The benefits of Reference Based Pricing. Sentry Health. https://sentryhealth.com/what-is-reference-based-pricing/
The American healthcare system definitely has its flaws. Elderly citizens are typically faced with high costs for healthcare since their health is normally depleting. This is partly because of the high insurance price when you’re older and partly because many people do not save enough money to support their health in the future. This leaves people in bad situations when they are faced with health complications. Another flaw, in the United States, is that citizens do not have the option to choose their doctor based on price. This leads to many Americans getting poor service at a high cost (whether that high cost is being paid by individuals or by insurance companies). Americans can only really decide which doctors they would like to visit based on quality of care, which can only be decided by testing various clinics out first. This usually leaves many citizens just choosing the closest option available to them, instead of the best overall option. Could the American healthcare system be better though? If American healthcare was on pricing, where citizens could compare prices for things like surgeries, I believe that it could be better and advance further.
This whole concept was brought to my attention by Dr. Sean Flynn in his speech titled, “The Cure That Works: How to Have the World’s Best Healthcare, at a Quarter of the Price”. In this speech, he begins by explaining how the current American healthcare system was created. He says that it was indirectly started by a man named Henry J. Carter, who was desperate for workers in World War II. Because of this, he offered free healthcare to any and all of his workers. After this, employers found that it was easy to do this same thing and thus, it became common practice for employers to offer healthcare options. Once I heard this, I realized that our current healthcare system seemed to have come about by accident, and it is also very dated. This system is all that many people today know though, so many aren’t open to change; however, change may be what America needs for the overall well-being of its citizens.
After this, he began to explain how Singapore has been able to offer excellent quality healthcare at a fraction of the price compared to the United States. The framework for their healthcare on the financial side includes MediSave, MediShield, and MetaFund. Each of these helps Singapore’s citizens to thrive without the burden of dealing with a 3rd party payer system and without the worry associated with the cost of healthcare. The “M” that stuck out to me was MediSave. As he highlights in his speech, many individuals are not willing to save money for their long-term future. MediSave, in a way, forces individuals to save money for their health in the future. Once someone is working, a certain percentage of their paycheck is put into a tax-free health savings account. This is a savings account that most people won’t touch until they are older.
Since most of this money would be saved until an older age, once individuals in Singapore are old, most of their health expenses would likely be covered by this alone. Because of this, Singapore citizen’s life expectancy is higher. As most of us know, the elderly in America typically struggle with the battle between depleting health and the high cost of healthcare. Insurance is also more expensive when you’re older since the risk of accidents and/or being in poor health (heart attacks, strokes, diabetes, cancer…) goes up during that time. If there was already a savings account in which someone put money in every year that they worked (and there was interest put on this money), then that person should be covered during their old age. This, of course, couldn’t work by itself because many individuals can’t work, and those people would still need help (which is where MediShield and MediFund come into the equation in Singapore).
The other point I wanted to talk about from this speech was, as I mentioned before, that American healthcare needs competition. Without competition, any industry (not just the healthcare industry) lacks the motivation to grow and adapt (innovate). Along with this, prices could be very high since there is no lower-price competition. Therefore, when there is a lack of competition among clinics and hospitals, for example, there is also a high chance of poor-quality service/ care and extremely high prices. Yes, consumers have the opportunity to go to other clinics or hospitals (assuming they can travel wherever needed which isn’t realistic), but they don’t know the price or service differences among businesses unless they ask other individuals who have used them before or try it out themselves. If there were more competition between healthcare services, it could also open up the opportunity for better access to patients.
As Dr. Sean Flynn states in his speech, this is not a new idea to America, though it may seem so at first. Since such things as cosmetic procedures are not covered by health insurance, businesses, like plastic surgery clinics, are forced to compete with the lowest possible prices for the highest quality doctors. This allows patients to “shop around” for the option they want. This same thing could apply to everyday medical procedures and surgeries as well. On another note, lower prices for healthcare not only help patients save money but also the government. This means that the money the government saves can go to fund other things.
In conclusion, the United States healthcare system needs a change. Americans are paying too much for poor-quality care while sometimes having to travel several states away. I think that by taking a look at how other countries operate healthcare, we could come up with a plan that would best fit America. That could look like combining parts of Singapore’s unique healthcare system with other developed countries’ universal healthcare system to create something that would work for America. The best things to do, in my opinion, are to create a savings plan for American citizens and to make it so that healthcare services must compete with each other for patients to lower health costs and raise availability along with the quality of care.
Works Cited
Aging Asia and the Pacific. (2009, February). Singapore’s Long-Term Care System Adapting to Population Aging. Asian Development Bank. https://www.adb.org/sites/default/files/publication/637416/singapore-care-system-population-aging.pdf