Wednesday, February 27, 2013

Desires of the Elite

Our health care establishment was not built to the needs of the people but to the desires of a ruling elite.

Markets form around the flow of resources.

In the status quo, most health care resources flow from a large pool (either owned by an insurance company or the government) to the care provider.

Information aligns with the flow of resources.

The valuable information in health care flows from the providers to large centralized entities. The people are simply cut out of the process.

The desire of the ruling elite is to sit on a throne and dictate the allocation of resources.

This desire is at the heart of both the Republican and Democratic approaches to health care. Republicans have a vision of powerful business leaders sitting at the helm, and Democrats have the vision of powerful government bureaucrats.

The health care debate is false dichotomy in which the Left and Right struggle over the control of the ring of power.

But health care should be about care of the health of the people.

Independents must stand up and question the need for a health system controlled by a centralized bureaucracy.

The radical reform that I've proposed is simply to do the accounting on person by person basis.

The heart of the medical savings and loan concept is that all transactions should flow through personal savings accounts.If the transactions for personal care flowed through accounts owned by the individuals, then the accounts would provide complete information about the health spending of the individual. If we add to this a simple document management system, the accounts could serve as the basis of a medical records system.

Changing the flow of resources would lead to fundamental changes in the medical industry. Note, insurance agents and claims adjusters work for the owners of the insurance pool. If the money flowed through individual accounts, the focus of these positions would change from working for the insurance company to people who worked directly with the public. I changed the name of the position to "Health Care Advocate."

I have a wonderful presentation on this plan that I've been dying to give for the last five years. The presentation takes an afternoon. I live in Salt Lake. I am willing to travel.

Our health establishment was built for the desires of the ruling elite. PPACA (ObamaCare) is just a step on the road to ruin. If we wish to assure prosperity for future generations, Americans must stand up for the restoration of health freedom.

Tuesday, February 26, 2013

Financial Accounts and Medical Records

In his speech at the National Prayer Breakfast,  Dr. Benjamin Carson suggested that we give each American a Health Savings Account and an Electronic Medical Record.

My take on this subject is that one's medical records and their savings account are part of the same thing.

Here is my reasoning:

Health Care is the application of time and resources to the care of health.

The actions people take in concerning health occur in a chronological order and involve the use of time and resources.

If we start with an accounting system and add to it a detailed document management, then we would end up with a complete view of each person's financial and physical health.

It is true that doctors record biometrics that go beyond basic accounting. But, this idea that we shouldn't sully medical records by storing them in the same filing cabinet with financial information is absurd. It is on par with the idea that doctors should only speak Latin to avoid sullying the profession with the common tongue.

The system of keeping health records with financial records already exists in the insurance industry.

The flow of information in health care follows the flow of the money. In both insurance and socialism (insurance is socialism at a corporate level) the information flows from large pools to large providers. Health information flows back along this chain.

In many cases, the insurance company will have better information about a patient than the doctors.

The fact that information follows the flow of money is not surprising. Money, after all, is simply information. I have a desk littered with scraps of paper. I can change the scrap of paper called a dollar bill for a candy bar because of the information it represents.

Money is simply a tool that humans use to help quantify time and resources.

So, medical records are created by doctors recording biometrics. There is a cost associated with this activity; so there is pretty much always a financial record that corresponds with a medical record.

If our goal is to create a top notch electronics medical record, we would do well to start by giving each American an account through which we run all health expenses.

We can very easily attach to this a document management system with which we can add extra information.

The sweet thing about starting with the financial record is that it will provide funds for the maintenance of the records.

Dr. Carson is on the right track. I would amend the argument by pointing out that the basic structure of the financial record and medical record are so similar that we would do better to start with a unified record. The easiest way to do this is to start with the savings account and add a document management system.

Monday, February 25, 2013

Off Election Year Politics

2013 is not an election year. To build credibility for his show, Sean Hannity allowed Dr. Benjamin Carson on his show to talk about free market health care reform.

I've followed the health care debate since the 1980s.

This pattern repeats every single election cycle.

The GOP will permit free market rhetoric during off years. The GOP then clamps down on discussion of free market reform and push those wishing to advance the cause of freedom into the wilderness.

Notably, during the off election season of 2009, the GOP allowed the Tea Party movement to form. The Tea Party gave the GOP enough momentum to capture the House in 2010. The GOP establishment turned full force against the freedom movement, and in the 2012 election, the GOP produced the disastrous Mitt Romney campaign.

Think of the contempt the GOP has for you the voter. The GOP thinks so little of the American people that the party had the audacity to run the father of RomneyCare to defeat the father of ObamaCare. (The two plans are the same).

I've mentioned in the past that the internal pendulum swing within the GOP is a primary factor in the diminishing liberties in the United States.

The GOP has a long history in which they promote free market rhetoric when they are in the minority. When they get in power, the GOP enacts big government expansion.

Free market rhetoric is fine, but I want to see people moving beyond rhetoric to action.

I was thrilled to see Dr. Carson on the Hannity show, but the good doctor said nothing new.

Dr. Carson repeated arguments for free market health care reform that were made in the 1980s and 1990s.

There was a substantial free market health care reform movement after the HillaryCare debate in 1993.

All of the great ideas people put forward were put down. The GOP (which receives buckets of donations from the insurance industry) suppressed the ideas that arose in that debate.

These ideas have been around for decades. The problem is that the ideas have never been developed beyond rhetoric.

Because the ideas have never been fully developed, the ideas systematically fall short.

The best example of how free market ideas get destroyed can be seen during the Bush Administration.

The Bush Administration included tax deductions for Health Savings Accounts in his push for Medicare and Prescription Drug expansion. Large insurance firms created products that tacked a HSA onto High Deductible Insurance Policies.

If you run the numbers on the Bush plan you will find that the program is extremely regressive.

