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Somehow everybody in this system claims they're not the ones making bank on this swindling. The doctors say they're underpaid. The hospital admin says they're u

by causi 5y ago

Somehow everybody in this system claims they're not the ones making bank on this swindling. The doctors say they're underpaid. The hospital admin says they're underpaid. The insurance companies say they're barely covering their payouts. So who is lying?

praptak 5y ago
You missed this part: "Both the physicians and the hospital are part of companies recently taken over by private-equity investors."
blackhaz 5y ago
Some people somewhere, with cigars, in $5,000 suits. "Look at all those schmucks! $400 per shot and $1,000 per stitch." The whole healthcare system needs to be regulated by the government end-to-end. All procurement must be transparent. Every cent traced. Pharma mafia dismantled - on a federal level.
- smabie 5y ago
  Who are these people? Where are they? Not really convinced they exist.
  - donatj 5y ago
    They don’t exist. They’re the imagined scapegoat for what is actually just a much harder to comprehend creeping bureaucracy cost. The human mind loves clear enemies but Hanlon’s Razor almost always applies. Almost no one ever actually has malicious intent, but our brain evolved to watch for enemies and loves seeing patterns where they aren’t.
    - LightG 5y ago
      Cool story. So what you're saying is there is an horrendous creeping bueaucracy cost here. Funny, because that's exactly what free market proponents argue is the cause of inefficiency in publicly managed healthcare systems, and the reason to move towards models based on the US system. Someone is lying.
      - rsj_hn 5y ago
        The costs are more diffuse than this. First, the U.S. system costs twice as much as other systems because we have more people employed delivering care and they make higher salaries. Doctors, nurses, they all make more in the U.S. than in Europe. So more people, getting paid higher wage, results in double the costs. But wait, the financing in the U.S. is quite predatory, so a lot of people pay nothing, and a few people are stuck with outrageous bills. It's like the infamous SF General Hospital that offered loads of free care to the poor and to immigrants and then refused to take any insurance so that normal people were regularly driven to bankruptcy if the ambulence took them there. The U.S. healthcare is one in which a half a million is spent on emergency care for an indigent person and 10 middle class families lose their life savings of 50K treating snakebites and broken arms. Once you wrap your head around this, you'll understand we have a very similar problem in higher education, and for very similar reasons.
        LightG 5y ago
        Ok, I'll take all of that at face value and as given. It just sounds completely broken over there and I'm not sure I will manage to wrap my head around it. All I know is simpler systems around the world exist and work such that those 10 middle class families would never get stiffed like that, whilst also looking after the needy. I can't fathom it.
        rsj_hn 5y ago
        > It just sounds completely broken over there and I'm not sure I will manage to wrap my head around it. Agreed. But that's the way it is, and it's important to understand why it's this way. When Europe and Australia adopted national healthcare systems, the industry was ~3-5% of GDP. So at that point it wasn't politically strong enough to resist either nationalization or strict controls. Then healthcare mushroomed in size, being ~10% of GDP in Europe and 20% of GDP in the U.S. So now, when you try to do the politics that the europeans did, it doesn't work. The industry is too powerful. Merely blaming the US for not doing what Europe did misses this essential point. There are millions of nurses, lab techs, administrators, and doctors, and they have money and they vote. So the left keeps looking for some villain -- greedy insurance executives, Wall Street, Evil Billionaires, etc. And basically refuses to understand that these are not the ones standing in the way of reform. It's the 13% of our labor force that earns 20% of national income, and these are not the same easy targets that the left can attack, because they are a large portion of the US middle class, and are core Democratic constituencies. That's why healthcare reform in the U.S. always focuses on having the government pay some of the costs charged to consumers rather then reducing the costs of providing healthcare. E.g. more subsidies for this bloated industry, which only results in costs rising even more, and then calls for even more subsidies when people can't afford to pay the costs. When what we should do is fire 50% of the staff and cut the pay of those that remain by another 50%. That's the only way to get affordable healthcare. And you have a similar problem with higher ed.
    - RobertoG 5y ago
      The USA expenditure in healthcare per capita is, more or less, the double that the Netherlands (1) and doesn't cover all the population. Where the difference goes? Sorry if some of us, in our biased minds, suspect that some of that money is spent in cigars and expensive suits. (1) - https://data.worldbank.org/indicator/SH.XPD.CHEX.PC.CD?most_recent_value_desc=true https://data.worldbank.org/indicator/SH.XPD.CHEX.PC.CD?most_...
