4 ms·

I echoed this idea in a comment yesterday. The medical industry is the only industry with a broad anti-trust exemption. What this means is that they do not ha

by tmaly 10y ago

I echoed this idea in a comment yesterday. The medical industry is the only industry with a broad anti-trust exemption. What this means is that they do not have to publish prices like all other industries. How can one expect to control costs if you cannot even know how much things cost? Removing this anti-trust exemption and allowing the public to see prices for the common procedures would be a good start.

dllthomas 10y ago
> tmaly 10 minutes ago [-] I echoed this idea in a comment yesterday. The medical industry is the only industry with a broad anti-trust exemption. What this means is that they do not have to publish prices like all other industries. Could you elaborate on this? I don't see what publishing prices has to do with anti-trust, and certainly I have encountered "call for prices" elsewhere.
- mikeash 10y ago
  I don't know about the anti-trust aspect, but the situation in medicine goes far beyond "call for prices." It's often impossible, no matter what you do, to find out what a procedure will cost. Billing systems are so complicated that the hospitals themselves barely understand it, and the only way they can find the cost for many things is to go ahead and do it and see how it comes out.
  - ArtDev 10y ago
    They provider may not even be allowed to tell you due to contracts with insurance companies. This kind of thing is outright criminal. We need transparent pricing regulation!
    - prostoalex 10y ago
      Would be hard to enforce legislatively, as you're essentially forcing private companies to disclose the previously confidential pricing agreements between them and insurance companies. What will end up happening is the equivalent of MSRP in car sales - here's the list price, but since you're such a good guy, and we're running a promotion, you can get 5% off if you act today.
      - beambot 10y ago
        So instead you sign a contract to purchase a car (with no take backs!) and only then do you get told the must-pay MSRP? That's about how medical pricing works today.
        prostoalex 10y ago
        Some states do require chargemaster transparency, e.g. https://www.oshpd.ca.gov/chargemaster/ https://www.oshpd.ca.gov/chargemaster/
      - mikeash 10y ago
        Why would that be hard? I thought law takes precedence over contracts. Even having the equivalent of car MSRPs would be a huge improvement. As it stands today, you often cannot get any price for a procedure beforehand, not even a "forget about insurance, I'm just going to pull out a wad of benjamins and start counting until you tell me it's enough" price. Plus, car prices don't vary that much from MSRP. I can look up a car's MSRP and know that this is approximately what I'll pay. If I get a really good deal I might get away with paying 10-20% less. If the car is in extremely high demand, I might have to pay 10-20% more. But I can get a pretty decent idea. Medical pricing often varies by a factor of ten depending on whether you have insurance, and which provider it is.
        prostoalex 10y ago
        I posted a link below, but some states already mandate chargemaster transparency. It's close to useless, as one quickly discovers that (a) pretty much any procedure costs a trillion dollars, but discounts apply and (b) the consumer's view of "procedure" and hospital system's view of "services provided" differ radically, as every gauze used up, every vital measurement, and every painkiller is a billing item in hospital's book (cost of goods and labor), but are integral part of the "procedure" the way the consumer sees it.
        mikeash 10y ago
        That some current laws are useless doesn't mean better laws couldn't be made. Mandate a final, guaranteed, all-inclusive price, or require disclosing every single discount made available to anybody, or even require charging the same price to everybody. I think the real problem is that Americans mostly aren't willing to have their government going around telling businesses to cut out their shit or else.
- dv_dt 10y ago
  The ACA required hospitals to publish prices in some contexts. http://thehill.com/policy/healthcare/204868-new-price-transparency-rules-for-hospitals-under-o-care http://thehill.com/policy/healthcare/204868-new-price-transp... https://www.bna.com/hospitals-required-price-n17179910723/ https://www.bna.com/hospitals-required-price-n17179910723/
- tmaly 10y ago
  Karl provides more detail in his write up than I could cover, and he links to two US Supreme Court cases in regards to the price issue https://market-ticker.org/akcs-www?post=231949 https://market-ticker.org/akcs-www?post=231949
  - dllthomas 10y ago
    Interesting, if ranty, hard to follow, and possibly overstated. For one, there seems a distinction to be made between "publishing" prices and individually receiving a quote in advance of work. If there's a technical sense in which the two are equivalent, I would recommend clarifying in casual conversation. Those requirements also don't seem (though I could've missed something) to be a part of anti-trust law, per se. The requirement that prices be consistent is, in the cited Robinson-Patman Act (although that seems to only apply if you're crossing state lines?)
richardthered 10y ago
But knowing the price of a procedure doesn't change my need for it. If I need heart surgery, I still need it regardless of whether it's $10k or $100k. In other words, demand is inelastic. And, most people can't afford to pay 10k or 100k out-of-pocket. So, it's not like managing your household budget. The funds have to come from somewhere else (insurance). Also, healthcare is not easy to evaluate for a layperson. If my doctor says that I need 'procedure X', I'm relying on their expertise. Healthcare recommendations are not fungible products. If I'm buying a car, I can read reviews about the different models, reliability, etc. But my doctor's recommendation for me is highly specific to my personal health history. So, for a lot of healthcare spending, it's not me that's choosing a medical procedure. Instead, I'm choosing to trust a doctor's recommendation. The doctor is the one that's recommending the procedure.
- squozzer 10y ago
  I think the elasticity of the demand depends pretty heavily upon the urgency of the problem. And the demand - as you pointed out - also depends heavily on trust. That said, most health problems aren't unique enough to require a completely bespoke solution. So at least hypothetically, it's possible to shop around IF pricing and other data were available. But they are not, at least generally. I found this book rather interesting -- https://www.amazon.com/dp/B01DRXKWRM/ref=dp-kindle-redirect?_encoding=UTF8&btkr=1 https://www.amazon.com/dp/B01DRXKWRM/ref=dp-kindle-redirect?... -- where a company compiled their health care expenditures and made the data available to their employees.
deleted 10y ago
[deleted]

by tmaly 10y ago

dllthomas 10y ago

> tmaly 10 minutes ago [-] I echoed this idea in a comment yesterday. The medical industry is the only industry with a broad anti-trust exemption. What this means is that they do not have to publish prices like all other industries. Could you elaborate on this? I don't see what publishing prices has to do with anti-trust, and certainly I have encountered "call for prices" elsewhere.