The rich get a nice little benefit from the tax deduction.

Seeking to cut costs, companies give the high deductible insurance to low wage workers. The low wage workers don't have the money to put into savings. They don't get a substantial tax deduction.

The Bush Era HSA creates a system in which low wage workers stop receiving basic and preventative care.

People with chronic conditions fare even worse. Imagine that your diabetes requires $2,000 treatment a year for twenty-years and your insurance has a deductible of $3,000. Well, you have to pay the full cost of your diabetes. Your insurance company will see your diabetes as a risk and raise your premium.

To add insult to injury, the HSA+HDHC combination fails to restore the pricing mechanism. The cost drivers in medicine happen with expensive care (not with the inexpensive care). High deductible insurance does not reduce costs, because its the expensive care exceeding the deductibles that drives the cost of medicine.

When we let the political establishment implement Health Savings Accounts without any input from the public, the political class will create the worst possible implementation of the plan.

To create an implementation of the Health Savings Account that advances the cause liberty and restores balance requires something that Conservatives are simply unwilling to do.

It requires people meeting together and talking about free market alternatives to insurance.

I am at the ready to discuss this issue. I live in Utah. I will be happy to drive to Arizona, Colorado, Nevada or possibly even Southern California.

Anyway, I am delighted that Sean Hannity allowed a discussion of free market health care on his show.

The ideas presented on the show are undeveloped. If anyone is interested in developing the ideas fully, I am ready to hit the road.

If the GOP remains true to form, Republicans will allow free market rhetoric during the off season but will push the ideas aside during the next election year.

The freedom movement needs to take advantage of the pendulum swing and create a fully developed implementation of health savings accounts that will fly in the next general election.

Saturday, February 23, 2013

Virtual Office

I admit, I am intrigued with DaVinci Virtual Office. This is on demand office and meeting space. They have locations all over the place. If I subscribed, I could travel around without looking like a homeless, no-good bum. Unfortunately, the subscription fee is out of my range.

What I Want

I would not ask for help if I did not have a clear and achievable goal in mind that would help advance the cause of liberty with positive benefits for those involved in the effort.

The achievable goal is to create an entity called "The Health Care Advocates Association" which will explore free market health care reform.

The weak part of PPACA (ObamaCare) is the insurance mandate.

The way to defeat PPACA is to create a compelling alternative to insurance.

If there was a compelling alternative to insurance, then people who are unhappy with their insurance could rise up and yell. "We don't want insurance … we want this instead."

By creating an alternative to insurance, I am creating a mechanism that would allow people to say: "I want to opt out of PPACA and the corruption that it represents."

My presentation is about the business of financing health care. It is not a government program. It is not a pursuit of government handouts. It is a program that seeks to empower people to take control of their health.

There are political ramifications of the program. By creating an alternative to insurance, I will give the freedom movement a positive cause.

Arguing against PPACA is a negative cause. People who argue negative causes are pulled into an ugly form of action and reaction politics which can undermine their efforts.

Creating an alternative to insurance would allow members of the freedom move to present their position as a positive cause. It allows people to say: "I want options." I don't want to be shoved into an insurance plan. I want the option to take a different route.

I hate politics. I am not a politician.

I believe that funding health care is a business problem and required innovative business solutions.

The code name of this project is "The Medical Savings and Loan."

In this program, all transactions flow through an account owned by the patient. Since the transactions flow through individual account, the account will create a complete and accurate picture of a person's lifelong health.

Changing the flow of resources changes the focus of jobs in the insurance sector. To highlight this change, I changed the titles of the insurance agents and claims adjusters to "Health Care Advocate."

I created an entity called "The Health Care Advocate Association." The goal of this association is to define the best business practices of the Health Care Advocate and to create business plans built on savings accounts and grants.

The entity exists as a sole proprietorship. I want to hold meetings to gauge interest in the plan.

If people are interested, I will draw people from the meetings to create the program as a professional association.

If you attended a meeting, I would discuss the plan. If people are interested in moving forward with the plan, I might ask them to become members of the board of directors.

BTW, people who become a member of a board of directors in its founding stage get to be called "Founding Members" of the organization.

If this idea takes off. The potential of the program is unlimited.

The cost is essentially nothing. You have to listen to some nimrod talk about free market health care for a couple hours. If you find merit in the idea, then you could become a founding member of an organization with unlimited potential.

I live in an intellectual backwater called Utah. Currently, I am thinking of heading South to Arizona and possibly Southern California.

I am a third generation Coloradan. I would be happy to drive East to my home state. Utah is pretty and has great skiing. If someone wanted to fly out here, I'd be happy to combine the meeting with a ski vacation or even a photography trip to Southern Utah.

What I am looking for is a person to make a serious commitment of a date or time to hold a meeting on free market health care reform. For example, I am willing to meet on on the Ides of March on the London to the dagger name is Brutus, et tu?

If I had a firm date, location and time for a meeting, then I would have something to plan for.

Friday, February 22, 2013

Group v. Individual Analysis

I was asked to explain my mathematical model.

Insurance analyzes the health experience of a group over a year. People are dynamic beings. People often move between groups. People will often belong to more than one group at a time. Sometimes people are not in a health group.

Insurance creates a fractured view of individuals.

I believe that health care should be administered to individuals and not groups.

I wish to see health care based on a full life cycle analysis of the individual.

Now, it just so happens that the flow of information in health care follows the flow of money.

This is not surprising. Money is nothing but a piece of information. Money is a tool that humans use to quantify resources. 

In the insurance model, money flows between insurance pools and large health providers.

The fact that the money is flowing through these massive pools creates a fractured view of the individual.

My goal is the change the flow of the money so that it flows through individual accounts held by people.

Imagine for a moment that all of your health spending flowed through a savings account and that this savings account included a document management system that recorded the itemization of each bill.