  - LightG 5y ago
    Owners, private equity firms, VC's ... whoever is the ultimate lever in this arena. It's not hard.
    - tartoran 5y ago
      Yep, wallstreet is heavily invested in this space. People fail to connect the dots.
  - alistairSH 5y ago
    Whoever categorized the subject’s stitches as a Level 4 trauma, for starters. That was damn near fraudulent.
  - praptak 5y ago
    "Both the physicians and the hospital are part of companies recently taken over by private-equity investors."
  - blackhaz 5y ago
    These people are rarely public, you don't even need to know they exist. They exist behind the figures we see on the TV. Where there is money and a chance of corruption, they definitely exist.
yardie 5y ago
The hospital admins are lying. Doctors will go through a billing agency who can charge whatever they want. The doctor might not know, but would be naive to believe it’s not expensive.
otagekki 5y ago
The hospital and the doctors. Almost $500 for a tetanus shot is simply not justifiable
- ceejayoz 5y ago
  The doctors likely have nothing to do with how much procedures bill for. In private practice outside a hospital, they perhaps have more guilt here, but in an ER? They set the prices about as much as the janitors do.
  - CalChris 5y ago
    Doctors are acutely aware of how much which procedures bill for.
  - otagekki 5y ago
    Yet they still charged roughly $2,000 for a single patient and that is something that did not take the whole day. If I was a physician I'd be happy if I could bill half that amount even if it took me the whole day to treat the patient
  - legutierr 5y ago
    I've had doctors in the ER bill directly out of their own practice several times. Out of network, but I've had no choice in the matter except to receive treatment or refuse treatment for life-threatening conditions. The law here has changed since then to prohibit this kind of thing, though.
    - learc83 5y ago
      In the case where an ER doctor isn’t employed by the hospital, they are likely employed by a physicians’s group. These used to be ran by physicians, but now many of them have been bought up and consolidated by private equity. The doctors likely have very little say in the pricing.
      - legutierr 5y ago
throw8636363738 5y ago
All of them
masklinn 5y ago
> The hospital admin says they're underpaid. The insurance companies say they're barely covering their payouts. So who is lying? Insurance companies are definitely lying (their execs are paid tens of millions) though it should be noted that the US system greatly limits the ability to spread insurance payments on health populations, so it makes sense that the population using medical services is a larger share of the insured population, and thus has to pay more. Anyway more generally the administrative overhead of US healthcare is absolutely enormous e.g. as of 2017[0] it was almost 35% of medical expenses, versus 17% in Canada (up from respectively 31 and 16.7 in 2003). > [Administrative costs per capita in the US versus Canada are] $844 versus $146 on insurers' overhead; $933 versus $196 for hospital administration; $255 versus $123 for nursing home, home care, and hospice administration; and $465 versus $87 for physicians' insurance-related costs. So the admin overhead in the US (v Canada) is: - 5.78x on insurance - 4.76x on hospitals - 2.07x on nursing homes, home care, and hospices - 5.34x on physicians Importantly though you did not list drug companies in there. Drug costs are completely out of control in the US (some generic and out of patent drugs have seen price increases of 80x in a decade), and AFAIK modern treatment regimens tend to include a lot more different drugs. At the hospital level, aside from the administrative overhead above, as an other commenter notes there is also the issue that because it's not a single-payer public health system hospitals have to compensate for indigent ER clients by billing more to, well, people who can pay. Then of course there's the issue that because all the incentives are fucked under the US system it's being used the least efficient way possible e.g. medical costs are sky-high, so people can't have a GP, so they can't take care of their conditions until those go south, at which point they go to the ER which is the most expensive and least efficient medical service center. And then the ER's job is to stabilise them, but they still don't have any more money to pay for long-term treatment than they did before having to go to the ER (less, really), so they can't follow through, so they degrade again, and back to the ER. [0] https://pubmed.ncbi.nlm.nih.gov/31905376/ https://pubmed.ncbi.nlm.nih.gov/31905376/
throwaway09223 5y ago
My understanding is that the ER system is especially expensive because paying customers are subsidizing non-paying customers (homeless) who use the ER as primary care. That said, I don't think this excludes the possibility that the insurance companies and the hospitals are also not telling the full truth.
- watwut 5y ago
  I think it is more that prices are not transparent. Instead they are impredictable. And you can't shop around for cheaper treatment. Partly because you are not in position to do so and partly because no one will tell you full price in advance.
