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One of the bigger problems in healthcare is also over-utilization i.e. getting things are are technically covered under insurance but not objectively medically

One of the bigger problems in healthcare is also over-utilization i.e. getting things are are technically covered under insurance but not objectively medically necessary or getting a more expensive brand name drug over a chemically equivalent generic drug. Agree that the patient-provider relationship today is usually "I'm a doctor and I'm going to tell you to do this, this, and this" regardless of cost, and we go with it because if we're insured under today's system it means marginally more out of pocket dollars for us. If you had an high deductible plan with an HSA (i.e. paying pre tax dollars out of a health savings account), I'd bet psychologically you'd be more choosey when shopping around for healthcare and/or ask more questions of your provider around "is this really necessary?" or "is there a cheaper option?"

tomkarlo 9y ago
I have a high-deductible plan, and have had one for ~7 years now. It doesn't really change my decision process that much, honestly. Especially when I'm considering a procedure that my doctor has told me I need, but I don't know / understand the technical details of... I will try to go in-network, but I don't really have the capability to go shop around and assess which providers will give me a better outcome per dollar spent. I especially don't usually have the necessary skill set to assess if some cheaper option that's not my doc's first choice would really be a good choice. With healthcare, it's not just about "what's the cheapest option", it's also "who will deliver the best service"... given the relatively limited ability to optimize the first, I generally will focus on the second, and I think that's what most folks do - they go with providers they trust. It all comes back to my original point: healthcare, particularly non-elective healthcare, is not well-suited to a free market solution.
- Consultant32452 9y ago
  Assuming you are not an auto mechanic, how do you go about deciding which cars to purchase? If you're unable to discern whether your doctor's preferred solution is the best one, then what is the purpose of asking your doctor in the first place? Or how would it be beneficial if the "worst" provider was forced to charge you the same as the best provider?
  - tomkarlo 9y ago
    Cars have the nice property of being mass-produced goods, where there's an established mechanism for testing, rating, and regulating them. There's no such thing for healthcare (and it's a service, not a hard good.) If I was qualified to discern if my doc's preferred solution was the best one, I'd be a doctor. I ask my doctor because he's been specifically trained to make that determination. > Or how would it be beneficial if the "worst" provider was forced to charge you the same as the best provider? You've got that backwards. Right now, we basically allow the worst provider to charge as much as the best one, because we don't really have any way to differentiate the best from the worst. There's no need to force any business to charge more.
    - Consultant32452 9y ago
      >Cars have the nice property of being mass-produced goods, where there's an established mechanism for testing, rating, and regulating them. There's no such thing for healthcare (and it's a service, not a hard good.) TIL there's no testing, rating, or regulating in the medical industry. >I ask my doctor because he's been specifically trained to make that determination. I agree, so this concern of yours is alleviated. The market provided you an expensive option which is the one your trusted advisor recommends, and there's a cheaper one which may offer lower quality service. You are now empowered to make your own decision on the matter. >You've got that backwards. Right now, we basically allow the worst provider to charge as much as the best one, because we don't really have any way to differentiate the best from the worst. There's no need to force any business to charge more. Moving to single payer does not help you differentiate the best from the worst. All it does is force the good provider and the bad provider to charge the same. The current insurance regime is not better, because your provider can choose the worse provider for you if they're cheaper, leaving you no option at all.
  - romwell 9y ago
    >Assuming you are not an auto mechanic, how do you go about deciding which cars to purchase? I can't believe we're going with car analogies here. HN is now the Slashdot of yore. I do hope you realize that people use fundamentally different methods of choosing things in life depending on the importance and consequences of that choice, and hence asking about how one chooses cars doesn't apply to choosing a healthcare provider. Unless you are, in fact, a robot, in which case I welcome our new, ah nevermind.
emodendroket 9y ago
I mean, you're right that people get less medical care if their out-of-pocket costs are higher. The problem is they're really poor at judging for themselves whether procedures are necessary and so they end up sacrificing their health or sometimes outright dying because they didn't get care they needed. "Skin in the game" is one of those zombie ideas that just don't die.
- pdonis 9y ago
  > "Skin in the game" is one of those zombie ideas that just don't die. No, the idea that people who have no skin in the game--regulators and bureaucrats--can make better decisions than the people directly involved, particularly about matters with as much at stake as health care--is one of those zombie ideas that just don't die. No regulator or bucreaucrat ever suffers any negative consequences because of bad decisions about other people's health care. As for people being poor at judging for themselves whether procedures are necessary, another comment upthread already addressed that: there are plenty of other areas (auto repair, for example) where most people don't have the technical knowledge to judge for themselves whether procedures are necessary, yet markets seem to function in those areas. Furthermore, under the current system in the US, people have little incentive to become more knowledgeable, because they are not going to be given a choice anyway; they're going to get whatever their health insurance provider says is the standard care. Under a market system, people would have much more of an incentive to actually learn about the various options. And there would also be much more of an incentive for independent third parties to provide information, particularly information that health care providers might not want people to know. More generally, the reason market advocates, like me, advocate markets is not that they always give optimal outcomes. They don't. But in cases where they don't, non-market alternatives give outcomes that are even worse.
  - tomkarlo 9y ago
    And yet the data shows that when you leave the decision to regulators and bureaucrats, you seem to get better value for the healthcare dollar than if you let individuals make their own decisions. The US, in particular, spends more and sees worse outcomes than other counties. This shouldn't be a surprise. An individual is going to not make very good decisions about how healthcare dollars are allocated over the course of their life. They're going to usually tend to underspend on preventative care (which has the highest ROI) and tend to overspend on end-of-life care (which has a lower ROI). You can see this played out in things like the US's infant mortality rate (3X other developed nations) and life expectancy (31st worldwide, declining).
u801e 9y ago
> One of the bigger problems in healthcare is also over-utilization i.e. getting things are are technically covered under insurance but not objectively medically necessary or getting a more expensive brand name drug over a chemically equivalent generic drug. Another problem is that procedures and appointments that could be considered routine maintenance in other areas are paid for by insurance. You don't use car insurance to pay for oil changes or new tires. Services such as annual physicals/check ups, vaccinations, etc should be cheap enough to pay for out of pocket. That would leave insurance to pay for the more expensive forms of care, just like one would use car insurance to pay for damage as a result of a collision.
- maxerickson 9y ago
  Flu vaccines are reasonably cheap. $30-40. The flip side of that is that they aren't contributing much to insurance premiums. At a policy level it may be worth a slight increase in cost if building it into insurance significantly increases the number of people that actually get the shot.
  - u801e 9y ago
    > The flip side of that is that they aren't contributing much to insurance premiums. Can we be certain of that? That is, even if the vaccination costs $30 to $40, will the insurance be billed for that amount, or do they get billed something like $300 instead? I haven't tried to pay for a influenza vaccination out of pocket recently, so I don't know what most places would charge.
    - maxerickson 9y ago
      Insurance will usually pay less than the cash price. They have a better idea of the cost than individuals and more leverage.
    - tomkarlo 9y ago
      The price the insurance company pays is almost never going to be higher than what you would pay if you're uninsured. You're confusing your co-pay with the uninsured cost of a flu shot. If Sam's Club and Costco can offer flu shots for $15 [0], it's a safe bet that the cost to an insurance company is less than that. [0] https://www.bradsdeals.com/blog/where-to-get-a-cheap-flu-shot https://www.bradsdeals.com/blog/where-to-get-a-cheap-flu-sho...
uberduber 9y ago
The vast majority of dollars spent in over-utilization has to do with our culture and is in the last 6 months of life. I wish we as a society could have a moral/ethical discussion about whether we should try every last treatment trying to save 89 year old grandma for two months at the cost of $300k. Ask any doctor, and there's a reason they personally do not want to go anywhere near a hospital at the end of life. It's usually the children/grandchildren who live far away and never visit who insist that every last thing be done prolonging their grandparents' suffering in my opinion. The ones who live nearby and spend plenty of time are usually okay with letting them go.

