13 ms·

Researchers chart path to drastically lower administrative costs of health care

138 points by achou 5y ago

jostmey 5y ago
I agree with the three issues they identify driving up costs. But I fear “Medicare for All” won't fix all the issues, which go much deeper. For example, the US has extremely high standards restricting who can practice medicine compared to the rest of world, limiting the supply of doctors and artificially driving up their demand. There is a need for standards, but perhaps the AMA has too much political influence. Likewise, manufacturers of medical supplies operate as monopolies because the moat to reach approval is really high. I fear the US medical system is becoming so insane the only fix will be to replace it entirely (It's not just about tearing down, but replacing institutions)
- syops 5y ago
  The bottleneck is not the number of people with an MD. The bottleneck is the number of residency programs. These are funded by Medicare and I believe they are not profitable for hospitals.
  - tgb 5y ago
    There's some good reason to think that residencies are profitable: in 2019, 550 of them were auctioned off for $55 million in a controversial bankruptcy case. https://www.inquirer.com/business/hahnemann-university-hospital-residency-slots-55-million-20190809.html https://www.inquirer.com/business/hahnemann-university-hospi...
    - sjg007 5y ago
      So residences are basically taxi medallions. Interesting.
      - syops 5y ago
        They are taxi medallions to newly graduated MDs but not to the hospital. Without a residency slot MDs often times are relegated to a lifetime of med school debt servicing.
    - andrewlgood 5y ago
      It is not that the residencies themselves are profitable. It is that medical schools need to be able to provide residency slots to their students to have an effective program. Definitely an issue for newly formed for-profit medical schools.
  - HEmanZ 5y ago
    I don't know how residencies could not be profitable for hospitals. Hospitals receive something like $120k/yr per resident, then work residents 80+ hours/week at $50k/yr pay, amounting to right around minimum wage (for my city). Residents do a tremendous amount of work in supporting the hospital, so much so that a single resident getting deathly ill and needing to stay home (e.g a surgery resident getting covid, which I witnessed) is enough to send a massive shock through a hospital and force other residents into 100+ hr/week schedules. I know this because my wife is a surgery resident and I'm describing a situation from this year. Edit: But there are still way too few residency spots. I think it has to do with the difficulty and administrative work around starting a new program or with getting federal funding for more spots.
    - ihsw 5y ago
      It sounds like we have a spending problem and not a funding problem.
    - EvanAnderson 5y ago
      The residency slots are so limited right now because the AMA lobbied hard against expanding them in the 1990s (fearing a "glut" of doctors). Edit: Every time this comes up I go down a rabbit hole of looking for an article from the mid-to-late 90s where a medical lobbyist spoke about how doctors would be forced to leave the profession and do "mundane" jobs like driving cabs if the residency slots weren't capped. It did not paint the lobby in a good light, and I've love to see it trotted out today. I never have been able to find the article online. If somebody with better search-engine-fu than me can find it I'd be greatful.
      - nradov 5y ago
        The AMA is actively lobbying for more residency slots. https://www.ama-assn.org/press-center/press-releases/ama-fund-graduate-medical-education-address-physician-shortages https://www.ama-assn.org/press-center/press-releases/ama-fun...
        EvanAnderson 5y ago
  - rcpt 5y ago
    I don't think it's about the profit it's the fact that anything involving Medicare is a big political fight
  - warmfuzzykitten 5y ago
    A helpful link on this subject. Apparently, medical schools in the US are now allowing more graduates. Not sure about profitability of residency programs, but certainly not all hospitals are teaching hospitals and the latter are federally subsidized. https://www.aamc.org/news-insights/us-medical-school-enrollment-rises-30 https://www.aamc.org/news-insights/us-medical-school-enrollm...
  - kaitai 5y ago
    This is correct and needs to be upvoted more. The number of residency slots is artificially capped and already fails to serve the number of medical school graduates in the country. The Balanced Budget Act of 1997 is the basic vehicle for this cap. In Dec 2020 the first expansion in decades was passed, adding a whopping 1000 residency spots. Look up Graduate Medical Education program for more info. For more key words, see this document from the U of California system that has an agenda (increase capacity) but also effectively lists salient points: https://www.ucop.edu/federal-governmental-relations/_files/fact-sheets/fgr-health-factsheet-gme-f1.pdf https://www.ucop.edu/federal-governmental-relations/_files/f...
- throwaway13337 5y ago
  Agreed. Entrenched institutions are the general problem with America. It's the police unions protecting bad policing, the restricting of doctor supply via the residency bottleneck, and local governments preventing new building for burgeoning populations. They're all the same problem really. Beneficial to the incumbent group at the expense of those they service. It's kind of amazing.
  - mbg721 5y ago
    Institutional trust is certainly a huge problem right now.
  - mycologos 5y ago
    > the restricting of doctor supply via the residency bottleneck Assuming that you're referring to the AMA here, their role is pretty unclear to me. They appear to have played a lobbying role to get Congress to freeze residency funding in 1997 to avoid having lots of doctors [1], but for several years now, the AMA has at least publicly claimed that they've been lobbying congress to increase funding for residency slots [2]. Maybe they're lying? But I for one don't actually know who is keeping residency funding low. [1] https://qz.com/1676207/the-us-is-on-the-verge-of-a-devastating-doctor-shortage/ https://qz.com/1676207/the-us-is-on-the-verge-of-a-devastati... [2] https://www.ama-assn.org/press-center/press-releases/ama-builds-efforts-expand-funding-graduate-medical-education-0 https://www.ama-assn.org/press-center/press-releases/ama-bui...
    - smooth_remmy 5y ago
      AMA is a bad actor. They refuse to allow junior doctors (doctors who are MD school graduates but who have not completed residency) to practice medicine in ANY capacity. Common sense says that junior doctors should have the same practice rights as physician assistants - but the AMA refuses to let that happen. They are a medical cartel. A few states have allowed junior doctors to start practicing medicine in a limited capacity, because every other doctor so damn expensive. But the AMA does not support those states' decision.
      - 5y ago
- chiefalchemist 5y ago
  Demand is also "artificially" driven up by the American diet and lifestyle. If the preventables (e.g., Type 2 Diabetes) were prevented, otherwise mitigated (less sugar!) then the resources / system could focus on real disease. The issue with the USA is it wants its cake, it wants to eat it, and expects to pay less for consistently making unhealthy choices.
  - nradov 5y ago
    Sure but most other countries are on track to have the same diet and lifestyle health problems as the USA. They're running a few years behind us but they'll catch up eventually.
    - djdjdjdjdj 5y ago
      Germany doesn't. I can think of plenty other European countries.
      - nradov 5y ago
        Germany has a high rate of obesity just like most comparable countries.
- rscho 5y ago
  > For example, the US has extremely high standards restricting who can practice medicine compared to the rest of world Rest of the world, yes. Rest of the developed world, not at all. The major difference is that becoming a doc in the US is much more expensive than pretty much anywhere else. You could also argue it's proportionally harder because of the more numerous competitors. But on an absolute level of knowledge and capability no, it's not harder than say, in western european countries.
  - whiddershins 5y ago
    I believe it takes longer in the US, when all is said and done. It’s hard to casually verify this because each country uses different terms and has a different track but I think, when you include the various phases of training, starting from the bachelors degree, the US one is more total years. Edit: So for example the UK and France don’t appear to require any sort of bachelor’s degree as a prerequisite for medical. Which saves you 4 years on average. So their tracks may be longer but you can start sooner.
    - jimnotgym 5y ago
      Citation definitely needed here And just to be sure, I would like you to start from the beginning of the person's medical training and not include the gatekeeping bit of having to get a bachelors in a random subject unrelated to medicine. I note this Wikipedia article that suggests 4 years messed school plus 1 year internship could get me a license in the US. That sounds like Western Europe to me. Or India... https://en.m.wikipedia.org/wiki/Medical_education_in_the_United_States https://en.m.wikipedia.org/wiki/Medical_education_in_the_Uni...
      - triceratops 5y ago
        > I would like you to start from the beginning of the person's medical training and not include the gatekeeping bit of having to get a bachelors in a random subject unrelated to medicine. Why? An apples-to-apples comparison would be to see how long it takes to become a general physician after completing secondary school. In the UK or India it's something like 5.5-6 years.[1] In the US it's 3-4 years of "pre-med", then 4 years of med school. That's from the article you referred. 1. https://en.wikipedia.org/wiki/Medical_school_in_the_United_Kingdom https://en.wikipedia.org/wiki/Medical_school_in_the_United_K...
- KoftaBob 5y ago
  They state early in the article that this research details how to tackle those three issues without resorting to Medicare for All.
- gumby 5y ago
  > For example, the US has extremely high standards restricting who can practice medicine compared to the rest of world, limiting the supply of doctors... Really? Can you give some examples? There are a lot of immigrant physicians in the USA. An anecdotal counter example: my mother is a physician with medical licenses from Australia, UK and the USA (obviously two have lapsed) and though she is quite critical of countries X and Y and positive about country Z she has never expressed any such opinion or said that one might be tougher than another, which is exactly the kind of thing she would point out.
  - IG_Semmelweiss 5y ago
    all those immigrant physicians went thru the same programs as the non-immigrants. In fact, I hear this is continuously a problem for well qualified , practicing, and established physicians to migrate to the US. They are fed up with their own home countries lack of security, opportunities for their children, freedom etc, but they cannot imagine going back to medical school to be accredited to practice in the US. This does not apply to every country. Notably, 4, all here: https://www.theabfm.org/become-certified/i-am-certified-country-outside-united-states https://www.theabfm.org/become-certified/i-am-certified-coun... While many foreign physicians will have years of experiences diagnosing, treating patients, and administering medicine, in order to practice as a US doctor, it essentially requires them to start all over again academically, especially when the curriculum differs from overseas qualifications. [1] https://www.fnu.edu/foreign-physicians-work-healthcare-practitioners/ https://www.fnu.edu/foreign-physicians-work-healthcare-pract...
