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John Mackey’s Prescription for Fixing Health Care
By JLP | August 20, 2009
As I said earlier this week, I’m behind on my reading. I just now got around to reading Whole Foods’ CEO, John Mackey’s op-ed piece in last week’s Wall Street on health care. He broke it down into eight steps:
• Remove the legal obstacles that slow the creation of high-deductible health insurance plans and health savings accounts (HSAs).
• Equalize the tax laws so that that employer-provided health insurance and individually owned health insurance have the same tax benefits. Now employer health insurance benefits are fully tax deductible, but individual health insurance is not. This is unfair.
• Repeal all state laws which prevent insurance companies from competing across state lines.
• Repeal government mandates regarding what insurance companies must cover.
• Enact tort reform to end the ruinous lawsuits that force doctors to pay insurance costs of hundreds of thousands of dollars per year.
• Make costs transparent so that consumers understand what health-care treatments cost.
• Enact Medicare reform. We need to face up to the actuarial fact that Medicare is heading towards bankruptcy and enact reforms that create greater patient empowerment, choice and responsibility.
• Finally, revise tax forms to make it easier for individuals to make a voluntary, tax-deductible donation to help the millions of people who have no insurance and aren’t covered by Medicare, Medicaid or the State Children’s Health Insurance Program.
Thinking about it, I would rather the government do some sort of plan where they gave people responsibility for their own health accounts rather than giving them insurance. I just think insurance is not the answer because there is no incentive to reduce costs.
Thoughts?
Topics: Miscellaneous | 10 Comments »
August 20th, 2009 at 1:34 pm
I agree that insurance is not the answer, and in fact believe that without the elimination of insurance companies, there is no reform possible. I am completely for health care for all aka fully socialized medicine, but would not be terribly opposed to a version of letting the market decide. This version entails eliminating insurance companies and requiring payment from everyone for the health care they receive. If health care is a commodity, consumers should know the exact price going in. I see the opposition to “paying for others’ health care” as meaning not wanting to pay for one’s own. Those who oppose are confident that they are covered and not threatened.
If nobody got off, and everyone had to pay, you can be sure that prices would necessarily go down – and quicker than the current reform fiasco will bring any positive change. Naturally, there would be less waste and unnecessary care. Whatever dismantles the current system quickest will be the best thing.
August 20th, 2009 at 2:08 pm
I generally agree with Yana.
One issue I have with this op-ed is that companies nor the government should decide if someone will not be insured (essentially I’m totally against coverage being dropped or denied because of preexisting or extreme conditions). Most people don’t see it as important, until something bad happens to them or someone they know and they become uninsured. Health care is a right, not a privelege.
August 20th, 2009 at 2:14 pm
The creation of high deductable HSA’s would only force insurance costs up. Young and healthy people would go into HSA’s leaving the rest for regular insurance. It doesn’t surprise me that a CEO would support this. Many employees and sharheholders of Whole Foods are against his reccomendations.
August 20th, 2009 at 3:25 pm
Too easy and makes too much sense.
Why are people afraid to let the market decide if an HSA or HDP is worth it?
What would it cost 30,000,000 uninsured Americans to get a $4,000 High Deductible health plan (subtract the 13 million illegals from the number usually bandied about of 43 million)? Less than what we paid to bailout AIG — about $120 billion per year. Oh, and while we’re at it, lets also subtract the 15 million that make over $50,000 per year but just refuse to buy health coverage, then we’re down to $60 billion.
And we’re going to pay HOW MUCH for this “reform?”
August 20th, 2009 at 6:55 pm
“Health care is a right, not a privelege.” Privilege.
I would agree with that if everybody pay for their own insurance. You have the right to buy insurance. No more entitlement.
August 20th, 2009 at 7:02 pm
Health care is not a right.
August 21st, 2009 at 6:43 pm
It’s difficult. I wish I knew the answer.
A couple of things:
“Repeal government mandates regarding what insurance companies must cover.”
This may be a problem. Very few people here know how much new cancer treatments cost. Let me give you numbers:
Some chemotherapy regiments – about $5000-6000 every 3 weeks. If your insurance requires you to pay 20%, can you handle it? Is there really much incentive for insurance to cover it?
Newer targetted treatments – $3000-4000 for monthly supply of pills. They may not look great on the average, but they are truly miraculous if your cancer responds to it. But… people have to take them indefinitely, they aren’t like chemo.
PET scan to see how far cancer spread – $9000
I’d imagine some other conditions – heart disease, auto-immune diseases have high price tag too.
