Consumer-Directed Healthcare Reform

As the U.S. Supreme Court nears its decision on the constitutionality of federal health care reform, the Montana Policy Institute endeavors to emphasize the need for true reform centered on the patient consumer. We believe that patients and their doctors are best equipped to make decisions about what care is best, not bureaucrats in Washington, DC, or our state capital of Helena. The root problem lies in the fact that there is a vast wedge between patients and their healthcare providers caused by heavy government intervention and the unintended consequences of a third-party payer system. The following consumer-directed options will help individuals and families make – and own – their decisions.

Individual ownership of insurance policies. Equalize tax treatment by extending to individuals the tax deduction that allows employers to own insurance. Also make those plans portable when workers leave or change jobs.

Leverage health savings accounts. Coupled with affordable high-deductible plans, HSAs empower individuals to monitor their health care costs while establishing incentives for individuals to use only those services that are necessary. HSAs are growing in popularity but will be undermined by federal healthcare reform.

Allow interstate purchase of healthcare insurance. Allowing consumer to shop for plans beyond their state borders will enhance competitiveness in the health insurance market. Because of fewer state regulations, plans in other states are more affordable. Because it will empower consumer choice through competition, interstate purchase will drive down prices and, possibly, force states to deregulate.

Reduce mandated benefits. Other than consumer overutilization caused by insulation from actual cost, there is nothing that contributes more to the inflation of healthcare costs than state benefit mandates. States should reduce or eliminate mandated benefits to empower consumers to work directly with health insurers to tailor plans to their needs. Consumers won’t be able to do this unless health insurers have flexibility to fulfill the needs of individuals. In a freer health care market, there is no reason to assume that insurers will treat the insured any differently than, say, the grocery store treats its customers by providing many products at prices consumers are willing to pay.

Block grant federal Medicaid funding to give states flexibility to create voucher programs for low-income individuals to purchase their own insurance. An income-based sliding scale voucher program is an effective reform option that states such as Florida have enacted to give low-income individuals more control, fight costly fraud and abuse, and save on considerable administrative costs of running a large bureaucracy.

Eliminate unnecessary scope of practice laws and allow non-physician healthcare professionals to practice to the extent of their education and training. Enhancing the provider pool increases competition without compromising access to quality care. It empowers patients to decide how best to get the care they need.

Reform tort liability laws. Defensive medicine needlessly drives up medical costs and creates an adversarial relationship between doctors and patients.

 

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