Updated: May 3, 2013 12:15PM
We're facing a moment of truth as Congress debates reshaping financial services and health care -- two huge segments of the economy that will impact all of us in a very personal way.
The coming weeks will be significant ones for the economy -- and our free enterprise system -- as Washington turns its attention from crisis control to problem solving.
It's so very tempting to close your eyes to the issue of health care reform, and let the "experts" decide what's best. I feel that temptation myself. But while we don't have to follow the details, we must focus on the direction and incentives that will be debated in the months ahead.
These important decisions will be made through the political process. And democracy only works well when we have an informed and involved population. So, no matter what side of the discussion you take, it's time for all of us to get involved.
That's why I've set up a special section on my blog at www.Terry Savage.com for your health care solution comments. And I've posted a link there to the e-mail address of your representatives and senators in Congress, so you can make your views known.
The great health care debate
There is only one area of total agreement: If health care costs keep rising at twice the rate of inflation, our financial future will be destroyed. Something MUST be done! But the "easy" solution also might be the most dangerous one to our future health care needs.
I was in Toronto two weeks ago, where the news headlines announced that the "average waiting time for surgery" for those who have just been diagnosed with cancer is now four weeks! And "elective" surgery such as hip or knee replacement can take months on a waiting list. Many Canadians cross the border to upstate New York, or Minnesota, or Seattle to receive care on a timely basis -- if they can afford it. Certainly, that government-managed health care system is not one we want to emulate.
But are we willing to make tough choices?
**Will we ration health care, based on age, or condition, or ability to pay?
**Will we strike a balance between diagnostic medicine and "lawsuit prevention" medicine?
**Can we provide -- and price -- lifelong coverage, so there is no need to worry about "pre-existing" conditions?
**Can we "charge extra" for those who incur "controllable" conditions, just as the airlines do when they demand obese travelers pay for two seats? And who would decide what's within our control?
**Can we create an electronic system for health care records that provides adequate security, control and privacy?
**Can we cut health care costs if the insurance system doesn't create an incentive for people to know and care about the costs?
These are just some of the tough issues to be debated. And it is YOUR health care that is at stake.
Right now, many physicians are declining to take new Medicare patients because of the low reimbursement rate. So governmental price-setting can work -- if you can find a physician to give care at those prices. There's no incentive to take more patients if you lose money on patient care.
Right now, physicians may overdo the testing process -- not in the interest of diagnosing the patient, but because they are incented to protect themselves in potential lawsuits. The cost of the testing, and their malpractice insurance, adds to the overall health care bill. But if you've been a victim of malpractice, you want the right of recovery.
Right now, people who have insurance never question the cost of care. But health savings accounts give the incentive to stay well, and spend health care dollars wisely -- since money not spent grows tax-deferred for future health care needs.
If we want the best doctors, the best health care, the best medicine, the best medical technology and the best drugs, we're going to have to rely on a system of incentives -- not government directives. That's never worked in any health care system -- unless people are willing to wait, willing to ration care, and willing to settle for less than the best. We can come up with a better solution in America. And that's The Savage Truth.