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Healthcare in the United States. The insurers have somehow created which ensures their survival at a real cost. Attempts to rationalize the system have failed

by JackFr 3y ago

Healthcare in the United States. The insurers have somehow created which ensures their survival at a real cost. Attempts to rationalize the system have failed because of the focus on getting everyone health insurance rather than health care (admittedly among other reasons).

Aurornis 3y ago
It doesn’t help that politicians continue to propose dead-in-the-water alternatives. The last round of “Medicare for All” included a lot of provisions that were very unpopular when you asked people about them directly, such as taking away people’s existing private insurance. This a common theme in politics: Actually solving the problem might remove enthusiasm for your candidate or party, so instead they propose things with no realistic chance of passing. Their business is being front and center in public discourse, not quietly fixing things. EDIT: I’m getting downvoted because a comment below is denying this part of the bill, so I’m adding the exact text here: > SEC. 107. PROHIBITION AGAINST DUPLICATING COVERAGE. (a) IN GENERAL.—Beginning on the effective date described in section 106(a), it shall be unlawful for— (1) a private health insurer to sell health insurance coverage that duplicates the benefits provided under this Act; or (2) an employer to provide benefits for an employee, former employee, or the dependents of an employee or former employee that duplicate the benefits provided under this Act. The comment below is incorrect. The bill would have made people’s existing insurance plans illegal to offer.
- jerojero 3y ago
  No one is going to get elected for solving a problem everyone today is going to be dead to see the results of. Although we all might agree that this is necessary, people usually tend to vote for people who promise "real" solutions. As in, short term solutions to problems we've been carrying for decades (which obviously requires policies that also take decades to cement).
- bgoggin 3y ago
  This is not correct. There was no prohibition on private insurance. Rather, all would have been required to participate in the public plan to spread the risk. That's the only way it could work. If someone wanted to also pay for a private plan, that was allowed.
  - Aurornis 3y ago
    No, this is incorrect. Here is the actual section from the bill: > SEC. 107. PROHIBITION AGAINST DUPLICATING COVERAGE. (a) IN GENERAL.—Beginning on the effective date described in section 106(a), it shall be unlawful for— (1) a private health insurer to sell health insurance coverage that duplicates the benefits provided under this Act; or (2) an employer to provide benefits for an employee, former employee, or the dependents of an employee or former employee that duplicate the benefits provided under this Act. You could technically also buy extra insurance for… something extra, but your existing insurance plan would have become illegal. This was a huge sticking point, despite how many people try to deny it or downplay it.
    - jrajav 3y ago
      I'm honestly curious what the real meat of the objections to this were (I never heard much about this sticking point). Why would you want duplicating coverage anyway? Is it not strictly better for any consumer to only be paying for the extra coverage you want on top of the public coverage?
      - Aurornis 3y ago
