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Last week's health care column triggered a flood of e-mail from readers. Most agreed that something needed to change, and they cited their specific frustrating examples in dealing with the prevailing system.
Those few happy with the status quo don't have much sympathy for the 45 million uninsured, but they are forgetting one thing: It's not the same 45 million from year to year.

If you asked the question, "How many Americans went without insurance for at least six months over the past 10 years?" I think that the answer would be closer to 100 million thanks to the revolving door of job tenure. The average American changes jobs every seven years.

Common sense would indicate that there's more heartache to that 45-million statistic than just the raw number. Of this group, a higher percentage than the national average must have pre-existing conditions that make them uninsurable. After all, someone with a health problem is probably having a harder time getting a job - a condition exacerbated by the fact that insurance plans for small businesses (where a majority of Americans work) often require that new employees prove insurability to get coverage.

For a final insult to our intelligence, imagine what an employer thinks about hiring an older employee when the annual insurance cost for that 50-plus age applicant could easily be $5,000 more than that of a younger person. We can safely bet that a lot of those 45 million are older former employees.
One of the most comprehensive e-mails came from a friend and former senior vice president of a major insurance company who also serves in a key leadership role today for a hospital chain. He confirms the fact that only 75 percent of a premium dollar goes to fund medical costs. The missing 25 percent is for overhead and profit.

Between 25 and 40 percent of health care dollars are spent in the last year of a person's life. There is duplication and over capacity of facilities because communities all believe that they need everything. What allows all of these inefficiencies to persist is the fundamental disconnect between the patient receiving the benefit and the source of revenue for paying the bill. Despite the public's dismay at a 131 percent increase in costs over five years, nobody anywhere in the transaction has any incentive to control costs.

The answer, according to this experienced and "connected" executive is as follows: First, he recommends a single-payer system with premiums paid at varying rates depending on an insured's gross taxable income. Next, there should be large deductibles and co-insurance which would, again, be variable and tied to taxable income. Preventive care would be paid on a first-dollar (no-deductible) basis.

A key ingredient of this proposal would be an independent agency, similar to the one in Maryland, that would determine prices to be paid to providers. The amount paid would reflect what it cost to attract people to the roles of primary-care physicians, to meet the capital needs of hospitals, and to cover quantifiable research and development costs of drug companies.

Insurance companies would be confined to administering claims. A parallel, presumably higher-cost, option would be available for anyone not satisfied with the services provided by the model outlined above. And finally, illegal aliens presenting themselves to emergency rooms for care would be stabilized and returned to their country of origin - something that should be happening now anyway.

How can anyone argue with this well-constructed approach?

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