  - throwaway09223 5y ago
    I agree that those are problems with American healthcare. I'm describing why ER prices are specifically so much higher than care in other areas of the hospital.
- Lifelarper 5y ago
  I find it hard to believe the small non-paying contingent is unique to the US or even a significant % of daily patients, plenty of other countries have homeless who end up in ED's. America somehow spends far more than any other country on healthcare and yet patients still have some of the highest out of pocket costs even when they have expensive private insurance schemes, something is clearly broken to anyone looking and it's not the homeless causing it.
  - chongli 5y ago
    The US's non-paying contingent doesn't need to be any different from any other countries in order to cause the problem. The issue is that the uninsured subsidize the non-payers alone. This is radically different from countries with universal health care where the costs are spread among the entire tax-paying population. As for why the US spends more than any other country: it's due to an overabundance of caution among the comfortably insured. It's much easier to get a variety of expensive (and often unnecessary) tests and scans (such as MRI scans) in the US. In countries with universal health care these tests and scans are restricted only to those with demonstrable need and they may be subject to long waiting lists.
nine_zeros 5y ago
The American insurance system has inherent efficiency problems. Hospitals are for profit corporations. Doctors are reviewed on how much revenue they generate per patient - usually by asking for more diagnosis and treatments - which is what patients want too. Too much admin, too little doctors. Someone should get the admin to doctor ratios at hospitals, it is nuts. A lot of admin is there to handle the insane documentation requirements, software, machinery and dealing with insurance providers. Insurance providers have their own army of admins, talking everyday to hospital admins. On top of this, supplies providers know that insurance is going to foot any bill. So they charge more. Insurance tries to negotiate it down but there's only so much they can do - unless they buy stuff directly from China or somewhere else. To add, each of these institutions has their own management ladder with fatter paychecks than the doctors themselves. These folks are nothing but leeches who just need the corporate ladder to exist. Unfortunately, the only capitalist solution out of this is to allow massive production of doctors (blocked by AMA), allow doctors to unite and form their own hospitals willy nilly (harder than you think because legal requirements are burdensome) and for insurance providers to compete in open market - as they do for cars. No more open enrollment.
- masklinn 5y ago
  > Hospitals are for profit corporations. Doctors are reviewed on how much revenue they generate per patient - usually by asking for more diagnosis and treatments - which is what patients want too. FWIW lots of hospitals are non-profit (though I expect that changes are investors are moving more and more into the space). That doesn't mean they don't focus on doctor's revenue, it only means there are no owners skimming off the top, but there are still execs being paid (a lot), as well as suppliers, etc... I'm not saying NFP hostpitals are worse (or even as bad as) FP, but they're hardly good.
- refurb 5y ago
  Most hospitals in the US are non-profit entities.
addicted 5y ago
No one is lying. The system is filled with massive inefficiencies. 1) Insurance companies don’t pay sticker prices. They pay negotiated rates. At the same time, hospitals have to pick up a lot of ER costs that are never covered. They might be making money but reasonable amounts at best (also that’s probably not true either considering how many hospitals are shutting down in the US). 2) The negotiated rates insurance companies pay are still very high. They are probably making a good profit, but their margin is still probably a fraction of the margin of many other industries, and it’s not like they have no competition, so they do have market pressure to reduce prices. 3) Doctors pay a ton in education and liability insurance and delayed earnings due to the extensive education required. They can spend over a decade, and be into their 40s before their net worth turns positive. So where is all the money going is an excellent question. No one is benefitting from this current system. 1 obvious destination for the money is the education system in the US. Higher Ed in the US is an increasingly growing money pit. Tuitions are exploding. Loans are exploding (and educational loans are unique in the US in that they cannot be canceled in a bankruptcy). Administrative salaries are blowing up. Ever fancier buildings are being built. Yet money for teachers, researchers and remasters/phds is plummeting. It’s a complete scam with the entire system paying ever more money to build fancy buildings, the vast majority of the cost of which is captured by corrupt contractors with connections to university presidents, etc. Then you have the pharma industry, which unlike any other civilized society, needs to advertise to consumers in the US. This means they have pressure to constantly grow their sales and once popular enough they have parents, and once generic, brand value, to force hospitals and patients to buy overpriced drugs. But the US can’t outlaw pharma ads like nearly every other civilized country has, because that will then destroy your Media and Tech industries, and where ads, and therefore pharma ads, make up a massive source of income. And I’m sure the same dynamic probably applies to medical tech as we’ll. So in honesty, the money is likely going to the places that are showing that they are receiving money. Not in the healthcare system, but rather to tech, media, and construction and real estate.
