Monday, July 19, 2010

Getting Linkedin to Antitrust and Competition Issues

Posted by D. Daniel Sokol

Ever wonder who the other readers of the blog are and your potential opportunities to network with them?  I have created a Linkedin site for readers of the blog to network and post announcements on substantive issues and also on any job announcements and tenders.  Click here to join.  If anyone can create a logo for the site, please let me know.

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Posted by: bryan | Dec 16, 2009 5:39:34 AM

Health care costs alarm
It’s good that TamilNadu government has given Rs. 1 Lac critical illness insurance to the people below certain income level, with the controversy that the people below certain income level is not accurately identifiable in the non salaried crowd. Best part is that the supposedly poor should be able to get treated well in case of above mentioned medical situations.

One of the ways to tackle the healthcare problem is the ‘state insurance cover’ meant for costless surgery in any hospital in the state, and the other way is to fund the government hospitals that are already operational in the state to serve the same purpose. Having the concept of government run hospitals in the state and also giving state insurance cover that can be used in any hospital negates the purpose of the state owned hospitals.
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What are the pros and cons of the state insurance against the funding of state run hospitals for better health care? It’s obvious that the quality of state run hospitals are not so good in all the places starting from infrastructure to the staff quality. Infrastructure is an easily attackable problem by pumping more money. Quality of staff is the major concern, but it is obviously the same as the performance concern in other state owned companies. Incentives (punishments!) could be a potential solution for the performance problem!

In my opinion, most of the government staff is quality personal in terms of capability and knowledge, but the problem is with the performance. Less salary compared to private is not an acceptable reason, folks should resign the job and move on if the salary is less rather keeping the job, earning the salary and not doing what they are supposed to be doing. But if the state wants to improve the performance, it could always do it with more incentives for performance. Again, ‘incentive’ could also be positive or negative and punishment is one type of negative incentive. If the negative investment is strong enough, people would have some incentive to perform better.

Now coming back to the point, the pros of state run insurance is that the people can go to any private hospitals which they think is better. Now comes the hard part. Private hospitals are mostly motivated by profits and the folks there would obviously want to make use of the situation. From whatever I hear from people, looks like most people who get admitted under the state run insurance scheme in any private hospital will compulsorily get operated, irrespective of the necessity for operation. Even though I don’t have data to prove the increasing number of operations because of the state run insurance, this is a very plausible logical argument.

What happens because of that? One, people are being unnecessarily operated and second, this is indirectly pushing up the basic cost of health care slowly and steadily from moral damage standpoint. The proof for moral damage claim is the costs that are being billed for the insurance patients in comparison to the cash patients in any hospital. Since the percentage of insurance patients is going up steadily, boosted by state run insurance, moral damage factor would be proportionately increasing at the industry level leading to higher healthcare costs in the medium term and worst possible cost increases in the longer term.

Watch out, we are moving towards a dangerous health care cost explosion like in the United States because of these mismanaged vote bank oriented thought processes by our politicians. Now it’s only the TamilNadu government that is doing this, but I am sure this is going to spread to other state politics as well, as it did in the case of Rs.1/Kg rice scheme.

Posted by: edgar "JJ"MOLINA | Jul 22, 2010 5:31:35 PM

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