    - dublin 5y ago
      No, they most certainly did not. I've spent a large chunk of my career in healthcare technology, and one thing I can say for sure is that with very few exceptions, foreign doctors are no where close to the knowledge and capability of those educated in the US. I'm not going to specify to avoid slamming particular countries, but I would definitely refuse to be treated by doctors from several major countries that crank out tons of doctors, many of whom worm their way into US practice. (This isn't based on race, etc, at all just competency, and I have a much larger exposure to this than most people. These people kill way too many patients with their incompetence, but (especially lately) they cannot be criticized for fear of being branded racist. My body, my choice.)
- podgaj 5y ago
  The bottleneck is the cost of medical school. That cost is linked to the colleges raising prices because they can. Medicare for All will surely help this, but free college will help as well. The U.S. is like a dysfunctional family where the parents will not pay for the kids college even though they have the money.
  - nradov 5y ago
    The cost of medical school is not a bottleneck. Lower prices would be nice, but even with current high prices all accredited medical schools have essentially full enrollment. The real bottleneck is in lack of federal funding for residency programs. Every year students graduate from medical school with an MD but are unable to practice medicine because they don't get matched to a residency slot.
- heymijo 5y ago
  I just realized Physician Assistants (PAs) and Nurse Practitioners (NPs) have been forgotten in this equation. 126,000 practicing PAs [0] 325,000 licensed NPs [1] 985,000 practicing physicians (MDs and DOs) [2] I know that nurse practitioners are not under the same artificial residency constraints of MDs/DOs. I'm not sure about physician assistants. For someone not in the U.S., NPs and PAs often do the same role as general practitioners/family doctors e.g. see patients, prescribe medicine, etc. They can also specialize. [0] https://www.thepalife.com/physician-assistant-stats/ https://www.thepalife.com/physician-assistant-stats/ [1] https://www.aanp.org/about/all-about-nps/np-fact-sheet https://www.aanp.org/about/all-about-nps/np-fact-sheet [2] https://en.wikipedia.org/wiki/Physicians_in_the_United_States https://en.wikipedia.org/wiki/Physicians_in_the_United_State...
  - tryptophan 5y ago
    PA/NA education is a complete joke compared to what your average MD gets. They are not qualified to practice as general doctors at all. However, they are really cheap, which is why corporations are pushing them so hard. Substandard care in the name of profits.
    - deleted 5y ago
      [deleted]
    - weasel_words 5y ago
      Wow I was about to gush about how much I LOVE my NP compared to my old crappy, braindead MDs. I could share stories of how bad MDs are...and the horrors of insurance. She is sharp as a whip. Smarter and more motivated than ANY MD I've EVER had. Anything she doesn't know about, she researches (on her own time/dime). She prescribes everything - dirt cheap. Lets me text/call/email ANY time. Refers me to a specialist for anything beyond her expertise (just like any MD would!) DIRT CHEAP (eg: MRI for $300, scheduled within a day or two down the street). A single, cheap, monthly fee ($65/mo!) lets me see her any time day and night, ask anything, discuss as long as I like...and I do all these things! No MD going through standard insurance would allow anything even remotely similar. ...I could go on... imo the NP model is FAR superior than the traditional insurance+MD crap model we have right now. It's one of those things "they" don't want people learning about since it'll crush the traditional way of doing things once people realize how amazing that model is. Yes I have basic insurance since it's required. And, just in case - she obviously doesn't have an emergency room.
- pessimizer 5y ago
  It's not that the standards are high, it's that they are protectionist. I think one of the biggest hurdles is the US residency requirements. Everything you say is true, though.
- sct202 5y ago
  The supply of doctors in a lot of primary care roles is supplemented by Nurse Practitioners and Physicians Assistants who have less restricted licensing bodies. Like NPs and PAs aren't required to go thru residency and can switch specialties more easily than a doctor.
- mbesto 5y ago
  You just conflated two partners in the whole mix of what we call "healthcare" in the US. Payers = Medicare for All, UNH, Aetna, etc. Providers = Hospitals, doctors, medical supplies, etc. It's entirely possible to have one payer and then having a governing body regulate a free market[0] comprised of providers in the market. [0] - I'm using the word free market not in its purest form (which rarely exists) but rather in a more colloquially way.
- tw04 5y ago
  >Likewise, manufacturers of medical supplies operate as monopolies because the moat to reach approval is really high. I can tell you for a fact this simply isn't true. The reason manufacturers of medical supplies operate as a monopoly is because they have turned to acquiring everyone and anyone in the medical supply/device business and there's been 0 opposition to it. https://www.beckersspine.com/orthopedic-a-spine-device-a-implant-news/item/50526-medtronic-acquires-7th-company-in-2020-9-device-company-notes.html https://www.beckersspine.com/orthopedic-a-spine-device-a-imp... https://mergr.com/abbott-laboratories-acquisitions#cma-tab https://mergr.com/abbott-laboratories-acquisitions#cma-tab https://www.greenlight.guru/blog/top-100-medical-device-companies https://www.greenlight.guru/blog/top-100-medical-device-comp... You can go through the last link which is a list of device manufacturers and look at their acquisitions. They just eat up every small player that shows even a hint of providing competition. Some of them have been averaging an acquisition a month for years.
- UncleOxidant 5y ago
  If we do medicare for all or some other kind of universal healthcare in the US we're also going to need to train doctors way more cheaply than we do now. At the least we're going to need to offer free or heavily subsidized education to incentivize more people to go into medicine without graduating with debt higher than many mortgages.
- King-Aaron 5y ago
  The United State's healthcare don't even appear in any "Top-10 global healthcare" rankings available anywhere, and are consistently overshadowed by many European countries, Singapore, Australia, Japan etc. I don't think you can use "extremely high standards restricting who can practice medicine" as reasoning when it doesn't appear to impact the quality of care at all.
- jjav 5y ago
  > limiting the supply of doctors Possibly, but the cost of doctors (+nurses, technicians, etc) is in the noise, just a distraction. The vast majority of the cost of medical care in the US goes to the middlemen who contribute no value at all, just extract profit. A 15 minute session with a general practicioner here (CA) costs around $300. That doctor isn't making $1200/hr ($2.5M/yr). That doctor is likely only making a bit over 200K: https://www.salary.com/research/salary/benchmark/family-physician-salary/ca https://www.salary.com/research/salary/benchmark/family-phys... The other $2M+ are going hangers-on who're not contributing to health care, just inserting themselves into the chain to get rich. Take a look at the billions in revenue collectively by all insurance companies. That's all a tax on health care that provides no value.
  - rland 5y ago
    Huh? You'd need to look at billions in profit, not revenue, since insurance does pay out for the cost of care. When you look at that, the margin is actually lower than most industries. It is true that there are a lot of middlemen with hands in the pot but it's not quite that simple. The biggest driver of healthcare is that Americans just consume a lot of it. We get surgeries, we opt for long, expensive treatments at the end of our lives, we use extremely sophisticated and expensive medical equipment a lot, we pay people to take care of our old people exorbitant sums of money. Like, in other countries, when your lungs and kidneys start going, you don't go to the hospital for a multiple surgery. When you fall and you can't move around and wipe your own ass, you don't get moved into a facility where people are paid to take care of you, you move in with your family. And, if you don't have those options, you die. I'm with you that the system is fucked but the underlying reason doesn't _really_ have anything to do with greed in medicine and everything to do with the way that we treat medicine culturally: the duty that children (don't, in this country) have to care for their elders, the attitude we have about prolonging death. That every part of the medical system says: we will never, ever make the decision to let someone pass away, even when "fixing" their problem (of death!) with all the technology and labor we've got turns out to be ludicrously expensive.
    - jjav 5y ago
      > profit, not revenue No, because profit is substracting all the operating costs of the insurance company, including salaries of hundreds of thousands of paper pushers and multi-million dollar bonuses to their executives. All of this is just overhead that provides no health-care value and can be eliminated.
hpoe 5y ago
Recently I got laser eye surgery to help my vision. This was not covered by my insurance. It also happened to be the simplest medical procedure/payment I ever had to interact with. They told me "this procedure will cost $X.XX and we have a discount we can offer you that will save you X%" I said okay and paid them the money. Compare that to insurance being involved recently in my wife's diabetes supplies. My wife is a type 1 diabetic and needs supplies that monitor her blood sugar, we noticed her supplies didn't arrive on the scheduled date, we waited a week to see if they would show up and they didn't. My wife called the company that was supposed to send them, they said our account was in collections? Why, we never received a bill, we never were notified, but in collections we were. We eneded up paying and got that sorted out and waited another week, still no supplies. I'll cut it short and just say it took us 3 weeks being on the phone multiple times a day being bounced around between our insurance, the supplier and her dr, to finally get told we couldn't get the supplies because my wife had gotten a new phone and so the insurance company didn't have enough data to prove that she needed these supplies, and wouldn't reauthorize them. The drama is still ongoing. Let's get this straight a huge part of the healthcare costs are directly related to insurance and the money and laws tied up in that. We need to get rid of insurance, and the way it works if we honestly want to make any change. Any other effort will only further entrench the confusopoly.
- JJMcJ 5y ago
  I have had some private pay medical treatment and can concur. Come in, write the check/present the card, and walk out. Fortunately it wasn't very expensive.
