8 ms·

> So you end up with this marketplace constricted by overregulation — some well-meaning but often basically occurring because of protectionist moats and regulat

> So you end up with this marketplace constricted by overregulation — some well-meaning but often basically occurring because of protectionist moats and regulatory capture Don't hand-wave your claim of overregulation, be specific and name the regulations you think should go away.

pfdietz 1y ago
> Don't hand-wave your claim of overregulation, be specific and name the regulations you think should go away. Regulations that prevent construction of new hospitals without some sort of "demonstration of need".
- myrmidon 1y ago
  How would higher hospital density help quell healthcare costs, though? Isn't that just more infrastructure, administration overhead and staffing that victims have to pay for, in the end?
  - wat10000 1y ago
    Where would you expect bananas to be cheaper: a town with five grocery stores, or a town with one?
    - ceejayoz 1y ago
      I mean, that depends. A town with ten people and five grocery stores will be inefficient, and probably have very expensive produce as a result.
      - wat10000 1y ago
        A town with ten people won't have five grocery stores in the first place. Nobody's going to spend a bunch of money to open a store in a place where there isn't a customer base to support it.
        ceejayoz 1y ago
        > Nobody's going to spend a bunch of money to open a store in a place where there isn't a customer base to support it. Tell that to the waves of cupcake shops, craft breweries, and now cannabis dispensaries in my area.
        wat10000 1y ago
        Right, luxury items are definitely an apt analogy here. Man, people really do love to argue, huh.
        ceejayoz 1y ago
        The point is that business decisions aren't magically correct. People can, and do, open stores in oversaturated markets. When your cupcake shop flops, that's sad; when hospitals close, that can be devastating to a community. It makes at least theoretical sense for states to try and prevent that impact.
        wat10000 1y ago
        Avoid the impact from hospital closures by preventing them from opening in the first place? Hospital closures are devastating if they're the only one in the area, or remaining facilities don't have enough slack. They aren't devastating in an oversaturated market.
        ceejayoz 1y ago
        > Avoid the impact from hospital closures by preventing them from opening in the first place? Yes? That's the idea. I won't say it always works, but it's the idea; preventing the existing facilities from closing. > They aren't devastating in an oversaturated market. It certainly can be, if the oversaturation puts all of them on shaky financial grounds.
        goodpoint 1y ago
        There is such thing as market failure due to oversaturation.
    - palmotea 1y ago
      > Where would you expect bananas to be cheaper: a town with five grocery stores, or a town with one? I'm not defending the "Certificate of Need" regulations, but your thinking is sloppy: healthcare is not a product like bananas. That analogy will mislead more than it will inform. If every person has to buy 10 bananas a day or they will die, the town with 5 stores may have more expensive bananas, because they can just raise prices to cover the excess capacity and people will pay.
      - wat10000 1y ago
        If we look at "food" more generically, rather than bananas specifically, we are literally in that situation where every person has to have X amount per day or they will die. And competition still works great. There are two things that set healthcare apart here. One is that sometimes people need unusual treatments to stay alive that are extremely expensive, and our desire not to let people die is at odds with the normal market mechanism where products that cost too much just don't get purchased. The other is that sometimes people have emergencies so urgent they can't really choose their provider. But the vast majority of healthcare doesn't fall into those categories, and normal market mechanisms work fine for those. Competition would lower prices for most healthcare just like it does for food and everything else.
      - ajmurmann 1y ago
        They can't just raise the prices because people will bring their business to the competition. I've personally done this for CT scans. In my local market we literally got a scan for 2k where the hospital we'd usually go to wanted 10k. The same works for non-emergency surgery as well. Take a look at https://surgerycenterok.com/ https://surgerycenterok.com/ it's such a breath of fresh air to see the full price for each procedure right there. People travel there from all over the country to get needed procedures. So competition clearly works but the system doesn't really enable it. For example insurers don't want to work with the linked center because they won't give them rebates but charge everyone the same price. More details: https://www.econtalk.org/keith-smith-on-free-market-health-care/ https://www.econtalk.org/keith-smith-on-free-market-health-c...
