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But why - I still don't understand what is causing the problem in the US? Even in the non-US systems, somebody has to pay, so how can they afford it, given that

But why - I still don't understand what is causing the problem in the US? Even in the non-US systems, somebody has to pay, so how can they afford it, given that all other countries are poorer than the US? In my view, insurance is completely compatible with capitalism. It is simply a business, based on statistics. So why should the US have a special problem with insurance?

beefsack 9y ago
> But why - I still don't understand what is causing the problem in the US? Even in the non-US systems, somebody has to pay, so how can they afford it, given that all other countries are poorer than the US? Perhaps the issue isn't that the US as a whole can't afford it, but more that medical treatments are expensive and the rich aren't willing to subsidise for the others. In countries where it's funded essentially via sliding scale income tax, the rich don't have a choice but to subsidise it.
- anothercomment 9y ago
  That would be another issue than the "medical care is especially expensive in the US", though. Are the numbers even known, I mean, how much would proper health insurance cost per person?
  - youdontknowtho 9y ago
    There are economic interests that have made sure that the information you are talking about isn't available. Its hard to get this across, because it sounds a little crazy. There are economic forces in American life that actively misinform the public. Medical care is made to be expensive to protect those interests.
fsloth 9y ago
If all the money comes from one pocket - the government - the system is incentivized to concentrate on economically optimal treatment. In the US scenario hospitals are financially incentivized to fleece insurance companies for all they can. This is an exaggearation of course, but if a viable treatment can be done with a one doctors visit or two, the US system incentivies for two doctors visits and so on.
- deleted 9y ago
  [deleted]
- anothercomment 9y ago
  why would the money coming from one pocket incentivize economic optimal treatment? By what mechanism? Why wouldn't hospitals try to fleece the government (spoiler: they do, in the countries with public health care)?
  - walshemj 9y ago
    The NHS as the only major buyer of drugs etc can bargain for price reductions
  - grey-area 9y ago
    Compare the actual figures spent per capita on healthcare spend in single payer vs the us system and the outcomes and you'll find your assumptions are badly wrong. Single payer works better, that's why almost all countries use it for basic healthcare.
    - aianus 9y ago
      Single payer may work better overall but I can confirm that in Canada they do fleece the single payer in exactly this way. "Only one issue per visit" so they can charge for two visits. Making me visit to hear the negative results of a standard STD panel, again, just so they can charge for two visits. They charge for an extra visit just to renew prescriptions with no additional examination. Etc.
      - madengr 9y ago
        Same thing in the USA. Trying getting a problem looked at during a physical; they want a separate appointment. Though since my insurance pays for physicals, I can see why they do it. Probably required by insurance company since my deductible is $5000.
      - grey-area 9y ago
youdontknowtho 9y ago
Insurance is compatible with capitalism. I don't think anyone is implying that it isn't. What we are trying to say is that in the US, insurance provides very little benefit while constantly driving up cost. They actually have every incentive to shield consumers and producers from having good levels of information about value and cost. If making money from the actuarial spread were the only thing that they did, they might not be so toxic. Instead, they partition information into silo's to further create arbitrage points. Every point where they serve as gatekeeper for information is a place in the system that extra profit can be made. I think one of the things that you are assuming is that they have a single function in the market. They don't. As is often the case, simple capitalist models for ideal markets just don't match reality. They are also able to use their gains to game the system in their favor from a regulatory perspective.
- anothercomment 9y ago
  But why can't they be disrupted? For example some people could be pissed off that they don't get information, and companies providing information could win them over as customers. Obviously, things are not working out in the US. I am just not yet convinced that the market/capitalism is to blame, or if it is essentially corruption (including lobbyists bribing politicians to set up a system that allows the bad insurers to stay in operation).
  - aianus 9y ago
    Consumers don't choose their health insurance companies in the US. Their employers choose them. And when the user != the purchaser, you don't get a good user experience, you get corruption and a race to the bottom.
    - anothercomment 9y ago