- anotha1 5y ago
  Sorry to hear about your ongoing issues. Sadly, it's the same story thousands of times per day, often for people experiencing the final moments of their lives. The healthcare insurance industry absolutely needs to be destroyed. One day, we'll look back at this debacle similar to cigarettes, big industry manipulating the population and millions of people dying unnecessarily because of it. It's time to end the suffering.
- zhdc1 5y ago
  Several years ago, I lived in a country where I had high-deductible private insurance in lieu of the (then relatively new) national healthcare plan. I was able to walk into a fairly large hospital, get a full battery of tests along with a thankfully minor diagnosis and medication for a small amount of money paid up front. The bill was itemized, translated, and I received excellent customer service.
taurath 5y ago
Can anyone grok what the actual proposed reforms are? It’s missing from the article.
- creaghpatr 5y ago
  Looks like it's mostly an abstract of something that was published in a journal but they hint at it saying 3 scenarios: simplifying/streamlining individual plans, standardizing plans across all groups ie. more standardization, and a combination of those two things. This would lead to less complexity and administrative overhead which would lead to savings etc.
  - dboreham 5y ago
    Or perhaps look at other western countries that don't have any of this vampire squid stuff.
    - e40 5y ago
      Like Japan that has a published book which contains the prices for all procedures. https://en.wikipedia.org/wiki/Health_care_system_in_Japan#Cost https://en.wikipedia.org/wiki/Health_care_system_in_Japan#Co...
  - shkkmo 5y ago
    I thought a major aspect was also standardizing contracts between insurers and providers.
  - kingsuper20 5y ago
    I'm not much for the genius of government to correct things, but you really can make a strong argument for the standardization to a small number of insurance plans with stated rules, third party arbitration, etc. You would definitely see more of a free market by producing fungible products with (hopefully) a bit less obfuscation. The insurance companies would still do their best to not cover a claim of course, so this is only a partial solution. One nice side effect is that it's a small nudge in an organically 'designed' system rather than the inevitable chaos by changing the whole machine at once. If you believe in single payer healthcare, it would be easy to attach redesigns in cash inflow to a set of standardized policies. I've always admired the size of office staff in a doctor's office, no doubt mostly due to the complexity of the cashflow in the backend. Perhaps simplification of billing would result in less bookkeeping and more caregivers.
legulere 5y ago
We have standardized health care billing in Germany, both for the around 100 public health insurances and the private ones. We still have a relatively expensive health care system when compared with other European countries.
- perlgeek 5y ago
  ... and much cheaper than the US, currently.
  - saiya-jin 5y ago
    Everything is cheaper than US. Even Switzerland.
  - ju-st 5y ago
    I pay 759€/month for my German public health insurance while in the US according to Google the average cost of platinum insurance (the best?) is $750/month.
    - smnrchrds 5y ago
      Is it calculated as a percentage of income? In that case, it is effectively a tax, and like any progressive taxation, higher income individuals pay more.
      - perlgeek 5y ago
        Yes it is. Also of note: when you're insured with a public health insurance in Germany, a spouse and kids without income of their own are automatically insured as well, without extra cost.
      - legulere 5y ago
        Your wage is payed from that insurance, so it makes sense that you pay accordingly to what you earn.
    - ixacto 5y ago
whowe1 5y ago
So how do they plan on getting private capitalist enterprise to start implementing reforms that would lower their profits? Because by definition administrative cost to the consumer is profit for the company.
- whiddershins 5y ago
  By making it possible for them to compete to the consumer on price versus quality?
  - podgaj 5y ago
    Why is this not happening now? Because they hide the prices on purpose. And when I am having a manic episode it is kind of hard for me to search for the cheapest hospital to have myself involuntarily committed. There are just some thing capitalism really sucks at, just admit it.
    - dantheman 5y ago
      Emergency care is a tiny portion of all healthcare costs.
      - podgaj 5y ago
        In 2017 ED healthcare costs were $76 billion. That is about 10%. Just go on amazon and try to buy something if you think finding the "cheapest price" would help people get healthcare. But also, am I supposed to suffer higher prices because of my specific illness that they can charge whatever they want?
        dantheman 5y ago
        Lots of ED health care costs aren't emergency, and the reason they can charge whatever ever the want is because of special government privileges. It's much easier to address the cost of non ED care and since it's 90% of spending, that seems like a good place to start?
dboreham 5y ago
Paper is paywalled :(
deleted 5y ago
[deleted]
zhdc1 5y ago
Link to the actual paper (paywall): https://onlinelibrary.wiley.com/doi/10.1111/1475-6773.13649 https://onlinelibrary.wiley.com/doi/10.1111/1475-6773.13649
DonnyV 5y ago
Worthless paper, administrative costs is only a piece of the many issues with US "Healthcare". Medicare For All is the better and cheaper way forward. No one ever talks about what is the value all these Health Insurance companies bring? The whole point of their existence when they were created was to control costs. Obviously they have failed miserably. Medicare For All handles lowering or eliminating student loans for Doctors and Nurses. It regulates costs for pharmaceuticals and medical equipment. By having the government be the insure. It relieves business on having to provide insurance and creates a much healthier workforce. It would also create an explosion of entrepreneurship. Now that insurance isn't tied to a job.
- 238475235243 5y ago
  Or we could make it legal to open hospitals, or charge differential pricing based on the time of day... you know, basic stuff? Most people have no idea how captured healthcare is. There's no competition, indeed most healthcare is government granted monopolies already. Having lived in countries with "free" healthcare, that isn't all it's cracked up to be either. A good example of cost cutting: just make the disease illegal, like ADHD in the UK. If it doesn't exist, nobody can claim medication for it. Problem solved.
  - triceratops 5y ago
    The rest of your post I agree with but > just make the disease illegal, like ADHD in the UK What in the world are you talking about?[1] 1. https://www.nhs.uk/conditions/attention-deficit-hyperactivity-disorder-adhd/ https://www.nhs.uk/conditions/attention-deficit-hyperactivit...
    - 238475235243 5y ago
      You need a psychiatric evaluation for diagnosis, which is exceptionally hard to get. So there's a nice shiny website and then there's the reality. Getting the diagnosis and then medication can literally take years, and it looks like this is on purpose.
calkuta 5y ago
I have an idea. Remove government management of this industry.
- KoftaBob 5y ago
  So your solution to overly complex/cumbersome regulations and laws...is to completely deregulate the healthcare industry? You can't think of something in the middle that's not as reckless?
  - 238475235243 5y ago
    It's not just cumbersome - it's completely illegal to open a hospital. The lack of competition is the root of all of this mess.
- 238475235243 5y ago
  Exactly. Everyone should know it's completely illegal to open a hospital. It's illegal to charge less at 3am when you're not busy. Any and all competition, even weak competition like Urgent Care, should be encouraged.
podgaj 5y ago
Are they getting rid of the Health Insurance companies finally??? Nope. More neoliberal capitalist apologetics....
TheRealDunkirk 5y ago
What a joke. The only thing that would lower the costs would be to increase the competition, but the government has allowed merger after merger after merger (in health insurance, and in providers, just like everything else lately), taking away more and more pressure to compete. Why is every other ad on TV for one of the car insurance companies? Competition, which drives down price. The way to fix US health care is to create a market environment where I can buy health insurance like I can buy car insurance. It's too regionally regulated now. Make the market national. Make it possible for a young, unmarried man to buy into a group policy with other young, unmarried men (with zero benefits for maternity or female-specific illnesses), and let the market sort it out. Tying insurance to employment has got to be one of the most BALLER moves of Capitalism the world has ever seen. I mean, how much harder could you force your employees to bend over than to tie their literal life and health to working for the company? GET MY EMPLOYER OUT OF MY FUCKING INSURANCE. People say there's no money for nationalized healthcare. Bullshit. We're already paying it. Give me the money that my company is paying on my behalf -- about $20,000/year -- and let me combine that with my portion -- about $8,000 -- and let me go buy a plan that makes sense for me on the open market. Do these 2 things, and the market would sort this out in a New York minute.
- CarlosEscobedo 5y ago
  i think the main difference is if i have car insurance A and get into an accident they send me to body shop A, or at worst i go to body shop and send insurance the bill. If i need to see one of the 15 dentist in my area and there 100s of dental insurances there is no guarantee they take my insurance. When i switched dental insurance to another big regional one, my current dentist didn't accept that insurance, so now im paying out of pocket or finding a new dentist.
- JamesBarney 5y ago
  Health insurance merges help drive down costs. Provider merges drive up costs. Health insurance is the buyer of medical care, so when they are monopsony (buyer side monopoly) they drive down costs.
  - 5y ago
jollybean 5y ago
Some have noted 'bottlenecks' at the MD entrance level. There is an opportunity to allow for procedural specialization so that 'techs' can do a lot of the work normally done by docs and nurses. 'Early detection' is a new, major shift in how medicine works, because the things we get now 'come on slowly in a hidden way'. Allowing for technical specialists to run operationalized testing with standards, clear rules etc. may enable us to get costs down and possibly improve outcomes. My bet is that someone with very narrow and focused training may be even 'better' at that thing - so long as we can put a nice dotted line around it because of course it's always more complicated than just 'one thing'. Perhaps requiring 'best price' for all so that individual payers can get the same price as insurers might work, though it's not exactly 'free market' it mostly is. Transparency - so that everything is published and public might work as well. It may also be worth not billing specifically for low-cost materials used, and just roll it into the type of visit.
not2b 5y ago