        1y ago
    - h2zizzle 1y ago
      The town where you can see the banana prices on the shelves, if not online, and where there's a collective refusal to pay (perhaps through an organizer payer) if the price is too high.
    - cogman10 1y ago
      In the town closest to central america. The labor to produce, ship, and shelve the banana determine it's cost along with whatever margin the store that sells the banana is willing to take. Walmart, for example, could be perfectly willing to sell a banana at a loss if they think that will get you in to buy a TV. This is why dollar stores exist and often kill off local grocers. They can sell a lot of non-perishable goods at a loss and win back by understaffing the location and overcharging on non-perishable goods. I live in a city with probably around 50 different clinics, but they are all associated with 3 major medical groups. It isn't a lack of buildings that's preventing competition.
    - anubistheta 1y ago
      Exactly. The more suppliers are in a market, the more competition there is. Thus lower prices and a better selection. People don't like a monopoly is other areas of life. Healthcare is no different.
    - myrmidon 1y ago
      I don't think that is a good comparison at all. Unlike grocery stores, hospital ERs don't get frequent repeat customer interaction, so that makes the competition aspect basically completely inapplicable. As typical ER visitor, - You wont know what "quality" of care you are going to get beforehand - You will have very limited capability of selecting the hospital - You will be unable to compare prices beforehand So why would any of those 5 hypothetical hospitals decrease prices? More competitors won't do shit if the market is uncompetitive by design.
      - wat10000 1y ago
        An ER is only a small part of what a typical hospital provides. And life-threatening, must-get-treatment-immediately-or-die emergencies are only a small part of what a typical ER provides. Yes, there are some kinds of care that aren't very amenable to competitive market forces, but the vast majority is.
        deleted 1y ago
        [deleted]
      - esafak 1y ago
        That's what reviews and word of mouth are for. Don't you do research before picking a hospital and doctor? We do need price transparency though.
        myrmidon 1y ago
        > Don't you do research before picking a hospital and doctor? No. Preventing rapid unplanned end of life is the main purpose of hospitals in my view. Enough time to make a choice of hospitals (or even to collect information on specific hospitals) is a luxury that I would not expect patients to have.
        esafak 1y ago
        For every emergency I plan a visit to the hospital at least 10-20 times. Emergencies are the exception, by definition. I think everyone with health insurance, which the Census Bureau says is 92% of Americans, since they will not go directly to the ER.
    - jasonlotito 1y ago
      1. One accepts only Visa, one only MC, one only Amex, one only cash, and one only accept bitcoin. 2. One offers bananas to walk in visitors, but the others have a minimum wait time of 1 month to a year. 3. One is a mile away. One is an hour away. Still in the same county. 4. None of them offer an easy to understand menu. You can't just order a banana. You ahve to order Banana Services and meet with Banana specialists. You can't take the banana home. 5. You wake up in a banana shop and you didn't get a chance to shop around before being presented with a bill. They don't take your payment of choice, so it's 10 times as expensive. 6. Some won't let you buy a banana. Instead, you have to buy a banana service. Per banana pricing is the lowest here, but the total cost is higher if you just want a banana. Which banana store do you buy from? A, B, C, D, or E? I'll take the first choice you make and let you know if you picked correctly. Anything other than the correct choice is a failure.
    - taeric 1y ago
      My expectation on cost of banana will be more on how much it costs to ship to said town? Similarly, which town has higher tax burden to cover? Assuming any sort of health inspection on places that store food, the town with more stores has a higher burden. Which is all to say, my gut is it is far more complicated than that allows for. Not a useless model, but also not a very actionable one.
  - pfdietz 1y ago
    But the victims don't have to pay for it -- excess infrastructure is a bad investment that those who built it pay for. The builders are not guaranteed a return on their investment.
    - myrmidon 1y ago
      I don't really get it. If you are arguing that the customer is not paying for inefficient providers, then I strongly disagree. Customers always end up paying for inefficient supply chains. If you end up with an inefficient allocation of hospitals/doctors (local overprovisioning), it's always gonna be the patients that are gonna pick up the bill for this in the end through higher average prices. Inefficiencies are doubly bad because you potentially don't just pay the pure cost for the inefficiency (middlemen, waste etc.) you even pay for margins on top. I think the assumption that such inefficiencies could lead to actual savings for customers (by magically making the providers decrease their profit margins) is highly overoptimistic.
