Muddling Through to a Likely Future in Healthcare

Our current economic troubles ripple across every fabric of American life; one aspect of American life that is especially affected by the economic downturn is our access to adequate healthcare.  The increased role of our federal government in the troubled economy could possibly set a precedent for the Administration attempting to improve and solve the great problems in the healthcare system. increasing its present portion of healthcare spending from by providing healthcare services directly. This role of the federal budget stands in contrast to the more conservative approach of the government indirectly playing a role in the delivery of quality healthcare services by both sectors of the economy.

Both approaches, which have been debated and analyzed very thoroughly since the early 20th century, attempt to solve the problems of accessibility, availability, quality, and affordability in health care. There is a clear distinction, between these two main alternatives and various proposed solutions have vacillated between them both. The significant divide between both aspects often leads to a stalemate that produces an environment of frustration. This frustration produces compromise and incremental attempts at solutions. We seem to make progress by just “muddling through”, which characterizes this trend of our government bureaucracy over the years.

There are some trends and developments that will continue regardless of the progress of legislation produced by Congress.  What are some of these short term improvements?

One significant development is the increased emphasis on the health care “safety net”.  The “safety net” is a fairly complex but often times informal network of private and public resources committed to the provision of healthcare services to those unable to pay. It is made up of a range of public and private providers like government funded Community Health Centers all the way to private entities such as Free Clinics and Churches.  This network makes needed health care services more available to those in need.  Understandably, the government and private sources are likely to place a greater emphasis on these programs in the future.

Another significant advance is the continued growth of retail healthcare clinics. These clinics are located in pharmacies and grocery stores, and are staffed by Nurse Practitioners and Physician Assistants who are under the direction of a physician. They are operated on a “no appointment” basis, and their charges, which are much cheaper than a trip to the doctors’ office, are posted.  Prescriptions also can be written at these clinics. A recent study by one of the retail clinic companies stated that by 2013 there could be as many as 3,000 clinics nationally, with each receiving 8000 visits annually.

Moreover, there is significant progress being made in the utilization of mass consumer health information.  Recently Microsoft and Google teamed up to use the internet for medical information useful to the consumer. By promoting easy availability of medical information like individual patient records utilized by the consumer, more decisions can be made by the consumer.  Already there are other well developed web sites such as Revolution Health and WebMD competing with other companies to provide the necessary and useful healthcare information for the consumer to use in their decision making.  This information revolution will lead to price and quality transparency.

Another trend is the explosive growth in medical tourism for consumers interested in value.  Patients will shop for care internationally.  A recent study by Deloitte stated that outbound medical tourism currently accounts for 2.1 billion dollars spent by Americans overseas.  This amounts for 15.9 billion dollars in lost revenue for American healthcare providers. Medical care in countries like India, Thailand and Singapore can cost as little as little as 10 percent the cost of comparable U.S. care.  Often this includes airfare and very nice accommodations and fits well with elective procedures. This is spurring on leading academic medical centers and other quality providers to compete strongly to capture the medical tourism market. They will use leverage and strong brands to compete with international providers.

In addition, there is the important trend of the government becoming more aware of the inequality of the tax treatment for medical services.  Employees who work for large companies receive their heath care plan with tax free dollars.  On the other hand, the self employed, and individuals cannot deduct the cost of their healthcare plans with tax free dollars.  This dilemma will receive the attention of government. The tax treatment of healthcare expenses will likely become the same for everyone.

As the debate continues and fluctuates between both approaches to solve the wide array of healthcare problems, progress on many fronts will still be made. We will continue to muddle through to solve some of the major problems. Whichever overall solution develops, our country depends on our excellent health care system to compete effectively in a world economy.

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