Dr. David Berry’s diagnosis: Health insurance is a crutch for patients

Kevin Allen

Dr. David Berry, the son of an economics professor, says dinnertime conversation often would drift toward topics of finance. Now a high-risk obstetrics doctor in Austin, Texas, Berry is dispensing his own pearls of financial advice in “Cha-Ching Wisdom: A Simple Prescription for Financial Success.”

We spoke with Berry and got his take on the health care profession. Here’s a hint: He doesn’t think it works well in its current state.

InsuranceQuotes.com: What made you want to write this book?

Dr. David Berry: I’ve read a lot of these personal finance books and realized that in some of these books, there’s 300 pages and I might get two or three pearls of wisdom out of it. That’s absurd. No one has time to read 300 pages to get three good tips, and I’m a pragmatist at heart. The pragmatist in me wanted to provide simple, clear pearls of wisdom in a very easy-to-read format.

“I think people are relying on health insurance as essentially a blank check and that it abdicates them of all responsibility,” says Dr. David Berry, author of “Cha-Ching Wisdom: A Simple Prescription for Financial Success.”

InsuranceQuotes.com: What aspects of the health insurance industry do you think need fixing right now?

Berry: I could go on about that for days. I actually read the health care law and, as it stands, right now it’s a disaster. Unfortunately, it’s just made everything worse and bumped all the burdens to the taxpayer and has now dropped the reimbursement to private-practice doctors, particularly.

InsuranceQuotes.com: You were quoted in a radio interview saying that you think 30 percent of doctors could end up leaving the profession. Why is that?

Berry: That’s right — including myself. I’m making my own economic decisions and personal decisions now as far as my business model goes now to arrange it so I’m not part of the system. I don’t want to be part of the system.

In the state of Texas, they were talking about how Medicaid reimbursements were going to be cut because that money comes from the federal government, down to the states and they allocate it to the Medicaid programs to allocate to the doctors and hospitals. Sixty percent of the pregnant women in the state of Texas are on Medicaid and welfare. And those 60 percent of women who are having babies are going to have their reimbursements to their doctors cut. Hospitals will maintain their reimbursements and pharmaceuticals will retain their reimbursements, but small-practice doctors are going to have their rates cut pretty dramatically.

My suspicion is that it’s going to be a 30 percent reimbursement cut, which is going to be somewhere around a 90 percent cut to the doctor’s salary. Economically, we can’t continue practicing, and that’s coming around the corner. The problem is that we’re going to have to merge into hospital-based, large multispecialist groups, or they’re going to have to run government-care clinics where we’re going to have to run 50 to 100 patients through one doctor in one day. Most doctors won’t tolerate that.

InsuranceQuotes.com: So, where does individual patient responsibility come into play with all of this?

Berry: That’s what a lot of the book is about. It’s about individual responsibility. It’s about saying that it’s noble for a society to have some sort of safety net for their less fortunate. But is that something we should be mandated to do? What about the churches? What about the philanthropic groups? Why don’t we go through that for our health care?

I’ll give you an example. If I were to cut out insurance altogether and someone was to come and pay me for a service, I would cut my prices by 70 percent. I would make more money seeing fewer patients, and I wouldn’t have to wait 60 to 90 days to get reimbursed and go through all the hoops that health insurance companies want me to go through.

Personally, my preference on the doctor-patient relationship is to get rid of the health insurance companies altogether and have the patient pay for the service. If you need a loaf of bread at the grocery store, you pay for a loaf of bread. If you need a will from an attorney, you pay the attorney. If you need a penicillin shot from the doctor, why don’t you pay the doctor? You don’t decrease cost by adding more middle men.

InsuranceQuotes.com: What’s preventing you from pursuing that business model right now?

Berry: I was actually planning that in 2008, and then with the economic downturn that happened, it put a hold on that. Patients’ income dropped dramatically, and competition in my field in Austin went up at the same time. But, yes, if I had the guts to do it, I should have done that business model a long time ago.

InsuranceQuotes.com: What are some common mistakes you see consumers making when it comes to health insurance?

Berry: I think people are relying on health insurance as essentially a blank check and that it abdicates them of all responsibility. In my opinion, the purpose for insurance is for catastrophic complications that don’t happen every day, every year, every decade. I was paying $10,000 a year for my family for a $500 deductible plan. That’s nuts. I don’t use $10,000 worth of health care every year. Health insurance isn’t meant to be a fix-all. It’s meant for catastrophic, once-in-a-lifetime events.

InsuranceQuotes.com: What do you think government’s role in health care should be?

Berry: That’s a loaded question, but I’m happy to answer. We’ve been moving toward this “nanny state” for years, where the government is responsible for all my ails to where if I have a boo-boo on my leg, I’m going to make the government responsible for that Band-Aid. That’s where I think personal responsibility does come in. It’s noble of a government and a society to provide some sort of minimum, sustenance-based health care for their poverty-stricken. I think that’s a noble cause. I think that’s a reasonable thing to do.

The short answer is, there should be a two-tiered system — one for the welfare patient that’s not paying and one for the paying patient.