Ten needed fixes for the health care system


By Jack E. Lohman    (Comments ON)

First and foremost, the solutions are political. Totally!

Not because politicians don’t know how to fix the problem, but because they are being paid not to.

With campaign cash coming from every direction – insurance companies and agents, pharmaceutical companies and pharmacists, hospitals, doctors, clinics, nursing homes, lawyers, even CEOs and shareholders – it’s pretty hard for politicians to keep their “public protector” hat on.

The public wants reform, the moneyed interests want the opposite, and it is they who are funding the elections.

Get used to it.

We could provide first class care to 100% of our population for the same 16% of GDP we are spending today, if the politicians wanted to. EVERYBODY could have CheneyCare!

So what would these politicians do if cash were not flowing into their campaign coffers?

They’d fix the system, but let’s look at how and who would object. I’ll abbreviate the opponents I, P, H, D, C and N.

1) Systemic:

This is the biggest and most obvious fix needed. Instead of sending wasted health care dollars to the insurance industry, they’d change the system to bypass this middleman bureaucracy and save 31% of healthcare dollars. Hospitals and doctors would remain private, but they’d be paid by collective taxes rather than insurance companies.

No, it’s not socialized medicine, it’s public-private like Medicare is today. It’s the same kind of single-risk pool that funds our police, fire and other vital services, and it uses the same private doctors and hospitals we’ve always used. (Opposition: I,P,H,N)

2) Certificate of Need:

They’d restore the CON committee that they disbanded years ago after pressure from their contributors. All hospitals, physicians, clinics and nursing homes would be required to seek CON approval before expanding in beds or expensive technology and services. (Opposition: H,D,C,N)

3) Hospitals:

They’d prohibit the building of duplicative hospitals or adding beds in areas already adequately served. They’d not be able to expand to provide, say, open heart surgery, without a community need and CON approval. They’d not be able to hire their own physician referral staff, who now are obligated (and sometimes pressured or paid bonuses) to fill empty and unnecessary beds and order unnecessary tests so they can pay for the expensive technology they’ve invested in. Physicians would remain independent.

And a law should be passed that prevents for-profit corporations from buying non-profit hospitals and healthcare providers — which they’ve done at 50 cents on the dollar, thus ripping off the community they serve. (Opposition: H)

4) Doctors/Clinics:

They’d not be able to purchase expensive testing equipment or services that are adequately provided by area hospitals or independent labs. These purchases not only draw revenues away from hospitals and destroy the economics, they become cash cows for the clinics and physicians. According to a recent McKinsey report, physicians who have such ownership are up to eight times more likely to order tests than physicians without such conflicts of interest.

Physicians also should not be allowed to receive outside consulting fees from medical device manufacturers and pharmaceutical companies, which can add $200,000 per year to their income. This creates a serious conflict of interest that can alter treatment decisions and affect proper patient care when they implant lesser-desirable technologies. (Opposition: D,C,P)

5) Nursing Homes:

They would be watched more closely. They’ve been known to sit patients in front of a TV set and bill Medicare for a therapy session, or sit them in a coffee clutch and bill for “group therapy.” With #7 below, these abuses will dry up overnight. (Opposition: N)

6) Medical Liability:

It’s a problem, and though minor when compared to all else, representing less than 1% of all costs, it should still be fixed. They’d create a three-judge medical court rather than a 12 man jury with no medical expertise. Lawyers would have three strikes and then start paying defendant’s legal fees when they bring frivolous cases. Punitive damages (if awarded) would go to the healthcare fund rather than to plaintiffs and attorneys that have already received fair damages. (Opposition: Lawyers, plaintiffs)

7) Fraud/Abuse oversight:

All medical providers would be required to educate employees on what health care fraud is, how to report it, and make them aware of the whistle-blowing laws and financial rewards. Once employees are aware of fraud rules we’ll see them providing the oversight government has failed to provide in the past. (Opposition: P,H,D,C,N)

8 ) National Patient Database:

