Karl Denninger Proposes a One Sentence Health Care Bill

Billy Fuster sent this over. It’s pretty thought provoking:

“Notwithstanding any other provision in state or federal law, a person who presents themselves while uninsured to any provider of a medical good or service shall not be charged a price greater than that which Medicare pays for the same drug, device, service or combination thereof.”

That’s it.

One sentence.

If you want to add a penalty clause with it I propose the following:

“Any bill rendered to a person in excess of said amounts shall (1) be deemed void, with all services and goods provided as a gift without charge or taxable consequence to said consumer but not deductible by said physician or facility from any income or occupational tax and (2) is immediately due to the customer in the exact amount presented as liquidated damages for the fraud so-attempted.”

It ends the “Chargemaster” ripoff game.

It ends the $150,000 snake bite or the $80,000 scorpion sting.

It ends the $500,000 cancer treatment.

It ends all of that, immediately and instantly.

I remind you that Medicare is required to set pay rates by law at a level that in fact are profitable — that is, above cost by a modest amount — for everything it covers.  Further, those pay rates are audited regularly to prove that they in fact are above cost.

Does this solve every problem?  No, and in fact that would leave alone the existing monopolistic pricing systems that many medical providers, whether they be drug makers, device makers, service providers or otherwise have in place.  It would do exactly nothing to get rid of the 10 paper pushers hired for every doctor or nurse, none of whom ever provide one second of care to an actual person through their entire time of employment.

But it would instantly end walking into an emergency room and getting hammered with a $50,000 bill for something that Medicare will pay $5,000 for.

More at Market Ticker. (The comment section hashes out pros and cons and flaws and solutions.)

22 Comments on Karl Denninger Proposes a One Sentence Health Care Bill

  1. Mine is better. “The federal and the state governments shall not directly or indirectly regulate or pay for health care or services.”

    A pure fee for service pay for your own care that existed before governmental intrusions, which distorts pricing.

    Health care insurance as the “middle man” is a major factor here in price distortion and is supported by regulations.

  2. You can’t do that unless you remove a law adopted by Reagan that says every hospital is compelled to treat a human being in need of medical treatment irrespective of their ability to pay.

    Because of that law, and the open floodgates at the border, hospitals are overrun by people who cannot pay.
    That will drive them out of business without government subsidies.

    It’s not as simple as people think it is.

  3. Imagine a law that stated that restaurants had to feed people irrespective of their ability to pay.
    Would you open a restaurant?

    Now imagine that law on supermarkets.
    Would you open a supermarket?

    Now imagine no restaurants or supermarkets.

  4. Well Hell, if we’re gonna start makin sense around here, I’m goin home!

    That’s the problem. It makes too much sense!
    How are we going to keep all those high-priceed lawyers and administrators in business with that level of simplicity?
    Over the years they have layered up the system into a complicated, expensive Labyrinth that only a professional shyster can negotiate and then Revrum Wright´s “God-Damn America”-hating, Marxist, Muzlim, Mallard put it on steroids! It is high time to roll it back, but a lot of jobs will suffer and they’re gonna fight it like they’re the third monkey on the ramp to Noah’s Arc!

  5. It seems that the insurance industry has been inflating medical costs to support their overhead and profit…right?….What? for about 40+ years?…WELL SLAP MY ASS AND CALL ME BEAUREGARD!….I done figured that out meself and didn’t even need an insurance broker….

  6. @BFH…Now align your restaurant argument against the argument you made correlating a $500 smart phone vs MJA’s $10,000 insulin pump….

  7. Repeal is good. “And replace” is a mistake.

    I like Denninger’s proposal. We agree it eliminates a lot of lucrative abuse.

    90% of what is wrong with the current medical business model is the disastrous combo of Government and Tort Lawyers.

  8. I’ve been a fan of Karl’s for more than 10 years. He does his homework, reads the bills and uses common sense. His background is tech – he was one of the early ISP providers and sold out at the right time for millions. He’s very good for tech matters. He’s had some swings and misses but overall a great batting average.

    I like this proposal of his. Simple. Straightforward.

