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To quote from my own comment when we discussed this six months ago (replying to https://news.ycombinator.com/item?id=13325022 https://news.ycombinator.com/item?
by waqf 9y ago
To quote from my own comment when we discussed this six months ago (replying to https://news.ycombinator.com/item?id=13325022 https://news.ycombinator.com/item?id=13325022):
"[…] there's adverse selection. The hospitals that make errors in the client's favor or that don't make errors at all are more likely to go out of business than the ones that make errors in their own favor. So guess which ones are still around when you need a hospital.
In other words, just because the errors are accidental, it doesn't mean they happen at random.
(This argument applies to any shady business practice that "looks" like an accident, for example dark patterns on websites, or having great customer service for taking your money but terrible customer service for refunding it.)"
- SilasX 9y agoThat's not a complete explanation, as it would likewise prove that every business errs as much as possible in their favor. It wouldn't explain what's different about hospitals and health insurance that makes them so brutal about it.
- waqf 9y agoTrue. My assumption is that there's a complete lack of the usual consumer protections because (a) no ability to shop around and (b) no political will to fix it because most bills go to insurance companies who (i) are expert at questioning medical bills and (ii) have a negotiated relationship with providers so they don't pay sticker price anyway.
- SilasX 9y agoRight -- those factors would be more relevant, specific things to point to than "providers who err in their favor get more money than those who don't".