- gitfan86 5y ago
  Another big inefficiency is the margin of error allowed due to malpractice lawsuits. If a patient is at a 1 in a 10,000 risk for a problem, the Doctor will order a test to rule that problem out. Because if the Doctor doesn't order the test and the person ends up having the problem, the Doctor could be sued for malpractice. In other countries the Doctor would say this is very unlikely so I'm not going to run the test.
refurb 5y ago
Well UCSF charged my brother in law $20,000 for an MRI a private standalone MRI clinic charges $3,000 for. Insurance paid UCSF $16,000 after discount. So I’d say the hospitals definitely are a part of the problem. You can imagine what he did with a fund raising letter he got from UCSF asking for a donation so they could continue to help the community…
- Aeolun 5y ago
  Meanwhile, the most expensive MRI I’ve ever gotten in Japan was $300 before insurance. Even the private clinic is making bank like there’s no tomorrow.
  - refurb 5y ago
    It was a complicated MRI that was actually 5-6 MRIs in one and involved radiocontrast. Their standard lower back MRI was $400. Price competition can be fierce in MRIs since the startup costs aren’t high and you can pull patients from everywhere.
  - deleted 5y ago
    [deleted]
  - varelse 5y ago
    I had to go to the ER in Hong Kong and I got better service uninsured for $35 US than I've ever gotten in the United States fully insured. And no surprise bills afterwards whatsoever.
- boplicity 5y ago
  > Insurance paid UCSF $16,000 after discount. There you go. The insurance company is actually incentivized to not negotiate a lower price. What if they refuse a ludicrous price? Their customers will complain -- what, what? go without MRIs? Worse -- the insurance company gets to keep 20% of the costs as profit. For a $16,000 bill, that's $3,200. For a $3,000 bill, that's just $600. So why, again, would they fight for a lower bill? No reason. Competition from other companies? Unfortunately, they're all playing the same game, and lower premiums are simply not happening.
pydry 5y ago
Probably a lot of actors. You know that the hospitals who claimed that their prices were trade secrets when being forced to reveal them were telling porkies.
throwthere 5y ago
Lol what? Insurers are hugely profitable— many are public companies and don’t hide that. And you can underpay plenty of people if you give them difficult to do bullshit jobs that don’t provide value. That doesn’t make “administrators” liars. Doctor salaries have declined over time with inflation— is hard to blame them for higher healthcare expenditures. My main point is outright calling people liars and playing a blame game isn’t going to get anywhere. The system is fubard.
Folcon 5y ago
I'm curious, are there just more staff? How many admins / doctors does the US system employ compared to other health systems? I'm willing to believe addicted's[0] rationale, but maybe most people are getting paid poorly, there's just more of them in the system? - [0]: https://news.ycombinator.com/item?id=29287371 https://news.ycombinator.com/item?id=29287371
heavyset_go 5y ago
If you're looking for somebody that's walking away with fat bags of cash, you aren't going to find them on payrolls.
pietrovismara 5y ago
It's not secret knowledge at all. Just invested 2 minutes in searching: > US health insurers report billions in first quarter as small providers face stress > UnitedHealth Group, reported $4.9bn in profits in the first quarter of 2021 while CVS Health reported $2.2bn - https://www.theguardian.com/business/2021/may/08/us-health-insurance-companies-2021-first-quarter https://www.theguardian.com/business/2021/may/08/us-health-i... > Major U.S. Health Insurers Report Big Profits, Benefiting From the Pandemic - https://www.nytimes.com/2020/08/05/health/covid-insurance-profits.html https://www.nytimes.com/2020/08/05/health/covid-insurance-pr... > The health insurance industry continued its tremendous growth trend as it experienced a significant increase in net earnings to $31 billion and an increase in the profit margin to 3.8% in 2020 compared to net earnings of $22 billion and a profit margin of 3% in 2019. - https://content.naic.org/sites/default/files/inline-files/2020-Annual-Health-Insurance-Industry-Analysis-Report.pdf https://content.naic.org/sites/default/files/inline-files/20...
fgonzag 5y ago
Though in this case it is quite obvious that there are some parties making an obscene amount amount of money in healthcare, there are businesses where employees feel underpaid, owners lose money / break even, and customers believe they are overpaying, so no one is happy. Childcare is first example I can think of.

