Doctor's solution to cut costs, expand care

This physician's eminently reasonable ideas stem from the basic facts that the cash price for a lot of things that go through insurance for payments, is a fraction--up to 70% less--than what is billed for payment to the third parties:

"Stop Thinking Insurance" Kent Holtorf, M.D., 09.09.09, 04:00 PM EDT
"How to implement health care reform that cuts costs and improves care"

"Historically, health care programs end up costing five to 10 times their original estimates. Hawaii tried a system with a public option intended to cover more individuals; the program was dropped within seven months as costs spiraled out of control. Other states have had similar experiences.

"A major problem with the current insurance model is that it does not work for services used on a routine basis. Insurance is designed to work for services that are unexpected; it is a very poor and ineffective method of delivery for routine, expected services....

"The system needs to change so that it empowers patients and physicians to work together to provide the most appropriate treatment in the most cost-effective manner. Medical savings accounts--with negotiated rates to prevent overcharging--would be a step in the right direction...

"An even more significant change would be converting to payment on a cash basis. We have found that, almost without exception, laboratories, doctors and other services will happily take 70% less if paid in cash at the time of service. Their costs are increased by that much if they have to bill insurance companies and incur other expenses...

"A recent patient who visited our office, for example, had extensive lab work (21 tests). The lab billed the insurance $1,800 and the insurance paid $1,200; the patient was billed a $600 co-pay. The cash price would have been less than $400.
What is the solution? It is to expand medical saving accounts. But in doing so, the government must require that all doctors, laboratories, hospitals and other services post their rates, and cash must be the least expensive rate...

"What about those who cannot pay out of pocket? Instead of an employer paying, say, $500 per month to a third party, $400 per month could go into the medical saving account and $100 could go toward catastrophic care insurance. "

Read the whole article for more: http://www.forbes.com/2009/09/09/health-care-reform-insurance-opinions-contributors-doctors.html