> Jim McManus, director of public relations for BCBS of Minnesota, says the company has a process to flag excessive charges. "Unfortunately, those necessary reviews did not happen in this case," he wrote in an email.
The reason it wasn't flagged is that both the insurer and the provider are incentivized to make this as expensive as possible. Insurers cannot make more than 10% in profit, so if they want to make an extra $1000, they need to take in $10,000. Next, providers are paid fee-for-service, so they want to bill as many services as possible and charge the highest rate for each one. Ultimately our insurance premiums go up to cover this, but the whole thing is a racket.
And single payer will not solve this. All we do is subsidize demand and decrease supply in a never ending fashion in the medical industry. We need to 1) Make it easier to supply services (allow doctors to be imported from other countries, easier to start facilities, allow people with less credentials than an MD to perform services) and 2) Stop subsidizing demand (Medicare for All = Use as much as you want).
My ideal health insurance model is catastrophic insurance provided by the government for any bills over $50,000, Health Savings Accounts to allow you to save for procedures beneath 50k, and a total free-for-all of insurance companies beneath the 50k mark. This would radically reduce insurance rates while preventing people from becoming bankrupt. Catastrophic insurance covers you from cancer and being hit by a bus, but for 99% of all health issues the bill would not exceed that.
If there is only one payer, and they refuse to pay your outrageous prices, you either lower your prices or you go out of business. Since a government-run payer does not have to make a profit, it is very easy to incentivize it to keep costs low.
If you don’t forcibly ban doctors from opening up private, non-governmental clinics - and that means radically restricting individual freedom through the threat of violent force, which I assume would be unconstitutional - then doctors (or at least the good doctors) will decamp to the private sector only.
Doesnt single payer "solve" this by having negotiating power. As a provider, You can choose not to take it but you are keeping yourself out of 95% of the market.
Medical care is a product like any other. When it's 100% free, you have no disincentive to use it. Unfortunately, there is not a single thing in the economy that is immune from the laws of supply and demand. So if you want to have the government pay 100% of all medical bills and do nothing to prevent using it, you'll have never-ending increases is costs.
The chronic lack of price transparency in U.S. healthcare is the single biggest cause of runaway healthcare spending.
Medicare for All would preempt the lack of price transparency: participating doctors get what the government says they will receive. Period. They can opt out and only serve non-M4A payees, but that will shrink their customer pool. Healthcare spending would plummet across the board.
The U.S. healthcare industry operates outside of the capitalist system. We can either try to make it more market-based, or, acknowledging the high value of life and astronomical bargaining power of medical practitioners in wealthy nations, we can socialize the provision of necessary healthcare. Almost every other developed nation has done this successfully.
Engineer: I will charge X for this project because that’s what competitive projects of equal value go for.
Gas station owner: I charge $1 for a Hershey’s bar because that’s what the convenience store next door charges for a Hershey’s bar, and my customers can just bail or hop over there if I charge too much.
Hospital/Surgeon/Doctor/Pharma exec: Well, it’s complicated. You know there are insurance companies and PBMs, they’re the real villains, what can I do? Look, let me ask you, what’s the value of life? We charge a small portion of that. Do you really want to cut back on something so vital? We save lives, respect our profession. Feel free to go to my competition, they will all tell you the same thing. Stop trying to haggle like we’re spice merchants at the Grand Bazaar.
(Of course, thousands of medical practitioners support socialized medicine, the above is simply a generalization used to illustrate my points on price transparency, crony non-capitalism, and bargaining power)
No it's not. Medical care is a process people don't want to go through to make them healthy.
> When it's 100% free, you have no disincentive to use it.
1. that's just plain bullshit, as demonstrated by the NHS and other single-payer free-at-point-of-use systems, people don't hang out at their GPs office just because it's free
2. you actually want to incentivise people to use medical system preventively, it's way cheaper than having to use them curatively
> So if you want to have the government pay 100% of all medical bills and do nothing to prevent using it, you'll have never-ending increases is costs.
Literally every other healthcare system is cheaper than america's, despite the US healthcare system being by far the one most disincentivising use.