I'm skeptical, because a key element of the US payment system is that everyone is highly motivated to shift costs to someone else, to be paid more money and to pay out less money, so doctors hire armies of accountants to do battle with similar armies deployed by insurance companies, hospitals, and drug companies. How will they fix that?
- deleted 5y ago
  [deleted]
29athrowaway 5y ago
The problem with healthcare is that inefficiency and lack of transparency is profitable. The government has deep pockets, and everyone is trying to get as much money as they can from it. Pharmaceutical industries, insurance providers, healthcare facilities, etc. Pharmaceutical research is important and expensive, but there must be a way for that research to happen without doing stupid shit like making insulin expensive. Labor costs in healthcare are high, but there must be a way to not make a bag of water with salt not cost $500. People pay for costs that are completely unrelated for the products and services they are receiving.
nitwit005 5y ago
Even fairly mundane steps like assigning people uniform medical record numbers, so that every single organization doesn't need its own system, is a heated political issue in the US: https://ehrintelligence.com/news/house-votes-to-overturn-national-patient-identifier-ban https://ehrintelligence.com/news/house-votes-to-overturn-nat...
- bilbo0s 5y ago
  That's because companies like Epic exist. Their entire business is fixing impedance mismatches. Your implicated solution is to eliminate impedance mismatches. Do you think the major med tech firms will be for or against that? What do you think their lobbyists will recommend?
  - benlivengood 5y ago
    I'd lay the blame closer to interface engine companies (whose job is often to disambiguate MR#) and individual practices (who don't want the overhead of working with centralized MR# source of truth) since Epic makes an entire EHR and can almost certainly interface with any ADT (admit, discharge, transfer) system as a source of truth for medical records.
  - nradov 5y ago
    Epic and their competitors never lobbied to retain the national patient identifier ban. The political opposition to national identifiers was based on concerns about patient privacy and federal government overreach.
yalogin 5y ago
> Estimates suggest that the country wastes more than $265 billion annually due to this administrative complexity, and that the rate of increase in administrative costs has outpaced that of overall health care expenditures This happens for a reason. A 265 Billion industry (however fragmented) has developed to create/maintain and profit off the complexity. I am extremely pessimistic that they will allow this to be fixed. It might be just too big to fail at this point. However, it might plague "medicare for all" systems too, unless it's completely a separate system somehow. These entities will make every effort to get into the "medicare for all" flows as well.
- coredog64 5y ago
  Private insurance companies are already deeply ingrained in Medicare, and I’m not just talking about Medicare Advantage. HHS has 5 or 6 large regional contracts where they have a private insurance company handle most of the administration. Uncle Sugar just pays the bills. Which isn’t really too much different from private insurance at a large employer: Cigna or whoever just brings admin and a network of providers, while your employer pays the bills out of some actuarially sound pool of money. Smaller employers can’t usually swing this, and that’s where the crappy rates come from.
fuzzer37 5y ago
> A new analysis by Stanford researchers suggests the health care industry can reap many of the economic benefits of a “Medicare for All” program through incremental changes to the private health care market. Why not just implement Medicare for All, instead of trying to band-aid the private healthcare market?
evgeniysharapov 5y ago
I think under "administrative costs" they might have hidden consolidation of the providers market. Anecdote: I wen to podiatrist about 4 years ago and now. The same doctor the same place, everything is the same. Except 4 years ago it was ~ $200 per visit, now I am looking at ~$350. What's changed? His practice became part of the big group footandankle. Similar situation happens with other specialists and family doctors, hospital networks consolidate all they could find in vicinity under their roof. There's no promised administrative cost reduction. Everything goes up in price. But apparently it's a "faux pas" to criticize hospital networks because somehow it reflects may reflect bad on the doctors.
ohples 5y ago
Universal Healthcare, free at the point of delivery.
milliondollar 5y ago
Their solution in the TFA is to focus on straight-through billing through standardization of payment mechanisms, arguing that each physician is paying $100K / year. Of course, this also puts the lie to the insurance companies, who are the other side of the transaction and essentially add another 20% in cost just to pay the bill! (Their loss ratios due to medical costs are about 80%.) Insurance companies are basically just bill paying services, as almost all employer sponsored healthcare is self-insured by the employer as the risk pool is large enough to take care of the true "insurance" nature of the mutual pooling of risks. So how do you think insurance companies will react to making it "easier to pay the bill through standardization?" Chance of movement = zero.
- kurthr 5y ago
  One of the big lies is that Insurance Companies have an incentive (aligned with the customer) to lower costs. In fact Insurance Companies have an incentive to pay no more than competition, but for costs to rise. Due to regulated %overhead this is one of the few ways they increase profits every year. To maintain current inflation adjusted stock valuations (based on earnings and growth) Insurance companies need prices to rise and they are incentivized to produce this outcome. Surprise!
  - AtlasBarfed 5y ago
    Agreed, the insurance companies are effectively capped on the profits they can declare, otherwise they'll expose themselves to regulation and stricter price controls. So that's how places like UnitedHealthCare have such exhorbitant salaries and a bloated executive structure. It's the same as colleges, which also have constantly expanding revenues but are "nonprofit". So a vampiric parasitic management class attach themselves to the organization and suck all the money away, while costs soar.
- rustybelt 5y ago
  My reaction exactly. This article basically says we can achieve much of the savings of Medicare for all if insurance companies and providers put aside self-interest to voluntarily and in a coordinated manner adopt the aspects of Medicare for all that reduce costs! And if apes had tails they'd be monkeys!
benlivengood 5y ago
I worked in a hospital for 13 years. The economic incentives for the current system are quite perverse. The FDA has no cost constraints and so maximizes safety instead of QALYs. Medical equipment and drug manufacturers maximize profit and so fill the highest margin niches first instead of maximizing QALYs. Radiology and lab services are lucrative and separate themselves from clinical providers to maximize profits instead of QALYs. Individual physicians and especially surgeons can maximize profits by having their own practices vs. hospital or clinic environments where coordinated care maximizes QALYs. Hospitals and clinics and especially ERs, cancer treatment, and skilled nursing facilities try to make ends meet with inpatient population and try to hold on to outpatient surgery, radiology, and lab services to make ends meet while providing whatever level of coordinated care they can, but still optimizing for profit over QALYs. Insurance companies maximize profits by building actuarial plans that stratify patient populations by plan cost, skewing the burden of healthcare costs to the unemployed, underemployed, and low wage earners. A patient becoming uninsured is an economic win for insurance companies and employers. QALYs are proxied by cost/patient/year for anyone managing to stay insured which ignores deductibles, co-insurance and other out of pocket pay. Medicare and medicaid programs are left to pick up the pieces by trying to piece together effective care with compensation restricted by arbitrary budgets and arbitrary service providers (many specialists, independent physicians, and facilities flatly refuse medicare/medicaid patients). Actual patients have no clue how any of this works and end up with a pile of bills they try to pay off or if they know the trick they negotiate with the healthcare provider to settle for something slightly above the ~2% face value of debts written off to debt collectors who will hound sick people and their families incessantly. Maximizing QALYs is hard enough in a centralized single-payer or universal healthcare system. Almost nothing in the U.S. healthcare system is aligned with that goal.
- neartheplain 5y ago
  For anyone else who didn't know, QALY stands for "Quality-adjusted life year."
- renewiltord 5y ago
  Well, that's because Americans have an aversion to QALYs. It might be related to the idea that the country is fundamentally Christian in a deep way. A common accusation of anyone attempting to do a QALY based system would be that they are "sacrificing grandma for the dollar". The recent COVID crisis is an example where QALY based evaluations (which may well have gone either way) were summarily considered "putting a number on the value of a life". In that respect, it's not that the institutions are perverted but that the society they are in prefers them this way.
psyc 5y ago
This headline by itself could be a stand-alone Simpsons joke.
Ericson2314 5y ago
Considering how enmeshed everything is at Standard is with private sector businesses, and how many of these businesses can prosper due to these inefficiencies, I am quite skeptical. Even if the particular businesses these professors work with stand to gain from such reform, this sort of approach that thinks we can technocrat our way around the antagonism that is precisely why things like medicare-for-all are so difficult seems incredibly politically naive.
nwah1 5y ago
This speaks about standardizing contracts but neglects to mention that the competing proprietary electronic medical record standards also add cost, complexity, and increase medical errors. And there are still about 14 other layers of the healthcare onion to peel. Medical talent is kept artificially scarce thanks to the lobbying and control of licensing by the AMA. We should hand control of licensing over to the AARP and the March of Dimes instead. Hospitals and insurance have perverse incentives because they are separate. But when insurance and provisioning is combined as with Kaiser Permanente, then incentives are aligned and bureaucracy can be streamlined. Hospital consortiums currently carve up monopolies within a given piece of turf. We should break that up, and allow a proliferation of low-cost community clinics for less advanced procedures. And this hasnt even covered obscene pharmaceutical costs, electronic medical device manufacturers, the diagnostic industry oligopoly, and so on.
- nunie123 5y ago
  I started a project last week requiring me to learn the proprietary EDI file format that CMS mandates. I was surprised to learn that in order to exchange healthcare data with our government we have to use a file format owned by a private entity. And of course you have to pay to get access to the full implementation documentation.