tomkarlo 9y ago

I have a high-deductible plan, and have had one for ~7 years now. It doesn't really change my decision process that much, honestly. Especially when I'm considering a procedure that my doctor has told me I need, but I don't know / understand the technical details of... I will try to go in-network, but I don't really have the capability to go shop around and assess which providers will give me a better outcome per dollar spent. I especially don't usually have the necessary skill set to assess if some cheaper option that's not my doc's first choice would really be a good choice. With healthcare, it's not just about "what's the cheapest option", it's also "who will deliver the best service"... given the relatively limited ability to optimize the first, I generally will focus on the second, and I think that's what most folks do - they go with providers they trust. It all comes back to my original point: healthcare, particularly non-elective healthcare, is not well-suited to a free market solution.

Consultant32452 9y ago
Assuming you are not an auto mechanic, how do you go about deciding which cars to purchase? If you're unable to discern whether your doctor's preferred solution is the best one, then what is the purpose of asking your doctor in the first place? Or how would it be beneficial if the "worst" provider was forced to charge you the same as the best provider?
- tomkarlo 9y ago
  Cars have the nice property of being mass-produced goods, where there's an established mechanism for testing, rating, and regulating them. There's no such thing for healthcare (and it's a service, not a hard good.) If I was qualified to discern if my doc's preferred solution was the best one, I'd be a doctor. I ask my doctor because he's been specifically trained to make that determination. > Or how would it be beneficial if the "worst" provider was forced to charge you the same as the best provider? You've got that backwards. Right now, we basically allow the worst provider to charge as much as the best one, because we don't really have any way to differentiate the best from the worst. There's no need to force any business to charge more.
  - Consultant32452 9y ago
    >Cars have the nice property of being mass-produced goods, where there's an established mechanism for testing, rating, and regulating them. There's no such thing for healthcare (and it's a service, not a hard good.) TIL there's no testing, rating, or regulating in the medical industry. >I ask my doctor because he's been specifically trained to make that determination. I agree, so this concern of yours is alleviated. The market provided you an expensive option which is the one your trusted advisor recommends, and there's a cheaper one which may offer lower quality service. You are now empowered to make your own decision on the matter. >You've got that backwards. Right now, we basically allow the worst provider to charge as much as the best one, because we don't really have any way to differentiate the best from the worst. There's no need to force any business to charge more. Moving to single payer does not help you differentiate the best from the worst. All it does is force the good provider and the bad provider to charge the same. The current insurance regime is not better, because your provider can choose the worse provider for you if they're cheaper, leaving you no option at all.
- romwell 9y ago
  >Assuming you are not an auto mechanic, how do you go about deciding which cars to purchase? I can't believe we're going with car analogies here. HN is now the Slashdot of yore. I do hope you realize that people use fundamentally different methods of choosing things in life depending on the importance and consequences of that choice, and hence asking about how one chooses cars doesn't apply to choosing a healthcare provider. Unless you are, in fact, a robot, in which case I welcome our new, ah nevermind.