> there is not a single thing in the economy that is immune from the laws of supply and demand
As a sibling comment noted, this doesn't happen in countries where there are existing single payer systems, so your analysis is trivially disproven by example.
Additionally, this presumes the content of "the laws of supply and demand" -- what's the nature of supply when consumers cannot choose between competing providers? What's the nature of demand for a product that people require to survive? These are not standard parameters, and to assert that they can be understood with simple demand curves is disingenuous at best.
As demonstrated in every single-payer system where this… doesn't happen because the single-payer entity decides what they're going to pay for medical acts and if you don't like it tough tits, the gravy train of high-marging acts only works until the next revision where the single payer auditors realise you're making 90% on something and… just slash down what they're paying by 90%. That was pretty widely reported on with japanese neck MRIs a decade or so back, manufacturers created small cheap MRI machines, every doctor's office equipped themselves to feed at the through, review time arrived and neck/head MRI prices were slashed to $100 or so.
> 2) Stop subsidizing demand (Medicare for All = Use as much as you want).
This is the exact same lie as the voter fraud scare-mongering: not an actual issue. Most people have to be pushed to see their docs, the vast majority just want to get better and would rather be anywhere than an md’s office.
> Patient emergency room visits rose to a record high of 141.4 million in 2014, the same year the Affordable Care Act's insurance expansion went into effect, according to new data from the Centers for Disease Control and Prevention.
The results contradict policy experts' assertions that unnecessary ER use would decline as more people gained access to health insurance under the ACA.
People get insurance, they use healthcare more. This is not a surprising result.
Thank you. But also - measuring this after first short years of just introducing a new rule is a bit disingenuous, IMHO. How many of these people that went to an ER immediately after they could afford it, actually went there from complications of simple things that could've been relatively easy (aka cheaper) fixed if they would've just gone to a doctor years ago? How many of these who went now and fixed something simple that would be a financial disaster to fix couple years later?
PS. Sorry, I hope I did not mess up previous sentences too much to make it completely opposite of what I am trying to say.
Markets created this mess. Markets will not solve it. Single payer takes insurance out of the game entirely, just run the entire industry out of town and be done with it. Doctors fix people, Doctors are paid by the Government what is reliably determined to be going rates for their services.
We (the United States) are the SOLE western country that does not have state sponsored healthcare, and it shows and it's ridiculous. I don't know how anyone can feel we are the greatest or great in any capacity when a car accident can send a family into poverty.
Markets are not responsible for insane health care regulation that restrict competition. Those exist locally and by state for insurances and providers. I could go on a whole list of all of these insane regulation that exist in the US. The US law going back to World War 2 that essentially forces people to get health insurance threw your employer is one one example of one of the dumbest ever laws and incredibly harmful to people.
The point is that everything that's outside of the regulated insurance market, such as plastic or lasik surgery and a whole list of other things are actually getting consistently cheaper while operations that are captured in a totally degenerate insurance market go the opposite direction.
We don't have many western countries that have ever even tried a more market style of health care. Singapore is the most market oriented system in the world and its by far the cheapest when looking at % of GDP.
The reason it wasn't flagged is that both the insurer and the provider are incentivized to make this as expensive as possible. Insurers cannot make more than 10% in profit, so if they want to make an extra $1000, they need to take in $10,000. Next, providers are paid fee-for-service, so they want to bill as many services as possible and charge the highest rate for each one. Ultimately our insurance premiums go up to cover this, but the whole thing is a racket.
And single payer will not solve this. All we do is subsidize demand and decrease supply in a never ending fashion in the medical industry. We need to 1) Make it easier to supply services (allow doctors to be imported from other countries, easier to start facilities, allow people with less credentials than an MD to perform services) and 2) Stop subsidizing demand (Medicare for All = Use as much as you want).
My ideal health insurance model is catastrophic insurance provided by the government for any bills over $50,000, Health Savings Accounts to allow you to save for procedures beneath 50k, and a total free-for-all of insurance companies beneath the 50k mark. This would radically reduce insurance rates while preventing people from becoming bankrupt. Catastrophic insurance covers you from cancer and being hit by a bus, but for 99% of all health issues the bill would not exceed that.