The Whole Foods Alternative To Obamacare

This is a story that should have been circulated widely by Old Media. But, since it undercuts socialized medicine as envisioned by Barack Obama, they simply sat on it in the hopes that no one else would notice it. Good thing we have a blogosphere to do the job that Old Media absolutely refuses to do.

John Mackey, the co-founder and CEO of Whole Foods Inc. has a nice eight-point plan for health care reform. It was published in the Wall Street Journal back on August 11, 2009. Here are the eight points:

• Remove the legal obstacles that slow the creation of high-deductible health insurance plans and health savings accounts (HSAs). • Equalize the tax laws so that employer-provided health insurance and individually owned health insurance have the same tax benefits. • Repeal all state laws which prevent insurance companies from competing across state lines. • Repeal government mandates regarding what insurance companies must cover. • Enact tort reform to end the ruinous lawsuits that force doctors to pay insurance costs of hundreds of thousands of dollars per year. • Make costs transparent so that consumers understand what health-care treatments cost. • Enact Medicare reform. • Revise tax forms to make it easier for individuals to make a voluntary, tax-deductible donation to help the millions of people who have no insurance and aren't covered by Medicare, Medicaid or the State Children's Health Insurance Program.

Six of these eight points are self-evident as to why we need to act on them. There are two that bear study: Tort reform and Health Savings Accounts (HSAs).

Here is how Mackey describes the HSAs:

The combination of high-deductible health insurance and HSAs is one solution that could solve many of our health-care problems. For example, Whole Foods Market pays 100% of the premiums for all our team members who work 30 hours or more per week (about 89% of all team members) for our high-deductible health-insurance plan. We also provide up to $1,800 per year in additional health-care dollars through deposits into employees' Personal Wellness Accounts to spend as they choose on their own health and wellness. Money not spent in one year rolls over to the next and grows over time. Our team members therefore spend their own health-care dollars until the annual deductible is covered (about $2,500) and the insurance plan kicks in. This creates incentives to spend the first $2,500 more carefully. Our plan's costs are much lower than typical health insurance, while providing a very high degree of worker satisfaction.

In other words, under this plan, if you go to a doctor just for a simple annual check-up, you would pay for it directly out of your HSA thereby relieving the insurance company of the administrative burden of processing such a small claim. And 90% of health insurance claims are in the small claims area of the spectrum. This would result in massive savings for the insurance company. But, at the same time, you will be covered if anything catastrophic happens to you. Another advantage here is that once you max out your HSA at $2,500, any money that would have gone into that account now goes into your own pocket. Thus, you now have a financial incentive to live a more healthy lifestyle.

The HSAs also go hand in hand with repealing government mandates as to what should be covered. That is something that should be left entirely up to the customer.

Tort reform is an essential part of health care reform as well. The problem here (and one that Barack Obama is deliberately ignoring) is that you have lawyers like John Edwards who seek to get rich quick off of medical lawsuits. Those lawsuits produce a great deal of fall-out that we (those who pay insurance premiums) ultimately pay for. All of those court costs get passed on to us in the form of higher premiums. (In fact, many women in the Carolinas were no longer able to afford OB-GYN care because the Edwards lawsuit drove OB-GYN insurance premiums higher than they could afford to pay.) But John Edwards and his ilk don't care that we have to pay higher prices so long as they themselves are able to get rich off of us. Also, doctors tend to do more tests than are necessary in an effort to stave off potential lawsuits. Those tests are then charged to insurance claims thereby driving costs even higher.

Included in tort reform should be a "loser pays" provision so that when frivolous lawsuits are brought against insurance companies, those costs don't get passed on to consumers.

I like this plan very much and will be writing letters to all my Congressional Reps asking them to support it. I suggest you do the same.

You can access the complete article on-line here:

The Whole Foods Alternative To ObamaCare
John Mackey
Wall Street Journal
August 11, 2009