      OK, but people choose their employers, to some extent. Would more transparency help them to demand the right health insurance from their employers?
pjc50 9y ago
"Insurance" and "healthcare" are two completely different things. To understand why this is, observe that the military run their own state-run medical system rather than requiring individual soldiers to have private medical insurance for any battlefield injuries. Non-US manage costs by some combination of state price control, aggressive triage, reduction of bureaucracy compared to complex insurance systems, and lower labour costs. Also, in re "other countries are poorer than the US": that may be due to the US having a few extremely rich people, it may be possible that the average or modal American is poorer than the average European. Especially if you account for healthcare.
- walshemj 9y ago
  The guardian a few days ago compared country's tax burden and for people in the lower tax band people in the USA paid more tax that the UK :-)
  - pjc50 9y ago
    This one? https://www.theguardian.com/money/2017/may/27/tax-britons-pay-europe-australia-us https://www.theguardian.com/money/2017/may/27/tax-britons-pa... The one which has "US Tax rate 20.3%" and "UK Tax rate 18.9%"? Even if we did pay more tax, how are you accounting for healthcare and other benefits? US state taxes? UK council tax, and the situations where you can have "negative income tax" in the UK (WFTC)? And, as discussed, you're free of worries about whether or not you'll get healthcare in the UK. (You may experience a delay for non-urgent conditions, I'll give you that)
    - walshemj 9y ago
      Its the other way around for those earning under £25k uk 18.9 usa 20.3
      - pjc50 9y ago
        That's the same way round as I said, 18.9% in the UK is lower than 20.3% in the US.
crdoconnor 9y ago
>In my view, insurance is completely compatible with capitalism. It is simply a business, based on statistics. Insurance that is based upon a normal distribution is compatible. Insurance based upon a non-normal distribution is not compatible because you basically can't price it. You therefore usually get a few scenarios: * The insurer prints money during the good years and goes bankrupt in the bad years. * The insurer prints money during the good years and somehow caps their liability in the bad years (this is why homeowners' insurance typically doesn't cover flood damage). Sometimes the government covers the difference (e.g. the government coughing up the money AIG owed to Goldman Sachs, the nuclear liability cap or NFIP), sometimes it doesn't. You get non-normal distributions in a lot of situations - nuclear insurance, flood, earthquake, healthcare and insuring against default risk. tl;dr capitalism is compatible only with high school statistics.
- anothercomment 9y ago
  But lots of insurance companies operate on the risks you mention, floods, earthquakes. There are insurance companies that insure other insurance companies against outliers, for example. Sure, there is no guarantee that the whole network can not go broke. But that goes for governments, too. Also I think health care will always have to be capped at some point, because with arbitrarily high investments, you could presumably keep people alive indefinitely (heart fails - attach heart machine. Lung fails - attach lung machine...). That is why in the UK afaik they don't pay for dialysis once you reach a certain age.
  - crdoconnor 9y ago
    "But lots of insurance companies operate on the risks you mention, floods, earthquakes. " Where this does happen there's usually a fairly low liability cap, some sort of hybrid private/public partnership or a combination. "Also I think health care will always have to be capped at some point, because with arbitrarily high investments, you could presumably keep people alive indefinitely (heart fails - attach heart machine. Lung fails - attach lung machine...). That is why in the UK afaik they don't pay for dialysis once you reach a certain age." The UK is almost entirely communist (this is a description, not a slur) in the way funds are allocated. They base funding decisions on something called QALYs - quality adjusted life years. The practical upshot is that expensive operations that will add 6 months of painful life for an elderly patient are not prioritized under the NHS whereas operations that could save a newborn child's life have virtually no funding limits.
kesselvon 9y ago
In the U.S., insurers cannot be prosecuted for anti-trust violations under McCarran-Ferguson. care providers and suppliers tend to engage in anti-competitive practices, and the state does not provide price controls. Also, EMTALA prevents hospitals from denying treatment for ER visits. People without insurance use these frequently as they have no other alternatives for care. ER visits are incredibly expensive and its a partial reason for price spikes. Basically the US healthcare system is a patchwork of system tied to employment (which stemmed from wage controls during WW2). No one's been able to rework the system since there are too many entrenched players making too much money
- maxerickson 9y ago
  It would be very interesting to see the actual costs of no-pay ER visits. Not the billed amounts, the underlying costs.

