Tuesday, May 27, 2008

Reece. personal musings - A Call to the Uninsured and Underserved: The Case for Cash Only

Operator, please connect me to the health care uninsured and underserved in the USA.

Yes, I know there are 45 to 50 million uninsured. No, I don’t now how many consider themselves underserved, i.e., unable to gain intimate access to their doctors

Yes, I know the uninsured are a mixed bunch – 82% are employed, 50% are between 18 and 34, 75% say they’re in good or excellent health, 67% have college degrees, some are down and out, and others are between jobs.

The underserved are more affluent. They simply seek doctors’ undivided attention and quick access.

How am I going to pay for this call? I’m at a pay phone. I’ll pay cash. It’s a simple, convenient, and quick way to go, just as a paying for your health care often is.


Hello. Am I speaking to the uninsured and underserved? Good, I’d like to talk to you about the cash-only approach to paying for care.

I’ll speak to the underserved first. You may want to pay cash, roughly $1000 to $2000 a year upfront, in exchange for doctors responding to your every need. There are about 500 practices providing this level of service. You can find out where they are at the Society of Innovative Practice Design website (www.SIMPD.org). SIMPD is a physician organization promoting direct financial relationships with patients.

Now for you uninsured. You may want government to take care of you. Well, it might if Senators Clinton or Obama have their way. But their reforms will take years to wend their way through Congress, and reforms aren’t a sure thing. You need care now. Beside, Senator McCain might win, and that’s another kettle of fish. He says you can pay cash and deduct $5000 of annual health expenses.

Senator Clinton calls for an “individual mandate. “ That means you’ll have to pay for individual coverage... This mandate approach isn’t working well in Massachusetts because 1/3 of the uninsured are resisting paying their way. If you can’t pay, the government will pay for you. That involves paperwork to make sure you qualify...

What are your other options? Good question.

• Try Medicaid. It covers 59 million Americans, but you’ll have to sign up, and you should understand many doctors don’t take Medicaid patients because of low payments and paperwork. You may have to pay co-payment. Some consider being Medicaid patients a social stigma.

• Since 82% of you are employed, you could ask your employer to cover you with a high deductible plan with a health savings account. Why would your employer want to do that? First of all, it saves employers money. Health costs are only going up 2-3% for employers with HSA-linked plans, versus 8-10% for other plans. Yes, you may have to pay cash for care because of the high deductible. But the cash you pay is tax-deductible, and if you don’t spend it, it carries over until the next year and accumulates in your tax-free HSA account. It’s like a 401K plan.

• What about cash on the barrel-head for your care? This may not be a bad idea. Since 1/2 of you are in good or excellent health and probably only have minor ailments, paying cash when you see the doctor may cost you a lot less than paying for expensive premiums.

How does this work, and how do you find doctors who accept cash? Well, first of all, most doctors accept cash. Second, cash-only clinics are cropping up around the country, so ask your doctor, ask around. You’ll find someone. Thirdly, you might want to seek out a retail clinic at Walmarts, CVS, or Walgreens, or some other retail chain. Nurse practitioners generally run these clinics. They accept cash, and they charge $59 to $89 for treating minor illnesses. A word of caution, if you think you’re seriously ill, sees your doctor. Doctors run a few of these retail clinics, but not many yet. Lastly, you might want to seek out a national known chain of doctors called Simple Care. At Simple Care, patients pay cash for short ($35), medium ($65), and long ($95) visits. You can go to Simplecare.com to find if there’s an affiliated doctor in your town or region.

Will the cash-only approach solve America’s high cost crisis. Of course not. If you have a health problem requiring a high-cost solution –major surgery, cancer, a joint replacement, heart surgery – you will need insurance. Most of us don’t have the cash to cover the cost. A few of you might want to travel abroad for lower-cost treatment, but that’s not an option for most. If you want to lower your premiums, a high deductible HSA-plan may be the best way to go. If you have a minor illness you want treated quickly, try the options listed above, or ask your doctors if they would take cash. About 50% of doctors’ overheads are due to 3rd party payments, and many prefer to deal in cash. Cash is simple, direct, requires no 3rd party OK, and avoids credit-care woes and collection problems. Try it. You may like it. The doctor will.

1 comment:

myHSAguy.com said...

I've always wondered why most physicians still cling to a managed care delivery system that is upside down. The only way a high quality physician gets paid more than a mediocre one is to see more patients. A physician willing to spend thirty minutes to an hour visiting with a patient trying to help them make meaningful lifestyle changes should be allowed to charge more than the cattle herder spending 6 minutes per patient.

That doesn't happen with the current managed care system. Today insurance executives dictate what procedures should be done for certain diagnosis and how much the physician is allowed to charge. PPO and HMO contracts don't allow any competition for the patient dollar.

Cash changes this.

Yes, PPO networks are here today. All HSA qualified insurance plans we offer currently have PPO discounts. This is especially necessary for hospital bills. The PPO discounting can be as much as 80%.

Tomorrow we might allow quality physicians to charge and get paid what they are worth using cash...

Or better yet, triple tax advantaged HSAs!!