138 points by achou 5y ago

I agree with the three issues they identify driving up costs. But I fear “Medicare for All” won't fix all the issues, which go much deeper. For example, the US has extremely high standards restricting who can practice medicine compared to the rest of world, limiting the supply of doctors and artificially driving up their demand. There is a need for standards, but perhaps the AMA has too much political influence. Likewise, manufacturers of medical supplies operate as monopolies because the moat to reach approval is really high. I fear the US medical system is becoming so insane the only fix will be to replace it entirely (It's not just about tearing down, but replacing institutions)

syops 5y ago
The bottleneck is not the number of people with an MD. The bottleneck is the number of residency programs. These are funded by Medicare and I believe they are not profitable for hospitals.
- tgb 5y ago
  There's some good reason to think that residencies are profitable: in 2019, 550 of them were auctioned off for $55 million in a controversial bankruptcy case. https://www.inquirer.com/business/hahnemann-university-hospital-residency-slots-55-million-20190809.html https://www.inquirer.com/business/hahnemann-university-hospi...
  - sjg007 5y ago
    So residences are basically taxi medallions. Interesting.
    - syops 5y ago
      They are taxi medallions to newly graduated MDs but not to the hospital. Without a residency slot MDs often times are relegated to a lifetime of med school debt servicing.
  - andrewlgood 5y ago
    It is not that the residencies themselves are profitable. It is that medical schools need to be able to provide residency slots to their students to have an effective program. Definitely an issue for newly formed for-profit medical schools.
- HEmanZ 5y ago
  I don't know how residencies could not be profitable for hospitals. Hospitals receive something like $120k/yr per resident, then work residents 80+ hours/week at $50k/yr pay, amounting to right around minimum wage (for my city). Residents do a tremendous amount of work in supporting the hospital, so much so that a single resident getting deathly ill and needing to stay home (e.g a surgery resident getting covid, which I witnessed) is enough to send a massive shock through a hospital and force other residents into 100+ hr/week schedules. I know this because my wife is a surgery resident and I'm describing a situation from this year. Edit: But there are still way too few residency spots. I think it has to do with the difficulty and administrative work around starting a new program or with getting federal funding for more spots.
  - ihsw 5y ago
    It sounds like we have a spending problem and not a funding problem.
  - EvanAnderson 5y ago
    The residency slots are so limited right now because the AMA lobbied hard against expanding them in the 1990s (fearing a "glut" of doctors). Edit: Every time this comes up I go down a rabbit hole of looking for an article from the mid-to-late 90s where a medical lobbyist spoke about how doctors would be forced to leave the profession and do "mundane" jobs like driving cabs if the residency slots weren't capped. It did not paint the lobby in a good light, and I've love to see it trotted out today. I never have been able to find the article online. If somebody with better search-engine-fu than me can find it I'd be greatful.
    - nradov 5y ago
      The AMA is actively lobbying for more residency slots. https://www.ama-assn.org/press-center/press-releases/ama-fund-graduate-medical-education-address-physician-shortages https://www.ama-assn.org/press-center/press-releases/ama-fun...
      - EvanAnderson 5y ago
- rcpt 5y ago
  I don't think it's about the profit it's the fact that anything involving Medicare is a big political fight
- warmfuzzykitten 5y ago
  A helpful link on this subject. Apparently, medical schools in the US are now allowing more graduates. Not sure about profitability of residency programs, but certainly not all hospitals are teaching hospitals and the latter are federally subsidized. https://www.aamc.org/news-insights/us-medical-school-enrollment-rises-30 https://www.aamc.org/news-insights/us-medical-school-enrollm...
- kaitai 5y ago
  This is correct and needs to be upvoted more. The number of residency slots is artificially capped and already fails to serve the number of medical school graduates in the country. The Balanced Budget Act of 1997 is the basic vehicle for this cap. In Dec 2020 the first expansion in decades was passed, adding a whopping 1000 residency spots. Look up Graduate Medical Education program for more info. For more key words, see this document from the U of California system that has an agenda (increase capacity) but also effectively lists salient points: https://www.ucop.edu/federal-governmental-relations/_files/fact-sheets/fgr-health-factsheet-gme-f1.pdf https://www.ucop.edu/federal-governmental-relations/_files/f...
throwaway13337 5y ago
Agreed. Entrenched institutions are the general problem with America. It's the police unions protecting bad policing, the restricting of doctor supply via the residency bottleneck, and local governments preventing new building for burgeoning populations. They're all the same problem really. Beneficial to the incumbent group at the expense of those they service. It's kind of amazing.
- mbg721 5y ago
  Institutional trust is certainly a huge problem right now.
- mycologos 5y ago
  > the restricting of doctor supply via the residency bottleneck Assuming that you're referring to the AMA here, their role is pretty unclear to me. They appear to have played a lobbying role to get Congress to freeze residency funding in 1997 to avoid having lots of doctors [1], but for several years now, the AMA has at least publicly claimed that they've been lobbying congress to increase funding for residency slots [2]. Maybe they're lying? But I for one don't actually know who is keeping residency funding low. [1] https://qz.com/1676207/the-us-is-on-the-verge-of-a-devastating-doctor-shortage/ https://qz.com/1676207/the-us-is-on-the-verge-of-a-devastati... [2] https://www.ama-assn.org/press-center/press-releases/ama-builds-efforts-expand-funding-graduate-medical-education-0 https://www.ama-assn.org/press-center/press-releases/ama-bui...
  - smooth_remmy 5y ago
    AMA is a bad actor. They refuse to allow junior doctors (doctors who are MD school graduates but who have not completed residency) to practice medicine in ANY capacity. Common sense says that junior doctors should have the same practice rights as physician assistants - but the AMA refuses to let that happen. They are a medical cartel. A few states have allowed junior doctors to start practicing medicine in a limited capacity, because every other doctor so damn expensive. But the AMA does not support those states' decision.
    - 5y ago
chiefalchemist 5y ago
Demand is also "artificially" driven up by the American diet and lifestyle. If the preventables (e.g., Type 2 Diabetes) were prevented, otherwise mitigated (less sugar!) then the resources / system could focus on real disease. The issue with the USA is it wants its cake, it wants to eat it, and expects to pay less for consistently making unhealthy choices.
- nradov 5y ago
  Sure but most other countries are on track to have the same diet and lifestyle health problems as the USA. They're running a few years behind us but they'll catch up eventually.
  - djdjdjdjdj 5y ago
    Germany doesn't. I can think of plenty other European countries.
    - nradov 5y ago
      Germany has a high rate of obesity just like most comparable countries.
rscho 5y ago
> For example, the US has extremely high standards restricting who can practice medicine compared to the rest of world Rest of the world, yes. Rest of the developed world, not at all. The major difference is that becoming a doc in the US is much more expensive than pretty much anywhere else. You could also argue it's proportionally harder because of the more numerous competitors. But on an absolute level of knowledge and capability no, it's not harder than say, in western european countries.
- whiddershins 5y ago
  I believe it takes longer in the US, when all is said and done. It’s hard to casually verify this because each country uses different terms and has a different track but I think, when you include the various phases of training, starting from the bachelors degree, the US one is more total years. Edit: So for example the UK and France don’t appear to require any sort of bachelor’s degree as a prerequisite for medical. Which saves you 4 years on average. So their tracks may be longer but you can start sooner.
  - jimnotgym 5y ago
    Citation definitely needed here And just to be sure, I would like you to start from the beginning of the person's medical training and not include the gatekeeping bit of having to get a bachelors in a random subject unrelated to medicine. I note this Wikipedia article that suggests 4 years messed school plus 1 year internship could get me a license in the US. That sounds like Western Europe to me. Or India... https://en.m.wikipedia.org/wiki/Medical_education_in_the_United_States https://en.m.wikipedia.org/wiki/Medical_education_in_the_Uni...
    - triceratops 5y ago
      > I would like you to start from the beginning of the person's medical training and not include the gatekeeping bit of having to get a bachelors in a random subject unrelated to medicine. Why? An apples-to-apples comparison would be to see how long it takes to become a general physician after completing secondary school. In the UK or India it's something like 5.5-6 years.[1] In the US it's 3-4 years of "pre-med", then 4 years of med school. That's from the article you referred. 1. https://en.wikipedia.org/wiki/Medical_school_in_the_United_Kingdom https://en.wikipedia.org/wiki/Medical_school_in_the_United_K...
KoftaBob 5y ago
They state early in the article that this research details how to tackle those three issues without resorting to Medicare for All.
gumby 5y ago
> For example, the US has extremely high standards restricting who can practice medicine compared to the rest of world, limiting the supply of doctors... Really? Can you give some examples? There are a lot of immigrant physicians in the USA. An anecdotal counter example: my mother is a physician with medical licenses from Australia, UK and the USA (obviously two have lapsed) and though she is quite critical of countries X and Y and positive about country Z she has never expressed any such opinion or said that one might be tougher than another, which is exactly the kind of thing she would point out.
