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> that's what is driving the costs. Physicians salaries make up 8.6% of medical spending. Kaiser did a study that found a 40% reduction in physician salaries

> that's what is driving the costs. Physicians salaries make up 8.6% of medical spending. Kaiser did a study that found a 40% reduction in physician salaries would result in a 3% savings to consumers on medical costs.

thijson 2y ago
Where are the costs then? Is it the MRI that costs $1000?
- sarchertech 2y ago
  Equipment is heavily regulated and so it’s insanely expensive, drugs are heavily regulated and expensive to develop in general, infrastructure, malpractice insurance, non-physician labor, regulatory compliance, insanely expensive software, administrators etc… Then you add in the profit that has to be extracted at every level. Private equity buys up hospitals, physicians groups, and ambulance operators. They need to take their cut. Insurance companies need to take their cut. The free market doesn’t work great for to keep rent seekers from extracting profits because of insurance and the very nature of healthcare which reduces the ability of customers to shop around.
  - hedora 2y ago
    Last I checked (10 years ago?), 33% of US healthcare costs went to haggling between the insurance company and the administrative assistants the doctor has to hire. I’d guess it’s higher now. It also seems really easy to fix: Just have a standard price list, and auto accept/reject 99% of procedures at the time of administration. Also, have a billing system that lets the patient pay on discharge (like restaurants). Edit: Concrete example. I needed some medicine. There are two interchangeable options. One retails for $30, and the other for $600. The doctor chose the $600 version, and insurance rejected it. This wasted my afternoon, an hour of the pharmacist’s time, 15 minutes of insurance company time, and at least 45 minutes of time at the doctor’s office. On top of that, the doctor had to context switch back to my case to change the prescription. If the doctor had a UI when writing the prescription that contained a price list, whether insurance covers which drug, and a “no really, we need the expensive one” button (there is already such an override that the insurance company honors), then all of this waste would have been avoided.
    - teruakohatu 2y ago
      Wouldn’t a better regulation be that pharmacists can dispense cheaper generics with patient consent? If the doctor really wants something specific they can state no substitutes on the script. Here in New Zealand I am pretty sure that’s the case.
      - zo1 2y ago
        Here in South Africa, the pharmacist is obligated to offer a generic to you, irrespective of which medicine it is. Some days I just go sure, other times I specifically want the non-generic because it is slightly (at least to me) better.
        hedora 2y ago
        It works that way in the US too. These were different drugs, and there is no generic for the expensive one. In my case, there was zero reason to prefer one over the other. That’s not true in all cases.
    - toast0 2y ago
      > Also, have a billing system that lets the patient pay on discharge (like restaurants). If we're wishing, let's wish for it to be like car repair. Where they have to give us a quote before they begin service. Need some allowance for billing for care when you were unable to consent, like when an ambulance picks you up for an emergency, or if something unexpected comes up during a surgery.
gruez 2y ago
>Kaiser did a study that found a 40% reduction in physician salaries would result in a 3% savings to consumers on medical costs. source?
Onavo 2y ago
In that case they shouldn't try to use Congress to obstruct training more doctors.
- sarchertech 2y ago
  [flagged]
ssivark 2y ago
It's likely that inefficiencies like this contribute O(40%) to every slice of the pie, so fixing any one slice seems unimportant, but cumulatively they would make a big impact on the situation. A second hypothesis is that the inefficiencies are fractal/recursive -- and that we might be able to squeeze out another one or two 40% savings in some slices even after the first one!
- sarchertech 2y ago
  >cumulatively the would make a big impact Because of the nature of the healthcare market a reduction in physician salaries would be almost entirely captured by private equity and insurance companies. The only realistic way a reduction in physician salaries leads to a significant reduction in costs is with a single payer system. >fractal/recursive This is just wishful thinking. I can think of zero mechanisms where paying physicians less has a compounding negative effect on prices. I can think of several mechanisms for how it would have a compounding positive effect. Decrease in quality, decrease in recruiting, acceleration of retirement etc…
snapplebobapple 2y ago
What was included in physician salaries? I suspect either specialists wernt included or they used take home salary rather than fees because fees by doctors and specialists is a lot more than 8% in canada
- sarchertech 2y ago
  8% is total physician compensation including specialities. If you look at total billed physician services it's closer to 14%. The difference comes from revenue skimmed off by entities that employ or contract physicians. A huge part of that is profit skimmed off by private equity buying out physician groups over the last 20 years or so.