by causi 5y ago

praptak 5y ago

You missed this part: "Both the physicians and the hospital are part of companies recently taken over by private-equity investors."

blackhaz 5y ago

Some people somewhere, with cigars, in $5,000 suits. "Look at all those schmucks! $400 per shot and $1,000 per stitch." The whole healthcare system needs to be regulated by the government end-to-end. All procurement must be transparent. Every cent traced. Pharma mafia dismantled - on a federal level.

smabie 5y ago
Who are these people? Where are they? Not really convinced they exist.
- donatj 5y ago
  They don’t exist. They’re the imagined scapegoat for what is actually just a much harder to comprehend creeping bureaucracy cost. The human mind loves clear enemies but Hanlon’s Razor almost always applies. Almost no one ever actually has malicious intent, but our brain evolved to watch for enemies and loves seeing patterns where they aren’t.
  - LightG 5y ago
    Cool story. So what you're saying is there is an horrendous creeping bueaucracy cost here. Funny, because that's exactly what free market proponents argue is the cause of inefficiency in publicly managed healthcare systems, and the reason to move towards models based on the US system. Someone is lying.
    - rsj_hn 5y ago
      The costs are more diffuse than this. First, the U.S. system costs twice as much as other systems because we have more people employed delivering care and they make higher salaries. Doctors, nurses, they all make more in the U.S. than in Europe. So more people, getting paid higher wage, results in double the costs. But wait, the financing in the U.S. is quite predatory, so a lot of people pay nothing, and a few people are stuck with outrageous bills. It's like the infamous SF General Hospital that offered loads of free care to the poor and to immigrants and then refused to take any insurance so that normal people were regularly driven to bankruptcy if the ambulence took them there. The U.S. healthcare is one in which a half a million is spent on emergency care for an indigent person and 10 middle class families lose their life savings of 50K treating snakebites and broken arms. Once you wrap your head around this, you'll understand we have a very similar problem in higher education, and for very similar reasons.
      - LightG 5y ago
        Ok, I'll take all of that at face value and as given. It just sounds completely broken over there and I'm not sure I will manage to wrap my head around it. All I know is simpler systems around the world exist and work such that those 10 middle class families would never get stiffed like that, whilst also looking after the needy. I can't fathom it.
        rsj_hn 5y ago
        > It just sounds completely broken over there and I'm not sure I will manage to wrap my head around it. Agreed. But that's the way it is, and it's important to understand why it's this way. When Europe and Australia adopted national healthcare systems, the industry was ~3-5% of GDP. So at that point it wasn't politically strong enough to resist either nationalization or strict controls. Then healthcare mushroomed in size, being ~10% of GDP in Europe and 20% of GDP in the U.S. So now, when you try to do the politics that the europeans did, it doesn't work. The industry is too powerful. Merely blaming the US for not doing what Europe did misses this essential point. There are millions of nurses, lab techs, administrators, and doctors, and they have money and they vote. So the left keeps looking for some villain -- greedy insurance executives, Wall Street, Evil Billionaires, etc. And basically refuses to understand that these are not the ones standing in the way of reform. It's the 13% of our labor force that earns 20% of national income, and these are not the same easy targets that the left can attack, because they are a large portion of the US middle class, and are core Democratic constituencies. That's why healthcare reform in the U.S. always focuses on having the government pay some of the costs charged to consumers rather then reducing the costs of providing healthcare. E.g. more subsidies for this bloated industry, which only results in costs rising even more, and then calls for even more subsidies when people can't afford to pay the costs. When what we should do is fire 50% of the staff and cut the pay of those that remain by another 50%. That's the only way to get affordable healthcare. And you have a similar problem with higher ed.
  - RobertoG 5y ago
    The USA expenditure in healthcare per capita is, more or less, the double that the Netherlands (1) and doesn't cover all the population. Where the difference goes? Sorry if some of us, in our biased minds, suspect that some of that money is spent in cigars and expensive suits. (1) - https://data.worldbank.org/indicator/SH.XPD.CHEX.PC.CD?most_recent_value_desc=true https://data.worldbank.org/indicator/SH.XPD.CHEX.PC.CD?most_...
- LightG 5y ago
  Owners, private equity firms, VC's ... whoever is the ultimate lever in this arena. It's not hard.
  - tartoran 5y ago
    Yep, wallstreet is heavily invested in this space. People fail to connect the dots.
- alistairSH 5y ago
  Whoever categorized the subject’s stitches as a Level 4 trauma, for starters. That was damn near fraudulent.
- praptak 5y ago
  "Both the physicians and the hospital are part of companies recently taken over by private-equity investors."
- blackhaz 5y ago
  These people are rarely public, you don't even need to know they exist. They exist behind the figures we see on the TV. Where there is money and a chance of corruption, they definitely exist.

