Of all the changes, advancements and potential reforms in healthcare, one of the most promising is the return of medicine to a market-driven, consumer-oriented system. Helping drive this trend are doctor practices that only accept cash, which according to The Heritage Foundation, enjoy several advantages over traditional practices.
First, they allow the doctor to save time and personnel on insurance paperwork and redirect resources to patient care, simultaneously passing savings on to the consumer. Second, they encourage a closer doctor-patient relationship, free of interference from third parties such as insurance companies or government programs. Most importantly, cash-only practices curtail expenditures by linking health care decisions and cost directly to consumers; after all, when the insurance company is paying for your checkup, who bothers to ask how much it costs?
Cash-only doctors complement and enhance consumer-driven health care plans (CDHPs) like health savings accounts (HSAs) and high deductible health insurance plans (HDHPs). High deductible health plans offer lower premiums and provide coverage for major medical emergencies and catastrophic events. Other medical costs, like routine checkups, are paid out of pocket. Health savings accounts allow consumers to save money on a tax-free basis, similar to an IRA, and then apply their money to these out of pocket expenses with pre-tax dollars. These options supplement the cash-only market and empower consumers to take control of their health care costs.
So why aren’t these practices more widespread? Simply put, big government hinders these options through the federal tax code, which favors comprehensive, employer-provided coverage. In reforming health care, Congress should not favor one type of health care over another. Instead, patients should have the right to choose which health care delivery system works best for them. As The Heritage Foundation’s Ed Haislmaier states:
Maximizing value can be achieved in health care only if the system is restructured to make the consumer the key decision maker. When individual consumers decide how the money is spent, either directly for medical care or indirectly through their health insurance choices, the incentives will be aligned throughout the system to generate better value—in other words, to produce more for less.