mikeash 10y ago
I don't know about the anti-trust aspect, but the situation in medicine goes far beyond "call for prices." It's often impossible, no matter what you do, to find out what a procedure will cost. Billing systems are so complicated that the hospitals themselves barely understand it, and the only way they can find the cost for many things is to go ahead and do it and see how it comes out.
- ArtDev 10y ago
  They provider may not even be allowed to tell you due to contracts with insurance companies. This kind of thing is outright criminal. We need transparent pricing regulation!
  - prostoalex 10y ago
    Would be hard to enforce legislatively, as you're essentially forcing private companies to disclose the previously confidential pricing agreements between them and insurance companies. What will end up happening is the equivalent of MSRP in car sales - here's the list price, but since you're such a good guy, and we're running a promotion, you can get 5% off if you act today.
    - beambot 10y ago
      So instead you sign a contract to purchase a car (with no take backs!) and only then do you get told the must-pay MSRP? That's about how medical pricing works today.
      - prostoalex 10y ago
        Some states do require chargemaster transparency, e.g. https://www.oshpd.ca.gov/chargemaster/ https://www.oshpd.ca.gov/chargemaster/
    - mikeash 10y ago
      Why would that be hard? I thought law takes precedence over contracts. Even having the equivalent of car MSRPs would be a huge improvement. As it stands today, you often cannot get any price for a procedure beforehand, not even a "forget about insurance, I'm just going to pull out a wad of benjamins and start counting until you tell me it's enough" price. Plus, car prices don't vary that much from MSRP. I can look up a car's MSRP and know that this is approximately what I'll pay. If I get a really good deal I might get away with paying 10-20% less. If the car is in extremely high demand, I might have to pay 10-20% more. But I can get a pretty decent idea. Medical pricing often varies by a factor of ten depending on whether you have insurance, and which provider it is.
      - prostoalex 10y ago
        I posted a link below, but some states already mandate chargemaster transparency. It's close to useless, as one quickly discovers that (a) pretty much any procedure costs a trillion dollars, but discounts apply and (b) the consumer's view of "procedure" and hospital system's view of "services provided" differ radically, as every gauze used up, every vital measurement, and every painkiller is a billing item in hospital's book (cost of goods and labor), but are integral part of the "procedure" the way the consumer sees it.
        mikeash 10y ago
        That some current laws are useless doesn't mean better laws couldn't be made. Mandate a final, guaranteed, all-inclusive price, or require disclosing every single discount made available to anybody, or even require charging the same price to everybody. I think the real problem is that Americans mostly aren't willing to have their government going around telling businesses to cut out their shit or else.
dv_dt 10y ago
The ACA required hospitals to publish prices in some contexts. http://thehill.com/policy/healthcare/204868-new-price-transparency-rules-for-hospitals-under-o-care http://thehill.com/policy/healthcare/204868-new-price-transp... https://www.bna.com/hospitals-required-price-n17179910723/ https://www.bna.com/hospitals-required-price-n17179910723/
tmaly 10y ago
Karl provides more detail in his write up than I could cover, and he links to two US Supreme Court cases in regards to the price issue https://market-ticker.org/akcs-www?post=231949 https://market-ticker.org/akcs-www?post=231949
- dllthomas 10y ago
  Interesting, if ranty, hard to follow, and possibly overstated. For one, there seems a distinction to be made between "publishing" prices and individually receiving a quote in advance of work. If there's a technical sense in which the two are equivalent, I would recommend clarifying in casual conversation. Those requirements also don't seem (though I could've missed something) to be a part of anti-trust law, per se. The requirement that prices be consistent is, in the cited Robinson-Patman Act (although that seems to only apply if you're crossing state lines?)

richardthered 10y ago

But knowing the price of a procedure doesn't change my need for it. If I need heart surgery, I still need it regardless of whether it's $10k or $100k. In other words, demand is inelastic. And, most people can't afford to pay 10k or 100k out-of-pocket. So, it's not like managing your household budget. The funds have to come from somewhere else (insurance). Also, healthcare is not easy to evaluate for a layperson. If my doctor says that I need 'procedure X', I'm relying on their expertise. Healthcare recommendations are not fungible products. If I'm buying a car, I can read reviews about the different models, reliability, etc. But my doctor's recommendation for me is highly specific to my personal health history. So, for a lot of healthcare spending, it's not me that's choosing a medical procedure. Instead, I'm choosing to trust a doctor's recommendation. The doctor is the one that's recommending the procedure.

squozzer 10y ago
I think the elasticity of the demand depends pretty heavily upon the urgency of the problem. And the demand - as you pointed out - also depends heavily on trust. That said, most health problems aren't unique enough to require a completely bespoke solution. So at least hypothetically, it's possible to shop around IF pricing and other data were available. But they are not, at least generally. I found this book rather interesting -- https://www.amazon.com/dp/B01DRXKWRM/ref=dp-kindle-redirect?_encoding=UTF8&btkr=1 https://www.amazon.com/dp/B01DRXKWRM/ref=dp-kindle-redirect?... -- where a company compiled their health care expenditures and made the data available to their employees.

deleted 10y ago

[deleted]