FF WT Health Care 022617

Healthcare Industry Dependence on Obamacare Finances Illustration by Greg Groesch/The Washington Times


– – Sunday, February 26, 2017

Most Republican health care proposals include Health Savings Accounts (HSAs). People like them because they reward healthy lifestyle choices and careful, cost-conscious use of health care resources. When we are advised we need to get a MRI, we ask “when?” and “where?” but hardly ever, “what does it cost?”
If the MRI is now paid out of this special pot of money set aside only for health care and funded by our employer or ourselves, cost suddenly becomes relevant. What we don’t spend, we keep. Whatever our employer deposits, we could add to it with both of us getting tax deductions.HSAs drive down prices and utilization. Hospitals don’t like this. They are delighted that Obamacare pays them for services for which they previously did not get adequately paid. Most other providers — drug companies, eye doctors, chiropractors — agree.We cannot reduce premiums without reducing the underlying costs being insured. If the single hospital in a small North Dakota town charges $1200 for an MRI, 10 competing insurance companies will have very similar premiums. The premiums drop only when we find $800 MRIs in Minneapolis.The challenge of getting our desired reform becomes problematic when those sitting around the table — drug, hospital and insurance companies — outgun us when it comes to influence. The “patient lobby” is sitting in chairs on the side of the room as observers along with doctors.We deserve the right to own our own policies that can travel with us from job to job just like our auto and homeowner policies.By executive order on Aug. 15, 1971, President Richard Nixon froze prices and salaries. But companies were allowed to compete for employees by offering health care.We want to choose the policies and select the coverage we want. Don’t force us to pay for what we don’t want. Nor pay for other people’s free stuff. Mandated coverages of both Obamacare and states need to go.

Our current system is not one of “insurance” but of “prepaid health care.” Imagine what our auto premiums would be if insurance covered tire replacement, oil changes, tune ups and gas refills.

When we drive from Arizona to Wisconsin and crash our car in Iowa, insurance covers it. Why can’t our health insurance function the same way? How do we rid the “in network/out of network” discussions?

The marriage of high deductible policies to HSAs doesn’t work for everyone. Our low-income neighbors now in Medicaid programs need a different solution. Let’s have President Trump write a federal check to each of the 50 states from what he is now spending on Medicaid. States can be more sensitive to those in need.

There are 1250 Federally Qualified Health Centers with over 8,000 delivery sites scattered around the states.These could be expanded using the check Mr. Trump sends. Locating them in low-income areas would also address transportation issues. Alter the rules, so like emergency rooms, everyone must be accepted and payment is prorated according to ability to pay. Include free service? Sure.

Many of our political leaders have “reducing insurance premiums” as a goal but our goal should be to provide quality health care to all at a more reasonable cost. Guaranteed admittance to emergency rooms and “Urgi-Centers” despite no insurance is an example of one tool. Sen. Sanders’ supporters should embrace its near “single-payer” qualities.

Our neighbors with pre-existing conditions and/or huge annual expenses — dialysis, chemo — need yet another approach. Ailing 75-year-old Ben on dialysis should acknowledge his premiums should be higher than those of 25-year-old marathonerTom.

But Ben should be allowed into a group policy where his costs can be absorbed by others in the pool. Also, all of us should be allowed to buy our policies through an association of our choice — an alumni group, our church or bowling league. This prevents our premiums from skyrocketing when we get hit with an expensive health issue as those costs spread to the pool.

These associations can create an efficient way of dealing with Ben’s high expenses by requiring that one Ben be added for every 100 healthy lives insured. This assumes only 1 percent of Americans are as costly as Ben.

In addition to reducing premiums by reducing underlying health care costs, which HSAs should achieve, we also need to restore annual and lifetime caps. This would allow significant reduction in premiums. But what happens to poor ol’ Ben when expenses exceed those caps?

Then a safety net comes into play. Almost all Republican plans include them, but they are called “high risk pools.” When Ben’s costs go beyond the caps, the state-administered safety net sends a check to the association where Ben’s coverage exists.

Competition among healthcare providers is more important than competition among insurers to drive down premiums. But that trend is going the opposite way as hospitals gobble up orthopedic, cardiac and anesthetist groups and skin doctors. Medicare pays a cardiologist $200 for a cardiogram done in his office. When a hospital buys his practice they are allowed to attach a “facilities fee” of $700. How can we stop such increases?

More competition might also curb run away administrator salaries. One East Coast hospital pays $3.4 million to its top guy.

The president of Aetna, which is expected to survive, says insurance companies are in a “death spiral”; policy holders are dropping or being dropped.

But do not despair; here cometh Medishare. A friend and his wife now pay a $5,000 premium with a $10,000 deductible instead of costs totaling $32,000. Medishare is only open to professing Christians with Christian lifestyles, moderate drinking accepted.

Medical expenses are shared among members, akin to an insurance company. These arrangements were banned by Obamacare, but two were grandfathered. Why not allow others.

Building a “patient lobby” would help match the power of the aforementioned big players. We can make that happen.

Foster Friess founded Friess Associates, which grew to $15 billion in assets under management. He now promotes “return to civility” efforts. Twitter: @FosterFriess


Please forward this Washington Times op-ed to your Congressmen and Senators and ask for their feedback. Also ask them to follow me on Twitter @FosterFriess so we can get them engaged to better understand our needs as patients.

God Bless,

Let’s all of us promote Civility.
Together We’ll Get There!


