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Japan forces their doctors to charge only what's published in a book that the government issues and negotiates prices periodically. Simple price fixing in an ot

Japan forces their doctors to charge only what's published in a book that the government issues and negotiates prices periodically. Simple price fixing in an otherwise private healthcare market. In return, Japanese doctors and hospitals (FYI, there are more private hospitals in Japan than the US) are allowed to set whatever prices for ancillary services (like private or semi-private rooms) that they want. BTW, the average stay overnight in a private room at a Japanese hospital is about $100. An MRI (which was 1400 negotiated down to 700 FTA) is $98, due largely to the fact that the Japanese have more MRIs and CT scanners per capita than the US. I mean, wasn't technology supposed to be our superiority play? And, if you want to talk care and outcomes, let's pick the most grim of diagnostics: Cancer. Japan's 5-year survival rates are among the highest in the world, and the highest in particular cancers such as colon and rectal cancer. And, FYI, the US isn't #1 in survival rates for all cancers. It's spread evenly through the G8. And, the most free of supposed free markets and tax-friendly wonderlands, Singapore, also puts price controls on procedures, with similarly successful outcomes. So it isn't a cultural or "economic" thing, it's a government thing. It always will be. An adult just needs to come in, put their foot down similar to what Tommy Douglas did in Canada, and declare either we all buy in to a government-run healthcare system, or we buy in to the government completely regulating the market much like it does the stock market or agricultural industry. States will have no say, no quarter, or feedback. They can choose to secede from the union to opt-out of the program. And, while I love me some comment karma, I know that my position is tantamount to heresy on this board, so, get your dismissive hand cocked and ready to wave me away :D

