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> That's fine, but it doesn't address the fundamental problem of US health care costs, which is --- regardless of "who pays" --- "why does it cost so fucking mu

> That's fine, but it doesn't address the fundamental problem of US health care costs, which is --- regardless of "who pays" --- "why does it cost so fucking much". A doctor named David Belk set out to find answers to this question. He presented what he found at http://truecostofhealthcare.org/ http://truecostofhealthcare.org/. You can start with the introduction (http://truecostofhealthcare.org/introduction/ http://truecostofhealthcare.org/introduction/) or skip straight to the conclusion (http://truecostofhealthcare.org/conclusion/ http://truecostofhealthcare.org/conclusion/), or explore his findings on a category-by-category basis. Or, if you prefer, the LA Times ran an article a while back that examined the single case of a dislocated shoulder: https://www.latimes.com/business/story/2019-09-12/medical-equipment-pricing https://www.latimes.com/business/story/2019-09-12/medical-eq... A deep dive into the specifics is well outside the scope of a comment on an HN thread that's already gone off the front page, but the summary is that the US system has a large number of profit-motivated groups involved in every step of the health care system, and those costs balloon rapidly as a result, and health care recipients are the least powerful group politically so none of this is changing for the better. Based on the findings like these and the plethora of other articles I've read on the subject, I'm extremely skeptical of a < 5.7% profit margin number for the health industry. Given that that figure seems to be coming from companies' self-reported profits, I'd bet there's some Hollywood accounting going on. Either that, or all the US health care corporations are really impoverished, every article on the subject that has faulted obscene profits is wrong, and all other countries are somehow propping up a rather large section of their social services with tax rates only marginally higher than the US overall rate.

tptacek 7y ago
I don't have an opinion about profit margins in the US health care system and am receptive to arguments that profits in the system are themselves exorbitant (it's Rayiner who consistently argues for perspective about comparative profits; ironically, Rayiner supports a national health plan, and I oppose it). My argument is orthogonal: it's that there is a payer side of the system and a provider side, and the national discussion about health care is focused almost entirely on the payer side, with the exception of prescription drugs, which are not the major driver of health costs. If the answer to this problem is "nationalize the profit-seekers", OK, I can hear that argument out --- but it has to be about doctors and hospitals and long-term care facilities, not about "greedy insurance companies".
- thaumaturgy 7y ago
  Sure, and that's one of the reasons I like Belk's site: he tries to explore more facets of the overall US health care clusterfuck than most other researchers and journalists. For the hospitals' portion of the mess, he finds that despite an overall decline in hospital stays [1], the amount that hospitals bill over what they actually collect has grown dramatically [2]. This in turn is caused by differences in incentives between Medicare/Medi-Cal and private insurance companies; private insurance companies are less motivated to drive down costs, and even have some incentives to pay hospitals more than Medicare/Medi-Cal would for the same services. Hospitals likewise have had steadily growing profits overall (in the 5% to 8% range) over recent decades, although most US hospitals are non-profit business entities. (This doesn't mean they don't make money, of course.) This really funky interplay between governmental health insurance, private health insurance, and hospitals is the main driver of the shocking, headline-grabbing bills people receive. They aren't the prices the hospital is expecting to actually collect, they're the prices that hospitals have invented in the hopes of collecting 30% of it from Medicare, and private insurance companies are playing along because it gives them a justification for raising their pricing for coverage. In a sense, a lot of what people are arguing about is phantom prices. Unfortunately, uninsured and under-insured get caught up in all this absurdity and that ends up driving around 60% of bankruptcies [3]. And while there are often arguments that hospitals have to charge more because there are more people unable to pay their bills, the number of uncollected bills hasn't really changed for a long time [2]. Thus a lot of the discussion around this issue ends up coming back to "greedy insurance companies" because they really are a major contributor to the problem. Prescription drug pricing likewise affects a disproportionate number of fixed-income people (whether retired or disabled). I'll try to keep yours and ~rayiner's different positions in mind in the future. [1]: http://truecostofhealthcare.org/admissions_data/ http://truecostofhealthcare.org/admissions_data/ [2]: http://truecostofhealthcare.org/hospital_financial_analysis/ http://truecostofhealthcare.org/hospital_financial_analysis/ [3]: http://www.cnn.com/2009/HEALTH/06/05/bankruptcy.medical.bills/index.html http://www.cnn.com/2009/HEALTH/06/05/bankruptcy.medical.bill...
  - jrs235 7y ago
    >although most US hospitals are non-profit business entities. (This doesn't mean they don't make money, of course.) Where I used to live... https://www.wpr.org/data-shows-la-crosses-gundersen-hospital-most-profitable-u-s https://www.wpr.org/data-shows-la-crosses-gundersen-hospital... I always cringed when I heard them asking for donations for capital improvements to build their new hospital wing.

