uninsured.

 The average individual health insurance premium is between $300-$400 per month, or $3600 – $4800 per year.

(Multiplying)  Today it would cost $188-$225 billion to provide health insurance to all of the uninsured.

 This cost is currently rising between 8-10% per year.

Generally tax revenue growth is proportional to GDP growth.

How can our government finance an additional $200 billion per year growing at 8+% per year when historically GDP growth has been well below 8+%. 

Can they keep raising taxes?

Most reasonable people would say no, we cannot raise tax rates year after year (or perhaps even now for that matter).

To accomplish universal coverage we need to discover enough healthcare initiatives that together result in reducing healthcare inflation to the level of inflation of the economy in general (about 0-4% over the last 10 years or so).

If we can achieve this goal, then we can realistically and responsibly begin to create proposals for getting everyone insured.

The two biggest areas of potential cost savings are: (1) waste and redundancy (estimated at a total cost of $700 billion/year) and (2) the expansion of the prevalence and cost of chronic illness (about 70% of the $2.4 trillion healthcare economy, or $1.7 trillion per year).

Initial approaches to healthcare reform should focus on measuring these costs and implementing initiatives to reduce them over time.  Many of the technologies and proven approaches  to tackling these issues are currently available, but are going largely ignored by lawmakers as they craft reform.  Many more are in development and will appear over the next 5-10 years.  Many of them cross my desk as potential investment opportunities everyday.

Look for insights on modern and novel approaches to improving healthcare quality and reducing costs as this blog develops.

February 24, 2010

Email from Senator Patty Murray – Re: Healthcare Reform

Filed under: Healthcare — Steve Krupa @ 8:53 pm
Tags: , ,

Today I received the following email (see below, abridged ever so slightly) from Patty Murray, incumbent Senator from Washington State, serving her third term:

 “Dear Stephen (note:  she calls me Stephen, since that’s the name I use on the credit card I used to contribute to President Obama’s presidential campaign):

 Tomorrow, I’ll be attending the White House bipartisan summit on health care reform hosted by President Obama.

This forum, bringing together congressional leaders from both parties, will provide an opportunity to have an open and honest dialogue about what we must do to reform our health care system — this year….

As families continue to face double-digit premium increases, lost or reduced care due to unemployment, and decreased access to care, I will continue to fight to ensure that health care reform addresses these priorities.

I’m committed to protecting health insurance where it’s good, improving it where it’s not, and ensuring quality care for the millions who don’t have it at all — while preserving your choice of doctor, treatments, and insurance plans throughout it all.

Getting health care reform passed this year is not just about compassion — it’s about economic common sense.

But I want to hear from you, too. What do you think we should do about health care reform?

Some critics say we can’t afford to tackle health care reform. I say we can’t afford not to.

That’s going to be my main message in tomorrow’s summit — but I want to make sure I take your views with me, too.

Thanks in advance for letting me know what you think.

 Sincerely,

Patty Murray
U.S. Senator

She’s sounds very committed to healthcare reform, and genuinely sincere about wanting to help.  I also noted that she is running for re-election this year, so I thought I would take her up on her offer to let her know what I think, and wrote back the following: 

 “I believe both of the bills (from the house and the senate) are too extreme and loaded with expensive and unproven ideas.  While I support the idea of universal health insurance in the long-run, I am opposed to such a sudden, massive overhaul.  I would encourage a rewrite of the current bill that started off focused on measuring and reducing cost and improving quality in the current healthcare system.  After these concepts are proven then I would support using ongoing savings in the system to subsidize expansion of health insurance.  This is the logical, pragmatic approach, particularly given the size of our national debt and budget shortfall.  We should learn how to save money now to finance expanded coverage in the years to come.”

(Btw, you too can click on this or the above link (for the time being) and let Sen. Murray know what you think too – if you do, copy me too, please.)

I wonder whether she, or any other politician for that matter, believes that it’s possible to save costs in the healthcare system.  If they do, why don’t they prove it to us first, before making such a massive financial committment?

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