Groxx 16y ago
That's an interesting way to do things, didn't know Japan did that. Thanks for the info! How much do things like emergency services cost? Do they fall under ancillary or not? Anything that's nigh-essential that does? Know if the hospitals are supported by the government, and how much taxes it takes?
- muhfuhkuh 16y ago
  For most insurance, patients pay 30% copay maximum for any procedure (emergency or standard), but the minimum monthly payment (yes, it's not due all at once, which I think should also be legislated here in the States) is capped according to income. Hospitals are private, and both they and doctors negotiate every two years to set prices for everything from MRIs to stitches. The insurance industry is also private, but they have a public-run insurer for Japanese poor. AFAIK, taxes are taken just for the public-run insurance, to which only a small percentage of Japanese apply, but for private insurance (which the rest are mandated to have), it's paid through premiums per month, which is on average about $250/mo per family (and employers pay for almost all of that).
andrewflnr 16y ago
Japan's hospitals are going into debt because they can't charge what things cost. http://www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/countries/ http://www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/c...
- muhfuhkuh 16y ago
  So, the solution to that in the US is for the patients to either die or go bankrupt rather than hospitals or insurers going into debt. Everything has a price, but that seems a little lopsided.
  - SkyMarshal 16y ago
    Well neither is sustainable, so neither is a solution. I generally trust a self-correcting free market over a government bureaucracy to solve such problems, but in this case it seems the fundamental problem is that there just isn't enough margin for for-profit insurance companies to prosper without turning the screws on either doctors & staff, patients, and/or taxpayers.
  - tptacek 16y ago
    This is an utterly nonresponsive comment. If the economics of providing healthcare don't work out, they don't work out. It's not as if "go into debt" means "fat cats make less money". No, it means that the skilled labor and capital that drives the insolvent health care system will simply migrate somewhere they can deliver it profitably. Say goodbye to hospitals for rural and poor areas.
    - muhfuhkuh 16y ago
      "Say goodbye to hospitals for rural and poor areas." That was happening anyway, if it weren't for Medicaid, that is. There was a definite brain drain of doctors (especially specialists) who choose to go to affluent suburbs and urban areas simply because they get more (and better quality, AKA rich) patients. You think if we _further_ privatized the market, those in rural areas would be _better_ served? Isn't that the opposite of what the free market would actually do? In fact, take a look at this study[1] about physicians in rural America. It's eye opening how they advocate federal and state intervention (read Medicaid and Medicare) as one of the solutions (along with opening training up to more potential candidates, which even I as a liberal elitist supports). [1]http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1071163/ http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1071163/
georgieporgie 16y ago
> FYI, there are more private hospitals in Japan than the US Incidentally, as near as I can tell, a hospital in Japan is equivalent to a clinic or doctor's office in the US. They also seem to be open weird hours. (example http://www.youtube.com/watch?v=Mi31MJrRjhE http://www.youtube.com/watch?v=Mi31MJrRjhE)
maguay 16y ago
Thank you, thank you, thank you. Someone needed to say it! And the funny thing is, Singapore and Japan both are rather well-off nations, not much different wage and price wise than the US. Biggest difference is medical cost...
tptacek 16y ago
This is basically a recap of the Japan segment of the Frontline special "Sick Around The World", which you can watch online at: http://www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/ http://www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/. The Japanese system is not without its problems. More importantly, the "price fixing" approach to health insurance simply isn't going to happen in the US. What parts of it do you think we really can adopt? Because nobody is going to fix US healthcare by fiat.
- muhfuhkuh 16y ago
  "More importantly, the 'price fixing' approach to health insurance simply isn't going to happen in the US." Why wouldn't it? Would there be riots in the streets? Roving gangs of healthcare-affiliated hooligans throwing rocks, burning patient effigies? Doctors lining up to leave the country en masse for a freer medical marketplace or just throwing dirt in the eye of medicine to go be a quant trader at a hedge fund? The more important question is: Why hasn't that happened worldwide, in places where there truly _is_ universal/free/government healthcare? "What parts of it do you think we really can adopt? Because nobody is going to fix US healthcare by fiat." And, nobody but the rich and upper-middle class will be able to afford healthcare by Market. We can already see that today, with over 50 million uninsured Americans, up from 37 million just two years ago. How many will it be next year?
  - Groxx 16y ago
    I think the goal was more to state that our government is heavily influenced by rich special interest groups, who won't let it happen here, even if it costs them billions of dollars every year to fight it off. Funny mental picture though :D In my head they're wearing those stereotypical nurse hats and brought their own stretchers to carry off the wounded / exhausted / weaponry.
  - tptacek 16y ago
