My wife is the Nurse Manager for an outpatient pain surgery center. I couldn't begin to list all of the horror stories she has told me over the years about the things like government mandates that drive up their cost of doing business. As but one minor example, remember the HIPAA privacy regulations that went into effect a few months ago? It cost her office many thousand dollars to comply with that law, such as consultant fees, adding white noise generators and building new walls to mask conversations. Multiply that expense by a several hundred thousand medical offices around the country and you get some serious money, at least a billion dollars nationwide and probably much more than that. Guess who gets to pay for that? HIPAA is but one set of government mandates. There's are many more and new ones being enacted all the time.

There have been attempts at reform that show potential for lowering costs, but many of them are deliberately limited by Congress. For example, consider the idea of Medical Savings Accounts (MSAs). The idea is to allow people to buy catestrophic care coverage (e.g. hospitalization coverage) and to pay for other medical expenses like doctor's office visits from a tax-exempt savings plan. Catestrophic care coverage is a lot less expensive than a full coverage policy, but that isn't hard to understand. How much do you think auto insurance would cost if it covered every possible expense like paint jobs, new tires, and oil changes? Somehow, a lot of people have come to expect their medical insurance to pay for every possible medical expense. That isn't cheap.

One little tidbit that my wife told me is that a lot of doctors will gladly accept lower payments for office visits if you pay them immediately. Just about any doctor's office you'll find will have at least one full time employee whose job is to try to collect from insurance companies and the government (Medicare/Medicaid) for covered expenses. It often takes from weeks to months for them to receive payment. Between the labor costs and cash flow issues, collecting payment eats up a significant portion of the office visit expense.

The idea of MSAs seems like a reasonable option for a lot of people, but it has some restrictions. You may decide that it would be a good option for you, but if you aren't self-employed or if you already have insurance, you aren't allowed to set up a MSA. Also, the original legislation limited the total number of MSAs nationwide to 750,000. While admittedly far from perfect, it seems to me that MSAs have potential to help provide health coverage for a lot of people.