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The End of Health Insurance as We Know It?


Up to one-third of independently practicing physicians in the US may soon stop using health insurance as we have come to think of it. Kaiser Health News reports on attempts by health care practices to change how they do business as a result of shifting industry patterns, the uncertainty created by the ACA, and the public pressure on them to offer better and cheaper care.

One of the most notable experiments is the so-called “subscription model,” in which a patient pays a basic monthly flat fee to a practice that covers the costs of all basic services. We’ve written about this model before. Though it sounds like health insurance by another name, it manages to cut out a lot of the administrative overhead of that method, saving both the practice and the patient money. According to Kaiser Health news, the subscription model may soon be coming to a primary care physician near you:

 The proportion of independently practicing physicians, working in groups or solo, will fall to 36 percent this year. One-third of those will choose a subscription-based model.

This is only one of the new funding models the piece highlights. Another is the “medical home,” which is, according to the National Committee for Quality Insurance, “a model of care where patients have a direct relationship with a provider who coordinates a cooperative team of healthcare professionals.” Kaiser reports:

The medical home model’s focus on preventive care includes newer technologies, like a weighing scale that reports a patient’s weight directly from home to the clinic, and reminders to patients of routine diabetes or cancer screenings. The Heights Medical Center, as the practice is called, has also expanded from two to five doctors and nurses, and hired a patient coordinator who organizes doctor visits, referrals and prescriptions.

This kind of experimentation is exactly what we want to see more of in our health care system. We need to find new ways to deliver services and to introduce price sensitivity to the health care market for consumers. Obamacare does little to move us toward these goals.

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  • ojfl

    This will not happen unless the government keeps its hands off them. As soon as these things start happening we will hear calls from Washington to regulate, curtail, price control, etc.

    • rheddles

      The killer will be if it is made illegal for government paid specialists to accept referrals from out of system physicians. Acceptance of government payments may also be made a condition of future licensing, cutting off the supply of potential out of system physicians.

      • ojfl

        That indeed will be tragic rheddles. There are many ways the government can stifle this new development, unfortunately.

  • Robert Sykes

    These forms of health care are almost certainly illegal under Obamacare. Remember, individuals must prove to the IRS that they have government-approved health insurance under penalty of fine.

    • wigwag

      Acutally there is a provision in Obamacare which specifically encourages subscription based medicine and subscription based medicine is specifically required to be included in the health exchanges that are being set up by the states and the federal government. This was one of the few areas where Republicans and Democrats were in complete agreement. As it happens there are also bipartisan attempts in Congress to pass additional legislation encouraging subscription based medicine in the contest of medicare.
      Who hates subscription based primary care? It’s the health insurance companies. Why wouldn’t they hate it? After all, it’s a classic case of disintermediation; the two parties critical to the relationship, the doctor and the patient are writing the middle man (the insurance company) out of the equation, In fact, the cost savings, the improved service and the dramatically better working conditions for doctors are all made possible by the elimination of the insurance companies from primary care.
      Doctors love the new system; patients love the new system. If it controls costs (as it surely will) the government will come to love the new system. The only people who will absolutely hate it are executives at health insurance compainies. Count on the fact that they will fight this new system tooth and nail.
      But those companies will lose; in the end, the move towards disintermediation is inexorable. Health insurance companies will have no better luck fighting it than long distance telephone companies, music industry executives, newspapers or book publishers did.
      At least, the health insurance executives will still have a good business ripping off sick people who need speciality care. That is, until someone figures out how disintemediate those companies out of that business too.

      • rheddles

        I couldn’t agree more with the last paragraph. There is a place for government and there is a place for insurance. But neither belong between the doctor and patient. But that’s what we’ve got now and I don’t expect either to give up its sinecure without a fight.

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