All patient data (symptoms, diseases, drug therapy, but not patient ID) would be made available to all physicians so they can make evidence-based decisions on patient treatments and negative drug interactions. This will someday lead to transparency and competition on the basis of physician quality rather than price. (Opposition: Civil liberties types, even with the security safeguards)

9) Administration: 

The system would be administered by a non-partisan healthcare panel, similar to the Federal Reserve Board with members serving staggered 14-year terms. It could be state-run with national guidelines. (Opposition: Politicians, because they like control that generates campaign contributions)

10) Political system:

What else would you expect? Politicians will oppose all of the above because their campaign contributors oppose them. They like privatization because private companies can give campaign contributions and public entities can’t.


Of course health care is not the only area of government that has been destroyed by our corrupt political system. We pay enormous taxes to offset the unnecessary spending by politicians receiving cash contributions from special interests. Tax breaks, pork barrel projects, subsidies, no-bid contracts and the giveaway of other taxpayer assets amounts to $1300 per taxpayer per year at the state level and $4000 each at the federal level. Even conservatives should hate this corruption, because both political parties cost us unnecessary taxes.

The solution is obvious. If politicians are to be beholden to the taxpayers, the taxpayers must fund their elections. And at $5 per taxpayer per year ($10 at the federal level) it’d be one terrific bargain.

Why would politicians not like this? Because it levels the playing field and politicians don’t like level playing fields. So they argue that it will “increase taxes” even when it will do just the opposite. And they’ll make other pathetic claims just to keep the fat cats alive and well, and themselves in office.

If you reallywant to fix it fast, take away health care from 15% of the legislators, underinsure another 15%, and force the balance into high-deductible health savings accounts. Then watch the scrambling. 8)


(I sure get tired of writing about the corruption, but will continue as long as it remains. Only by pulling support from worthless incumbent politicians of both political parties will we either get a fix, or new blood.)


22 Responses to Ten needed fixes for the health care system

  1. clydewinter says:

    Dynamite article, Jack. So fine, so firm, so fully packed. How can we lose with clear thinking and expression like that making the case and showing the way?

  2. John P says:


    If the Government took over the financing of health care, what negoiating power would medical professionals have over their reimbursements? They would be at the mercy of the government. Look at the fight that doctors have to have every year with congress not to cut medicare. Under a total Government financed system, wouldnt the medical profession have to unionize in order to get a fair rates? Look what happens when a private insurer takes over 70% of the market as what happened in Philly.

  3. John P says:

    I totally agree with your other fixes, these should have been in place along time ago. All testing equipment should be independent. I would think that doctors would not have to do it (I do not know any who have this situation), if reimbursement were greater, especially in primary care.

  4. Thanks for the comments, Clyde and John.

    Medicare already does set rates for physicians, and under a Medicare-for-all system that would surely continue. But even with that, 64% prefer a Medicare system because it significantly reduces their billing and administrative costs. But if it truly is “for all,” including politicians, I expect fairness to rule.

    The alternative is not good, and I highly recommend reading the online book at http://www.makingakilling.org/chapter1.html. If you think it’s bad now, wait until medicine is fully controlled by CEOs whose salaries and bonuses are determined by shareholders whose bottom line is the bottom line: profits. The best way to increase profits is to decrease care and to increase the denials that result when new applicants miss reporting the least little medical thing in their history. Or to cancel policies retroactively, after the policyholder gets sick.

    The trend is toward corporate medicine and we may have to get there before people realize what a terrible option it is.

  5. JacksAFool says:

    Yes Jack, sure.

    Politicians are too corrupt to be trusted but they should run health care. It makes so much sense.

    Putting that much power in the hands of the politicians is foolish.

  6. Medicare has been more efficient than the private healthcare system for over 50 years, and if the politicians and their families were being treated under the same system, yes, I think it’ll continue to be run okay. Remember that Medicare doesn’t treat patients, it only administers the payments. As a Medicare patient I see the same private doctor and go to the same private hospital as I did before and as you do now, they just send their bill in a different direction.