And if you think that you are immune because of your healthy lifestyle, think again. My mother, who has lung cancer hasn’t smoked a cigarette in her life and neither has anybody in our family. My friend – a young athletic young woman and competitive swimmer died at the age of 38 from lymphoma. My other friend’s husband survived (for now) a bout with sarcoma. It can happen to anyone of us at any time.
Sometimes we hear how these new treatments add only a few months on the average. But a) this is average which means that some people gain years and some nothing b) these new treatments are steps towards more effective treatments. If the isurance companies don’t pay for these treatments than there’ll be no incentives to develop them. Research into new treatments is very expensive.
Even popular screening tests like mammograms are only covered because government requires it. Notice that in Europe there is a lot less screening – because most of it is expensive. Now, there is no evidence at all that American practice is better, but I am sure most Americans will disagree. Sure, you may think how prevention like this saves money. If you think that then you don’t realize that you need to screen hundreds, sometimes thousands for years to make a difference for one person. Sure, mammograms are cheap, but about 50% of people will have at least one false positive within 10 years leading to additional tests. What about colonoscopies which are even more expensive? Do you really think insurance will cover it? Without rules, a lot of this stuff isn’t going to be covered. Are we ready to live with it?
• “Enact tort reform to end the ruinous lawsuits that force doctors to pay insurance costs of hundreds of thousands of dollars per year.”
Agreed. These lawsuits also lead to additional tests and hospital admissions – $$$
• “Make costs transparent so that consumers understand what health-care treatments cost.”
Agreed. This is especially true for tests – many Americans hear about this hot new test on TV and demand it. Even if the test hasn’t been shown to do any good. There was a study in NEJM that showed that over 50% of physicals included non-recommended tests.
• “Enact Medicare reform. We need to face up to the actuarial fact that Medicare is heading towards bankruptcy and enact reforms that create greater patient empowerment, choice and responsibility. ”
These are generic words. No concrete proposals here.
“essentially I’m totally against coverage being dropped or denied because of preexisting or extreme conditions”
I agree.
BTW — I really haven’t made up my mind about this reform. I see many problems with it including serious doubts in claims that it would save money. I think there are ways to reduce costs – reducing futile care by encouraging living wills; reducing unnecessary testing; maybe some others – but I don’t think Americans will go for it. One problem with any reform is that we want everything. Obviously, having good insurance from my employer I don’t want to lose what I have.
So no solutions from me… Just problems.
August 24th, 2009 at 4:55 pm
Mackey is just another bizillionaire out pushing a “libertarian” agenda in order to make his net worth even more astronomical. Why are we listening to a guy who penned over 1000 entries on Yahoo finance pumping up his own stock (and net worth) while slandering competitors under a psuedonym? His new attacks on healthcare are even more dubious, as he his company is them most recognized green company out there! His ideas are either commonplace, self-serving, or just plain silly:
Commonplace (I agree with him. So does everyone):
- Tort reform
- Across state lines
- Equalize individual and employer plans
- Medicare reform (actually, everyone is in favor of this in theory, but no one has any idea how to do it without losing every single senior and baby boomer vote)
Self-serving:
- HSA. This is one of his main ideas, as it is the mechanism he uses to keep his own company’s healthcare expenditures low. However, this should also go in the silly category as there are no “legal barriers.” It takes 15 minutes of paperwork and 4-5 days. The only requirement is you have a high deductible plan. Which is code word for a crappy plan. You get the privelege of paying $250 a month when you are in perfect health for a plan that provides ABSOLUTELY NOTHING unless you have an accident. Given the alternative plans out there, HSA’s are better, but they are by no means any answer to our woes.
Silly:
- Tax forms. Are you kidding me? We are going to solve the healthcare crisis by donations? And the main barrier to giving is that poor little rich people like Mackey can’t figure out how to deduct on his tax forms? Give me a break. Or get a new accountant.
Mackey is using the same old far right tactics of deny, delay and confuse. The difference is that everyone assumes he is progressive simply because he owns Whole Foods!
August 24th, 2009 at 5:35 pm
Givemeabreak,
“Far right tactics”???
Even Democrats are worried about what Obama is trying to pass.
I want reform, NOT socialism.
People SHOULD be scared. We have a 1,000+ page bill that our representatives have not read. We should all be scared.
August 25th, 2009 at 11:47 am
Mackey makes good points, even if you don’t agree with all of them. There are plenty of good reforms you can make in private healthcare that could lower costs. Tort reform, allowing inter-state competetion, electronic medical records that can communicate more easily… Why are Obama and congress trying to tie Healthcare reform to startinga brand new government entitlement program? It’s scary. First clean up medicare and private insurance, then talk about the uninsured separately.