thijson 2y ago

Where are the costs then? Is it the MRI that costs $1000?

sarchertech 2y ago
Equipment is heavily regulated and so it’s insanely expensive, drugs are heavily regulated and expensive to develop in general, infrastructure, malpractice insurance, non-physician labor, regulatory compliance, insanely expensive software, administrators etc… Then you add in the profit that has to be extracted at every level. Private equity buys up hospitals, physicians groups, and ambulance operators. They need to take their cut. Insurance companies need to take their cut. The free market doesn’t work great for to keep rent seekers from extracting profits because of insurance and the very nature of healthcare which reduces the ability of customers to shop around.
- hedora 2y ago
  Last I checked (10 years ago?), 33% of US healthcare costs went to haggling between the insurance company and the administrative assistants the doctor has to hire. I’d guess it’s higher now. It also seems really easy to fix: Just have a standard price list, and auto accept/reject 99% of procedures at the time of administration. Also, have a billing system that lets the patient pay on discharge (like restaurants). Edit: Concrete example. I needed some medicine. There are two interchangeable options. One retails for $30, and the other for $600. The doctor chose the $600 version, and insurance rejected it. This wasted my afternoon, an hour of the pharmacist’s time, 15 minutes of insurance company time, and at least 45 minutes of time at the doctor’s office. On top of that, the doctor had to context switch back to my case to change the prescription. If the doctor had a UI when writing the prescription that contained a price list, whether insurance covers which drug, and a “no really, we need the expensive one” button (there is already such an override that the insurance company honors), then all of this waste would have been avoided.
  - teruakohatu 2y ago
    Wouldn’t a better regulation be that pharmacists can dispense cheaper generics with patient consent? If the doctor really wants something specific they can state no substitutes on the script. Here in New Zealand I am pretty sure that’s the case.
    - zo1 2y ago
      Here in South Africa, the pharmacist is obligated to offer a generic to you, irrespective of which medicine it is. Some days I just go sure, other times I specifically want the non-generic because it is slightly (at least to me) better.
      - hedora 2y ago
        It works that way in the US too. These were different drugs, and there is no generic for the expensive one. In my case, there was zero reason to prefer one over the other. That’s not true in all cases.
  - toast0 2y ago
    > Also, have a billing system that lets the patient pay on discharge (like restaurants). If we're wishing, let's wish for it to be like car repair. Where they have to give us a quote before they begin service. Need some allowance for billing for care when you were unable to consent, like when an ambulance picks you up for an emergency, or if something unexpected comes up during a surgery.

gruez 2y ago

>Kaiser did a study that found a 40% reduction in physician salaries would result in a 3% savings to consumers on medical costs. source?

Onavo 2y ago

In that case they shouldn't try to use Congress to obstruct training more doctors.

sarchertech 2y ago
[flagged]

ssivark 2y ago

It's likely that inefficiencies like this contribute O(40%) to every slice of the pie, so fixing any one slice seems unimportant, but cumulatively they would make a big impact on the situation. A second hypothesis is that the inefficiencies are fractal/recursive -- and that we might be able to squeeze out another one or two 40% savings in some slices even after the first one!

sarchertech 2y ago
>cumulatively the would make a big impact Because of the nature of the healthcare market a reduction in physician salaries would be almost entirely captured by private equity and insurance companies. The only realistic way a reduction in physician salaries leads to a significant reduction in costs is with a single payer system. >fractal/recursive This is just wishful thinking. I can think of zero mechanisms where paying physicians less has a compounding negative effect on prices. I can think of several mechanisms for how it would have a compounding positive effect. Decrease in quality, decrease in recruiting, acceleration of retirement etc…

snapplebobapple 2y ago

What was included in physician salaries? I suspect either specialists wernt included or they used take home salary rather than fees because fees by doctors and specialists is a lot more than 8% in canada

sarchertech 2y ago
8% is total physician compensation including specialities. If you look at total billed physician services it's closer to 14%. The difference comes from revenue skimmed off by entities that employ or contract physicians. A huge part of that is profit skimmed off by private equity buying out physician groups over the last 20 years or so.