beefsack 9y ago

> But why - I still don't understand what is causing the problem in the US? Even in the non-US systems, somebody has to pay, so how can they afford it, given that all other countries are poorer than the US? Perhaps the issue isn't that the US as a whole can't afford it, but more that medical treatments are expensive and the rich aren't willing to subsidise for the others. In countries where it's funded essentially via sliding scale income tax, the rich don't have a choice but to subsidise it.

anothercomment 9y ago
That would be another issue than the "medical care is especially expensive in the US", though. Are the numbers even known, I mean, how much would proper health insurance cost per person?
- youdontknowtho 9y ago
  There are economic interests that have made sure that the information you are talking about isn't available. Its hard to get this across, because it sounds a little crazy. There are economic forces in American life that actively misinform the public. Medical care is made to be expensive to protect those interests.

fsloth 9y ago

If all the money comes from one pocket - the government - the system is incentivized to concentrate on economically optimal treatment. In the US scenario hospitals are financially incentivized to fleece insurance companies for all they can. This is an exaggearation of course, but if a viable treatment can be done with a one doctors visit or two, the US system incentivies for two doctors visits and so on.

deleted 9y ago
[deleted]
anothercomment 9y ago
why would the money coming from one pocket incentivize economic optimal treatment? By what mechanism? Why wouldn't hospitals try to fleece the government (spoiler: they do, in the countries with public health care)?
- walshemj 9y ago
  The NHS as the only major buyer of drugs etc can bargain for price reductions
- grey-area 9y ago
  Compare the actual figures spent per capita on healthcare spend in single payer vs the us system and the outcomes and you'll find your assumptions are badly wrong. Single payer works better, that's why almost all countries use it for basic healthcare.
  - aianus 9y ago
    Single payer may work better overall but I can confirm that in Canada they do fleece the single payer in exactly this way. "Only one issue per visit" so they can charge for two visits. Making me visit to hear the negative results of a standard STD panel, again, just so they can charge for two visits. They charge for an extra visit just to renew prescriptions with no additional examination. Etc.
    - madengr 9y ago
      Same thing in the USA. Trying getting a problem looked at during a physical; they want a separate appointment. Though since my insurance pays for physicals, I can see why they do it. Probably required by insurance company since my deductible is $5000.
    - grey-area 9y ago

youdontknowtho 9y ago

Insurance is compatible with capitalism. I don't think anyone is implying that it isn't. What we are trying to say is that in the US, insurance provides very little benefit while constantly driving up cost. They actually have every incentive to shield consumers and producers from having good levels of information about value and cost. If making money from the actuarial spread were the only thing that they did, they might not be so toxic. Instead, they partition information into silo's to further create arbitrage points. Every point where they serve as gatekeeper for information is a place in the system that extra profit can be made. I think one of the things that you are assuming is that they have a single function in the market. They don't. As is often the case, simple capitalist models for ideal markets just don't match reality. They are also able to use their gains to game the system in their favor from a regulatory perspective.

anothercomment 9y ago
But why can't they be disrupted? For example some people could be pissed off that they don't get information, and companies providing information could win them over as customers. Obviously, things are not working out in the US. I am just not yet convinced that the market/capitalism is to blame, or if it is essentially corruption (including lobbyists bribing politicians to set up a system that allows the bad insurers to stay in operation).
- aianus 9y ago
  Consumers don't choose their health insurance companies in the US. Their employers choose them. And when the user != the purchaser, you don't get a good user experience, you get corruption and a race to the bottom.
  - anothercomment 9y ago
    OK, but people choose their employers, to some extent. Would more transparency help them to demand the right health insurance from their employers?

