Gov. Bill Haslam's Insure Tennessee admirably provided a spotlight on the need to help the working poor access health care in this perilous economy. There are no low-cost health care alternatives for many reasons, and fixing the problem will require at least a two-pronged approach. Our current Medicaid program has no incentives for patients to save. Until we get costs in TennCare under control, any advancement of the program is a mistake.
Tennessee is laden with health care innovators. When our state and federal laws that hinder their innovation are removed, prices will go down. Creative incentives for TennCare patients to save and getting government out of the way of innovators will do much to solve the problem.
We've often heard Medicaid/TennCare patients "need skin in the game." The question is how do you do that in a way that prompts a free market to drive down costs. Currently the government has a similar program for food. The SNAP program -- Supplemental Nutritional Assistance Program -- provides needy individuals with a set amount of money or a budget. They can shop for low cost alternatives to save money and stretch the dollars.
What if we gave patients one half of the average amount spent on a TennCare patient on a health card? We could then incentivize them by allowing them to keep whatever portion of the dollars they had not spent by the end of the year. The taxpayer is benefited by the other half not getting spent. The patient is incentivized to shop and save, and physicians would be paid immediately at the point of the delivery of care, which would decrease their cost of filing insurance claims.
Costs go down as market forces create negotiations and competition relative to pricing along with decreases in administration of care.
Currently, Tennessee has laws inhibiting free market innovations in health care. For example, state regulations prevent telemedicine. The advancement of technology provides opportunity for low-cost solutions using web-based platforms for care. Other states are doing this now. Tennessee needs to embrace wholesale change in restrictions on telemedicine for convenience, cost and good care for patients.
Tennessee restricts free-standing emergency departments to within 35 miles of the partner hospital. Increasing this distance will allow rural communities to have a medical stabilization platform should the community hospital not be economically viable.
Other market innovations, such as a "Priceline-like" service that catalogues prices for the purpose of head-to-head comparison will assist cash-paying customers, those with high deductibles with out-of-pocket expenses as well as those with health savings accounts. Any restraints on the use of these systems keep prices falsely elevated and the working poor with no solution.
On the federal level, several laws cause increased prices. A 1997 law which restricts the number of physicians able to attend residencies decreases the supply of providers and drives up costs. The federal government prohibits insurance companies competing across state borders to sell their product like homeowners or auto insurance -- such as Geico, Progressive, Allstate, State Farm, etc. Competition drives down price. The federal government needs to get out of the way of interstate competition.
Gov. Haslam's desire to help the working poor is laudable. Getting government out of the way of market innovators and properly incentivizing patients to save money are the critical first steps to a market-based, low-cost solution that ensures good, quality care.
State Sen. Mark Green, R-Clarksville, is an emergency room physician and president and CEO of Align MD, an emergency department staffing company.