      - pfdietz 1y ago
        > Customers always end up paying for inefficient supply chains. Obviously not. There is nothing that compels a customer to do business with an inferior competitor, if there is an alternative. The end result of having a sufficiently inefficient supply chain can be that the company involved goes out of business, as it cannot operate at a profit.
  - vlovich123 1y ago
    No, actually it would be lower for the same reason competition always leads to lower prices. Uncompetitive hospitals that can’t meet need would naturally go out of business. A “need” certificate is similar to the cap that med schools have - it’s effectively a pricing cartel to keep salaries/revenue high
    - milesskorpen 1y ago
      There are extremely high fixed costs + we require hospitals to do unprofitable work (they aren't allowed to turn anyone away from the ED, for example). In many small regional chains, their profitable hospitals in one area fund unprofitable hospitals in other regions. Overall we have a crisis of hospitals shutting down, not a crisis of oversupply.
    - jplrssn 1y ago
      > competition always leads to lower prices I don't see how this could be true for emergency visits. Would an ambulance drive you to the cheapest hospital within some fixed radius?
      - hamdingers 1y ago
        Hospitals typically lose money on emergency visits and make it back on scheduled inpatient care and outpatient services. This would accelerate a poor performing hospital's demise, because ambulances will go to the closest one but patients who have options will look elsewhere.
      - theptip 1y ago
        If you now have two ERs within driving range, you have the choice to go to the cheaper one if you are conscious and in a stable enough condition to reflect. This is the sort of thing people already think about in the US.
    - thunderfork 1y ago
      [dead]
  - opo 1y ago
    Here is a summary of a number of studies of the effects of Certificates of Need: https://ij.org/report/striving-for-better-care/overwhelming-evidence-shows-that-con-laws-lead-to-higher-health-care-spending/ https://ij.org/report/striving-for-better-care/overwhelming-...
- h2zizzle 1y ago
  Oh, well that's BS. Urgent care clinics have proliferated like crazy over the post decade or so. The supply to fill the vast majority of urgent medical needs which hospital ERs used to have to carry alone is there. But it's true that that supply often goes unused. Why? Because ERs HAVE to tend to and stabilize patients when they present; UCCs can turn you away if you can't demonstrate the ability to pay. The problem is not restrictions on medical facility construction, it's inefficient use of what we already have. In general, America has an issue with defaulting to "building new", as if we have an everlasting greenfield, rather than careful provisioning of the already overbuilt infrastructure base. Capitalists love being freed of prior obligations, with no regard for how they contribute to an even more unwieldy set of obligations in the future. Enough. You can't just do as you like. Help solve the actual problem.
  - pfdietz 1y ago
    BS, eh? https://www.health.ny.gov/facilities/cons/ https://www.health.ny.gov/facilities/cons/
    - alostpuppy 1y ago
      That’s just New York, yeah? Does every state have similar regulations?
      - pfdietz 1y ago
        So, unless every state has a regulation, that regulation doesn't exist and has no effect? Any other goal lines you want to redraw? Let's get that out of the way now instead of going back and forth. (To answer: in my personal experience Illinois also has such a regulation.)
      - ch4s3 1y ago
        Slightly more than half have CoN laws and other states have a number of restrictions of facility construction that complicate building smaller clinics.
    - kotaKat 1y ago
- jasonlotito 1y ago
  This doesn't solve the issue presented in the study. PE hospitals exists in states with and without these restrictions. So while CON might be an issue, it doesn't reconcile the issue of PE. In fact, PE priorities is exactly one of the things CON was setup to handle. Regardless, you have to explain how removing CON solves the PE issue mentioned when states without CON had the same issues.
  - RHSeeger 1y ago
    You seem to be under the mistaken impression that - There is a specific list of regulations that cause the problem - Each regulation in that list is present everywhere the problem exists Neither one of those are true. Instead, there are many regulations and, combined, they add up to causing the problems. The specific regulations can and do vary by location; but the result is the same.
