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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

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.
- atdrummond 5y ago
  I don’t buy this. If this were true, Texas would have much better health outcomes than most other states, as med mal payments are capped and basically nonexistent relative to other states given the low cap/incentive for lawyers to pursue. Instead of any kind of dramatic increase in patient results, this system instead protected truly terrible doctors like the murderer Dr. Christopher Duntsch.
  - gitfan86 5y ago
    You are actually proving my point. Incompetent doctors are incentivized to come to Texas because there is a low cap on malpractice. That makes healthcare worse. Also, the extra tests that are being run just to cover someone's liability in other states don't make outcomes better because they are overwhelmingly unnecessary. They just add extra cost to the medical system to avoid lawsuits outside of Texas.
blntechie 5y ago
Distinctive thing I found in the US is that hospitals are always big and do everything under one roof. There are some smaller clinics run by chains in some states but they operate primarily only for insurance money and are not common. At the bottom of the chain, some doctors run their own operations from a strip mall like place but they again provide very minimal service. Meanwhile, in developing countries, it's not that hard to find a decently qualified doctor running his own small clinic with couple of nurses in a busy street. And to the next level, there is always a small 20-bed hospital around with 3-4 doctors and a bunch of nurses. And options keeps increasing in size and cost from small to the big hospitals like you typically see in the US. Almost 95% of primary healthcare are met by these small-mid level operations and people go to the big hospitals only for complicated surgeries and intensive care. In this example of just 6 stitches, it probably would have been administered by a nurse in a 20-bed hospital for fraction of the cost of a big hospital.
- Semaphor 5y ago
  > Distinctive thing I found in the US is that hospitals are always big and do everything under one roof. It’s the same in Germany, so I’m not sure that actually is what makes things different.
  - blntechie 5y ago
    Germany is public-private healthcare insurance driven healthcare model compared to the pure play private insurance or out-of-pocket driven healthcare model in the US and other poor countries. Germany has statutory public insurance while the examples I’m quoting including the US don’t have any such. For a private driven healthcare system, it’s strange there are no smaller, cheaper and nimble competitors.
    - dragonwriter 5y ago
      > the US and other poor countries. the US is not a poor country, it is an astonishingly rich country whose elites want poor (and working-class more generally) people insecure so as to maximize the degree to which they can be exploited via economic coercion.

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.

atdrummond 5y ago
I don’t buy this. If this were true, Texas would have much better health outcomes than most other states, as med mal payments are capped and basically nonexistent relative to other states given the low cap/incentive for lawyers to pursue. Instead of any kind of dramatic increase in patient results, this system instead protected truly terrible doctors like the murderer Dr. Christopher Duntsch.
- gitfan86 5y ago
  You are actually proving my point. Incompetent doctors are incentivized to come to Texas because there is a low cap on malpractice. That makes healthcare worse. Also, the extra tests that are being run just to cover someone's liability in other states don't make outcomes better because they are overwhelmingly unnecessary. They just add extra cost to the medical system to avoid lawsuits outside of Texas.

blntechie 5y ago

Distinctive thing I found in the US is that hospitals are always big and do everything under one roof. There are some smaller clinics run by chains in some states but they operate primarily only for insurance money and are not common. At the bottom of the chain, some doctors run their own operations from a strip mall like place but they again provide very minimal service. Meanwhile, in developing countries, it's not that hard to find a decently qualified doctor running his own small clinic with couple of nurses in a busy street. And to the next level, there is always a small 20-bed hospital around with 3-4 doctors and a bunch of nurses. And options keeps increasing in size and cost from small to the big hospitals like you typically see in the US. Almost 95% of primary healthcare are met by these small-mid level operations and people go to the big hospitals only for complicated surgeries and intensive care. In this example of just 6 stitches, it probably would have been administered by a nurse in a 20-bed hospital for fraction of the cost of a big hospital.

Semaphor 5y ago
> Distinctive thing I found in the US is that hospitals are always big and do everything under one roof. It’s the same in Germany, so I’m not sure that actually is what makes things different.
- blntechie 5y ago
  Germany is public-private healthcare insurance driven healthcare model compared to the pure play private insurance or out-of-pocket driven healthcare model in the US and other poor countries. Germany has statutory public insurance while the examples I’m quoting including the US don’t have any such. For a private driven healthcare system, it’s strange there are no smaller, cheaper and nimble competitors.
  - dragonwriter 5y ago
    > the US and other poor countries. the US is not a poor country, it is an astonishingly rich country whose elites want poor (and working-class more generally) people insecure so as to maximize the degree to which they can be exploited via economic coercion.