yardie 5y ago

The hospital admins are lying. Doctors will go through a billing agency who can charge whatever they want. The doctor might not know, but would be naive to believe it’s not expensive.

otagekki 5y ago

The hospital and the doctors. Almost $500 for a tetanus shot is simply not justifiable

ceejayoz 5y ago
The doctors likely have nothing to do with how much procedures bill for. In private practice outside a hospital, they perhaps have more guilt here, but in an ER? They set the prices about as much as the janitors do.
- CalChris 5y ago
  Doctors are acutely aware of how much which procedures bill for.
- otagekki 5y ago
  Yet they still charged roughly $2,000 for a single patient and that is something that did not take the whole day. If I was a physician I'd be happy if I could bill half that amount even if it took me the whole day to treat the patient
- legutierr 5y ago
  I've had doctors in the ER bill directly out of their own practice several times. Out of network, but I've had no choice in the matter except to receive treatment or refuse treatment for life-threatening conditions. The law here has changed since then to prohibit this kind of thing, though.
  - learc83 5y ago
    In the case where an ER doctor isn’t employed by the hospital, they are likely employed by a physicians’s group. These used to be ran by physicians, but now many of them have been bought up and consolidated by private equity. The doctors likely have very little say in the pricing.
    - legutierr 5y ago

throw8636363738 5y ago

All of them

masklinn 5y ago

> The hospital admin says they're underpaid. The insurance companies say they're barely covering their payouts. So who is lying? Insurance companies are definitely lying (their execs are paid tens of millions) though it should be noted that the US system greatly limits the ability to spread insurance payments on health populations, so it makes sense that the population using medical services is a larger share of the insured population, and thus has to pay more. Anyway more generally the administrative overhead of US healthcare is absolutely enormous e.g. as of 2017[0] it was almost 35% of medical expenses, versus 17% in Canada (up from respectively 31 and 16.7 in 2003). > [Administrative costs per capita in the US versus Canada are] $844 versus $146 on insurers' overhead; $933 versus $196 for hospital administration; $255 versus $123 for nursing home, home care, and hospice administration; and $465 versus $87 for physicians' insurance-related costs. So the admin overhead in the US (v Canada) is: - 5.78x on insurance - 4.76x on hospitals - 2.07x on nursing homes, home care, and hospices - 5.34x on physicians Importantly though you did not list drug companies in there. Drug costs are completely out of control in the US (some generic and out of patent drugs have seen price increases of 80x in a decade), and AFAIK modern treatment regimens tend to include a lot more different drugs. At the hospital level, aside from the administrative overhead above, as an other commenter notes there is also the issue that because it's not a single-payer public health system hospitals have to compensate for indigent ER clients by billing more to, well, people who can pay. Then of course there's the issue that because all the incentives are fucked under the US system it's being used the least efficient way possible e.g. medical costs are sky-high, so people can't have a GP, so they can't take care of their conditions until those go south, at which point they go to the ER which is the most expensive and least efficient medical service center. And then the ER's job is to stabilise them, but they still don't have any more money to pay for long-term treatment than they did before having to go to the ER (less, really), so they can't follow through, so they degrade again, and back to the ER. [0] https://pubmed.ncbi.nlm.nih.gov/31905376/ https://pubmed.ncbi.nlm.nih.gov/31905376/

throwaway09223 5y ago

My understanding is that the ER system is especially expensive because paying customers are subsidizing non-paying customers (homeless) who use the ER as primary care. That said, I don't think this excludes the possibility that the insurance companies and the hospitals are also not telling the full truth.