    I prefer Medicare to a health care system run by a corporate CEO on the basis of profits. See the book I referenced above:

    The system we have today is the result of putting power in the hands of politicians…… who incidentally get their campaign funds from the corporate executives.

  7. […] political money is driving this issue, not […]

  8. Thanks for the analysis Jack. I can agree wholeheartedly with getting insurance companies out of the Health Finance business. They are good at assessing risk and avoiding it or charging for it. The regulation required to make them work in the public interest is simply too expensive.

    I am not sure that attempts to regulate hospital capacity and medical group purchase of diagnostic equipment are quite what we want. Granted that the current fee for service reimbursement system encourages the production of too many medical services. I am wishing that there were some way to bring health care providers financial incentives into line with society’s need for efficient, humane health care so that we could avoid a layer of regulation.

    I have some ideas on this one but they are still not all that clear.

  9. James Lamal says:

    Right Jack !
    If the public had the same health program as the politicians, it would be first class.
    The Public deserves as much as the Public Servants… I should think…
    Thanks for all your work Jack.
    James Lamal

  10. Jason Wilterdink says:

    The just retired (so he can take off the gloves, by the way he lost his $100,000 a year retirement pension by quitting early) David Walker said at a question and answer session after his “fiscal wake up tour” that the ways he would fiv social security, medicare, and medicaid are as follows. Social security would become based on need, a lower benefit, and a benefit you receive when you are older (a defacto form of welfare for old people). Medicare was ok when we had 42 payees to every one benefit receiver (when it was founded, we could afford to be generous) but around 2014 when each couple will be paying for one benefit receiver no one will be able to afford this. At that point the benefit receiver will have to become responsible for the majority of the bill – i bet the baby boom generation did not plan an extra $200,000 into their budget for that. Medicaid has been so mismanaged by the states who contribute up to 49% of the medicaid funds that it is beyond fixing. This is what the just retired, comptroller general of the USA, the head of the fiscal branch of the GAO said!!!

    The point is social security, medicare, medicaid and ANY government entitlement program (welfare by a different name) will not work. The ONLY reason this mess has been held together this long is we have the baby boomers (a 78 million person bubble in a 14 year period) who were funding people in need. When the new people (we only add 25 million people every 10 years through birth, legal, and illegal immigration) have to pay for the 78 million babyboomers and the older than baby boomers this pyramid scheme will fall apart. It will get ugly. Do politician dare piss off old people who need care and cant get out of the nursing home to vote, or do they tell the young voters that there is no money for college. Ugly, ugly business.

    Jack….I thoroughly read it all but just giving it a quick scan again I love solutions #6, 7, 8, 10

    I am opposed to letting government control any aspect of private industry. that is the problem now. We have already been too trusting of elected officials. We have allowed the wolves to watch the chicken coupe too long. States run medicine in any form is giving the wolves a bib and a frying pan for the yummy chicken breasts and omelets.

    Jason Wilterdink

  11. Jason, the problem is that private industry (and the fat cats) control government through their campaign contributions, so any criticism about government really has to be leveled at their corporate contributors. The wolves (corporations) and indeed having their way with the chickens (the people).

    That’s why we are (a) paying private Medicare contractors 15% more to provide less health care coverage to seniors, and Iraq mercenaries up to ten times more than we pay our troops. Follow the money and you’ll learn why.

    Can you imagine privatizing our police and fire department, where they are paid on the basis of how many tickets they write or fires they put out? Everybody is paying for 100% of health care costs as we speak, through cost sharing, bankruptcy costs and even when employers add their costs to their product price and we reimburse them at the cash register. But we are paying 31% more than we should and only cover 85% of Americans.

    Let me repeat my comment above: “It never ceases to amaze me, the amount of energy that can go into a project just to avoid doing the right thing. The best, simplest, least costly, most effective thing we could do is expand what has been working so well for years, Medicare. You get sick, you get care, and the caregiver gets paid. Nothing could be simpler.”

