THE BLOG

Government, Business and Healthcare -- a Mash-up of Necessity

04/04/2012 06:16 pm ET | Updated May 29, 2012

There is no doubt that the healthcare system in America needs a decent overhaul. There are excellent programs in place (Medicare, Medicaid) to help, but they are often corrupted or tweaked in the wrong directions. In the end, the consumer that they were designed to serve -- the patient -- is the victim. Unfortunately, the next in line in the victim chain is the provider of the services. Reduced reimbursement forces an increased cost burden. This creates a cycle of pain that needs to be severed and fixed. The whole system is suffering

Too often I have heard that the government needs to be run more like a business. The only problem with that statement is that government is NOT a business. The bottom line of a business is to make a profit. One of the ways to maximize profits is to minimize expenses. Expenses include not only the cost of goods sold (the items needed to create and sell the product) but also the cost of personnel. That means that the people who run the business need to delineate and rank their priorities including quality control and customer service. Often, items like these can drive up costs, and also affect gross revenue. In other words, if your bottom line is profit, if the numbers coming back to you to are more important that the satisfaction of your customer, so be it. If you bottom line is taking the best care of your customer, than your bottom line has to change. In government, your bottom line is supposed to be taking care of your constituents, either by protecting them from harm or allowing them to live in an environment that allows for life, liberty and the pursuit of happiness.
Therefore, government, by definition is NOT a business. Its goals are far more altruistic.

That, of course, is in a perfect world, which we, unfortunately, do not live in. Government, in a capitalistic society, is a hybrid. This is what often confuses people on the nature of government and what is also used by propagandist to spin an issue politically.

For example, there have been protests over the nature of government employees' retirement programs. Pundits and protesters have been claiming that the government is forcing the public to pay for public employees retirement funds with minimal or no monetary input by the employee. That is not really true. That part of the government employee's salary that goes into a retirement fund that is invested by the entity they work for is still part of their salary. The part that is sequestered from their paycheck to nest-egg it for the future is being held by the state or federal retirement fund without giving any interest to the employee until they get their retirement annuity. Unless, of course, they are laid off prior to retirement age or the retirement fund is raided for whatever reason and then all bets are off. Such is the benefits and risks of being a government employee. In Florida, state employees went for four years without a cost-of-living increase, and bonus programs were one of the first thing to go when budget cuts were needed in the growth-based economy that stagnated. That didn't stop protestors from loudly stating that state employees were "welching" off the government dole and getting "free retirement."

But such is the nature of propaganda...

But if government is to intervene to help in the matter of healthcare, this mixture of business and government is going to get ugly, and force the altruistic nature of our representatives in government to come forth to make it work more like government and less like a bottom-line-of-profit affair.

This is not to say that for-profit companies are not part of the solution. There are many innovations and high-tech solutions out there that can make a profit for their companies and still have a vision of lowering healthcare costs. They are that anomaly called a social enterprise, with a double-bottom line of profit and social impact. Their altruistic nature should be rewarded with a tax break, especially when their goal is to lower governmental costs and reduce the financial stress that our healthcare system imposes on individuals and families, making it tougher to allow them to participate in the growing of our economy by the buying of products and paying in of sales taxes and user fees.

We need to embrace those non-profit and for-profit organizations and companies that want to be a part of the solution to helping the private sector and the public sector improve healthcare.
Healthcare is too complex in its entirety to be simplified, so oversimplification will almost always be filled with fallacy. Solutions need to come from every direction including the private and public sector as well as communities and individuals. We need to move from sick-care to healthcare, from heroic measures to prevention and from politics to caring.