An Idea From The Community: Pay For Hospitals’ “Standing Costs”

Post By Fard Johnmar, ChangeNow4Health Moderator

(subscription required to view) focusing on how people are changing their lives to ensure they remain insured.  According to the Journal:

“Anxious over being caught uninsured or paying sky-high premiums, some people -- especially those with health problems -- are going to great lengths to get or keep job-based health coverage.

Wedding dates are being moved up to quickly get both husband and wife on a company plan. On the flip side, married couples are holding off on getting divorced so they will both stay on their existing plan. In some cases, those who are self-employed are going so far as to hire employees to qualify for group insurance.”

These decisions highlight a major barrier to consumerism.  The reality is that premiums for those with preexisting conditions are much higher than those for the healthy.  A major reason for this is the cost of medical (especially hospital) services.

This is why people are so focused on cost.  They argue that consumers – even those with preexisting conditions – would be better able to afford care if medical costs were lower.  While much has been said about the cost of prescription medications, they are relatively inexpensive compared to hospital-related services.

for reducing hospital costs developed by Greg Burbridge in 2004.  He writes:

“As a society we pay for these people to ‘standby’ for our need though we may never need them. Additionally, we pay for their firehouse, ambulance, precinct station and equipment via bonds and local, state, and Federal taxes. I’m suggesting we apply the same principal and funding structure to hospitals to cover the hospital’s “standby” costs. We would still charge those who use hospitals for the variable costs (costs incurred only because that patient was treated) of their treatment and for costs above the standby level of costs for sophisticated services like cancer treatment.”

He argues that this idea is not “single-payer” health care because “it does not make one party responsible for paying 100% of the costs.  In addition, the plan calls for public and private entities to corporate in order to administer and fund the program.

I think this is an interesting idea that seriously addresses a major barrier to access and increased participation by consumers in the health system: high hospital costs.  What’s your take?