    No, there won't be riots in the streets, because it would take amendments to the Constitution to institute price-fixed health care. Clinton's wildest single-payer fantasy (which, coincidentally, is one of my wild fantasies) would be easier to accomplish, and it, too, is D.O.A. My objection to your point is twofold: (1) It is total wishful thinking. (2) It's wishful thinking in the face of pragmatic solutions that could resolve the problems we have now without utterly restructuring the market for health care.† I'd also appreciate it if you wouldn't attempt to frame any critique of your comments in terms of "you're either with me or against health care reform". As you can see from a casual glance at this vast, Reddit-like thread, few opponents of health care reform would dare poke their head up on HN these days. I'm not an opponent of reform. † Recap of my wish list: mandatory guaranteed-issue private high-deductable health insurance, an exchange-type system that fosters 5+ insurers in every major market (up from the 2 we have today), and broad adoption of cost-cutting services like telemedicine-issued scripts and nurse-practitioner clinics.
damoncali 16y ago
What people don't like to admit is that free markets don't work for healthcare. What is the price you're willing to pay for curing that tumor in your gut? Everything you have. There is no supply vs. demand. Only supply vs infinity. What would happen to the food market were it not for the generally high supply of food? It wouldn't be pretty. Because of that, some sort of non-market intervention is simply unavoidable. As are the inefficiencies that go along with price controls and other similar endeavors. Ugly stuff, this healthcare business.
- tptacek 16y ago
  This is a weird summary of how "free markets" and "supply and demand" work. Yes, you will pay everything you have for a cure. But the guy who will offer you a cure for "everything you have minus one dollar" is going to get your business.
  - damoncali 16y ago
    That's not exactly encouraging.
    - deleted 16y ago
      [deleted]
      - damoncali 16y ago
        Sorry - I was joking. Perhaps I should have added a smiley. I get what you're saying. I also think that: 1. the medical industries/professions work very hard at discouraging price competition. 2. price competition is not sufficient to create a healthcare marketplace that works well for society. I'd like to see people without means have at least some access to medical technology/services, even at the cost of inefficiency. But that's just me. Like I said - it's a beast.
    - tptacek 16y ago
      You're not encouraged that there's price competition in health care, or you don't believe that there's price competition in health care?
joe_the_user 16y ago
Yeah, In fact, forcing US hospitals and doctors to publish a price of any kind would be a simple improvement. It is amazing with all the other twiddling that this approach never appears - at least not much.
- muhfuhkuh 16y ago
  Some may argue (though I don't) that it is tantamount to price fixing, because doctors aren't free to have a "sliding scale" of care, even though about 95% of what they do are routine. Hell, even my plumber and mechanic have a book that they're more than happy to show me for what a service costs. My broken arm, though? I _deserve to shit bricks in fear of the bill if I'm a part time cashier with no insurance. Let that be a harsh lesson to me to become a rich computer programmer.
goatforce5 16y ago
The Medicare system in Australia works in a sort of similar way to how you describe Japan. The government publishes a list of fees for every possible procedure and treatment. The medical service provider can "bulk bill" where they collect the money directly from the government, and the patient never hands over any money. Alternatively, the provider can charge whatever they want (because they're a noted doctor, or their office is in an expensive location, etc.), and the patient can then claim the set amount back from Medicare. Bulk billing is so much more convenient for everyone that you'll see signs advertising it on the outside of doctors surgeries, thus the cost of care is kept down. On the other hand, the doctors are free to charge what they want. Sounds like a fair way to do it.
tomlin 16y ago
What Tommy Douglas did was revolutionary, but Canada's healthcare system is no longer something to be proud of. We have some of the highest wait times for Cancer patients in the industrialized world, hurried appointments, cuts in coverage. I don't blame the government, I blame us Canadians. If you've seen the Micheal Moore movie, SICKO, you've seen the average Canadian's view on our system, which is, that it is truly great. The government is getting a pat on the back for removing essential services because the masses aren't taking notice; we've fanboy-ed our system while ignoring its degradation of the fundamentals. Our current system is not a positive guideline to success. A Macleans article about the state of our system: http://www2.macleans.ca/2011/01/25/our-health-care-delusion/ http://www2.macleans.ca/2011/01/25/our-health-care-delusion/
cdavid 16y ago
I think the issue is just too complicated to draw conclusions from broad inter-countries comparisons. I find the Japanese system terrible - I have been living there for 7 years and I have yet encountered a foreigner coming from a rich country who thinks the system is good. The problem with comparing global stats like cancer survival rates is their weak correlation with the health care system. For example, the reason why colon/rectal cancer survival rate is high is because Japan is basically the only rich country where those cancers are the most common one (in other rich countries, prostate, breast, lungs usuallly come first for the concerned sex). There is also the issue of "free-ride", where most western countries benefit from research being done in the US and a couple other countries - which is not so easy to quantify either. Designing good indicators is incredibly hard, and for that reason alone I think it will always be a political question first, and an economical one second (i.e. economics can help making a decision, but it won't give you the decision).

