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Hospital profit margins are razor thin in the US. Their pricing is so convoluted because they have to come up with inane contracts with insurance companies to s
by zdragnar 5y ago
Hospital profit margins are razor thin in the US. Their pricing is so convoluted because they have to come up with inane contracts with insurance companies to squeeze out every dollar they can.
In some instances, doctors in private practices have told me that taking Medicare or Medicaid means making less than minimum wage for certain procedures because the rates are fixed at such low values. In other cases, ER and intensive care units make nothing because they cannot legally turn anyone away for not being able to pay.
All of that has to be made up somewhere, and bilking insurance companies when they can are how they stay afloat.
Big companies can take the hit on high insurance rates. Drug makers live in boom and bust cycles (drugs are either fabulous money makers or bottomless pits that suck money from research, to testing, to the famously expensive FDA approval process).
The people hurt the worst are the small business employees and owners, the self employed, and the part time workers who can't afford to have the hospital come after them.
- fastball 5y agoSo hospitals and drug companies in the US are operating at peak efficiency without bilking anyone unnecessarily and yet a huge variety of procedures are more expensive than in the rest of the developed world. That definitely passes a smell test.
- s1artibartfast 5y agoA big driver is staff salary, which are 2-3X that in Europe. Another is technology with more expensive procedures, implants, tools, ect.
- fastball 5y agoSo GC claimed that some US Medicare/aid prices would cause HCW to make less than minimum wage, yet now you say salaries are 2-3x higher than Europe, which generally has higher minimum wages. Somehow all these excuses are still not jiving.
- s1artibartfast 5y agoHere are some easy graphs for compensation: https://www.physiciansweekly.com/how-do-us-physician-salaries-compare-with-those-abroad https://www.physiciansweekly.com/how-do-us-physician-salarie... https://www.oecd-ilibrary.org/sites/a44d2e24-en/index.html?itemId=/content/component/a44d2e24-en https://www.oecd-ilibrary.org/sites/a44d2e24-en/index.html?i... Physicians per capita: https://www.motherjones.com/kevin-drum/2013/11/why-are-american-doctors-paid-so-damn-much/ https://www.motherjones.com/kevin-drum/2013/11/why-are-ameri...
- zdragnar 5y agoTo clarify my point, the prices causing less than minimum wage income were for those procedures only. Other procedures paid more, but often not enough. On average, Medicare pays about 80% of what an insurance company will typically pay. Try finding a doctor while on Medicare; depending on region and specialty, only 2/5 to 2/3 doctors will take patients on Medicare. One other thing you may have missed: salaries are for doctors working at hospitals or clinics. Doctors working at private practices typically are self employed (or co-operate as a partner) and so are much more directly impacted by low payment rates. Edit: it is worth pointing out that the requirements to become a doctor are pretty extreme. You first need a 4 year bachelor's degree, then need to go to medical school (costing a total anywhere from 150k to 400k on the extreme high end), followed by residency (basically, a paid internship at a salary lower than a full doctor) lasting 3-7 years.
- bmarquez 5y ago> Try finding a doctor while on Medicare; depending on region and specialty, only 2/5 to 2/3 doctors will take patients on Medicare. One thing that I've noticed is that there are private practice doctors that will take Medicare/Medicaid but the wait time for an appointment is longer compared to private insurance. It's like they decided to space out the less-profitable patients to maintain their margins. (I knew a few people who had the same primary care physician but different insurances.)