This account would provide you with extremely valuable information related to your health.

Changing the flow of information would change the focus of all the jobs in the insurance industry. Notably, a claims adjuster is a person who is controlling the flow of resources from a large insurance pool. Changing the flow of resources would change the focus of the job from the needs of the pool to the needs of the individual.

To denote this change, I created a new job description called a "Health Care Advocate." The advocate oversees the flow of resources through an account and helps maintain the documents that flow back from the care providers.

So, if you were a member of the Medical Savings and Loan, all of your health spending would flow through an account in your name and under your control.

To gain perspective on your personal health, you need to know how you fare in regards to others.

Members of the plan allow actuaries access to summary information from their account.  So, from each account I abstract summary information. The summaries are stripped of any personal identifying information.

Since the account is under your control, you will see both the extracted information and the groups that analyze the information.

I take the summaries and merge them together to create composite views.

Clients will periodically have sessions with their advocate in which they compare their personal health experience with the composite views.

The composite views might track pertinent information such as health-effecting lifestyle choices, preventative medicine, diseases, major injuries, catastrophic events, genetic make-up and anything that affects health.

By looking at the composite views, you and your advocate will make projections of your expected expenses. These projections will become a basis for your savings plan.

In my ideal plan, summary information also includes data about your income and savings. The plan would also include data on any unmet health needs in your life. By including summary financial information in the composite views, we will be able to compare people's physical health with their financial health.

Now, if the ratio of your health costs to your financial condition is within the norm, then you are expected to self-fund your care. If your health experience and financial condition is out of whack, you will need additional assistance. (It's this basic)

So, the Medical Savings and Loan has a different mathematical model than insurance. With insurance we place the resources of the group in a pool. Actuaries analyze the experience of a group over a year. Insurance companies use this analysis for speculative plays on the health market.

The Medical Savings and Loan sees each person as a whole being. The program channels all of the health spending through a savings account owned by client.  It creates composite views of the health experience of others. This allows you to make a side-by-side comparison of your personal experience with the experience of others in your community.

I transform all the insurance agents, claims adjusters and medical transcriptionists into a new profession called the "Health Care Advocate." You will periodically work with your advocate to make sure your personal information is correct and to create a projection (based on real world information) of your future health expenses.

The program gives people who can self-fund their care the tools and knowledge needed to achieve this goal. The program also identifies those who cannot self-fund their care.

The composite views identify the people who can self-fund their care. It also identifies the people who cannot.

The composite views will show information about the amount of funds held aside for assistance. The views will also show how the grant money was applied.

The presentation that I've been wanting to have for the last five years simply talks about how these two approaches to funding health care differ.

The goal of the presentation is to build a full business model around this mathematical model. If a group of people met and created a new business model around this mathematical model, then the group of people could march into the political arena and say: "The problem in health care is the overuse of group financing for individual consumption." The solution to health care is not to force everyone into a pool, but to provide an alternative mechanism for funding care.

The Achilles Heel of PPACA is the insurance mandate. The mandate is premised on the false assumption that pooled insurance is the only possible way to fund health care.

The people who engage in this conversation must be brave. Simply considering alternatives to insurance means that you are standing against the most powerful people in our nation.

I live in Utah. I am not LDS. The LDS Church (Harry Reid, Mitt Romney, Karl Rove, Governor Mike Leavitt, Governor Huntsman, and crew) are fully committed to the idea of socializing medicine through health exchange.

Open discourse is not tolerated in the Beehive State.

The people who run this state are vicious. If you so much as question their power, they do everything they can to drive you down.

 I have enough space on my credit card to drive up to 700 miles and get a hotel for two nights.
 For five years I've been staring at a map. This range includes Denver, Cheyenne, Phoenix, Tucson, Las Vegas, Reno, Idaho ... or possibly Southern California.

I think Arizona is the best bet.

The problem is that I cannot force other people into a room. I have absolutely no desire to force anything on anyone. I dislike PPACA because if forces a negative ideology onto this once great nation.

Unfortunately, I'm just stuck here in Salt Lake until I get an invitation from a group with a half dozen or so people who are brave enough to stand against Obama, Romney and other forces of oppression for the good of their fellowman.

Wednesday, February 20, 2013

Grants v. Insurance

I created a presentation called "The Medical Savings and Loan." The goal of this presentation is to create a system for funding health care built from the ground up around savings account. I designed this program to replace an employer based insurance pool. The program has to be understood in contrast to insurance.

The primary feature of this program is that all medical spending flows through savings accounts owned by the members. Since the money is flowing from individual savings accounts to providers, I realized I had to change the job description of the claims adjuster. So, I snuck into Hogwarts. Stole a wand. Waved it and the Claims Adjusters magically transformed into "Health Care Advocates."

The advocate helps people with the savings plan. The advocate helps find care providers and helps negotiate services with doctors. They have other duties which we will discover below.

I realize that people may have insufficient funds for a medical emergency. So, I require members to buy a share in a loan reserve. This reserve is used for interest free loans. The loan reserve involves both a lost opportunity cost and medical lending has a high default rate. The cost of the lost interest and the default is the premium members pay to have access to interest free loans.

The combination of savings accounts and interest free loans give people who have the ability to self fund their care to accomplish this task. So, lets say you have a medical emergency that costs $10,000 more than is in your savings and heal up. You would borrow the $10k and start paying it back.

I realize some people have medical costs that they can't repay. For these people I created a well funded system of grants. There is a fundamental difference between grants and insurance that I will talk about below.

I created the Medical Savings and Loan as a replacement for insurance. I will give a very simple presentation that has a lot of loose ends. The purpose of this example is to show how loans and grants work together.

