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William Copeland JR.'s assessment of the United States' healthcare system is crystal clear: The system is a financial and structural mess.
"There are large and fundamental flaws in our current healthcare system that are threatening the vitality of the U.S. economy, undermining the viability of businesses large and small, and-most importantly-preventing millions of American families from accessing the best healthcare possible," says Copeland, Deloitte Consulting LLP's national managing director, Life Sciences & Health Care Practice.
"Eighty percent of the population is healthy and doesn't spend a lot of money on healthcare, but we're building a healthcare insurance machine that forces everyone to buy a very expensive product or to do without coverage," he continues. "If you did that for automobiles, you would say that everyone has to have a Mercedes-Benz, and if you don't have a Mercedes-Benz, you can't drive on the road. We would be a country where very few people would be able to drive because not everyone could afford a Mercedes-Benz."
"The key healthcare constituencies have been focused on either their own agenda or focused on the wrong things driving the market, such as price regulation, benefit mandates, operational requirements and state tax reform," Copeland says. "It is good to get consensus on the symptoms of a poorly performing healthcare system, but we lack consensus on what the root causes of those symptoms are, so it is difficult to come up with solutions we can all talk about."
Under Insurance-for-All, subscribers may purchase basic, "no-frills" coverage from a menu of benefits and cost-sharing options, with the opportunity to "buy up" to other plan designs. Insurers already serving the commercial market, as well as new entrants, will sell the Insurance-for-All policy directly to subscribers, who will pay premiums to them. The product will be administered similarly by all insurers across the country. Participating Insurance-for-All insurers will be able to pay providers at Medicare rates, without contractual relationships with those providers.
Financing for the program is comprised of subscribers' premiums of $94 per person per month paid to health plans; a payroll tax of $95 per employee per month for businesses that do not provide all employees a healthcare insurance subsidy of at least $83 per month; and an additional federal subsidy derived from general revenue, a reallocation of funds from existing uninsured programs or other revenue sources. A new governance consortium including government, private and academic representatives would develop the exact benefit package.
Q. How is it possible to offer a no-frills, low-cost model when state mandates for coverage add expense and are different across each of the states?
A. That's why this program needs to be created through federal legislation, regulated locally by the states and operated by commercial health plans and other organizations. One of the fundamentals of the Insurance-for-All model is that the federal government tax code has the scope, depth and budget to make this work; states don't have the budget and the tax base to afford this.