- IG_Semmelweiss 5y ago
  all those immigrant physicians went thru the same programs as the non-immigrants. In fact, I hear this is continuously a problem for well qualified , practicing, and established physicians to migrate to the US. They are fed up with their own home countries lack of security, opportunities for their children, freedom etc, but they cannot imagine going back to medical school to be accredited to practice in the US. This does not apply to every country. Notably, 4, all here: https://www.theabfm.org/become-certified/i-am-certified-country-outside-united-states https://www.theabfm.org/become-certified/i-am-certified-coun... While many foreign physicians will have years of experiences diagnosing, treating patients, and administering medicine, in order to practice as a US doctor, it essentially requires them to start all over again academically, especially when the curriculum differs from overseas qualifications. [1] https://www.fnu.edu/foreign-physicians-work-healthcare-practitioners/ https://www.fnu.edu/foreign-physicians-work-healthcare-pract...
  - dublin 5y ago
    No, they most certainly did not. I've spent a large chunk of my career in healthcare technology, and one thing I can say for sure is that with very few exceptions, foreign doctors are no where close to the knowledge and capability of those educated in the US. I'm not going to specify to avoid slamming particular countries, but I would definitely refuse to be treated by doctors from several major countries that crank out tons of doctors, many of whom worm their way into US practice. (This isn't based on race, etc, at all just competency, and I have a much larger exposure to this than most people. These people kill way too many patients with their incompetence, but (especially lately) they cannot be criticized for fear of being branded racist. My body, my choice.)
podgaj 5y ago
The bottleneck is the cost of medical school. That cost is linked to the colleges raising prices because they can. Medicare for All will surely help this, but free college will help as well. The U.S. is like a dysfunctional family where the parents will not pay for the kids college even though they have the money.
- nradov 5y ago
  The cost of medical school is not a bottleneck. Lower prices would be nice, but even with current high prices all accredited medical schools have essentially full enrollment. The real bottleneck is in lack of federal funding for residency programs. Every year students graduate from medical school with an MD but are unable to practice medicine because they don't get matched to a residency slot.
heymijo 5y ago
I just realized Physician Assistants (PAs) and Nurse Practitioners (NPs) have been forgotten in this equation. 126,000 practicing PAs [0] 325,000 licensed NPs [1] 985,000 practicing physicians (MDs and DOs) [2] I know that nurse practitioners are not under the same artificial residency constraints of MDs/DOs. I'm not sure about physician assistants. For someone not in the U.S., NPs and PAs often do the same role as general practitioners/family doctors e.g. see patients, prescribe medicine, etc. They can also specialize. [0] https://www.thepalife.com/physician-assistant-stats/ https://www.thepalife.com/physician-assistant-stats/ [1] https://www.aanp.org/about/all-about-nps/np-fact-sheet https://www.aanp.org/about/all-about-nps/np-fact-sheet [2] https://en.wikipedia.org/wiki/Physicians_in_the_United_States https://en.wikipedia.org/wiki/Physicians_in_the_United_State...
- tryptophan 5y ago
  PA/NA education is a complete joke compared to what your average MD gets. They are not qualified to practice as general doctors at all. However, they are really cheap, which is why corporations are pushing them so hard. Substandard care in the name of profits.
  - deleted 5y ago
    [deleted]
  - weasel_words 5y ago
    Wow I was about to gush about how much I LOVE my NP compared to my old crappy, braindead MDs. I could share stories of how bad MDs are...and the horrors of insurance. She is sharp as a whip. Smarter and more motivated than ANY MD I've EVER had. Anything she doesn't know about, she researches (on her own time/dime). She prescribes everything - dirt cheap. Lets me text/call/email ANY time. Refers me to a specialist for anything beyond her expertise (just like any MD would!) DIRT CHEAP (eg: MRI for $300, scheduled within a day or two down the street). A single, cheap, monthly fee ($65/mo!) lets me see her any time day and night, ask anything, discuss as long as I like...and I do all these things! No MD going through standard insurance would allow anything even remotely similar. ...I could go on... imo the NP model is FAR superior than the traditional insurance+MD crap model we have right now. It's one of those things "they" don't want people learning about since it'll crush the traditional way of doing things once people realize how amazing that model is. Yes I have basic insurance since it's required. And, just in case - she obviously doesn't have an emergency room.
pessimizer 5y ago
It's not that the standards are high, it's that they are protectionist. I think one of the biggest hurdles is the US residency requirements. Everything you say is true, though.
sct202 5y ago
The supply of doctors in a lot of primary care roles is supplemented by Nurse Practitioners and Physicians Assistants who have less restricted licensing bodies. Like NPs and PAs aren't required to go thru residency and can switch specialties more easily than a doctor.
mbesto 5y ago
You just conflated two partners in the whole mix of what we call "healthcare" in the US. Payers = Medicare for All, UNH, Aetna, etc. Providers = Hospitals, doctors, medical supplies, etc. It's entirely possible to have one payer and then having a governing body regulate a free market[0] comprised of providers in the market. [0] - I'm using the word free market not in its purest form (which rarely exists) but rather in a more colloquially way.
tw04 5y ago
>Likewise, manufacturers of medical supplies operate as monopolies because the moat to reach approval is really high. I can tell you for a fact this simply isn't true. The reason manufacturers of medical supplies operate as a monopoly is because they have turned to acquiring everyone and anyone in the medical supply/device business and there's been 0 opposition to it. https://www.beckersspine.com/orthopedic-a-spine-device-a-implant-news/item/50526-medtronic-acquires-7th-company-in-2020-9-device-company-notes.html https://www.beckersspine.com/orthopedic-a-spine-device-a-imp... https://mergr.com/abbott-laboratories-acquisitions#cma-tab https://mergr.com/abbott-laboratories-acquisitions#cma-tab https://www.greenlight.guru/blog/top-100-medical-device-companies https://www.greenlight.guru/blog/top-100-medical-device-comp... You can go through the last link which is a list of device manufacturers and look at their acquisitions. They just eat up every small player that shows even a hint of providing competition. Some of them have been averaging an acquisition a month for years.
UncleOxidant 5y ago
If we do medicare for all or some other kind of universal healthcare in the US we're also going to need to train doctors way more cheaply than we do now. At the least we're going to need to offer free or heavily subsidized education to incentivize more people to go into medicine without graduating with debt higher than many mortgages.
King-Aaron 5y ago
The United State's healthcare don't even appear in any "Top-10 global healthcare" rankings available anywhere, and are consistently overshadowed by many European countries, Singapore, Australia, Japan etc. I don't think you can use "extremely high standards restricting who can practice medicine" as reasoning when it doesn't appear to impact the quality of care at all.
jjav 5y ago
> limiting the supply of doctors Possibly, but the cost of doctors (+nurses, technicians, etc) is in the noise, just a distraction. The vast majority of the cost of medical care in the US goes to the middlemen who contribute no value at all, just extract profit. A 15 minute session with a general practicioner here (CA) costs around $300. That doctor isn't making $1200/hr ($2.5M/yr). That doctor is likely only making a bit over 200K: https://www.salary.com/research/salary/benchmark/family-physician-salary/ca https://www.salary.com/research/salary/benchmark/family-phys... The other $2M+ are going hangers-on who're not contributing to health care, just inserting themselves into the chain to get rich. Take a look at the billions in revenue collectively by all insurance companies. That's all a tax on health care that provides no value.
- rland 5y ago
  Huh? You'd need to look at billions in profit, not revenue, since insurance does pay out for the cost of care. When you look at that, the margin is actually lower than most industries. It is true that there are a lot of middlemen with hands in the pot but it's not quite that simple. The biggest driver of healthcare is that Americans just consume a lot of it. We get surgeries, we opt for long, expensive treatments at the end of our lives, we use extremely sophisticated and expensive medical equipment a lot, we pay people to take care of our old people exorbitant sums of money. Like, in other countries, when your lungs and kidneys start going, you don't go to the hospital for a multiple surgery. When you fall and you can't move around and wipe your own ass, you don't get moved into a facility where people are paid to take care of you, you move in with your family. And, if you don't have those options, you die. I'm with you that the system is fucked but the underlying reason doesn't _really_ have anything to do with greed in medicine and everything to do with the way that we treat medicine culturally: the duty that children (don't, in this country) have to care for their elders, the attitude we have about prolonging death. That every part of the medical system says: we will never, ever make the decision to let someone pass away, even when "fixing" their problem (of death!) with all the technology and labor we've got turns out to be ludicrously expensive.
  - jjav 5y ago
    > profit, not revenue No, because profit is substracting all the operating costs of the insurance company, including salaries of hundreds of thousands of paper pushers and multi-million dollar bonuses to their executives. All of this is just overhead that provides no health-care value and can be eliminated.

