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I think people are holding on to the hope that competition in the marketplace will control prices and bring them back to reasonable levels. I know I held on to

I think people are holding on to the hope that competition in the marketplace will control prices and bring them back to reasonable levels. I know I held on to that hope for a long time, but it's becoming clear that mere competition among insurance providers isn't a strong enough force. Medical prices are so high now that I think people are ready to consider drastic change.

onething 8y ago
I wouldn't expect competition among insurance companies to lower prices by very much. Insurance companies are already constrained by law as to how much profit they can make and there is only so much overhead you can remove. In terms of competition, the real problem is the artificially low numbers of health care workers and facilities. The Drs are limited by the low number of medical schools, etc and the number of facilities are limited by requiring Certificates of Need, etc. First remove these barriers to entry and require transparent pricing. Then... maybe competition would result in lower prices.
- sundaeofshock 8y ago
  You could remove profit entirely from the mix. That would reduce costs pretty significantly.
  - onething 8y ago
    It isn't that simple. >...Seven of the top 10 most profitable hospitals in the United States are nonprofit facilities that each netted more than $150 million from caring for patients in 2013, >...The study’s main purpose was to determine the characteristics of the nation’s most profitable hospitals. They found that facilities that were part of a system were more profitable because they were able to dominate their local market, which gives them greater clout in negotiating higher prices from private insurers. It also means consumers end up paying more if their health-care provider is out of network, Anderson said. https://www.washingtonpost.com/news/to-your-health/wp/2016/05/02/these-hospitals-make-the-most-money-off-patients-and-theyre-mostly-nonprofits/?noredirect=on&utm_term=.360a403876d4 https://www.washingtonpost.com/news/to-your-health/wp/2016/0... Also: >...Nonprofit hospitals have higher profit margins than most for-profit hospitals after accounting for their tax obligations. http://thehealthcareblog.com/blog/2017/04/25/the-fairy-tale-of-a-non-profit-hospital/ http://thehealthcareblog.com/blog/2017/04/25/the-fairy-tale-...
chillwaves 8y ago
How can there be competition when there is no price transparency? No ability for the consumer to shop around? How does anything about the way medical care is administered in the US work in the context of the mythical "free market"?
- hathawsh 8y ago
  Chargemasters may be going online as early as next week: https://www.healthleadersmedia.com/finance/put-chargemaster-online-2019-says-cms-proposal https://www.healthleadersmedia.com/finance/put-chargemaster-... It's not clear that this will have the intended effect (since insurance always pays a heavily discounted price), but I think it's a step in the right direction.
Digory 8y ago
People firmly believe competition will control prices. But people also firmly believe they don't want price discrimination once they're on fixed incomes, and want government to take whatever steps are necessary to pay for that. Healthcare costs for old people is most of the game, and those are regulated. No one is willing to challenge that. Thus, we have a market that remains too regulated for presently-allowable-competition to make a difference.

onething 8y ago

I wouldn't expect competition among insurance companies to lower prices by very much. Insurance companies are already constrained by law as to how much profit they can make and there is only so much overhead you can remove. In terms of competition, the real problem is the artificially low numbers of health care workers and facilities. The Drs are limited by the low number of medical schools, etc and the number of facilities are limited by requiring Certificates of Need, etc. First remove these barriers to entry and require transparent pricing. Then... maybe competition would result in lower prices.

sundaeofshock 8y ago
You could remove profit entirely from the mix. That would reduce costs pretty significantly.
- onething 8y ago
  It isn't that simple. >...Seven of the top 10 most profitable hospitals in the United States are nonprofit facilities that each netted more than $150 million from caring for patients in 2013, >...The study’s main purpose was to determine the characteristics of the nation’s most profitable hospitals. They found that facilities that were part of a system were more profitable because they were able to dominate their local market, which gives them greater clout in negotiating higher prices from private insurers. It also means consumers end up paying more if their health-care provider is out of network, Anderson said. https://www.washingtonpost.com/news/to-your-health/wp/2016/05/02/these-hospitals-make-the-most-money-off-patients-and-theyre-mostly-nonprofits/?noredirect=on&utm_term=.360a403876d4 https://www.washingtonpost.com/news/to-your-health/wp/2016/0... Also: >...Nonprofit hospitals have higher profit margins than most for-profit hospitals after accounting for their tax obligations. http://thehealthcareblog.com/blog/2017/04/25/the-fairy-tale-of-a-non-profit-hospital/ http://thehealthcareblog.com/blog/2017/04/25/the-fairy-tale-...

chillwaves 8y ago

How can there be competition when there is no price transparency? No ability for the consumer to shop around? How does anything about the way medical care is administered in the US work in the context of the mythical "free market"?

hathawsh 8y ago
Chargemasters may be going online as early as next week: https://www.healthleadersmedia.com/finance/put-chargemaster-online-2019-says-cms-proposal https://www.healthleadersmedia.com/finance/put-chargemaster-... It's not clear that this will have the intended effect (since insurance always pays a heavily discounted price), but I think it's a step in the right direction.

Digory 8y ago

People firmly believe competition will control prices. But people also firmly believe they don't want price discrimination once they're on fixed incomes, and want government to take whatever steps are necessary to pay for that. Healthcare costs for old people is most of the game, and those are regulated. No one is willing to challenge that. Thus, we have a market that remains too regulated for presently-allowable-competition to make a difference.