    - 20after4 1y ago
      I think the problem is obsessive optimization of profit at the expense of literally everything else. Greed is bad, especially in a field that is at least in theory centered on taking care of people. You can't take care of someone by exploiting them for the maximum possible profit.
    - jasonlotito 1y ago
      > You seem... No. You are 100% wrong. The context of this discussion is PE. So comments discussing this involve PE. So while you are correct in general, you are wrong specifically. In light of that, I stand by what I said: you have to explain how removing CON solves the PE issue mentioned when states without CON had the same issues. Maybe this isn't possible, but then we accept that this is not an answer to PE, which again, topic of conversation.
viscountchocula 1y ago
Certificate of Need: basically, prove to regulators that there is enough "need" before opening up new facilities. https://en.wikipedia.org/wiki/Certificate_of_need https://en.wikipedia.org/wiki/Certificate_of_need
- bilbo0s 1y ago
  As someone already pointed out, PE owned hospitals are in states with, and in states without, CON requirements. Certainly on the face of that fact it would appear the existence, or nonexistence, of CON requirements has no effect on PE hospitals charging more and having far inferior outcomes. Do you have a hypothesis as to why CON requirements are driving inferior outcomes and increased cost metrics at PE owned hospitals? (A hypothesis that accounts for the fact that PE owned hospitals underperform even in the absence of CON requirements.) Serious question. I'm trying to get my head around this.
  - SkyBelow 1y ago
    Sample hypothesis with only minimal amount of knowledge on it. PEs seek to make profit, and are looking for places where they can either raise prices or lower costs (which will quickly correlate with worse outcomes) while not losing customers (yes, you could call them patients, but PE will view them as customers), or at least losing so few that the overall numbers result in more profit. One way of doing this is looking for barriers to competition/moats. CON is just one type of moat, and so is one factor PEs evaluate, but the presence or absence of other moats can still override the presence or absence of this one moat. One could try to work this out from data with some sort of regression, but with so many possible moats and a relatively limited number of data points, it would be easy to overfit the data. In comparison, non-PE hospitals might have some profit motive (or keeping to budgets, not going bankrupt, ect.), but will be less driven by this mentality and thus their relationships to moats will be more complex, and so something like a CON requirement won't be as fully exploited to raise prices or lower costs. This also fails to account for other ways that PE can seek to make money, which involves more complex parts of law and financing that I'm not well versed on (I've ready some things about real estate, but don't know enough to fairly analyze the claims).
betaby 1y ago
In the USA/Canada number of doctors minted is caped by the cartel of doctors. That costs non-trivial money and lives lost. Source: https://thedailyeconomy.org/article/how-congress-created-the-doctor-shortage/ https://thedailyeconomy.org/article/how-congress-created-the... and many others
- insane_dreamer 1y ago
  That’s not a regulatory issue
  - topkai22 1y ago
    Since the government (federal or state/local) authorizes those organizations to certify physicians and restricts medical care to only those who have been certified, it is.
  - nick__m 1y ago
    What kind of issue it is then ? If a regulation permits the doctors associations to set the allowed number of doctors residency, naively it is a regulatory issue.
    - insane_dreamer 1y ago
      It's a funding issue. There aren't enough residency slots available given the number of medical school grads. Residency is a requirement to get a medical license--which is issued by the states, not the federal gov. The reason there aren't enough residency slots is because they are heavily subsidized by the federal gov and they put a cap on the funding. No one else wants to foot the bill, so the slots remain limited, thus the licenses remains limited.
  - tptacek 1y ago
    It obviously is. A federal government policy decision caps the number of doctors we have, and another federal government policy decision restricts a huge number of basic medical services to those doctors.
johnisgood 1y ago
FDA drug approval processes and insurance regulations.
- palmotea 1y ago
  > FDA drug approval processes What, specifically? Just abolish them all, and return to the pre-1938 status quo (e.g. marketing radium water to cure what ails ya)? Or specific reforms to make the drug approval processes more effective? https://en.wikipedia.org/wiki/Radithor https://en.wikipedia.org/wiki/Radithor
  - cogman10 1y ago
    Best way to make the entire process more efficient would be centralizing R&D and approval and nationalizing the manufacturing of drugs. MAYBE you could license out the rights to produce drugs on 10 or 20 year license agreements. Turn it into a pure R&D effort and not one driven by profit.