For arguments sake: Let's say there was a group of 10,000 people with an expected annual health expense of $82,000,000 with a 10% margin of error. An insurance company might offer to cover this risk for $90,000,000. They charge a premium that comes to $9,000 per member.

Rather than putting this money in one big pool, I will place some of the money in the Savings Accounts. I will put some in a Loan Reserve and hold back the rest in a grants program. In the real world, the break down would be based on actuarial analysis. For arguments sake, I will simply divide by three.

If you were a member of this group, I might do the following. I would place $3,000.00 in your savings account. (There is now $30,000,000 in the savings accounts). I would give you a share in a loan reserve with a cash value of $3,000. (I know have a loan reserve with $30,000,000).

The last $30,000,000 is for grants. I will place it in the loan reserve so that we know have a loan reserve loaded with $60,000,000.00. We will talk about grants below.

The loan reserve works as follows: Each person has a share in the reserve worth $3k. (In this example, the grant agency has 10,000 shares). At the end of the year any money not lent out would fall into the savings accounts. Of course, you are required to buy a share in the next year's reserve.

Lets say $50,000,000.00 of the $60,000,000 was lent out. There are 20,000 shares. $10,000,000 distributed among 20,000 shares is $500. At the end of the year, the reserve would pay $500.00 into your savings account. Imagine that $10,000,000 or the loans were repaid in the second year. You would get $500.00 at the end of the second plus the used portion of the second year's reserve.

Do you see how this works? Every year you buy a share in a loan reserve. Buying a share gives you access to interest free loans. As people repay loans, that money falls into your savings account.

As people pay back their loans, the money will fall into the savings accounts of their coworkers. Imagine that after 10 years people repaid 90% of their loan. You will have seen $2,700 of the original $3,000 repaid into your account. Imagine that the last $300 fell into default. That default plus the lost opportunity cost of the money is the premium you paid to have access to interest free loans for a medical emergency.

Losing $300 in a loan default is a much better deal than losing $9000 to an insurance company.

The idea of a loan reserve sounds bizarre. It is actually a better deal for employees than employer based insurance. It gives people the same amount of protection, but provides a mechanism for employees to build equity in their accounts.

BTW, I should repeat here. You are an employee. This system is replacing your insurance pool. Your experience is that your employer gives you a share in a loan reserve. Having a share in a loan reserve means that you have access to emergency medical loans and you get a little pile of money every year as your coworkers pay back their loans.

The money lost in this program went to help one of your coworkers who had a bad medical expense.

So, I want to talk next about the people who have big medical expense. There experience is as follows. They will be given a savings account and a health advocate (who was a claims adjuster before some smug-muggle snuck into Hogwarts, stole a wand and went around casting spells).

So, you have some money, but it is insufficient for your needs. Your advocate will help you find doctors and negotiate bills. The advocates will help you secure loans.

There is a huge loan reserve. The amount of money in the loan reserve was determined by the same actuarial analysis used to put money into an insurance. You will be able to borrow sufficient amounts of money to pay for your health care needs.

A caveat of this program is that people with large medical expenses are expected to pay back their loans if they can. We will define this question of "if they can" later in the program.

Please notice what is happening. A person with a big medical expense is going to a health care provider with a health care advocate at his or her side. This person has access to a loan reserve with the same amount of money as an insurance company of similar size. The patient has cash in hand. The patient has an advocate experience in negotiating with doctors. This patient is expected to pay back a sizable chunks of the amount spent at the doctors.

The Medical Savings and Loan has just created a viable mechanism for restoring the pricing mechanism in health care.

When you are buying health care, you are doing so with the expectation that you will have to repay the loan.

Now, lets get back to the $30,000,000 set aside for grants. The $30,000,000 was foolishly invested in a loan reserve by some right-wing nut job who thinks Harry Potter is real.

But that is not that big of a deal.

The grant agency has a legal obligation to disperse the $30,000,000.00 to people who had higher than normal health care expenses.

The grant agency will "disperse" its money by writing off loans. So, the fact that the money was invested in the loan reserve isn't that big of a deal after all. Hmm, maybe Harry Potter is real?

Did I mention that you had a health care advocate? When you borrow to pay for your high medical bills, your advocate will apply to the grant agency.

So, the grant agency will end up writing off $30,000,000.00 of the loans. This will cover a good portion of the loans, but not all of the loans. People with high medical expenses will end up paying back a good portion of their high expenses from their personal finances.

Remember, the mantra of the Medical Savings and Loan is: Those who can self fund their care should. The writing off of loans will have a needs based component. Imagine that an executive making $500,000 a year had an unfortunate accident in the hot tub while celebrating his $200,000 Christmas bonus. The incident cost $50,000.

Sorry, but this bozo can afford the $50,000 hospital bill.

The minimum wage janitor who was hit by a car while biking home from work will have a much harder time paying that $50,000 medical bill.

This program fares well in the progressive test. There is a big transfer of wealth from the healthy to the sick. There is needs-testing of the grants as well. Above all, there is a massive transfer of wealth from the big insurance pool into the pockets of the workers.

On the conservative front. People will buy health care on a fee-for-service basis with the expectation that they must pay back their loans. People with higher medical costs are expected to pay a higher portion of their care.

An important aspect of this program is that people with large medical expenses are expected to pay more. The grants assure that middle income workers to not see an outlandish increase in what they pay.

Did I mention the bozo executive who tripped in a hot tub while celebrating his $200,000 Christmas bonus? He has to pay more.

But, I've never been all that fond of clowns ... especially the ones in suits.

The above simplistic model shows how savings, loans and grants work together.

All health expenses flow through the savings account and care is delivered on a fee for service basis. The costs are negotiated with the help of a trained advocate.

People who have insufficient funds get loans from a well funded loan reserve. The loan reserve just happens to include a huge amount dedicated for distribution as grants. The grants will be distributed by writing off the loans.