pjc50 9y ago

"Insurance" and "healthcare" are two completely different things. To understand why this is, observe that the military run their own state-run medical system rather than requiring individual soldiers to have private medical insurance for any battlefield injuries. Non-US manage costs by some combination of state price control, aggressive triage, reduction of bureaucracy compared to complex insurance systems, and lower labour costs. Also, in re "other countries are poorer than the US": that may be due to the US having a few extremely rich people, it may be possible that the average or modal American is poorer than the average European. Especially if you account for healthcare.

walshemj 9y ago
The guardian a few days ago compared country's tax burden and for people in the lower tax band people in the USA paid more tax that the UK :-)
- pjc50 9y ago
  This one? https://www.theguardian.com/money/2017/may/27/tax-britons-pay-europe-australia-us https://www.theguardian.com/money/2017/may/27/tax-britons-pa... The one which has "US Tax rate 20.3%" and "UK Tax rate 18.9%"? Even if we did pay more tax, how are you accounting for healthcare and other benefits? US state taxes? UK council tax, and the situations where you can have "negative income tax" in the UK (WFTC)? And, as discussed, you're free of worries about whether or not you'll get healthcare in the UK. (You may experience a delay for non-urgent conditions, I'll give you that)
  - walshemj 9y ago
    Its the other way around for those earning under £25k uk 18.9 usa 20.3
    - pjc50 9y ago
      That's the same way round as I said, 18.9% in the UK is lower than 20.3% in the US.

crdoconnor 9y ago

>In my view, insurance is completely compatible with capitalism. It is simply a business, based on statistics. Insurance that is based upon a normal distribution is compatible. Insurance based upon a non-normal distribution is not compatible because you basically can't price it. You therefore usually get a few scenarios: * The insurer prints money during the good years and goes bankrupt in the bad years. * The insurer prints money during the good years and somehow caps their liability in the bad years (this is why homeowners' insurance typically doesn't cover flood damage). Sometimes the government covers the difference (e.g. the government coughing up the money AIG owed to Goldman Sachs, the nuclear liability cap or NFIP), sometimes it doesn't. You get non-normal distributions in a lot of situations - nuclear insurance, flood, earthquake, healthcare and insuring against default risk. tl;dr capitalism is compatible only with high school statistics.

anothercomment 9y ago
But lots of insurance companies operate on the risks you mention, floods, earthquakes. There are insurance companies that insure other insurance companies against outliers, for example. Sure, there is no guarantee that the whole network can not go broke. But that goes for governments, too. Also I think health care will always have to be capped at some point, because with arbitrarily high investments, you could presumably keep people alive indefinitely (heart fails - attach heart machine. Lung fails - attach lung machine...). That is why in the UK afaik they don't pay for dialysis once you reach a certain age.
- crdoconnor 9y ago
  "But lots of insurance companies operate on the risks you mention, floods, earthquakes. " Where this does happen there's usually a fairly low liability cap, some sort of hybrid private/public partnership or a combination. "Also I think health care will always have to be capped at some point, because with arbitrarily high investments, you could presumably keep people alive indefinitely (heart fails - attach heart machine. Lung fails - attach lung machine...). That is why in the UK afaik they don't pay for dialysis once you reach a certain age." The UK is almost entirely communist (this is a description, not a slur) in the way funds are allocated. They base funding decisions on something called QALYs - quality adjusted life years. The practical upshot is that expensive operations that will add 6 months of painful life for an elderly patient are not prioritized under the NHS whereas operations that could save a newborn child's life have virtually no funding limits.

kesselvon 9y ago

In the U.S., insurers cannot be prosecuted for anti-trust violations under McCarran-Ferguson. care providers and suppliers tend to engage in anti-competitive practices, and the state does not provide price controls. Also, EMTALA prevents hospitals from denying treatment for ER visits. People without insurance use these frequently as they have no other alternatives for care. ER visits are incredibly expensive and its a partial reason for price spikes. Basically the US healthcare system is a patchwork of system tied to employment (which stemmed from wage controls during WW2). No one's been able to rework the system since there are too many entrenched players making too much money

maxerickson 9y ago
It would be very interesting to see the actual costs of no-pay ER visits. Not the billed amounts, the underlying costs.