    - ajmurmann 1y ago
      Who is gonna decide how the R&D money gets spent? What's their skin in the game and their feedback mechanism? Why will they do a better job picking what to research than current pharmaceutical companies?
      - cogman10 1y ago
        > Who is gonna decide how the R&D money gets spent? Same way the NHS previously funded medical research. Grants and grant review. You can expand that department and effort. > What's their skin in the game and their feedback mechanism? Believe it or not, some people just want to research and look into cures for diseases. Shocking I know. Feedback can be reviews of their work and blackballing bad actors that consistently kick out bad research. > Why will they do a better job picking what to research than current pharmaceutical companies? Because they already are. Pharmaceuticals aren't doing the majority of research, they are taking NHS funded research and running it through FDA approval. Ozempic, for example, didn't come from pharmaceutical research, it came from grant research into lizard spit.
mothballed 1y ago
[flagged]
- hiddencost 1y ago
  Hoodrats?
  - mothballed 1y ago
    Source: worked ~1 year in an inner city ER alongside a doctor seeing every case. Yes it was the hoodrats abusing the system.
    - habinero 1y ago
      Working all of one year before you got fired doesn't make you an expert, sorry. It's probably best you moved on from healthcare, you don't seem suited for it with your attitude.
      - mothballed 1y ago
        Unfortunately my attitude is the only one that will actually help you fix things because I'm bringing you a sober view of what the situation is. And people much "better suited for it" who worked in inner city ER generally had even less rosy thoughts than I did, if you want to defer to "experts" it's hilarious you would think this is unusual takeaway and that my opinion wasn't formed in large part by the experts thinking the very same thing (which of course they are never going to tell to the patients, you're probably not going to hear it unless you actually work in an ER and are close and comfortable enough with doctors for them to risk themselves to tell you what they really think as it's totally unacceptable to say it publicly).
        habinero 1y ago
        Sure, buddy. "Everyone thinks this way, they just don't say it" has been the rallying cry of people with bad minority opinions forever.
kriops 1y ago
[flagged]
potato3732842 1y ago
That's like saying "it's ok if I shit in the river, it's a big river". When a million other people do it you've got a water quality problem. Each and every one of these regulations can in abstract, be justified by some useful idiot looking at only the first and second order inputs and outputs and not looking at the totality of the effects. Nobody with a brain would defend shitting in the river, but here you are asking for individual turds so that they may be justified on the basis that the individual dropping them was relieved and their individual impact on water quality was minor.
- scott_w 1y ago
  No it's not. Shitting in a river is always a net negative. Regulations can be positive, negative, or ineffective. Trying to "just count" the regulations to determine quality completely discards this critical dimension and betrays an almost childlike view of the world.
  - potato3732842 1y ago
    >Shitting in a river is always a net negative It beats anything open air by miles. Sure, an outhouse would be better but river > street. >Trying to "just count" the regulations to determine quality completely discards this critical dimension and betrays an almost childlike view of the world. You're grasping at straws here. I am under no obligation to give such an infantile opinion (the one I initially replied to) a response at length. This is not the venue for such minutia.
    - scott_w 1y ago
      > I am under no obligation to give such an infantile opinion Responding with “I know you are but what am I?” is just proving my point.
deleted 1y ago
[deleted]
pfdietz 1y ago
Another issue is the requirement that doctors adhere to "standard of care" regardless of cost. If they don't, they are subject to malpractice lawsuits. Elsewhere, quality of a good or service is traded against cost. But in medicine, there's a cost ratchet as ever more expensive and marginally more performant treatments are introduced.
