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President Obama decided that three pressing issues require attention this year – healthcare, energy and education; curiously, each sector is among the best performers in the current economic climate.

With regard to healthcare, we’re spoon-fed the idea that our healthcare costs are out-of-control, that we have too many uninsured among us, that we spend an astronomical amount compared to other nations ($7,439 per person on average), and that we need to overhaul the entire system to not only deliver healthcare to all but to also reduce costs.

For a while now I’ve been trying my best to fully understand why this is now a centerpiece issue for the new administration. While many are quickly concluding that this is due to Obama looking to socialize medicine in the United States, I think it’s something else.

Something that few are willing to seriously discuss.

Why exactly might the government be pressing so hard to reform healthcare now?

The most compelling reason may be the fact taht while government programs provide coverage to 27.8% of the population, government spending accounts for 45% of all healthcare expenditures in the United States.

Basically the government is in a terrible financial position at the moment, and the situation isn’t getting better, it’s getting worse.

One quick and clever way to fix the problem is to make the issue a crisis for all of us, make it appear we’re all paying too much, getting too little and the government is able to resolve this problem.

And the way they’re going to attempt to resolve this is by sucking healthy people into the government system, to capture dollars that would otherwise be spent in the private sector – where private insurance is held by 67.5% of the population with expenditures toward healthcare costs at about 43% of the total expenditures in the United States and the remaining 12% are out-of-pocket as either co-pays, deductibles and/or those without insurance paying for their medical services.

So here we have:

Government programs – 27.8% of population; 45% of spending
Private insurance – 67.5% of population; 43% of spending
Out-of-pocket – 12% of spending

The government obviously has a problem and despite lowering reimbursements, shifting administration costs to the private sector, increasing compliance requirements for reimbursement and a host of other ways to frustrate the system, it has not, and can not reduce its financial load without healthy individuals contributing toward its ever increasing burden with our aging population.

Some interesting statistics that you won’t find all in one place, but need to go searching to bring the puzzle pieces together for a look at the bigger picture here:

80% of Americans utilize less than $1200 a year in healthcare services
10% of Americans utilize $1200 to $3500 a year in healthcare services
10% of Americans utilize more than $3500 a year in healthcare services

5% of Americans utilize more than 50% of all healthcare costs each year
1% of Americans utilize more than 27% of all healthcare costs each year

In 2007, medicare spent an average $5,694 per beneficiary on healthcare, medicaid spent $6,120 per beneficiary. That’s just “average” though and does not include that medicare spends an average $22,107 per beneficiary in their last year of life or the $14,858 for blind/disabled beneficiaries with medicaid and $14,058 on aged beneficiaries with medicaid in addition to medicare!

Is it any wonder seniors and senior advocacy groups are concerned about how various changes will impact those 65 and older?

As it is right now we have about 40 million seniors in the United States – in ten years it’s projected we’ll have 55 million, and even if we increase the age of eligibility for medicare, the projected 25% increase of eligible seniors is untenable – unless the government can convince us to suck healthy individuals into its system to capture those dollars.

When we begin to look at the even bigger picture – the $5,400 average for an individual health insurance policy and the $12,500 for a family policy, the bucks start to add up very quickly as we realize that if that money is captured by the government, effectively taken out of the private sector, it’ll be a boondoggle for the government financially – especially when you consider that 80% of the population needs less than $1,200 a year in healthcare.

When you do the math, it’s a no-brainer why the government is so hot on reforming healthcare – taking control of the current flow of money that’s within the private health insurance sector, capture those dollars to cover their butts since they’re going to go broke without those dollars and creating a crisis now is an effective way to convince us the entire system is broken and needs fixing.

Could our entire system need some reform? Sure – but it’s certainly not the crisis the government is making it out to be, except for the government programs themselves right now.

In future posts I’ll attempt to tease out changes that can make a difference and delivery better for the American public – and I can say, it’s not through expanding government programs!

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The word “profit” comes from the Latin, to make progress. 

Profit is the difference between the price something sells for and the cost of bringing to market whatever is sold, be it a product or service. 

Within the healthcare debate, we’re told profit is bad, it is a dirty word, it must be eliminated from our healthcare system so that we can deliver quality healthcare to all Americans.

The problem is one of semantics; any business endeavor, whether it is classifed as “for-profit” or “non-profit,” must generate enough revenue to meet its financial obligations like operating expenses and salaries. 

In the for-profit business model, revenues that exceed the cost of doing business are “profits”, whereas the same excess in the non-profit sector is termed “surplus”. 

No matter what you call it, it’s the same thing, more money in than money going out. 

The damning of profit however is an extremely effective way to terminate any discussion of alternatives or options to the current system we have because no one from within the healthcare system is going to step up and say “but profits are good” or anything related to money.

It’s manipulation pure and simple – carefully crafted and designed, then repeatedly executed well, by those who wish to keep the focus on establishing a single-payer universal healthcare system in the United States.

How can anyone have a meaningful discussion of the state of our healthcare system if you don’t talk money?

There is indeed much discussion on the demand side of the equation, that is the cost to those who need healthcare and virtually no discussion about the supply side of the equation, the costs to those delivering healthcare.

We absolutely must open the discussion up, take it beyond its cost to patients, and look at all sides if we are going to fix the areas in our healthcare system that need fixing and address the issues that are important to us all – the quality of our healthcare, how and where to better manage costs, and how to reach out to and provide affordable coverage to those uninsured among us.

Share your thoughts on this matter in the comments!