With this basic model in mind, I can finally address the difference between grants and insurance.

A grant agency has a huge pool of money. The agency has a legal obligation to disperse the funds according to a formula. In the above example, the agency has $30,000,000. The agency is required to distribute this $30,000,000 to the people in our group of 10,000 workers who had above normal medical costs.

The formula includes needs-testing. The overpaid bozo in a hot tub scores lower than the deserving janitor who is putting thirteen orphaned-children through college by riding a bike to work.

The grant agency works seamlessly with the loan reserve. A person with high medical bills will have the experience that that a mysterious loan agency writes off a big portion of the loans.

In contrast, insurance is unwieldy. With insurance an actuary analyzes the expected experience of a group. An insurance company will speculate on that risk and offer to cover the risk for a premium. The premium includes a big profit to cover the cost of the risk.

People with a health expense will file a lawsuit against the insurance pool. The biking janitor does not have the same legal clout as the suited-clown. The janitor might get some substandard and be expected to man up and live with the pain, while the suited bozo will get lavished with the best care political influence can buy.

Insurance is such a stupid thing. Everytime you want to see a doctor, you have to file a lawsuit.

Yes, if you are a political insider, you can get lavished with care. If not, God help you because because the insurance company that took your money won't.

The structure of the Medical Savings and Loan sounds bizarre. However, the program leads to more equitable results than insurance. We can see this when we examine people with chronic conditions.

Imagine two sportsman. Each have an insurance policy with a $3,000 deductible.

The first breaks a leg in a skiing accident. It costs $23,000 to pull the skier from the slope and slap on a cast. Too our great joy, the skier heals up and has a great story of an adventure in Park City. He pays a $3,000 deductible and the insurance pays $20,000. The insurance company raises the skier's premium for a few years, but it falls back down again because the the accident did not increase the client's overall risk profile.

In the second case, a fisherman tweaks his back while reeling in a steelhead. He goes to a chiropractor that costs $3,000 and finds out that he will need a treatment that costs $1,000 a year for the next 20 years. To make matters worse, the fisherman with the bum back now has a decreased earnings capacity.

The insurance company pays nothing because the $3k is under the deductible. Since the guy has a bum-back the insurance company jacks up the insurance premium $500 a year for life.

Both sportsmen had an injury that cost $23,000. The skier has a great story of a fun adventure. The fisherman has chronic pain for life. The insurance company will give the skier $20,000 simply because the cost came in a lump sum. The poor fisherman gets nothing and has to pay a higher premium.

The Medical Savings and Loan works as follows. Both sportsmen had $3,000 in their savings account. The skier has to take out a $20k loan. The fisherman pays the first bill from cash. The advocate will learn that the fisherman has an expected $20,000 in expenses and a lower earnings capacity.

Because this system is looking at each person as whole being the grant agency will end up giving the fisherman a little bit more than the skier because the guy with the bum-back and decreased earnings capacity has it worse than the guy with a cast and a story to tell.

This is a much better deal for you than your old insurance because you are now building equity in your savings accounts.

If you are lucky and don't have high health costs, you will see a tidy sum accumulate in your savings account.

Tuesday, February 19, 2013

Health Information

My goal for the last five years has been simply to have a meeting in which people spoke about free market health care reform. The goal of this blog is simply to show the types of arguments that one might make if a group of people sat down to discuss free market health care reform.

Personally, I am floored by the fact that, after five years and hundreds of pleas to every "conservative" group within an 800 mile radius of Salt Lake City, I've been unable to find anyone brave enough to discuss free market health care reform.

To all of you so-called conservatives out there: If you have zero interest in even discussing free market health care reform, then you should shut up and support Obama in his effort to nationalize health care.

If you are unwilling to spend an afternoon talking about alternatives to ObamaCare, then you have no business campaigning against Obama.

I put together a program to start a dialog about free market health care. I've avoided putting the program online because I want a dialog and not another monologue.

I decided to tear a page from the presentation and present it below. This part of the presentation talks about the proper role of medical savings accounts.

The Medical Savings Account

I've been upset with the low quality of the health care debate. I believe that, in the information age, our health care debate should be information driven. The health care debate should start by discussion how we gather health information and how we decide if a plan is effective.
So, let's start with question: How would you go about collecting information about your health?
Imagine for a moment that you spent decades meticulously collecting information about your every health expenditure. You kept this information in an audited database.
This database would provide you with some great information about your health care needs. However, the information lacks context. The information you gather does not tell you how you fare in regards to others.
Now, imagine that ten thousand people gathered meticulous records about their health expenses and shared that information.
This second idea is absurd. The idea that ten thousand people would spontaneously start recording their health expenses is absurd. The idea that ten thousand people who created their own database would be able to share their information is even more absurd.
Now, imagine that you had a savings account and that every single one of your health transactions took place through this account. One could add a simple document management program with an itemized detail of the billing and the savings account would be an impressively detailed and accurate record of medical expenses.
If all of your health transactions flowed through an account in your name, then that account would become a de facto record of your health experience.
Now, imagine that ten thousand people had similar accounts and that they agreed to allow actuaries access to summary information about the accounts?
These individually owned medical savings accounts would become accurate records of our health experiences. Since each account is an audited record of individual health experiences, we could use the medical savings accounts as a basis for judging the effectiveness of our health care decisions.
In the insurance paradigm, payments flow from an insurance pool to the health care provider. The insurance company records information about health transactions that take place through their pool. If you move between pools or spend money outside the insurance system, then this information is excluded from your record and you have an incomplete health record.

To make matters worse, the insurance company holds your personal health information as a proprietary secret. Insurance companies might calculate your individual risk profile, but they don't want you to know this information because the imbalance in information gives them an edge in negotiation.