  12. Jason Wilterdink says:

    Ooops. i thought i sent this earlier but i didn’t

    BTW…. here is another example

    78 million baby boomers. If they all receive a $1,000 a month Social Security check (a low number) that would equal $78 Billion per month. That is a hurricane Katrina EACH AND EVERY MONTH until those people pass away. We obviously can not afford it. The system is in more trouble than anyone realizes.

    Jason Wilterdink

  13. Jason Wilterdink says:

    I came to this board because Jack Lohman and I had a discussion on a different board. It started when the gannett news media through the HTR (herald times reporter) shared a story about one man who is “taming the beast”. I prefer the approach of this man, John Torinus, chairman of Serigraph Inc. He employs 700 people in Wisconsin. He uses HSAs with high deductible major medical plans to afford health insurance coverage. He has costs under control.

    The method is to shop around and get quality health care from the most valuable source. When I talk about “private industry” I am not talking about the big wigs. I am talking about demanding up front pricing (transparency) and there by forcing the medical providers to compete for the consumers dollars. This is called “capitalism” and it is what built this country. Having the government run everything is called either socialism or communism. Its a great idea but it did not work out so well for the Russians. ; )

    BTW……I have friends in iraq, afghanistan, Liberia, kosovo. I served on a UN mission as a paid contractor in africa. No one else was willing to do the dirty job so they offered me a lot of money tax free (foreign earned income exclusion under IRS code) to do the job. I was not and none of my friends are “mercenaries” as a mercenary will do whatever for $$$. My friends and I have served in bosnia, east timor as well as all the countries listed above. We have always done our best to help the people of those miserable little locations i just mention but alas we are not miracle workers.

    Scary thing is I come home and start to get educated about what the bankers, oil companies, medical community, and politicians are doing to MY COUNTRY and I am truly afraid. My friends and I all understand how a country slips into chaos, how easily it can happen, and how close we are getting.

    The answer IS NOT in letting big business run the show. The answer IS NOT in asking the corrupt politicians to mess things up anymore than they already are. The answer IS in people waking up, becoming as SELF SUFFICIENT as possible, burning home made bio-diesel and waste vegetable oil in diesel cars instead of oil from our friends in the middle east who would like us all dead. The answer is in demanding a level playing field so I know what my doctor bill will be BEFORE I get treatment, the answer is in insuring just the big stuff with a major medical policy and eating the little expenses (just like we do with home and auto insurance + that would be insanely expensive if we insured every dent and scratch as well). More solutions are in making as much of the food we eat our selves (oil is used to grow it and drive it across the country) and we just might be more healthy as well (organic instead of oil based fertilizers.)

    I do not claim to be the smartest person on this board. But I think David Walker is the smartest man when it comes to this stuff. Read my prior post. SOCIAL SECURITY AND MEDICARE, AND MEDICAID are DOOMED in their current form. The only reason it has survived so far is a pyramid scheme. The baby boomers (78 million people) and their kids were paying for a small group of benefit receivers. When the pyramid is inverted and the small groups have to pay for all the baby boomers it will cease to work (if it is working now). Manitowoc county just lost their public health care center because they lost $40-$60 per person, per bed who was on medicaid. Look around public care homes are CLOSING left and right. These are the warning signs. Yet people still believe in BIG GOVERNMENT to come rescue them. Social security has given people a -0.09 rate of return. If you are smart you would fire your financial guy for this kind of performance. But for some reason we should trust the government. I have worked with and fore those people, they have a hard time planning a b-day party.

    Jason Wilterdink

    P.S. I love the conversation but I do have a life. I enjoy the debate but in a few days i gotta get back to work.

  14. Jason Wilterdink says:

    BTW…medicaid beds are costing homes (public and private) $40 to $60 per person, per bed PER DAY. Guess who pays for that. The 25% of the residents who are in non-medicaid beds. This is what inflates the health care costs of the people trying to pay. This is one of those great, famed government run programs we have been talking about on this board.