emodendroket 9y ago

I mean, you're right that people get less medical care if their out-of-pocket costs are higher. The problem is they're really poor at judging for themselves whether procedures are necessary and so they end up sacrificing their health or sometimes outright dying because they didn't get care they needed. "Skin in the game" is one of those zombie ideas that just don't die.

pdonis 9y ago
> "Skin in the game" is one of those zombie ideas that just don't die. No, the idea that people who have no skin in the game--regulators and bureaucrats--can make better decisions than the people directly involved, particularly about matters with as much at stake as health care--is one of those zombie ideas that just don't die. No regulator or bucreaucrat ever suffers any negative consequences because of bad decisions about other people's health care. As for people being poor at judging for themselves whether procedures are necessary, another comment upthread already addressed that: there are plenty of other areas (auto repair, for example) where most people don't have the technical knowledge to judge for themselves whether procedures are necessary, yet markets seem to function in those areas. Furthermore, under the current system in the US, people have little incentive to become more knowledgeable, because they are not going to be given a choice anyway; they're going to get whatever their health insurance provider says is the standard care. Under a market system, people would have much more of an incentive to actually learn about the various options. And there would also be much more of an incentive for independent third parties to provide information, particularly information that health care providers might not want people to know. More generally, the reason market advocates, like me, advocate markets is not that they always give optimal outcomes. They don't. But in cases where they don't, non-market alternatives give outcomes that are even worse.
- tomkarlo 9y ago
  And yet the data shows that when you leave the decision to regulators and bureaucrats, you seem to get better value for the healthcare dollar than if you let individuals make their own decisions. The US, in particular, spends more and sees worse outcomes than other counties. This shouldn't be a surprise. An individual is going to not make very good decisions about how healthcare dollars are allocated over the course of their life. They're going to usually tend to underspend on preventative care (which has the highest ROI) and tend to overspend on end-of-life care (which has a lower ROI). You can see this played out in things like the US's infant mortality rate (3X other developed nations) and life expectancy (31st worldwide, declining).

u801e 9y ago

> One of the bigger problems in healthcare is also over-utilization i.e. getting things are are technically covered under insurance but not objectively medically necessary or getting a more expensive brand name drug over a chemically equivalent generic drug. Another problem is that procedures and appointments that could be considered routine maintenance in other areas are paid for by insurance. You don't use car insurance to pay for oil changes or new tires. Services such as annual physicals/check ups, vaccinations, etc should be cheap enough to pay for out of pocket. That would leave insurance to pay for the more expensive forms of care, just like one would use car insurance to pay for damage as a result of a collision.

maxerickson 9y ago
Flu vaccines are reasonably cheap. $30-40. The flip side of that is that they aren't contributing much to insurance premiums. At a policy level it may be worth a slight increase in cost if building it into insurance significantly increases the number of people that actually get the shot.
- u801e 9y ago
  > The flip side of that is that they aren't contributing much to insurance premiums. Can we be certain of that? That is, even if the vaccination costs $30 to $40, will the insurance be billed for that amount, or do they get billed something like $300 instead? I haven't tried to pay for a influenza vaccination out of pocket recently, so I don't know what most places would charge.
  - maxerickson 9y ago
    Insurance will usually pay less than the cash price. They have a better idea of the cost than individuals and more leverage.
  - tomkarlo 9y ago
    The price the insurance company pays is almost never going to be higher than what you would pay if you're uninsured. You're confusing your co-pay with the uninsured cost of a flu shot. If Sam's Club and Costco can offer flu shots for $15 [0], it's a safe bet that the cost to an insurance company is less than that. [0] https://www.bradsdeals.com/blog/where-to-get-a-cheap-flu-shot https://www.bradsdeals.com/blog/where-to-get-a-cheap-flu-sho...

uberduber 9y ago

The vast majority of dollars spent in over-utilization has to do with our culture and is in the last 6 months of life. I wish we as a society could have a moral/ethical discussion about whether we should try every last treatment trying to save 89 year old grandma for two months at the cost of $300k. Ask any doctor, and there's a reason they personally do not want to go anywhere near a hospital at the end of life. It's usually the children/grandchildren who live far away and never visit who insist that every last thing be done prolonging their grandparents' suffering in my opinion. The ones who live nearby and spend plenty of time are usually okay with letting them go.