watwut 5y ago
I think it is more that prices are not transparent. Instead they are impredictable. And you can't shop around for cheaper treatment. Partly because you are not in position to do so and partly because no one will tell you full price in advance.
- throwaway09223 5y ago
  I agree that those are problems with American healthcare. I'm describing why ER prices are specifically so much higher than care in other areas of the hospital.
Lifelarper 5y ago
I find it hard to believe the small non-paying contingent is unique to the US or even a significant % of daily patients, plenty of other countries have homeless who end up in ED's. America somehow spends far more than any other country on healthcare and yet patients still have some of the highest out of pocket costs even when they have expensive private insurance schemes, something is clearly broken to anyone looking and it's not the homeless causing it.
- chongli 5y ago
  The US's non-paying contingent doesn't need to be any different from any other countries in order to cause the problem. The issue is that the uninsured subsidize the non-payers alone. This is radically different from countries with universal health care where the costs are spread among the entire tax-paying population. As for why the US spends more than any other country: it's due to an overabundance of caution among the comfortably insured. It's much easier to get a variety of expensive (and often unnecessary) tests and scans (such as MRI scans) in the US. In countries with universal health care these tests and scans are restricted only to those with demonstrable need and they may be subject to long waiting lists.

nine_zeros 5y ago

The American insurance system has inherent efficiency problems. Hospitals are for profit corporations. Doctors are reviewed on how much revenue they generate per patient - usually by asking for more diagnosis and treatments - which is what patients want too. Too much admin, too little doctors. Someone should get the admin to doctor ratios at hospitals, it is nuts. A lot of admin is there to handle the insane documentation requirements, software, machinery and dealing with insurance providers. Insurance providers have their own army of admins, talking everyday to hospital admins. On top of this, supplies providers know that insurance is going to foot any bill. So they charge more. Insurance tries to negotiate it down but there's only so much they can do - unless they buy stuff directly from China or somewhere else. To add, each of these institutions has their own management ladder with fatter paychecks than the doctors themselves. These folks are nothing but leeches who just need the corporate ladder to exist. Unfortunately, the only capitalist solution out of this is to allow massive production of doctors (blocked by AMA), allow doctors to unite and form their own hospitals willy nilly (harder than you think because legal requirements are burdensome) and for insurance providers to compete in open market - as they do for cars. No more open enrollment.

masklinn 5y ago
> Hospitals are for profit corporations. Doctors are reviewed on how much revenue they generate per patient - usually by asking for more diagnosis and treatments - which is what patients want too. FWIW lots of hospitals are non-profit (though I expect that changes are investors are moving more and more into the space). That doesn't mean they don't focus on doctor's revenue, it only means there are no owners skimming off the top, but there are still execs being paid (a lot), as well as suppliers, etc... I'm not saying NFP hostpitals are worse (or even as bad as) FP, but they're hardly good.
refurb 5y ago
Most hospitals in the US are non-profit entities.

addicted 5y ago

No one is lying. The system is filled with massive inefficiencies. 1) Insurance companies don’t pay sticker prices. They pay negotiated rates. At the same time, hospitals have to pick up a lot of ER costs that are never covered. They might be making money but reasonable amounts at best (also that’s probably not true either considering how many hospitals are shutting down in the US). 2) The negotiated rates insurance companies pay are still very high. They are probably making a good profit, but their margin is still probably a fraction of the margin of many other industries, and it’s not like they have no competition, so they do have market pressure to reduce prices. 3) Doctors pay a ton in education and liability insurance and delayed earnings due to the extensive education required. They can spend over a decade, and be into their 40s before their net worth turns positive. So where is all the money going is an excellent question. No one is benefitting from this current system. 1 obvious destination for the money is the education system in the US. Higher Ed in the US is an increasingly growing money pit. Tuitions are exploding. Loans are exploding (and educational loans are unique in the US in that they cannot be canceled in a bankruptcy). Administrative salaries are blowing up. Ever fancier buildings are being built. Yet money for teachers, researchers and remasters/phds is plummeting. It’s a complete scam with the entire system paying ever more money to build fancy buildings, the vast majority of the cost of which is captured by corrupt contractors with connections to university presidents, etc. Then you have the pharma industry, which unlike any other civilized society, needs to advertise to consumers in the US. This means they have pressure to constantly grow their sales and once popular enough they have parents, and once generic, brand value, to force hospitals and patients to buy overpriced drugs. But the US can’t outlaw pharma ads like nearly every other civilized country has, because that will then destroy your Media and Tech industries, and where ads, and therefore pharma ads, make up a massive source of income. And I’m sure the same dynamic probably applies to medical tech as we’ll. So in honesty, the money is likely going to the places that are showing that they are receiving money. Not in the healthcare system, but rather to tech, media, and construction and real estate.

