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> More doctors will actually lead to lower prices It might if we had a free market for healthcare and if providers were the largest healthcare expense. But we

> More doctors will actually lead to lower prices It might if we had a free market for healthcare and if providers were the largest healthcare expense. But we don't, and they're not. Providers' take-home pay only amounts to about 10% of healthcare spending nationally[0]. Furthermore, the reason we don't have a competitive market is entirely due to the payer situation, not the providers. Providers (particularly hospitals, who account for a much larger chunk of spending) can't offer transparent pricing, because their cost structures are needlessly complex. I've written about this elsewhere, but in short, Medicare is not required to cover the direct costs[1] of the care that their patients receive in the reimbursements that they issue. This means that providers have to make up the difference in their contracts with private insurers, which is why they can't tell you how much a particular procedure will cost you - they really don't know, because it's not purely a function of what it costs them to treat that particular patient. [0] http://economix.blogs.nytimes.com/2008/11/14/do-doctors-salaries-drive-up-health-care-costs/ http://economix.blogs.nytimes.com/2008/11/14/do-doctors-sala... [1] I'm referring to COGS - the marginal cost per patient, which excludes markup and overhead.

maxerickson 10y ago
I dunno, I think if there were more doctors more of them would end up working outside of hospitals. It's certainly the case around here that doctors are moving under the hospital umbrella. This means that providers have to make up the difference in their contracts with private insurers, which is why they can't tell you how much a particular procedure will cost you - they really don't know, because it has nothing to do with what it costs them. Yes, this is an obnoxious tax. I don't think the hospitals are forced to keep their prices obscure though (see Massachusetts or Oklahoma), it just happens to be the best way for them to make revenue because if people could easily shop prices, they would. Another component of the problem are the many people who have a plan where they simply don't care about prices because they have a low out of pocket limit.
- chimeracoder 10y ago
  > It's certainly the case around here that doctors are moving under the hospital umbrella. That's part of a trend that's a few decades old, and which has accelerated in the last 5-10 years. It's not a function of the number of physicians; physicians are selling their practices to hospitals because they can no longer sustain themselves in private practice. > I don't think the hospitals are forced to keep their prices obscure though (see Massachusetts or Oklahoma), it just happens to be the best way for them to make revenue because if people could easily shop prices, they would. If anything, hospitals would prefer to be able to compete this way directly. They can't, though, because there is no single 'price', even if you're talking about a discrete, routine procedure that has no risk for complications. The way medical billing works, they don't necessarily have a set price for a given service per carrier. And even if they do, that doesn't always correlate to what the patient ends up paying (which is, of course, the thing the patient actually cares about). The reason they don't have a set price - even internally - isn't because they don't want to. It's because the contracts with public and private insurers have resulted in the amount of money they need to charge for a service being a function of so many external factors that they literally can't. Chapter 224 is a perfect example of a feel-good law that doesn't actually do anything in practice, because it fails to address the underlying complexity that's the root of the current problem with price transparency.
  - maxerickson 10y ago
    From what I understand, they often have no idea what services cost. This is different than not having an internal price. And there shouldn't be external factors that prevent them from measuring it. Or are you saying that they are contractually bound to avoid tracking costs?
    - ScottBurson 10y ago
      I don't know the answer to your question, but here's an interesting anecdote: https://news.ycombinator.com/item?id=4465845 https://news.ycombinator.com/item?id=4465845
      - maxerickson 10y ago
analog31 10y ago
Are salaries a good measure of the income of doctors? I've read that more than half of doctors are self employed, and I suspect that their ownership stake in medical businesses produces a good portion of their incomes.
- chimeracoder 10y ago
  It's the other way around. As of recently, the majority of doctors are salaried (employed), not in private practice. The numbers I cite correspond to the practice revenues, but as much as half of what doctors in private practice receive in reimbursements goes to practice expenses and insurance.
  - analog31 10y ago
    That's an interesting change. It wasn't too many years ago that my employer-provided health insurance was through a doctor-owned provider.

maxerickson 10y ago

I dunno, I think if there were more doctors more of them would end up working outside of hospitals. It's certainly the case around here that doctors are moving under the hospital umbrella. This means that providers have to make up the difference in their contracts with private insurers, which is why they can't tell you how much a particular procedure will cost you - they really don't know, because it has nothing to do with what it costs them. Yes, this is an obnoxious tax. I don't think the hospitals are forced to keep their prices obscure though (see Massachusetts or Oklahoma), it just happens to be the best way for them to make revenue because if people could easily shop prices, they would. Another component of the problem are the many people who have a plan where they simply don't care about prices because they have a low out of pocket limit.

chimeracoder 10y ago
> It's certainly the case around here that doctors are moving under the hospital umbrella. That's part of a trend that's a few decades old, and which has accelerated in the last 5-10 years. It's not a function of the number of physicians; physicians are selling their practices to hospitals because they can no longer sustain themselves in private practice. > I don't think the hospitals are forced to keep their prices obscure though (see Massachusetts or Oklahoma), it just happens to be the best way for them to make revenue because if people could easily shop prices, they would. If anything, hospitals would prefer to be able to compete this way directly. They can't, though, because there is no single 'price', even if you're talking about a discrete, routine procedure that has no risk for complications. The way medical billing works, they don't necessarily have a set price for a given service per carrier. And even if they do, that doesn't always correlate to what the patient ends up paying (which is, of course, the thing the patient actually cares about). The reason they don't have a set price - even internally - isn't because they don't want to. It's because the contracts with public and private insurers have resulted in the amount of money they need to charge for a service being a function of so many external factors that they literally can't. Chapter 224 is a perfect example of a feel-good law that doesn't actually do anything in practice, because it fails to address the underlying complexity that's the root of the current problem with price transparency.
- maxerickson 10y ago
  From what I understand, they often have no idea what services cost. This is different than not having an internal price. And there shouldn't be external factors that prevent them from measuring it. Or are you saying that they are contractually bound to avoid tracking costs?
  - ScottBurson 10y ago
    I don't know the answer to your question, but here's an interesting anecdote: https://news.ycombinator.com/item?id=4465845 https://news.ycombinator.com/item?id=4465845
    - maxerickson 10y ago

analog31 10y ago

Are salaries a good measure of the income of doctors? I've read that more than half of doctors are self employed, and I suspect that their ownership stake in medical businesses produces a good portion of their incomes.

chimeracoder 10y ago
It's the other way around. As of recently, the majority of doctors are salaried (employed), not in private practice. The numbers I cite correspond to the practice revenues, but as much as half of what doctors in private practice receive in reimbursements goes to practice expenses and insurance.
- analog31 10y ago
  That's an interesting change. It wasn't too many years ago that my employer-provided health insurance was through a doctor-owned provider.