Groxx 16y ago

That's an interesting way to do things, didn't know Japan did that. Thanks for the info! How much do things like emergency services cost? Do they fall under ancillary or not? Anything that's nigh-essential that does? Know if the hospitals are supported by the government, and how much taxes it takes?

muhfuhkuh 16y ago
For most insurance, patients pay 30% copay maximum for any procedure (emergency or standard), but the minimum monthly payment (yes, it's not due all at once, which I think should also be legislated here in the States) is capped according to income. Hospitals are private, and both they and doctors negotiate every two years to set prices for everything from MRIs to stitches. The insurance industry is also private, but they have a public-run insurer for Japanese poor. AFAIK, taxes are taken just for the public-run insurance, to which only a small percentage of Japanese apply, but for private insurance (which the rest are mandated to have), it's paid through premiums per month, which is on average about $250/mo per family (and employers pay for almost all of that).

andrewflnr 16y ago

Japan's hospitals are going into debt because they can't charge what things cost. http://www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/countries/ http://www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/c...

muhfuhkuh 16y ago
So, the solution to that in the US is for the patients to either die or go bankrupt rather than hospitals or insurers going into debt. Everything has a price, but that seems a little lopsided.
- SkyMarshal 16y ago
  Well neither is sustainable, so neither is a solution. I generally trust a self-correcting free market over a government bureaucracy to solve such problems, but in this case it seems the fundamental problem is that there just isn't enough margin for for-profit insurance companies to prosper without turning the screws on either doctors & staff, patients, and/or taxpayers.
- tptacek 16y ago
  This is an utterly nonresponsive comment. If the economics of providing healthcare don't work out, they don't work out. It's not as if "go into debt" means "fat cats make less money". No, it means that the skilled labor and capital that drives the insolvent health care system will simply migrate somewhere they can deliver it profitably. Say goodbye to hospitals for rural and poor areas.
  - muhfuhkuh 16y ago
    "Say goodbye to hospitals for rural and poor areas." That was happening anyway, if it weren't for Medicaid, that is. There was a definite brain drain of doctors (especially specialists) who choose to go to affluent suburbs and urban areas simply because they get more (and better quality, AKA rich) patients. You think if we _further_ privatized the market, those in rural areas would be _better_ served? Isn't that the opposite of what the free market would actually do? In fact, take a look at this study[1] about physicians in rural America. It's eye opening how they advocate federal and state intervention (read Medicaid and Medicare) as one of the solutions (along with opening training up to more potential candidates, which even I as a liberal elitist supports). [1]http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1071163/ http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1071163/

georgieporgie 16y ago

> FYI, there are more private hospitals in Japan than the US Incidentally, as near as I can tell, a hospital in Japan is equivalent to a clinic or doctor's office in the US. They also seem to be open weird hours. (example http://www.youtube.com/watch?v=Mi31MJrRjhE http://www.youtube.com/watch?v=Mi31MJrRjhE)

maguay 16y ago

Thank you, thank you, thank you. Someone needed to say it! And the funny thing is, Singapore and Japan both are rather well-off nations, not much different wage and price wise than the US. Biggest difference is medical cost...

tptacek 16y ago

This is basically a recap of the Japan segment of the Frontline special "Sick Around The World", which you can watch online at: http://www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/ http://www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/. The Japanese system is not without its problems. More importantly, the "price fixing" approach to health insurance simply isn't going to happen in the US. What parts of it do you think we really can adopt? Because nobody is going to fix US healthcare by fiat.

muhfuhkuh 16y ago
"More importantly, the 'price fixing' approach to health insurance simply isn't going to happen in the US." Why wouldn't it? Would there be riots in the streets? Roving gangs of healthcare-affiliated hooligans throwing rocks, burning patient effigies? Doctors lining up to leave the country en masse for a freer medical marketplace or just throwing dirt in the eye of medicine to go be a quant trader at a hedge fund? The more important question is: Why hasn't that happened worldwide, in places where there truly _is_ universal/free/government healthcare? "What parts of it do you think we really can adopt? Because nobody is going to fix US healthcare by fiat." And, nobody but the rich and upper-middle class will be able to afford healthcare by Market. We can already see that today, with over 50 million uninsured Americans, up from 37 million just two years ago. How many will it be next year?
- Groxx 16y ago
  I think the goal was more to state that our government is heavily influenced by rich special interest groups, who won't let it happen here, even if it costs them billions of dollars every year to fight it off. Funny mental picture though :D In my head they're wearing those stereotypical nurse hats and brought their own stretchers to carry off the wounded / exhausted / weaponry.
- tptacek 16y ago
  No, there won't be riots in the streets, because it would take amendments to the Constitution to institute price-fixed health care. Clinton's wildest single-payer fantasy (which, coincidentally, is one of my wild fantasies) would be easier to accomplish, and it, too, is D.O.A. My objection to your point is twofold: (1) It is total wishful thinking. (2) It's wishful thinking in the face of pragmatic solutions that could resolve the problems we have now without utterly restructuring the market for health care.† I'd also appreciate it if you wouldn't attempt to frame any critique of your comments in terms of "you're either with me or against health care reform". As you can see from a casual glance at this vast, Reddit-like thread, few opponents of health care reform would dare poke their head up on HN these days. I'm not an opponent of reform. † Recap of my wish list: mandatory guaranteed-issue private high-deductable health insurance, an exchange-type system that fosters 5+ insurers in every major market (up from the 2 we have today), and broad adoption of cost-cutting services like telemedicine-issued scripts and nurse-practitioner clinics.

