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From his column a Minute with Don

minute-with-don-07-13-1We’ve heard a lot about healthcare and health insurance. The Supreme Court weighed in and rendered an interesting decision on the Affordable Care Act (ACA). The House of Representatives voted at least 33 times on some measure of repeal of the act. One reliable estimate of the time spent in those efforts put the amount at more than ten days of the legislative session, at a cost of over $50 million. The bright side would seem to be that as long as they were doing that, they weren’t doing anything more destructive. And so we’ve witnessed yet one more round (and there have been too many to count) in our society of trying to come to grips with how to best deliver medical care and how to best pay for it.

My first recollection of this issue is from early childhood. My grandmother had purchased a major medical policy and my father, who was in the insurance business, was trying to explain it to her. As I listened in on the conversation, I remember thinking it must be very expensive and confusing to go to the hospital. Years later, it appears some things haven’t changed.

The biggest unknown in our medical system is what medical care actually costs. Free markets only work if we can compare pricing. That doesn’t happen with medical care due to the nature of the product, and the lack of transparency in pricing. The biggest “add on” to most medical care is what providers have to charge paying customers to make up for uncompensated care. Another cost is what they have to pay for liability insurance, taxes, and administration. When the hospital charges $20 for a dose of acetaminophen, there has to be an add-on!

So, our outdated medical delivery and payment system is going through painful transition. The fees, taxes, and benefit limits that are part of “health reform” are supposed to provide money for uncompensated care. And the argument is that once providers have less uncompensated care, the price charged to paying or insured customers will stabilize or trend downward. We’ll see how that works. An old adage comes to mind, “If it seems too good to be true, it probably is.”

Health insurance markets haven’t worked efficiently for nearly 30 years. True insurance principles rely in part on known or predetermined pricing of events, reliable actuarial risk projections, and the ability for insurers to depend on some level of stability in their risk pools. Today, it is more of a wholesale club/purchasing co-op for an increasingly unmanageable commodity.

Until we figure out what healthcare is and how much it actually costs, we’re going to be in a mess. Is it a right for everyone in the country to have the best possible care, regardless of cost? Is healthcare a product to be delivered in a fully free market economy? Is it a utility to be regulated like a managed monopoly? Is it a commodity to be packaged, regulated, and traded? In truth, it is probably all of that, and more. Now if we just knew how much it actually costs.

We Americans are funny folks. We don’t like “government healthcare,” but you’d better not mess with our Medicare! We say we think the private sector should deliver healthcare on a free market model, but no one should be denied care because they can’t pay. We want private payer systems, but dislike health insurance companies. We don’t want to take care of our own health, but it isn’t our fault if we suffer from an illness related to poor lifestyle habits. We don’t like big pharmaceutical companies, but if we go to the doctor and don’t get a prescription, we wonder at the wisdom of the physician. We don’t want anyone to be denied health insurance coverage for preexisting conditions, but we don’t want to require people to purchase coverage while they’re healthy.

One of the biggest challenges the Board of Pensions and Benefits USA and our office has faced over the last three decades is health benefits for pastors. We tried a “denominational plan” from 1983 until 1995. Unfortunately, it was offered without enforceable requirements for participation. It eventually ended because only the sickest folks stayed on the plan, and there weren’t enough healthy ones from whom to collect premiums. I’ve thought about that experience as I’ve listened to the debates over requiring people to purchase health insurance. It has been “deja vu all over again.”

Over these years, we’ve watched the data related to ministers’ compensation and benefits. It would appear a significant factor in the way pastors are paid and the decisions regarding the need for outside or spousal employment has been driven by the cost of health insurance. We know health insurance is expensive. We also know it is more expensive to get sick without it.

Healthcare and how to pay for it isn’t a Republican, Democrat, Liberal, or Conservative problem. Persons from all political parties and philosophies get sick and need care. And, for the most part, we generally believe those who are sick deserve some level of reasonable care. We like to read and preach from the story of the Good Samaritan. As I mentioned in my last column, the part about the Samaritan offering to pay for the injured man’s care doesn’t get a lot of “Amens,” but it was part of the story. I wonder why Jesus put that pesky little part in there?

We’re not done with the debates and impassioned discussions about healthcare in the United States. There is too much money and there are too many stakeholders involved—a lot of competing values are at stake. We’ve defined the problem in terms of winners and losers, so the probability of compromise and reconciliation around critical issues is diminished. It isn’t going to be an easy problem to solve.

To quote Pogo, “We have met the enemy….and he is us.”

Don Walter is director of Pensions and Benefits USA for the Church of the Nazarene.

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