        I didn't say I had objections to it. I said it was unpopular with the general public when you told them the details. This is an example of a situation where people dislike the system but when you ask them about it they like their part of the system. For example, people generally have an extremely low opinion of Congress, but on average they like their own Congress person. You get similar results when you poll people about healthcare and health insurance: People generally hate the health insurance system, but if you start talking about taking away their health insurance or their doctor and replacing it with an unknown system, they get upset. > Why would you want duplicating coverage anyway? Is it not strictly better for any consumer to only be paying for the extra coverage you want on top of the public coverage? Duplicating coverage is superfluous if you assume the new plan would be better in every way and you give up nothing in the process, obviously. However, the fear is that upending the entire system would require people to give things up and replace it with unknowns. There's a good chance that some people would be forced to be reassigned to different doctors under a centrally-planned system, or that access to things would be reset and need to be re-determined under new guidelines. If this doesn't make sense, consider a situation where someone got special approval for off-label coverage of a drug (happens all the time) but the new government insurance had stricter guidelines about which conditions could be treated with which drugs (to keep cost down). Those people could lose access to medications or treatments that were covered privately. We tend to think of "Medicare for All" type plans as being without downsides, but when you get into the details of changing the entire health care system out and banning the old ways, it's inevitable that some people would start losing things they liked. And that's where people get upset.
- sircastor 3y ago
  I recall an interview where the interviewers were asking the politician if their plan for health coverage would raise everyone's taxes, to which they responded yes - of course they would. The interviewers tried to move forward with that, but the politician then notes that this would also mean that everyone stops paying for their current health insurance - and thus quite a lot cheaper.
  - Aurornis 3y ago
    > the politician then notes that this would also mean that everyone stops paying for their current health insurance - and thus quite a lot cheaper. Unfortunately, not so simple: 1) Health insurance is already required to pay out at least 90% of your contributions, so even a hypothetically perfectly efficient replacement could only eliminate 10% of costs, all things equal. 2) The government run system would realistically be expensive to run, like any program covering all Americans. Many of those private insurance costs would just be transferred to a government-run operation. In theory it should be more efficient to have single payer, but it would also be extremely expensive in the short term to build and overhaul the system. 3) The actual cost savings wouldn’t come from operational efficiency (not the government’s strongest ability) but from forcing prices down because nobody would have any choice but to accept the government insurance. They were going to drive costs down by forcing doctors and hospitals to take lower payments and, as unpopular as it is to say, by limiting the types and amounts of treatments available to people.
    - ink_13 3y ago
      These points assume that costs would stay the same and there's no overhead in the existing insurance system. Single-payer could be cheaper and more efficient simply by returning the massive profits of health insurers directly to taxpayers. Part of high cost for healthcare in the USA is the huge number of middlemen.
      - mike_hearn 3y ago
        Do they have massive profits? It says here that they have very low profit margins of about 3% https://content.naic.org/sites/default/files/inline-files/health-2022-mid-year-industry-report.pdf https://content.naic.org/sites/default/files/inline-files/he... Contrast that with the average of all industry profit margins at ~10% and with SaaS type firms of ~80%. If you want to improve US healthcare costs by getting rid of the profit margin of insurers, it's probably a bad idea. You wouldn't notice the impact.
ttymck 3y ago
Most establishments in the United States.
SV_BubbleTime 3y ago
Obamacare was an absolute unfiltered gift to the insurance companies and to this day I can’t understand how no one saw this or cared. Yea… things were going to get better when more people were being ripped off.