hpoe 5y ago

Recently I got laser eye surgery to help my vision. This was not covered by my insurance. It also happened to be the simplest medical procedure/payment I ever had to interact with. They told me "this procedure will cost $X.XX and we have a discount we can offer you that will save you X%" I said okay and paid them the money. Compare that to insurance being involved recently in my wife's diabetes supplies. My wife is a type 1 diabetic and needs supplies that monitor her blood sugar, we noticed her supplies didn't arrive on the scheduled date, we waited a week to see if they would show up and they didn't. My wife called the company that was supposed to send them, they said our account was in collections? Why, we never received a bill, we never were notified, but in collections we were. We eneded up paying and got that sorted out and waited another week, still no supplies. I'll cut it short and just say it took us 3 weeks being on the phone multiple times a day being bounced around between our insurance, the supplier and her dr, to finally get told we couldn't get the supplies because my wife had gotten a new phone and so the insurance company didn't have enough data to prove that she needed these supplies, and wouldn't reauthorize them. The drama is still ongoing. Let's get this straight a huge part of the healthcare costs are directly related to insurance and the money and laws tied up in that. We need to get rid of insurance, and the way it works if we honestly want to make any change. Any other effort will only further entrench the confusopoly.

JJMcJ 5y ago
I have had some private pay medical treatment and can concur. Come in, write the check/present the card, and walk out. Fortunately it wasn't very expensive.
anotha1 5y ago
Sorry to hear about your ongoing issues. Sadly, it's the same story thousands of times per day, often for people experiencing the final moments of their lives. The healthcare insurance industry absolutely needs to be destroyed. One day, we'll look back at this debacle similar to cigarettes, big industry manipulating the population and millions of people dying unnecessarily because of it. It's time to end the suffering.
zhdc1 5y ago
Several years ago, I lived in a country where I had high-deductible private insurance in lieu of the (then relatively new) national healthcare plan. I was able to walk into a fairly large hospital, get a full battery of tests along with a thankfully minor diagnosis and medication for a small amount of money paid up front. The bill was itemized, translated, and I received excellent customer service.

taurath 5y ago

Can anyone grok what the actual proposed reforms are? It’s missing from the article.

creaghpatr 5y ago
Looks like it's mostly an abstract of something that was published in a journal but they hint at it saying 3 scenarios: simplifying/streamlining individual plans, standardizing plans across all groups ie. more standardization, and a combination of those two things. This would lead to less complexity and administrative overhead which would lead to savings etc.
- dboreham 5y ago
  Or perhaps look at other western countries that don't have any of this vampire squid stuff.
  - e40 5y ago
    Like Japan that has a published book which contains the prices for all procedures. https://en.wikipedia.org/wiki/Health_care_system_in_Japan#Cost https://en.wikipedia.org/wiki/Health_care_system_in_Japan#Co...
- shkkmo 5y ago
  I thought a major aspect was also standardizing contracts between insurers and providers.
- kingsuper20 5y ago
  I'm not much for the genius of government to correct things, but you really can make a strong argument for the standardization to a small number of insurance plans with stated rules, third party arbitration, etc. You would definitely see more of a free market by producing fungible products with (hopefully) a bit less obfuscation. The insurance companies would still do their best to not cover a claim of course, so this is only a partial solution. One nice side effect is that it's a small nudge in an organically 'designed' system rather than the inevitable chaos by changing the whole machine at once. If you believe in single payer healthcare, it would be easy to attach redesigns in cash inflow to a set of standardized policies. I've always admired the size of office staff in a doctor's office, no doubt mostly due to the complexity of the cashflow in the backend. Perhaps simplification of billing would result in less bookkeeping and more caregivers.

legulere 5y ago

We have standardized health care billing in Germany, both for the around 100 public health insurances and the private ones. We still have a relatively expensive health care system when compared with other European countries.

perlgeek 5y ago
... and much cheaper than the US, currently.
- saiya-jin 5y ago
  Everything is cheaper than US. Even Switzerland.
- ju-st 5y ago
  I pay 759€/month for my German public health insurance while in the US according to Google the average cost of platinum insurance (the best?) is $750/month.
  - smnrchrds 5y ago
    Is it calculated as a percentage of income? In that case, it is effectively a tax, and like any progressive taxation, higher income individuals pay more.
    - perlgeek 5y ago
      Yes it is. Also of note: when you're insured with a public health insurance in Germany, a spouse and kids without income of their own are automatically insured as well, without extra cost.
    - legulere 5y ago
      Your wage is payed from that insurance, so it makes sense that you pay accordingly to what you earn.
  - ixacto 5y ago

whowe1 5y ago

So how do they plan on getting private capitalist enterprise to start implementing reforms that would lower their profits? Because by definition administrative cost to the consumer is profit for the company.

whiddershins 5y ago
By making it possible for them to compete to the consumer on price versus quality?
- podgaj 5y ago
  Why is this not happening now? Because they hide the prices on purpose. And when I am having a manic episode it is kind of hard for me to search for the cheapest hospital to have myself involuntarily committed. There are just some thing capitalism really sucks at, just admit it.
  - dantheman 5y ago
    Emergency care is a tiny portion of all healthcare costs.
    - podgaj 5y ago
      In 2017 ED healthcare costs were $76 billion. That is about 10%. Just go on amazon and try to buy something if you think finding the "cheapest price" would help people get healthcare. But also, am I supposed to suffer higher prices because of my specific illness that they can charge whatever they want?
      - dantheman 5y ago
        Lots of ED health care costs aren't emergency, and the reason they can charge whatever ever the want is because of special government privileges. It's much easier to address the cost of non ED care and since it's 90% of spending, that seems like a good place to start?

dboreham 5y ago

Paper is paywalled :(

deleted 5y ago

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zhdc1 5y ago

Link to the actual paper (paywall): https://onlinelibrary.wiley.com/doi/10.1111/1475-6773.13649 https://onlinelibrary.wiley.com/doi/10.1111/1475-6773.13649

DonnyV 5y ago

Worthless paper, administrative costs is only a piece of the many issues with US "Healthcare". Medicare For All is the better and cheaper way forward. No one ever talks about what is the value all these Health Insurance companies bring? The whole point of their existence when they were created was to control costs. Obviously they have failed miserably. Medicare For All handles lowering or eliminating student loans for Doctors and Nurses. It regulates costs for pharmaceuticals and medical equipment. By having the government be the insure. It relieves business on having to provide insurance and creates a much healthier workforce. It would also create an explosion of entrepreneurship. Now that insurance isn't tied to a job.

238475235243 5y ago
Or we could make it legal to open hospitals, or charge differential pricing based on the time of day... you know, basic stuff? Most people have no idea how captured healthcare is. There's no competition, indeed most healthcare is government granted monopolies already. Having lived in countries with "free" healthcare, that isn't all it's cracked up to be either. A good example of cost cutting: just make the disease illegal, like ADHD in the UK. If it doesn't exist, nobody can claim medication for it. Problem solved.
- triceratops 5y ago
  The rest of your post I agree with but > just make the disease illegal, like ADHD in the UK What in the world are you talking about?[1] 1. https://www.nhs.uk/conditions/attention-deficit-hyperactivity-disorder-adhd/ https://www.nhs.uk/conditions/attention-deficit-hyperactivit...
  - 238475235243 5y ago
    You need a psychiatric evaluation for diagnosis, which is exceptionally hard to get. So there's a nice shiny website and then there's the reality. Getting the diagnosis and then medication can literally take years, and it looks like this is on purpose.

calkuta 5y ago

I have an idea. Remove government management of this industry.

KoftaBob 5y ago
So your solution to overly complex/cumbersome regulations and laws...is to completely deregulate the healthcare industry? You can't think of something in the middle that's not as reckless?
- 238475235243 5y ago
  It's not just cumbersome - it's completely illegal to open a hospital. The lack of competition is the root of all of this mess.
238475235243 5y ago
Exactly. Everyone should know it's completely illegal to open a hospital. It's illegal to charge less at 3am when you're not busy. Any and all competition, even weak competition like Urgent Care, should be encouraged.

podgaj 5y ago

Are they getting rid of the Health Insurance companies finally??? Nope. More neoliberal capitalist apologetics....

TheRealDunkirk 5y ago

What a joke. The only thing that would lower the costs would be to increase the competition, but the government has allowed merger after merger after merger (in health insurance, and in providers, just like everything else lately), taking away more and more pressure to compete. Why is every other ad on TV for one of the car insurance companies? Competition, which drives down price. The way to fix US health care is to create a market environment where I can buy health insurance like I can buy car insurance. It's too regionally regulated now. Make the market national. Make it possible for a young, unmarried man to buy into a group policy with other young, unmarried men (with zero benefits for maternity or female-specific illnesses), and let the market sort it out. Tying insurance to employment has got to be one of the most BALLER moves of Capitalism the world has ever seen. I mean, how much harder could you force your employees to bend over than to tie their literal life and health to working for the company? GET MY EMPLOYER OUT OF MY FUCKING INSURANCE. People say there's no money for nationalized healthcare. Bullshit. We're already paying it. Give me the money that my company is paying on my behalf -- about $20,000/year -- and let me combine that with my portion -- about $8,000 -- and let me go buy a plan that makes sense for me on the open market. Do these 2 things, and the market would sort this out in a New York minute.

