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There's something horribly wrong with a system in which the doctor cannot readily tell you how much a procedure will cost. It's not like the doctor is building

There's something horribly wrong with a system in which the doctor cannot readily tell you how much a procedure will cost. It's not like the doctor is building a new space rocket every time they do an appendectomy, or designing something completely new. It's a procedure that is done thousands of times per day. But still, no one can tell you how much it will cost. There's layers and layers of waste in American healthcare. No one seems to really want to take point in fixing it. Frankly, it seems like a hopeless situation that will only get worse.

ZeroGravitas 9y ago
Assigning a cost to something is actually fairly tricky in any business and there's often no single "correct" answer. And even if you had perfect pricing in medicine, deciding which procedure will be the best for you would involve a complex calculation of risk, balancing long term and short term health, impacts on quality of life and employment and so on. There are problems in any health system, but not all simple solutions are actually simple or solutions. The most obvious problems in the US system were attempted to be fixed by Obamacare according to the generally accepted wisdom of experts in the field. This was rejected by a large minority of voters just because it's easy for callous politicians to make any mildly complex thing into a conspiracy against their voters while pocketing cash from people who benefit from the policies they push. That to me seems the root of the issue, without fixing that then nothing else matters.
- chimeracoder 9y ago
  > Assigning a cost to something is actually fairly tricky in any business and there's often no single "correct" answer. And even if you had perfect pricing in medicine, deciding which procedure will be the best for you would involve a complex calculation of risk, balancing long term and short term health, impacts on quality of life and employment and so on. On the other hand, India has a billion payer system, and it's quite trivial to find concrete price quotes for most common (and even uncommon) treatments. You'll even see providers advertising their prices and (surprise!) competing with each other on price. That's something that's all but unheard-of in the US, except for a couple of niche areas of treatment. Medicine isn't inherently special in this regard. It is unfeasible for doctors in the US today to provide price quotations (for reasons I explain below), but there's no reason it has to be this way.
chimeracoder 9y ago
> There's something horribly wrong with a system in which the doctor cannot readily tell you how much a procedure will cost. There's a reason for this, and I've written about it in more detail on Hacker News before, but in short: Medicare reimburses rates below-cost. About 7% below COGS, which means providers lose money per-patient, even before they have to pay doctors, nurses, janitorial staff, building upkeep, etc. To make up for this, providers inflate the rates they charge to private insurers. They don't expect private insurers to pay the full amount that they bill for, of course, but private insurers usually peg their final reimbursement agreements to multiples of what Medicare pays (e.g. "350% of the Medicare rate)[0]. The provider can't tell you what you'll end up paying, because they literally don't know - it depends on the rate your insurer ultimately agrees to pay, which depends not just on what your provider charges, but also on whether the insurance network has existing payment agreements that apply to your treatment and supersede the rate that they bill. Private practices that don't accept insurance can always tell you what they'll charge you. Private practices that accept _only_ private insurance actually can sometimes tell you, because they don't have to do the roundabout dance to the same degree[1], so they often have more standardized rates with private insurers. However, standalone private practices are a dying breed - most are part of practice groups, which are themselves owned by hospital networks, so it's very hard to find a doctor who _does_ accept private insurance but is _not_ part of a provider network that accepts Medicare patients[2]. [0] It doesn't help that, in many cases, private insurers are required by law to reimburse more than Medicare does, which perpetuates this whole cycle. [1] They may still have a back-and-forth billing negotiation, but because they don't have to use privately-insured patients to subsidize the publicly-insured ones, they have a much better idea of where it will end up. [2] Some hospitals are actually talking about dropping Medicare altogether, because it's so expensive and complicated for them to accept Medicare patients, but even if they ultimately decide to, it will take a long time to actually implement, for a number of reasons which are rather tangential to the topic at hand here.
- DoveBrown 9y ago
  Why do providers accept a loss doing treatments for Medicare? If it's a loss per patient, it's a loss and you'll go out of business. What is the advantage for the provider to do any Medicare work?

ZeroGravitas 9y ago

Assigning a cost to something is actually fairly tricky in any business and there's often no single "correct" answer. And even if you had perfect pricing in medicine, deciding which procedure will be the best for you would involve a complex calculation of risk, balancing long term and short term health, impacts on quality of life and employment and so on. There are problems in any health system, but not all simple solutions are actually simple or solutions. The most obvious problems in the US system were attempted to be fixed by Obamacare according to the generally accepted wisdom of experts in the field. This was rejected by a large minority of voters just because it's easy for callous politicians to make any mildly complex thing into a conspiracy against their voters while pocketing cash from people who benefit from the policies they push. That to me seems the root of the issue, without fixing that then nothing else matters.

chimeracoder 9y ago
> Assigning a cost to something is actually fairly tricky in any business and there's often no single "correct" answer. And even if you had perfect pricing in medicine, deciding which procedure will be the best for you would involve a complex calculation of risk, balancing long term and short term health, impacts on quality of life and employment and so on. On the other hand, India has a billion payer system, and it's quite trivial to find concrete price quotes for most common (and even uncommon) treatments. You'll even see providers advertising their prices and (surprise!) competing with each other on price. That's something that's all but unheard-of in the US, except for a couple of niche areas of treatment. Medicine isn't inherently special in this regard. It is unfeasible for doctors in the US today to provide price quotations (for reasons I explain below), but there's no reason it has to be this way.

chimeracoder 9y ago

> There's something horribly wrong with a system in which the doctor cannot readily tell you how much a procedure will cost. There's a reason for this, and I've written about it in more detail on Hacker News before, but in short: Medicare reimburses rates below-cost. About 7% below COGS, which means providers lose money per-patient, even before they have to pay doctors, nurses, janitorial staff, building upkeep, etc. To make up for this, providers inflate the rates they charge to private insurers. They don't expect private insurers to pay the full amount that they bill for, of course, but private insurers usually peg their final reimbursement agreements to multiples of what Medicare pays (e.g. "350% of the Medicare rate)[0]. The provider can't tell you what you'll end up paying, because they literally don't know - it depends on the rate your insurer ultimately agrees to pay, which depends not just on what your provider charges, but also on whether the insurance network has existing payment agreements that apply to your treatment and supersede the rate that they bill. Private practices that don't accept insurance can always tell you what they'll charge you. Private practices that accept _only_ private insurance actually can sometimes tell you, because they don't have to do the roundabout dance to the same degree[1], so they often have more standardized rates with private insurers. However, standalone private practices are a dying breed - most are part of practice groups, which are themselves owned by hospital networks, so it's very hard to find a doctor who _does_ accept private insurance but is _not_ part of a provider network that accepts Medicare patients[2]. [0] It doesn't help that, in many cases, private insurers are required by law to reimburse more than Medicare does, which perpetuates this whole cycle. [1] They may still have a back-and-forth billing negotiation, but because they don't have to use privately-insured patients to subsidize the publicly-insured ones, they have a much better idea of where it will end up. [2] Some hospitals are actually talking about dropping Medicare altogether, because it's so expensive and complicated for them to accept Medicare patients, but even if they ultimately decide to, it will take a long time to actually implement, for a number of reasons which are rather tangential to the topic at hand here.

DoveBrown 9y ago
Why do providers accept a loss doing treatments for Medicare? If it's a loss per patient, it's a loss and you'll go out of business. What is the advantage for the provider to do any Medicare work?