by JackFr 3y ago

Aurornis 3y ago

It doesn’t help that politicians continue to propose dead-in-the-water alternatives. The last round of “Medicare for All” included a lot of provisions that were very unpopular when you asked people about them directly, such as taking away people’s existing private insurance. This a common theme in politics: Actually solving the problem might remove enthusiasm for your candidate or party, so instead they propose things with no realistic chance of passing. Their business is being front and center in public discourse, not quietly fixing things. EDIT: I’m getting downvoted because a comment below is denying this part of the bill, so I’m adding the exact text here: > SEC. 107. PROHIBITION AGAINST DUPLICATING COVERAGE. (a) IN GENERAL.—Beginning on the effective date described in section 106(a), it shall be unlawful for— (1) a private health insurer to sell health insurance coverage that duplicates the benefits provided under this Act; or (2) an employer to provide benefits for an employee, former employee, or the dependents of an employee or former employee that duplicate the benefits provided under this Act. The comment below is incorrect. The bill would have made people’s existing insurance plans illegal to offer.

jerojero 3y ago
No one is going to get elected for solving a problem everyone today is going to be dead to see the results of. Although we all might agree that this is necessary, people usually tend to vote for people who promise "real" solutions. As in, short term solutions to problems we've been carrying for decades (which obviously requires policies that also take decades to cement).
bgoggin 3y ago
This is not correct. There was no prohibition on private insurance. Rather, all would have been required to participate in the public plan to spread the risk. That's the only way it could work. If someone wanted to also pay for a private plan, that was allowed.
- Aurornis 3y ago
  No, this is incorrect. Here is the actual section from the bill: > SEC. 107. PROHIBITION AGAINST DUPLICATING COVERAGE. (a) IN GENERAL.—Beginning on the effective date described in section 106(a), it shall be unlawful for— (1) a private health insurer to sell health insurance coverage that duplicates the benefits provided under this Act; or (2) an employer to provide benefits for an employee, former employee, or the dependents of an employee or former employee that duplicate the benefits provided under this Act. You could technically also buy extra insurance for… something extra, but your existing insurance plan would have become illegal. This was a huge sticking point, despite how many people try to deny it or downplay it.
  - jrajav 3y ago
    I'm honestly curious what the real meat of the objections to this were (I never heard much about this sticking point). Why would you want duplicating coverage anyway? Is it not strictly better for any consumer to only be paying for the extra coverage you want on top of the public coverage?
    - Aurornis 3y ago
      I didn't say I had objections to it. I said it was unpopular with the general public when you told them the details. This is an example of a situation where people dislike the system but when you ask them about it they like their part of the system. For example, people generally have an extremely low opinion of Congress, but on average they like their own Congress person. You get similar results when you poll people about healthcare and health insurance: People generally hate the health insurance system, but if you start talking about taking away their health insurance or their doctor and replacing it with an unknown system, they get upset. > Why would you want duplicating coverage anyway? Is it not strictly better for any consumer to only be paying for the extra coverage you want on top of the public coverage? Duplicating coverage is superfluous if you assume the new plan would be better in every way and you give up nothing in the process, obviously. However, the fear is that upending the entire system would require people to give things up and replace it with unknowns. There's a good chance that some people would be forced to be reassigned to different doctors under a centrally-planned system, or that access to things would be reset and need to be re-determined under new guidelines. If this doesn't make sense, consider a situation where someone got special approval for off-label coverage of a drug (happens all the time) but the new government insurance had stricter guidelines about which conditions could be treated with which drugs (to keep cost down). Those people could lose access to medications or treatments that were covered privately. We tend to think of "Medicare for All" type plans as being without downsides, but when you get into the details of changing the entire health care system out and banning the old ways, it's inevitable that some people would start losing things they liked. And that's where people get upset.
sircastor 3y ago
I recall an interview where the interviewers were asking the politician if their plan for health coverage would raise everyone's taxes, to which they responded yes - of course they would. The interviewers tried to move forward with that, but the politician then notes that this would also mean that everyone stops paying for their current health insurance - and thus quite a lot cheaper.
- Aurornis 3y ago
  > the politician then notes that this would also mean that everyone stops paying for their current health insurance - and thus quite a lot cheaper. Unfortunately, not so simple: 1) Health insurance is already required to pay out at least 90% of your contributions, so even a hypothetically perfectly efficient replacement could only eliminate 10% of costs, all things equal. 2) The government run system would realistically be expensive to run, like any program covering all Americans. Many of those private insurance costs would just be transferred to a government-run operation. In theory it should be more efficient to have single payer, but it would also be extremely expensive in the short term to build and overhaul the system. 3) The actual cost savings wouldn’t come from operational efficiency (not the government’s strongest ability) but from forcing prices down because nobody would have any choice but to accept the government insurance. They were going to drive costs down by forcing doctors and hospitals to take lower payments and, as unpopular as it is to say, by limiting the types and amounts of treatments available to people.
  - ink_13 3y ago
    These points assume that costs would stay the same and there's no overhead in the existing insurance system. Single-payer could be cheaper and more efficient simply by returning the massive profits of health insurers directly to taxpayers. Part of high cost for healthcare in the USA is the huge number of middlemen.
    - mike_hearn 3y ago
      Do they have massive profits? It says here that they have very low profit margins of about 3% https://content.naic.org/sites/default/files/inline-files/health-2022-mid-year-industry-report.pdf https://content.naic.org/sites/default/files/inline-files/he... Contrast that with the average of all industry profit margins at ~10% and with SaaS type firms of ~80%. If you want to improve US healthcare costs by getting rid of the profit margin of insurers, it's probably a bad idea. You wouldn't notice the impact.

ttymck 3y ago

Most establishments in the United States.

SV_BubbleTime 3y ago

Obamacare was an absolute unfiltered gift to the insurance companies and to this day I can’t understand how no one saw this or cared. Yea… things were going to get better when more people were being ripped off.