CarlosEscobedo 5y ago
i think the main difference is if i have car insurance A and get into an accident they send me to body shop A, or at worst i go to body shop and send insurance the bill. If i need to see one of the 15 dentist in my area and there 100s of dental insurances there is no guarantee they take my insurance. When i switched dental insurance to another big regional one, my current dentist didn't accept that insurance, so now im paying out of pocket or finding a new dentist.
JamesBarney 5y ago
Health insurance merges help drive down costs. Provider merges drive up costs. Health insurance is the buyer of medical care, so when they are monopsony (buyer side monopoly) they drive down costs.
- 5y ago

jollybean 5y ago

Some have noted 'bottlenecks' at the MD entrance level. There is an opportunity to allow for procedural specialization so that 'techs' can do a lot of the work normally done by docs and nurses. 'Early detection' is a new, major shift in how medicine works, because the things we get now 'come on slowly in a hidden way'. Allowing for technical specialists to run operationalized testing with standards, clear rules etc. may enable us to get costs down and possibly improve outcomes. My bet is that someone with very narrow and focused training may be even 'better' at that thing - so long as we can put a nice dotted line around it because of course it's always more complicated than just 'one thing'. Perhaps requiring 'best price' for all so that individual payers can get the same price as insurers might work, though it's not exactly 'free market' it mostly is. Transparency - so that everything is published and public might work as well. It may also be worth not billing specifically for low-cost materials used, and just roll it into the type of visit.

not2b 5y ago

I'm skeptical, because a key element of the US payment system is that everyone is highly motivated to shift costs to someone else, to be paid more money and to pay out less money, so doctors hire armies of accountants to do battle with similar armies deployed by insurance companies, hospitals, and drug companies. How will they fix that?

deleted 5y ago
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29athrowaway 5y ago

The problem with healthcare is that inefficiency and lack of transparency is profitable. The government has deep pockets, and everyone is trying to get as much money as they can from it. Pharmaceutical industries, insurance providers, healthcare facilities, etc. Pharmaceutical research is important and expensive, but there must be a way for that research to happen without doing stupid shit like making insulin expensive. Labor costs in healthcare are high, but there must be a way to not make a bag of water with salt not cost $500. People pay for costs that are completely unrelated for the products and services they are receiving.

nitwit005 5y ago

Even fairly mundane steps like assigning people uniform medical record numbers, so that every single organization doesn't need its own system, is a heated political issue in the US: https://ehrintelligence.com/news/house-votes-to-overturn-national-patient-identifier-ban https://ehrintelligence.com/news/house-votes-to-overturn-nat...

bilbo0s 5y ago
That's because companies like Epic exist. Their entire business is fixing impedance mismatches. Your implicated solution is to eliminate impedance mismatches. Do you think the major med tech firms will be for or against that? What do you think their lobbyists will recommend?
- benlivengood 5y ago
  I'd lay the blame closer to interface engine companies (whose job is often to disambiguate MR#) and individual practices (who don't want the overhead of working with centralized MR# source of truth) since Epic makes an entire EHR and can almost certainly interface with any ADT (admit, discharge, transfer) system as a source of truth for medical records.
- nradov 5y ago
  Epic and their competitors never lobbied to retain the national patient identifier ban. The political opposition to national identifiers was based on concerns about patient privacy and federal government overreach.

yalogin 5y ago

> Estimates suggest that the country wastes more than $265 billion annually due to this administrative complexity, and that the rate of increase in administrative costs has outpaced that of overall health care expenditures This happens for a reason. A 265 Billion industry (however fragmented) has developed to create/maintain and profit off the complexity. I am extremely pessimistic that they will allow this to be fixed. It might be just too big to fail at this point. However, it might plague "medicare for all" systems too, unless it's completely a separate system somehow. These entities will make every effort to get into the "medicare for all" flows as well.

coredog64 5y ago
Private insurance companies are already deeply ingrained in Medicare, and I’m not just talking about Medicare Advantage. HHS has 5 or 6 large regional contracts where they have a private insurance company handle most of the administration. Uncle Sugar just pays the bills. Which isn’t really too much different from private insurance at a large employer: Cigna or whoever just brings admin and a network of providers, while your employer pays the bills out of some actuarially sound pool of money. Smaller employers can’t usually swing this, and that’s where the crappy rates come from.

fuzzer37 5y ago

> A new analysis by Stanford researchers suggests the health care industry can reap many of the economic benefits of a “Medicare for All” program through incremental changes to the private health care market. Why not just implement Medicare for All, instead of trying to band-aid the private healthcare market?

evgeniysharapov 5y ago

I think under "administrative costs" they might have hidden consolidation of the providers market. Anecdote: I wen to podiatrist about 4 years ago and now. The same doctor the same place, everything is the same. Except 4 years ago it was ~ $200 per visit, now I am looking at ~$350. What's changed? His practice became part of the big group footandankle. Similar situation happens with other specialists and family doctors, hospital networks consolidate all they could find in vicinity under their roof. There's no promised administrative cost reduction. Everything goes up in price. But apparently it's a "faux pas" to criticize hospital networks because somehow it reflects may reflect bad on the doctors.

ohples 5y ago

Universal Healthcare, free at the point of delivery.

milliondollar 5y ago

Their solution in the TFA is to focus on straight-through billing through standardization of payment mechanisms, arguing that each physician is paying $100K / year. Of course, this also puts the lie to the insurance companies, who are the other side of the transaction and essentially add another 20% in cost just to pay the bill! (Their loss ratios due to medical costs are about 80%.) Insurance companies are basically just bill paying services, as almost all employer sponsored healthcare is self-insured by the employer as the risk pool is large enough to take care of the true "insurance" nature of the mutual pooling of risks. So how do you think insurance companies will react to making it "easier to pay the bill through standardization?" Chance of movement = zero.

kurthr 5y ago
One of the big lies is that Insurance Companies have an incentive (aligned with the customer) to lower costs. In fact Insurance Companies have an incentive to pay no more than competition, but for costs to rise. Due to regulated %overhead this is one of the few ways they increase profits every year. To maintain current inflation adjusted stock valuations (based on earnings and growth) Insurance companies need prices to rise and they are incentivized to produce this outcome. Surprise!
- AtlasBarfed 5y ago
  Agreed, the insurance companies are effectively capped on the profits they can declare, otherwise they'll expose themselves to regulation and stricter price controls. So that's how places like UnitedHealthCare have such exhorbitant salaries and a bloated executive structure. It's the same as colleges, which also have constantly expanding revenues but are "nonprofit". So a vampiric parasitic management class attach themselves to the organization and suck all the money away, while costs soar.
rustybelt 5y ago
My reaction exactly. This article basically says we can achieve much of the savings of Medicare for all if insurance companies and providers put aside self-interest to voluntarily and in a coordinated manner adopt the aspects of Medicare for all that reduce costs! And if apes had tails they'd be monkeys!

benlivengood 5y ago

I worked in a hospital for 13 years. The economic incentives for the current system are quite perverse. The FDA has no cost constraints and so maximizes safety instead of QALYs. Medical equipment and drug manufacturers maximize profit and so fill the highest margin niches first instead of maximizing QALYs. Radiology and lab services are lucrative and separate themselves from clinical providers to maximize profits instead of QALYs. Individual physicians and especially surgeons can maximize profits by having their own practices vs. hospital or clinic environments where coordinated care maximizes QALYs. Hospitals and clinics and especially ERs, cancer treatment, and skilled nursing facilities try to make ends meet with inpatient population and try to hold on to outpatient surgery, radiology, and lab services to make ends meet while providing whatever level of coordinated care they can, but still optimizing for profit over QALYs. Insurance companies maximize profits by building actuarial plans that stratify patient populations by plan cost, skewing the burden of healthcare costs to the unemployed, underemployed, and low wage earners. A patient becoming uninsured is an economic win for insurance companies and employers. QALYs are proxied by cost/patient/year for anyone managing to stay insured which ignores deductibles, co-insurance and other out of pocket pay. Medicare and medicaid programs are left to pick up the pieces by trying to piece together effective care with compensation restricted by arbitrary budgets and arbitrary service providers (many specialists, independent physicians, and facilities flatly refuse medicare/medicaid patients). Actual patients have no clue how any of this works and end up with a pile of bills they try to pay off or if they know the trick they negotiate with the healthcare provider to settle for something slightly above the ~2% face value of debts written off to debt collectors who will hound sick people and their families incessantly. Maximizing QALYs is hard enough in a centralized single-payer or universal healthcare system. Almost nothing in the U.S. healthcare system is aligned with that goal.

neartheplain 5y ago
For anyone else who didn't know, QALY stands for "Quality-adjusted life year."
renewiltord 5y ago
Well, that's because Americans have an aversion to QALYs. It might be related to the idea that the country is fundamentally Christian in a deep way. A common accusation of anyone attempting to do a QALY based system would be that they are "sacrificing grandma for the dollar". The recent COVID crisis is an example where QALY based evaluations (which may well have gone either way) were summarily considered "putting a number on the value of a life". In that respect, it's not that the institutions are perverted but that the society they are in prefers them this way.

psyc 5y ago

This headline by itself could be a stand-alone Simpsons joke.

Ericson2314 5y ago

Considering how enmeshed everything is at Standard is with private sector businesses, and how many of these businesses can prosper due to these inefficiencies, I am quite skeptical. Even if the particular businesses these professors work with stand to gain from such reform, this sort of approach that thinks we can technocrat our way around the antagonism that is precisely why things like medicare-for-all are so difficult seems incredibly politically naive.

nwah1 5y ago

This speaks about standardizing contracts but neglects to mention that the competing proprietary electronic medical record standards also add cost, complexity, and increase medical errors. And there are still about 14 other layers of the healthcare onion to peel. Medical talent is kept artificially scarce thanks to the lobbying and control of licensing by the AMA. We should hand control of licensing over to the AARP and the March of Dimes instead. Hospitals and insurance have perverse incentives because they are separate. But when insurance and provisioning is combined as with Kaiser Permanente, then incentives are aligned and bureaucracy can be streamlined. Hospital consortiums currently carve up monopolies within a given piece of turf. We should break that up, and allow a proliferation of low-cost community clinics for less advanced procedures. And this hasnt even covered obscene pharmaceutical costs, electronic medical device manufacturers, the diagnostic industry oligopoly, and so on.

nunie123 5y ago
I started a project last week requiring me to learn the proprietary EDI file format that CMS mandates. I was surprised to learn that in order to exchange healthcare data with our government we have to use a file format owned by a private entity. And of course you have to pay to get access to the full implementation documentation.