  15. Jason Wilterdink says:

    indulge me please……

    lets say for a moment that i agree we need campaign finance reform (i don’t know enough about it to know you are right or how to do it). So please explain HOW you want to make this happen. How do you get fat politicians who are getting money from coporations to vote them selve out of receiving money. The media has been chasing these ideas for a long time. They sound grand but all i ever here is talk. I don’t see a single viable plan to make this happen.


  16. So here we have it; conservatives have trashed the system and put all the blame on liberals, and now it is gospel. The right wing has controlled congress since 1994 and essentially still do with the Bush veto and senate filibuster. That will change in November.

    I do NOT believe in big government, but I do want an efficient government. I’d give every department a six year lifespan and govern it with a nonpartisan board like the Federal Reserve Board (with 14 year staggered terms).

    The first issue is our corrupt political system. Politicians are controlled by corporate campaign contributors and decisions that should be made in the best interest of Medicare, Medicaid, Social Security and etc, are instead made in the best interest of the corporate contributors.

    Until we get the money out of the political system, no other issue will get fixed. But the last thing in the world politicians want is to lose control over a system that generates funds for their re-election. That’s why we need a complete turnover in congress.

  17. Jason Wilterdink says:

    Didn’t answer my question. I am open to hearing others view. Please explain HOW exactly we are going to remove all money from the political system in a capitalistic society? By its very definition it don’t work that way. Again the smartest person in the USA on the topic says that when he puts a calculator to the social security, medicare, and medicaid problems they are unsustainable in their current forms. Governments are always corrupt, I know this first hand by working with a lot of federal governments in the U.N. it is really how and to what extent they are dirty. I am always for cleaning some house in our government but I don’t see them regulating themselves as an answer. Please give me some hope. I see the administrator telling me how it SHOULD BE please tell me how you plan on changing it. Money does talk and B.S. does walk. The best method I have seen so far for reining in health care costs are competition, transparency of costs up front, and forcing these people to compete for business…….capitalism.

    BTW Clinton, the saint of liberals every where paved the road with weak national defense and an artificially inflated economy and artificially “balanced budget” to smooth over the white house sex scandal.

    The numbers are the numbers. It has little to do with right or left. fact is that welfare programs (socialism or communism in smaller forms) don’t work. They sound great but collapse in time. Only reason it has worked so far is the baby boomer pyramid scheme. sorry if this upset people.

  18. The answer is elsewhere on this blog, but let me repeat it here. We need public funding of campaigns like they have in Arizona, Maine and Connecticut. Politicians can “opt in”, which makes the system constitutional. If they want to continue taking private money, they can (if they think they can get re-elected). Cost to the public is about $5/$10 per taxpayer per year (state/federal). Cost of the current system when calculating all of the government giveaways to the special interests that now fund the elections: $1300/$3000 per taxpayer per year.

    If politicians are to be beholden to their funders, those funders should be the taxpayers. In AZ and ME about 70% of the elected politicians refused private money (which is a requirement for the public grant). Under this arrangement government is NOT corrupt. If they take money on the side they either go to jail or lose their seat. Over 70% of these state’s voters selected these systems by forced referendums.

    Why do politicians not want it? Because it works, and they don’t like being hampered by a level playing field.

    Just WHO do you claim is “the smartest person in the USA?”

    Yes, social security, Medicare, and Medicaid are not sustainable “in their current forms.” They must be changed, but as long as the political cash is flowing the only way we can change the system is to change the politicians. The fat cats are blocking reform because it would require tax changes they don’t like, so they give more cash to the politicians that write the laws.

    Please see Price competition in health care is a pipe dream. Capitalism does not work in Health Care.

    The numbers are the numbers? It has little to do with right or left?

    I disagree. See Are we having fun yet?

  19. […] isn’t perfect, and it needs to be fixed. But those fixes are being blocked by the politicians whose campaigns are funded by the hospital, […]

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