My thoughts on health care reform start with the notion that all of your health care transactions should take place through an account in the individual's name and under the control of the individual. If all transactions took place through individual accounts, then the individual accounts become accurate and audited records of the individuals health experience. If individuals had access to this information, then they could use the information in the accounts to help guide health decisions. Finally, if each person had an account that was under their control, then we would have an information base that we could use in judging the effectiveness of programs and in making health care decisions. The insurance paradigm creates a fractured view of the individual.

The first reform I wish to put forward is the idea that each individual in our society should have a medical savings account and that all of their health transactions should be driven through this account. It is basic information science. If each person had their own account and all transactions took place through the account, then these accounts would become accurate and audited health records.

Sunday, February 17, 2013

Fee For Service Medicine

I happen to like a concept called "fee for service medicine."

In fee for service medicine, a patient will have a direct contract with a doctor to perform a medical service.

Many people believe that fee for service medicine is immoral. Their argument starts with the statement that medicine is a higher calling and that doctors should not be constrained by an obligation to an individual patient but are, in fact, operating at a higher level in which they are performing a service to humanity.

With insurance, the doctor has a contract with an insurance company and is administering care to members of the pool. Members of the GOP believe that health care should be provided by a system in which doctors have contracts with employer based pools. The left believes such a system is inequitable and want a state owned pool.

The primary health care debate starts with the assumption that medicine is a higher calling and doctors should not be restricted by obligations to individual patients. The issue is who owns the pool. Should the pools be owned by billionaires or should the pools be owned by the state.

I admit. I am standing way out in left field waving my arms saying. "You know. Just maybe we should discuss the idea of fee for service medicine."

I realize that my radical stance (that health care could be delivered on a contractual basis between a care provider and a patient). I realize the radical notion that doctors have obligations to individual patients is in direct conflict with the progressive notion that medicine is a higher calling and doctors administer care to groups not people.

I realize that my idea of a doctor providing a service to a patient is radical beyond belief and is completely outside the health care debate. But, I have a subtle argument that says a collective is actually a group of individuals, and that if doctors worked on a fee-for-service basis providing care with direct contractual obligations to patients that we would create a world with healthier individuals. Healthier individuals means a healthier group.

I understand completely that many doctors today scoff at the idea that they should have any sort of direct contractual or moral obligations to patients. But, guess what, there just may be some doctors in this world who do believe that they are providing services to individual people, and that they should be able to form contracts to provide care to patients on a fee-for-service basis.

I am standing out here in left field watching republicans argue that the pools should be owned by billionaires while the left want the pools owned by the state. I believe this to be a false dichotomy, and I just want a group to entertain (even for just a moment) the radical notion that doctors provide services to patients.

I know the idea would be rejected by both the GOP and by Progressive, but I think the debate would be fun in and of itself.

Friday, February 15, 2013

Creating A Group

IMHO, the first step to promoting free market health care reform is to create a legal entity whose sole purpose is to discuss and promote reform.

An organization can start as a sole proprietorship, but should consider incorporating as a trade association, or educational or political action group. The group will decide the direction to take when the time is ready.

A legal entity should have a location. The location could be a home address or a box at the UPS store. I was just looking at the Virtual Offices of Davinci Suites. A virtual office has meeting space, an internet connection and a mailing address. What else could a traveling gnome desire?

We need a location. I happen to really like Utah. Utah has the best scenery. Utah has skiing at mountain resorts and canyoneering in deep gorges. Here is my Utah tumblr gallery. Unfortunately, I've not been able to gain any traction.

To put this mildly. The good people who "share Utah values" have told me in a firm commanding voice to "convert or leave." But that's just part of living in Utah. You get used to it.

I am a third generation Coloradan and admire the independent streak of the Centennial State and the Equality State to the north.

California is brimming with creative talent. I studied math at Santa Clara University. The creative and intellectual talent in California amazes me. Unfortunately, the state is burdened with an activist legislature and activist court system which would hurt this effort.

My goal is to question the insurance industry. Insurance is based on the same equations as the gambling. So, I want to avoid Nevada.

There are aspects of the conservative community in Arizona that makes me feel uncomfortable, but I've been impressed with the way that Arizona has been standing up for traditional American values. The AAPS in Tucson and Goldwater Institute in Phoenix are doing an amazing job standing up for free market health care.

Now, the way things work in America is, that for a group to have a national impact, it is best to set up addresses in multiple states.

My inclination for the last several years has been to create a legal entity the head office somewhere in Arizona with state chapters in Utah, Colorado and what not.

The ideal location might be a location like Lake Havasu, Parker or Yuma which are on the border of California and Arizona. Prescott and Flagstaff would be interesting as well.

I figure the cost of driving to Arizona to host a meeting and back would be from $500 to $750 (depending on how long I stayed.). I need an oil change, gas, a few nights in a motel and renting a meeting space. Driving all the way to California and hosting meetings would cost from $750 to $1000.

I've been ready to take this trip for the last two years. I created the site Arizona Color so that I could study the layout of the state. Since I only have room on the old credit card for one more trip, I don't want to go until I am certain that there is a there there.

This is why all of my blog posts keep ending with the words. If there is someone interested in standing up for health freedom. I believe that a small group of people could have a huge impact on the debate if they met to discuss self-funded health care.

Yes, I have ideas that I want to promote, and there some issues that I want to avoid. I want to promote the concept of health savings accounts. I want to promote replacing insurance with grants. I want to promote the ideal of the Health Care Advocate. I want to promote using a different model for analyzing health data. I want to avoid topics like buying insurance across state lines. I want to avoid the HSA+HDHC model.

I've realized that the real secret to health care reform is not the model. The secret is the people. Getting people together to discuss free market health care reform is the most important step in the process.