gitfan86 5y ago
Another big inefficiency is the margin of error allowed due to malpractice lawsuits. If a patient is at a 1 in a 10,000 risk for a problem, the Doctor will order a test to rule that problem out. Because if the Doctor doesn't order the test and the person ends up having the problem, the Doctor could be sued for malpractice. In other countries the Doctor would say this is very unlikely so I'm not going to run the test.

refurb 5y ago

Well UCSF charged my brother in law $20,000 for an MRI a private standalone MRI clinic charges $3,000 for. Insurance paid UCSF $16,000 after discount. So I’d say the hospitals definitely are a part of the problem. You can imagine what he did with a fund raising letter he got from UCSF asking for a donation so they could continue to help the community…

Aeolun 5y ago
Meanwhile, the most expensive MRI I’ve ever gotten in Japan was $300 before insurance. Even the private clinic is making bank like there’s no tomorrow.
- refurb 5y ago
  It was a complicated MRI that was actually 5-6 MRIs in one and involved radiocontrast. Their standard lower back MRI was $400. Price competition can be fierce in MRIs since the startup costs aren’t high and you can pull patients from everywhere.
- deleted 5y ago
  [deleted]
- varelse 5y ago
  I had to go to the ER in Hong Kong and I got better service uninsured for $35 US than I've ever gotten in the United States fully insured. And no surprise bills afterwards whatsoever.
boplicity 5y ago
> Insurance paid UCSF $16,000 after discount. There you go. The insurance company is actually incentivized to not negotiate a lower price. What if they refuse a ludicrous price? Their customers will complain -- what, what? go without MRIs? Worse -- the insurance company gets to keep 20% of the costs as profit. For a $16,000 bill, that's $3,200. For a $3,000 bill, that's just $600. So why, again, would they fight for a lower bill? No reason. Competition from other companies? Unfortunately, they're all playing the same game, and lower premiums are simply not happening.

pydry 5y ago

Probably a lot of actors. You know that the hospitals who claimed that their prices were trade secrets when being forced to reveal them were telling porkies.

throwthere 5y ago

Lol what? Insurers are hugely profitable— many are public companies and don’t hide that. And you can underpay plenty of people if you give them difficult to do bullshit jobs that don’t provide value. That doesn’t make “administrators” liars. Doctor salaries have declined over time with inflation— is hard to blame them for higher healthcare expenditures. My main point is outright calling people liars and playing a blame game isn’t going to get anywhere. The system is fubard.

Folcon 5y ago

I'm curious, are there just more staff? How many admins / doctors does the US system employ compared to other health systems? I'm willing to believe addicted's[0] rationale, but maybe most people are getting paid poorly, there's just more of them in the system? - [0]: https://news.ycombinator.com/item?id=29287371 https://news.ycombinator.com/item?id=29287371

heavyset_go 5y ago

If you're looking for somebody that's walking away with fat bags of cash, you aren't going to find them on payrolls.

pietrovismara 5y ago

It's not secret knowledge at all. Just invested 2 minutes in searching: > US health insurers report billions in first quarter as small providers face stress > UnitedHealth Group, reported $4.9bn in profits in the first quarter of 2021 while CVS Health reported $2.2bn - https://www.theguardian.com/business/2021/may/08/us-health-insurance-companies-2021-first-quarter https://www.theguardian.com/business/2021/may/08/us-health-i... > Major U.S. Health Insurers Report Big Profits, Benefiting From the Pandemic - https://www.nytimes.com/2020/08/05/health/covid-insurance-profits.html https://www.nytimes.com/2020/08/05/health/covid-insurance-pr... > The health insurance industry continued its tremendous growth trend as it experienced a significant increase in net earnings to $31 billion and an increase in the profit margin to 3.8% in 2020 compared to net earnings of $22 billion and a profit margin of 3% in 2019. - https://content.naic.org/sites/default/files/inline-files/2020-Annual-Health-Insurance-Industry-Analysis-Report.pdf https://content.naic.org/sites/default/files/inline-files/20...

fgonzag 5y ago

Though in this case it is quite obvious that there are some parties making an obscene amount amount of money in healthcare, there are businesses where employees feel underpaid, owners lose money / break even, and customers believe they are overpaying, so no one is happy. Childcare is first example I can think of.