A New Financing Proposal

AMONG THE VARIOUS PROPOSALS regarding health care financing, one published in Pediatrics is unlike the usual "Single Payer vs. Whatever," "The Sins of HMOs," and "How to Repair Medicare." It is An Innovative Proposal for the Health Care Financing System of the United States.

The authors are Glenn Austin and Robert Burnett, who practiced pediatrics together in Los Altos for about 40 years. Bob Burnett was President of the CMA in 1981-82, chaired the AMA Committee on Medical Services, and helped author the AMA policy on Medicare. Glenn Austin, a med school classmate of mine, was President of the American Academy of Pediatrics in 1981-82, chaired the Committee on Child Health Financing, and formed and ran a 250-physician IPA.

Here is how they introduce their plan in Pediatrics. "We propose new and innovative reforms that require a Federal Health Insurance Reserve System (FHIRS) to reduce ingrained errors and enhance the positive aspects of both the market and government systems. Whatever system develops a FHIRS will be pertinent, be it our new market-driven proposal or a single-payer or national health insurance systems." They identify these as problems needing solution:

1. The uninsured and underinsured.
2. Politically and litigiously mandated benefits.
3. Unequal tax treatment for health financing.
4. Lack of individual choice of plans and providers.
5. Perverse financial incentives for the insurance industry.
6. Underfunded and confused Medicaid programs.
7. The Ponzi-type Medicare scam of cross-generational financing.
8. Insufficient national clinical trials and lack of constraint of unnecessary malpractice suits.
9. Unfair competition by hospitals charging their own patients different amounts for identical services and pharmaceutical companies charging individuals and small organizations more than large organizations, increasing the number of uninsured.
10. Excessive costs that threaten the national economy, access to quality medical services, and federal and state budgets partly because of the lack of economic incentives to limit health care expenditures.
11. Lack of a national program to coordinate, analyze, and recommend optimizing medical care and controlling costs.

Although I don't agree with everything in it, the article is well worth reading. It is available on line at http://pediatrics.aappublications.orgPediatrics:AAP Publications. (AMA's own proposals are on its website, under Council on Medical Services.)

peniston@mcn.org