Forming a legal entity whose primary purpose is discussing free market health care is the first step. Until I find people wanting to take that first step, I am just locked in living nightmare where I see the American Experiment in Self Rule vanish before my eyes while I am unable to act.

Path to Success

I believe the best path to success is to create ways to help others succeed.

I am interested in free market health care. I've followed the debate for decades and am aware of the pitfalls that keep undermining the freedom movement. I also have some ideas which I believe could propel the free market health care debate.

Now, the freedom movement matters more than my ego.

There is enough pundits on this planet already. Rather than engaging is self-promotion. I would rather work on creating an organization that could help the freedom movement put up a good front in the cause of health liberty.

I have followed the debate for decades. I cannot find an organization with a strong focus on free market health care reform. There are many wonderful groups in the State Policy Network. These groups are focused on the policy side of the issue.

For real reform to take place, there needs to be a group addressing the problem from the individual perspective on the business end.

There are some wonderful doctor organizations. The AAPS is doing wonderful things, but it approaches health care from the physician's perspective.

In a free society, there should be hundreds of groups that approach the challenges of our day from many different perspectives.

So, I believe that the first step to promoting free market health care is to create a group with the primary focus on self-funded health care.

Personally, I think that creating organizations and talking about ideas is really fun.

The idea is for a group of people to get together with a blank canvas and ask: How can we put together a program (from the ground up) around Medical Savings Accounts.

I admit. I've worked on this issue for decades and have a plethora of ideas ready to stream off my tongue.

In my day, I've learned that one should spend more time listening to talking.

For example. I think the idea of a Health Care Advocate is golden. I came up with this idea when I asked: "What would happen to a Claims Adjuster if an insurance company changed from a pool-model to a model based on individual accounts?"

A claims adjuster approves and denies claims based on the rules of the pool. If we switched to self-funded accounts, the focus of the Claims Adjuster would change from administer of a pool to an adviser that helps individuals plan their health spending.

This person's job would change from one focused on the pool to one focused on the needs of the client. To highlight this change, I changed the title from "Claims Adjuster" to "Health Care Advocate."

I've registered the name "Health Care Advocates Association" and squatted on the domain

I would love for the group that advocates free market health care to be called "The Health Care Advocates Association" HCAA.

BTW, if you read this blog from the beginning, you will notice that I keep calling for people to hold a meeting on free market health care. My plan was to have a meeting. During the meeting I would ask people for suggestions about a name and I was planning on carefully sneaking in a suggestion: "Health Care Advocates Association."

Here's the deal. Imagine for a moment that I convinced an employer switched from insurance-pool model to a free market model for funding health care.The claims adjusters were told that they were are now "Health Care Advocates."?

In this scenario, who would define the  activities of the Health Cares Advocates?

It would be the advocates who define their position...not me. It would be the people doing the work, and not the pundit pontificating on political issues.

Do you remember in The Incredibles when Mr. Incredible was hunched over a pool charged with denying insurance claims of old ladies. Rather than being the pencil necked bureaucrat trying to keep people from penetrating the bureaucracy, I would turn to Mr. Incredible and say: "Your clients are now empowered with the ownership of their health resources. How do you, Mr. Incredible, help these deserving people make the most of their resources?"

I have watched the health care debate from the 1980s and have watched the freedom movement fail in its efforts to promote free market health care because the pundits arguing for reform lacked a structure to put reforms in place.

The first step to creating real reform is to create an organization to discuss and support reforms.

There have been hundreds of wonderful breakthrough moments when people like Dr. Benjamin Carson mentioned Medical Savings Accounts to Obama last week.

What is needed is for just a small number of Mr. Incredibles to meet and form an organization with a singular focus on promoting free market health care (from the business/individual perspective).

The goal of the group is to create a structure that would help people like Dr. Benjamin Carson succeed in their efforts to restore the concept of free market health care. 

Thursday, February 14, 2013

The Need for An Organization

It is true that the media and academic community lean left.

There is not a "news blockade" against the free market health care reform. The problem is that there is not an organization at the ready when free market health care reform breaks through the national media.

For example, my last post shows a great speech by Dr. Benjamin Carson in which he mentions Medical Savings Accounts.

Unfortunately, there is not an adequate organization to follow through on this debate and the momentum is lost.

I've been following the health care debate since the 1980s.

There have been hundreds of these moments when free market health care reform catches the public attention. Unfortunately, the freedom movement fails to capitalize on these moments because there is not a group at the ready to do the follow through.

Because the insurance lobby is large and powerful, what usually happens after these breakthrough moments is the insurance lobby will muscle itself into the spotlight and claim that insurance is the free market solution. The insurance lobby might use the spotlight to argue for tort reform or for buying insurance across state lines, but they fall short of discuss substantive free market health care reform.

The insurance lobby also puts forward the idea that tacking a tax free health savings account onto a high deductible insurance policy would somehow make things better. Give me an hour, and I will tear this idea to shreds.

See, the combination of savings and high deductible insurance is worst possible implementation of health savings. What happens is that companies will try to cut cost by giving high deductible insurance to its low wage workers. This causes the low wage workers to skip preventative care and increases costs.

The program fails to restore the pricing mechanism in health. The problem in health care is not the basic care that one can buy at any clinic. The cost driver in health care is the expense stuff that happens after exhausting the deductible.

Care providers are attentive to who is paying the bill. So, providers will try to shift costs from those below the deductible to those who are above the deductible.

So, while insurance companies like the idea of tacking a health savings account onto high deductible insurance, it is not the best implementation of health savings for the individual.

There are enough horror stories of people on HSA+HDHC that the left is able to shout down the freedom movement when it is drawn into defending this idea.

There are hundreds of these break through moments when people begin to discuss free market health care reform. To take advantage of the moments, there needs to be a group at the ready to take advantage of the moments.