damoncali 16y ago

What people don't like to admit is that free markets don't work for healthcare. What is the price you're willing to pay for curing that tumor in your gut? Everything you have. There is no supply vs. demand. Only supply vs infinity. What would happen to the food market were it not for the generally high supply of food? It wouldn't be pretty. Because of that, some sort of non-market intervention is simply unavoidable. As are the inefficiencies that go along with price controls and other similar endeavors. Ugly stuff, this healthcare business.

tptacek 16y ago
This is a weird summary of how "free markets" and "supply and demand" work. Yes, you will pay everything you have for a cure. But the guy who will offer you a cure for "everything you have minus one dollar" is going to get your business.
- damoncali 16y ago
  That's not exactly encouraging.
  - deleted 16y ago
    [deleted]
    - damoncali 16y ago
      Sorry - I was joking. Perhaps I should have added a smiley. I get what you're saying. I also think that: 1. the medical industries/professions work very hard at discouraging price competition. 2. price competition is not sufficient to create a healthcare marketplace that works well for society. I'd like to see people without means have at least some access to medical technology/services, even at the cost of inefficiency. But that's just me. Like I said - it's a beast.
  - tptacek 16y ago
    You're not encouraged that there's price competition in health care, or you don't believe that there's price competition in health care?

joe_the_user 16y ago

Yeah, In fact, forcing US hospitals and doctors to publish a price of any kind would be a simple improvement. It is amazing with all the other twiddling that this approach never appears - at least not much.

muhfuhkuh 16y ago
Some may argue (though I don't) that it is tantamount to price fixing, because doctors aren't free to have a "sliding scale" of care, even though about 95% of what they do are routine. Hell, even my plumber and mechanic have a book that they're more than happy to show me for what a service costs. My broken arm, though? I _deserve to shit bricks in fear of the bill if I'm a part time cashier with no insurance. Let that be a harsh lesson to me to become a rich computer programmer.

goatforce5 16y ago

The Medicare system in Australia works in a sort of similar way to how you describe Japan. The government publishes a list of fees for every possible procedure and treatment. The medical service provider can "bulk bill" where they collect the money directly from the government, and the patient never hands over any money. Alternatively, the provider can charge whatever they want (because they're a noted doctor, or their office is in an expensive location, etc.), and the patient can then claim the set amount back from Medicare. Bulk billing is so much more convenient for everyone that you'll see signs advertising it on the outside of doctors surgeries, thus the cost of care is kept down. On the other hand, the doctors are free to charge what they want. Sounds like a fair way to do it.

tomlin 16y ago

What Tommy Douglas did was revolutionary, but Canada's healthcare system is no longer something to be proud of. We have some of the highest wait times for Cancer patients in the industrialized world, hurried appointments, cuts in coverage. I don't blame the government, I blame us Canadians. If you've seen the Micheal Moore movie, SICKO, you've seen the average Canadian's view on our system, which is, that it is truly great. The government is getting a pat on the back for removing essential services because the masses aren't taking notice; we've fanboy-ed our system while ignoring its degradation of the fundamentals. Our current system is not a positive guideline to success. A Macleans article about the state of our system: http://www2.macleans.ca/2011/01/25/our-health-care-delusion/ http://www2.macleans.ca/2011/01/25/our-health-care-delusion/

cdavid 16y ago

I think the issue is just too complicated to draw conclusions from broad inter-countries comparisons. I find the Japanese system terrible - I have been living there for 7 years and I have yet encountered a foreigner coming from a rich country who thinks the system is good. The problem with comparing global stats like cancer survival rates is their weak correlation with the health care system. For example, the reason why colon/rectal cancer survival rate is high is because Japan is basically the only rich country where those cancers are the most common one (in other rich countries, prostate, breast, lungs usuallly come first for the concerned sex). There is also the issue of "free-ride", where most western countries benefit from research being done in the US and a couple other countries - which is not so easy to quantify either. Designing good indicators is incredibly hard, and for that reason alone I think it will always be a political question first, and an economical one second (i.e. economics can help making a decision, but it won't give you the decision).