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There certainly is a lot of debate in Congress as well as small town America about the challenge of reforming healthcare/health insurance in the United States today. An impression that I continue to find missed in the popular media is regarding individual choice by consumers and patients to control our own healthcare outcomes and costs. There is a division that seems to be forming in these discussions about the level of control by the government over these choices, which may impact our healthcare decisions. In my opinion, the government's role in healthcare is very important but not nearly as significant as the choices we should be able to make as active consumers.
One example of the model for patient choice and private solutions in healthcare is the grocery chain Safeway. Four years ago it changed its plan to one of private market choice and rewarding healthy behavior. The results so far have been spectacular. While the average American employer faced a 38 percent increase in healthcare costs from 2005-09, Safeway's premium costs have been flat. Their analysis showed that 70 percent of total healthcare expenditures were related directly to individual behavior, not congenital conditions. Seventy-four percent of these costs were related to four conditions (cardiovascular disease, obesity, diabetes, and cancer). Also, 80 percent of cardiovascular and diabetes, 60 percent of cancers, and 90 percent of obesity related diseases are completely preventable. Based on some estimates of the impact of obesity, if we as a collective American public reduced our weight to 1991 levels our economy's productivity boost would total nearly $1 trillion.
I do wonder why I can buy a life insurance policy across state lines as part of a group and realize significant premium savings but I can't do this today with my health insurance policy. We know that more competition provides lower costs for products and services but when it comes to healthcare, we consumers don't have real free choice to pick insurance plans that best fit our individual needs. Look at the mostly non-reimbursed procedure for vision improvement-LASIK. When this procedure first was developed consumers would have to pay over $3,000 per eye to have this procedure done with first generation equipment. Today, there is tremendous competition for this procedure and now you can find an advertisement in your local paper for much more sophisticated equipment with advanced lasers for one-third the cost. Because of the profit incentive and the ability of consumers to shop the procedure, ophthalmologists continue to invest in technology to attract price sensitive patients. What are the potential cost savings to consumers today if they carried that choice to MRI and other expensive medical procedures?
As the baby boom generation ages and demands more healthcare services, and unless we can stem the tide of our ever-expanding American waistlines, we will see our healthcare expenses rise no matter government or private model for health consumer choice. But we must take a hard look at our own medical choices we make and put the power of our collective buying power to make serious changes to our healthcare outlays. I think the Safeway model of healthcare cost reduction is worth looking at in reducing costs, but more importantly, it may be able to dramatically improve patient health and quality of life. Government obviously plays an important role in this discussion but controlling costs and improving healthcare outcomes is going to be very difficult to achieve without more private consumer choice. Before looking to Washington or Frankfort for healthcare solutions we need to look at ourselves and take responsibility for our healthcare improvement but also suggest to lawmakers that we should have greater control of choice to put the power of free and open markets at work as we begin to experience greater healthcare outcomes. Let's don't waste this opportunity for real healthcare change.