I've followed the health care issue for decades. I have some great ideas to contribute to such a movement. Above all, I am willing to do the work to help an organization get on the right track.

I confess, I can be obstinate. But, you know, that is a virtue when one must be at the ready to stand against forces on both the left and the right. I started to put together an organization called "The Health Care Advocates Association."

The goal of this organization is to create a mechanism for funding health care built from the ground up around Medical Savings Accounts. I gave my model the working title "The Medical Savings and Loan."

The point of the name is to say that the freedom movement needs an alternative to the HSA+HDHC model.

What needs to happen is for a small group of people to meet and spend a few days talking about free market health care reform, and I've been stuck for five years trying to find people with sufficient interest in free market reform to pursue the concept.

Wednesday, February 13, 2013

Dr. Carson to Obama

Dr. Carson gave a thought provoking speech on health care at a prayer breakfast. During this speech he spoke about spirituality, the current state of discourse. In the speech he mentioned Medical Savings Account.

Monday, February 11, 2013

Medical Savings Accounts would Reduce Poverty

Poverty is a state of being in which you own nothing.

Socialism tries to end poverty by ending ownership. The effect of socialism is that socialists create a dystopia with people reduced to abject poverty while an empowered elite controlling all aspects of life.

The way you end poverty is to structure society that people own things.

Using medical savings accounts to fund health care instead of insurance would dramatically reduce poverty because people would own the resources in their medical savings accounts.

If we gave every American a Medical Savings Account at birth and put their health care dollars in the accounts there would be fewer poor people.

Good portions of the money would be invested in housing. This would increase the percentage of Americans who own their house outright and reduce the systemic risk created by mortgages.

I used the term Medical Savings and Loan to differentiate my discussion from the HSA/HDHP offered by some firms. A high deductible policy with an HSA is still an insurance product.

I advocate a system of medical savings accounts supplemented by loans and grants. This system would put substantially more money in the accounts of the worker.

In the status quo, employers take about a half million dollars from each worker to provide care.

If your insurance policy costs $10,000 per year, you will end up paying over $400,000 in insurance premiums. You also have co-pays and deductibles.

If you add in the Medicare Tax; you will find that the ruling elite are taking over a half million dollars from each worker to provide for their care.

My analysis shows that if we replaced insurance with the Medical Savings and Loan, that your average working class family would have accounts with $100,000 to $200,000 by the time they retire.

Most of this money would be in housing. More working class Americans would own their house reducing the systemic risk of mortgage default.

Of course, people would end up selling their house to pay for care when they retire. But it is better to have a house to sell than to have a huge mortgage against a house at retirement ... as is common these days.

The growing poverty in America is frightening. This growing poverty is the result of the way we structured health care. Americans used to save for their care and were rich as a result.

Unfortunately, we listened to the likes of Warren Buffett and put our health savings into insurance pools.

By doing such, we undermined the once mighty American Middle class and reduced millions of Americans into poverty.

If we seek a restoration of the American experiment in self rule, we need to create an alternative to insurance. (an HSA plus high deductible insurance policy is still insurance).

Anyway, I conclude by repeating:

Poverty is a state of owning nothing and being helpless. The way to reduce poverty is to structure society around ownership.

Creating an alternative to insurance would help restore an ownership society. It would reduce poverty by increasing the amount of stuff owned by the working class and lower middle class.

If there is anyone on this planet brave enough to discuss free market health care, please contact me. I live in Utah. I am willing to travel. BTW, Utah is pretty. Here is my tumblr gallery of Utah.

Thursday, February 7, 2013

Regulating Guns Through Insurance

As mentioned on my other blog, gun control advocates seek to regulate guns through insurance.

The insurance companies would charge gun owners a premium year each for the privilege of gun ownership. This premium would make a huge pool to compensate anyone who experiences gun violence.

Juries are sympathetic to victims of crimes. Juries are likely to award huge settlements whenever a case strikes them thusly; so the premiums for gun insurance will be massive.

Because juries would award enormous settlements from the insurance pool, the premiums from the pool would be huge. The huge premiums mean that the gun control advocates could control guns by fiat through administrative rules of the insurance company.

For example, awards are likely to be higher if the crime involved a scary looking gun with a large magazine. This would allow regulators in the insurance industry to charge higher premiums for AR-type guns than for pistols.

It is likely that the gun insurance would be sold by groups like the NRA. The money would be held by insurance companies that make huge contributions to politicos on the left and right. So, once the insurance gets started, politicians will give the insurance bi-partisan support.

Imagined for a moment that the NRA made millions by selling insurance. Once that happens, then preserving the income stream of insurance would become a higher priority of the group than defending the second amendment.

The economic effect of gun insurance is that the insurance would transfer hundreds of millions of dollars from middle class gun owners to the ruling elite in the centralized banks.

Now, I admit. I am not all that interested in guns.

The thing is that insurance has had the same perverse effect in health care.

Health Insurance was designed by progressives as a tool for regulating health care.

Progressives developed health insurance as a tool to regulate health care through privately owned firms.

Although health insurance involves private corporations, health insurance has the same perverse effects as direct government control of health care.

If we wish to see substantive free market health, there must be a conversation about alternatives to insurance.

The only way to have a substantive conversation is for people to meet and talk.

For five years, I've had the goal of holding a meeting of people interested in free market health care reform. The meeting would discuss the mathematics of financing health care with the goal of defining an alternative to insurance.

Insurance is the problem in health care and not the solution.

Perhaps the fact that progressives seek to use insurance to regulate guns might wake people up to the perverse effects of insurance.

The gun industry is in the same situation as the health care industry was a half century ago. The industry is balking at insurance. Once insurance is imposed, the conservative groups that benefit from the insurance would become the primary advocates of gun insurance and they would seek to silence anyone opposed to the insurance. Just as conservatives actively silence critics of health insurance.