We all know at least one...

High medical care utilizer.  That is the emerging term for those who consume enormous amounts of medical resources compared to the average.  Of course, this is not by choice.  But one of the side-effects of rapidly advancing medical and pharmaceutical technology is the ability to treat formerly hopeless conditions - often at enormous cost.

I have family and friends who have consumed literally millions of dollars of health care, almost all of which was paid by their insurance. I have tried to estimate how many low-utilizers it requires to balance that expense out. Answer: a lot. This will not continue, simply because of the cost and the shortage of low utilizers.  But any attempt to rationalize this expenditure raises cries of rationing.  As if that were a dirty word.

If your mother or your daughter or your sister or your wife is dying of breast cancer, it doesn't matter to you how much the treatment costs relative to the benefit.  And indeed, the political battle over health care is infused with the belief that you shouldn't have to think about cost--that it is immoral to deny anyone a treatment that might help them. 

Unless we're willing to let health care expenses grow unchecked, someone is going to have to think about costs.  But so far in America, I see no means to develop a culture which will allow bureaucrats to deny potentially life-saving treatments simply because they're costly--either in the free market or in a single payer system.  Thus, I predict, costs will continue to grow. [More]

 Of course we ration health care.  It's just that now we do it surreptitiously by strangling the health care system and doctors, forcing them to make the actual decision and absorb the loss, and eventually passing the cost on to any source of income we can find.

Our third-party payer system encourages avoidance of this reality, IMHO. At the same time it completely masks the costs of providing health care from consumers.  As more Americans exhaust their insurance maximums (which seem tinier all the time) via long illnesses or expensive treatments, the momentum for change will grow.

Add in the growing number of uninsurables who cannot get coverage due to their current health, family history, or genetic predisposition, and the question of significant change is not if but when.  While programs do exist for high-risk consumers, their results are ambiguous.

There is simply no way to pay for all the health care people want. Insurance is not the issue.  The problem is everyone wants to pay $150/month for unlimited amounts of coverage without identifying who should pay for the rest. And the sooner we face up to it, the better.

Several ideas could help, starting with what to do about "high utilizers".

  5.  Focus on the “uninsurable”

5% of Americans account for over 50% of the overall cost of care (reference).  These are the uninsurable people - those who are truley expensive to treat.  There needs to be very close management of these people.  Leaving them uninsured doesn’t reduce cost, it just shifts it to hospitals and local government.  It also leaves them unmanaged.  Of the waste in healthcare, the likelihood is that a very large percent of it is in the high-utilizers (by definition).  These people need management, either in a “medical home” or by some sort of care management. [More]

I'm not sure we're ready to truly address the reality, but the path of least resistance is some form of Medicare-like coverage for all. Is it a good idea?  Clearly not.  But on the other hand, you probably know seniors who rejoiced when they finally were covered.

The market will not step forward to manage high-utilizers - it will simply price them out. Unless free-marketers offer a solution for this issue it is hard to take them seriously.  It is also hard to imagine how they will not diminish their market as better diagnostics identify more consumers as in this category.

One idea I have toyed with is allowing geezers like me to transfer my Medicare coverage to someone else, either by gift or even sale.  I could forgo the coverage I am entitled and transfer my expected years of insurance (likely around 15-20) to a friend or loved one or even a buyer for reasons I choose.

While this would probably not decrease Medicare costs it might at least lower the extravagant end-of-life expenditures and result in more added years of productive life by transferring treatment to a younger person.  It would designate Medicare coverage as a personal asset to be disposed of as individuals see fit.

We are not going to address this issue until health insurance bills reach astronomical amounts, I would predict.  But we are getting to that sad point faster than we might think.