  • Jeff Kunz MD says:

    You offer many important reforms that would improve quality while driving down cost through competition. What is missing is the group or groups to make this happen. Can a collaborative effort to make congressional change not be achieved? Without a strong, widespread effort individual or allied lobbying groups representing special interests will prevail. Perhaps we should not throw out the baby with the bath water. if we discontinue the Affordable Care Act (ACA) without recommending improvements we risk total chaos and/or continued subjugation by special interest lobbyists. Let’s build on what works in the ACA and inject more competition and less onerous regulations.

  • Ken Gaume says:

    Our son, Jacob, was born on March 20, 2010. By 3pm the following day he was diagnosed with a complex form of congenital heart and lung disease that my wife and I could never have fathomed. The shock was immediate, complete and overwhelming. Still in shock from the news about Jacob, that evening I watched in a fog as the House voted to pass the Affordable Care Act. It was truly surreal. In the run up to the vote, I recall thinking the law was good, offering healthcare to individuals that could not previously access it seemed right. Now our family was faced with a grave medical issue. I recall thinking at the time that this new law would impact our family in ways I could not imagine.
    Over the next six years our family adjusted to Jacob’s condition and fought for his life countless times, as the country grappled with the new landmark legislation. While our family dealt with over 180 days in the hospital, consultations with 4 major pediatric heart centers, 29 heart catheterizations, 4 open heart surgeries, 4 helicopter life flights to the major heart centers in Cleveland, 2 med-flights to his primary care facility at Boston Children’s Hospital and 15 car trips to Boston for medical procedures, the country seemingly became more divided over the law. Our goal was to provide needed medical care for Jacob while maintaining the new normal for our other 3 children, Maddie, Andrew and Ryan. The last six years have been very difficult, yet rewarding. The gifts of Maddie, Andrew, Jacob and Ryan have truly enriched our lives.
    As we continued to fight for Jacob, the country continued to fight over Obamacare. Now we stand on the edge of repeal. I wish to convey Jacob’s story and how Obamacare positively influenced his life. The law is by no means perfect. However, I truly believe Obamacare had a role in saving Jacob’s life and allowing our family to maintain the lifestyle we desire.
    Because of timing and fate, we always operated in an Obamacare environment in making our healthcare decisions for Jacob. We are very grateful for that. Luckily fears of financial instability because of Jacob’s condition were always passing hypotheticals. Prior to Obamacare, lifetime maximums for health care were common place. Jacob’s care resulted in medical bills that far exceeded the previous maximums. The removal of lifetime maximums because of Obamacare allowed us to make health care decisions that were in the best interest of Jacob. We never had to consider catastrophic financial burden scenarios, until now.
    Reverting back to a pre-Obamacare environment is extremely scary for our family. Your article states “what happens to poor ol’ Ben when expenses exceed those caps? Then a safety net comes into play. Almost all Republican plans include them, but they are called “high risk pools.” When Ben’s costs go beyond the caps, the state-administered safety net sends a check to the association where Ben’s coverage exists.”
    Jacob’s care requires that he be seen by the best doctor’s at Children’s Hospital Boston. We live in Ohio. Will the High risk pools restrict Jacob to receive care only in the state of Ohio? This is a key question to our family.

  • Rich Sugden M.D. says:

    You hit the nails on the head Foster. Your ideas are very similar to the proposal that SEN Paul Ryan is proposing, with his addition of “Associations” of folks in similar situations, employment, religion, hobbies, etc… to allow reduced rates for large numbers of members .. similar to employer “pools” that allow more competitive rates. Along with HJSA’s, selling insurance across state lines, removing any mandates and requirements for unnecessary services etc… Dr. Loel Fenwick, the inventor of the Birthing Bed and Birthing Room, who single-handedly changed maternity care around the world, has proposed an almost identical solution for healthcare. Also, there should be NO prohibitions against trying ANY healthcare system or idea, as there was under ObamaCare … The more ideas the better … and let the best one percolate to the top on its merits! (40+ years of family medicine experience .. and have seen all the problems as they developed!)

  • To Ken Gaume, God bless you and your wife for the fight you are putting up for your little Jacob. America needs more people like you who value life and fight for it. My heart goes out to you for the nightmare you have been through. I hope I can get updates on Jacob’s improving condition.

    The answer to your question is, ‘Yes’. Note the paragraph where it draws the analogy to a car wreck. Driving across country, you have a car accident. Totalled. Your car insurance covers you.

    My point is this should be the same for your health care. We need to “end the discussion of in network/out of network” is the way I expressed it.

    Do you feel the ideas I expressed would have worked for you if they were in place prior to Obamacare? Your costs are shared in three segments…..your family plays a high premium than marathoner Tom….but its increase is limited so as not to exceed your ability to pay.

    Then your costs are spread through the association to which you belong. The limits insurance companies are exposed to in a year or lifetime are re-instituted which allows insurance companies to dramatically lower premiums. I don’t know yet what that number should be?? $250,000? $100,000??

    But once it is reached the insurance company is relieved of future burden and the “Safety Net” of Ohio, assuming you bought your insurance as part of Ohio State alumni, comes into play.

    It writes a check to Ohio State alumni insurance pool from the Safety Net (commonly called “high risk pools” by the politicos) that the federal government has helped fund as part of shifting Medicaid dollars to the states.

    This, Ken, should give you the support from your fellow citizens in a much less destructive way than Obamacare which my article detailed by soaring deductibles and premiums of Everyday Americans. Like it?

    Send me a photo of Jacob so I can see him when I include him and your family in my prayers. I hope James 1;2 has some relevance for you. You are an inspiration. Have a Philippians 4:8 sort of day…….God Bless, Foster

  • kimberly gienko says:

    We appreciate this editorial piece, makes perfect sense.
    Passing this one along to some retired doctors and surgeons.
    I am sure you will receive a lot more positive feedback!

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