  9. I do not have insurance. In February, 2016 I concocted staff infection of the blood. I would have become comatose and dead within 24 hours had not a friend been there and driven me to the emergency room. Thus began an ordeal that involved four months of expensive intravenous antibiotics, visits to specialists, MRIs, lab tests, bone & heart scans, etc, then another four months walking with a cane while getting back to “normal”. Including cash discounts I paid over $20,000 out of pocket for something that should have cost a fraction of that. I knew that I was in fact being charged for all the deadbeats that don’t pay their bill. (They “socialize” medicine in the same way stores “socialize” the cost of shoplifting.) Visits to the doctors were relatively inexpensive but the hospitals and labs get you coming and going. A doctor friend from Seattle (who saved me $4000 by getting the antibiotics at cost) said that I should have been harder in my negotiations and only offered to pay them 1/4 of what they were asking because that’s what Medicare would have paid them. Oh well, water under the bridge.

  10. You can blame greed, lawyers, insurance companies all you want, it does not get at the root cause of the problem.

    Open borders, welfare state and the decree that all hospitals be compelled to treat people irrespective of ability to pay.
    THAT is the problem.

  11. Force the industry to publish the prices they charge for care. Stop charging different prices for different classes of customers .

    I have insurance and I have asked for the prices before treatment and they would not or
    could not tell me. One hospital may charge $2000 while another charges $20000 for the same procedure.

    What other business gets away with that?

    I always ask the price of a restaurant special of the day because the price usually is not that special.

  12. Sound like price-fixing to me. Probably better than what we’ve got now but the ultimate solution would be free market healthcare. Unfortunately, Americans think healthcare is a “right”

  13. “I remind you that Medicare is required to set pay rates by law at a level that in fact are profitable — that is, above cost by a modest amount — for everything it covers.”

    I don’t know what the law actually states about what Medicare is required to pay, but I *can* tell you they don’t pay cost for lab testing.

    I was a hospital lab tech (Medical Technologist) for 8 years before I went on to medical school. So I’m quite aware that Medicare didn’t pay even break-even costs for most of our testing. The lab is a net money loss for every hospital; they lose money on most (not all, but most) tests that are run, and we run a LOT of tests, every day.

    What’s worse is that we run unnecessary tests, which provide no real diagnostic information, but we do it anyway because to NOT do it would open the Attending and/or the facility to a malpractice case, for violating “standard of care”.

    So, in effect, the lab is being forced by the government to run tests that cost the lab more than the government is willing to pay for them.

    This is one reason why Bachelor’s and Master’s degree Med Techs are paid significantly less than nurses with equivalent or even lower levels of education.

  14. “But it would instantly end walking into an emergency room and getting hammered with a $50,000 bill for something that Medicare will pay $5,000 for.”

    So, what does Karl do about the parasites who go to the Emergency Room with ABSOLUTELY NO INTENTION of paying a cent?!?

    Maybe I’m missing something, but….

  15. “WELL SLAP MY ASS AND CALL ME BEAUREGARD!”

    Well, butter my butt and call me a biscuit! 🙂

    Change the law so illegals can be refused.

  16. Share the wealth.
    Share the risk.
    What’s the diff?
    Dump the insurance industry who has never in the history of the world, diagnosed, treated, or cured a single person.

  17. You argue against a free market system; price ceilings cause scarcity as healthcare vendors leave the market.

    Return insurance to dread disease to reduce market distortion. Require realtime price discovery at every vendor based on the extant medical coding of procedures together with immediate risk discovery (malpractice, disciplinary, patient satisfaction, etc). The best providers will be incentivized, the quacks punished.

    Don’t expect healthcare labor to invest a lifetime of training and want deferral for government wages. Don’t accommodate Cloward-Piven illegal alien flooding of the healthcare system. Eliminate Ubangicare. Stop H1-B visas in healthcare.

  18. You have to remember that people come to the ED, mostly, because they don’t want to wait for an apt at a Dr.s office. Every single day the vast majority of patients I see do not have a medical emergency, and either have no insurance, or, are on Medicaid or Medicare. People with copays generally tend to come only for serious issues.

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