tptacek 7y ago

I don't have an opinion about profit margins in the US health care system and am receptive to arguments that profits in the system are themselves exorbitant (it's Rayiner who consistently argues for perspective about comparative profits; ironically, Rayiner supports a national health plan, and I oppose it). My argument is orthogonal: it's that there is a payer side of the system and a provider side, and the national discussion about health care is focused almost entirely on the payer side, with the exception of prescription drugs, which are not the major driver of health costs. If the answer to this problem is "nationalize the profit-seekers", OK, I can hear that argument out --- but it has to be about doctors and hospitals and long-term care facilities, not about "greedy insurance companies".

thaumaturgy 7y ago
Sure, and that's one of the reasons I like Belk's site: he tries to explore more facets of the overall US health care clusterfuck than most other researchers and journalists. For the hospitals' portion of the mess, he finds that despite an overall decline in hospital stays [1], the amount that hospitals bill over what they actually collect has grown dramatically [2]. This in turn is caused by differences in incentives between Medicare/Medi-Cal and private insurance companies; private insurance companies are less motivated to drive down costs, and even have some incentives to pay hospitals more than Medicare/Medi-Cal would for the same services. Hospitals likewise have had steadily growing profits overall (in the 5% to 8% range) over recent decades, although most US hospitals are non-profit business entities. (This doesn't mean they don't make money, of course.) This really funky interplay between governmental health insurance, private health insurance, and hospitals is the main driver of the shocking, headline-grabbing bills people receive. They aren't the prices the hospital is expecting to actually collect, they're the prices that hospitals have invented in the hopes of collecting 30% of it from Medicare, and private insurance companies are playing along because it gives them a justification for raising their pricing for coverage. In a sense, a lot of what people are arguing about is phantom prices. Unfortunately, uninsured and under-insured get caught up in all this absurdity and that ends up driving around 60% of bankruptcies [3]. And while there are often arguments that hospitals have to charge more because there are more people unable to pay their bills, the number of uncollected bills hasn't really changed for a long time [2]. Thus a lot of the discussion around this issue ends up coming back to "greedy insurance companies" because they really are a major contributor to the problem. Prescription drug pricing likewise affects a disproportionate number of fixed-income people (whether retired or disabled). I'll try to keep yours and ~rayiner's different positions in mind in the future. [1]: http://truecostofhealthcare.org/admissions_data/ http://truecostofhealthcare.org/admissions_data/ [2]: http://truecostofhealthcare.org/hospital_financial_analysis/ http://truecostofhealthcare.org/hospital_financial_analysis/ [3]: http://www.cnn.com/2009/HEALTH/06/05/bankruptcy.medical.bills/index.html http://www.cnn.com/2009/HEALTH/06/05/bankruptcy.medical.bill...
- jrs235 7y ago
  >although most US hospitals are non-profit business entities. (This doesn't mean they don't make money, of course.) Where I used to live... https://www.wpr.org/data-shows-la-crosses-gundersen-hospital-most-profitable-u-s https://www.wpr.org/data-shows-la-crosses-gundersen-hospital... I always cringed when I heard them asking for donations for capital improvements to build their new hospital wing.