- bilbo0s 1y ago
  This is another example of a requirement that both PE owned and non PE owned hospitals, presumably, followed.e (I would hope neither of them were ignoring standards of care in the treatment of patients.) Yet the metrics are substandard at only the PE owned hospitals. So you would need to outline how this requirement unduly burdened the PE owned hospital relative to the non PE owned hospital for it to be the cause of the discrepancy. There may be such a reason, but you haven't outlined it in your post.
mimikatz 1y ago
Let nurses do more, let them write some prescriptions, let them open up a shop that puts casts on people with broken bones and minor things which they mostly do anyways.
landl0rd 1y ago
- The AMA froze the number of med schools for decades even as residency availability increased. - The majority of states still maintain "certificate of need" laws for new hospitals, ambulance providers, etc. - The AMA holds a state-enforced monopoly over physicians. - Many states still limit NPs/PAs, requiring physician supervision for things for which those people were trained. - Lack of interstate reciprocity in licensing means mobility is constrained and supply can't follow demand. - Costly medical equipment usually requires first-party repairs; mfgs claim a third-party modification (repair) constitutes remanufacturing under FDA regs. - Stark law makes e.g. physician/hospital value-based care arrangements very hard. It's quite strict and everyone has to tiptoe around it a bit. There's also the huge problem of malpractice insurance costs due to insane tort settlements. Awards need to be capped yesterday because it's too easy to talk a jury into bankrupting people over things that legitimately just sometimes happen. I'm guessing others could give you an even better list. Some of those are a bigger deal than others but it's a huge issue. Insurance net margins just aren't high enough to blame it and drug costs aren't enough of our total healthcare spend to be at fault. It comes down to humans being too expensive. There remain many areas of care where we can't cut man-hours down without sacrificing safety and quality. As such, we should reduce the insane byzantine co-ordination and compliance overhead.
- dimal 1y ago
  Don’t forget that the AMA has a monopoly on billing codes. Medicare defines the billing value of every procedure as Relative Value Units (RVUs). Then Medicare defers to AMA’s guidance on what these values should be. Insurers default to RVUs x multiplier. So the AMA has the ability to set prices. Oh, and patient value isn’t considered for these units. They are explicitly defined as input driven, so a procedure that is less costly to perform but has higher value to the patient will be billed at a lower value. Hospitals are incentivized to choose procedures that they can bill at a higher rate, and so because of these perverse incentives, they necessarily will ignore cheaper more effective treatments and choose the more expensive ones. I’m a lefty, but the older I get the less I believe in the old New Deal style leftism I’ve been sold my whole life. As systems get more complex, they simply become a way to obfuscate oligarchic control.
maxerickson 1y ago
Certificates of need. To reduce costs, we supposedly perfectly plan capacity and prevent over investment. Should also probably drop requiring an ER for Medicare certification and just directly subsidize ERs.
derbOac 1y ago
Others have kind of mentioned a lot of things I might anyway, and it's hard to summarize what I think is necessary. But to summarize, I think there needs to be a deregulation of licensing or practice laws to allow other types of providers to do more, of the sort they are perfectly capable of doing (and that studies show they can do) — pharmacists, psychologists, and optometrists are just some examples — and I think there needs to be more flexibility and diversity in terms of provider types and degree paths. My guess is there are many types of providers we can't even envision right now because there's such a rigid schema about what healthcare professionals should look like. I also think, for example, there are probably a lot of cases where someone could go from a PA -> MD degree without returning to do a second degree; I might be wrong about that but these are the types of things that should be encouraged at least as experiments. I also generally think there's a lot of choice that could be encouraged in terms of drug access. I generally think people should be able to buy medications and drugs without a prescription, or at least under the monitoring of a pharmacist or something, or at least in most cases. I can think of medications that there have literally been papers written saying that they are safe to give without a prescription decades ago and they still require a prescription; there's also medications that people take for years safely, and it seems kinda absurd to require them to get a prescription for them. My thoughts about the FDA itself are complex and could probably an essay in itself. I'm very in favor of public healthcare, and public healthcare institutions but I also feel a lot should be deregulated or reregulated toward greater openness, choice, and competition. There's probably a lot of areas where there should be more regulation too I suppose — I think antitrust principles should be applied to insurance and hospital consolidation more often.

pfdietz 1y ago

> Don't hand-wave your claim of overregulation, be specific and name the regulations you think should go away. Regulations that prevent construction of new hospitals without some sort of "demonstration of need".

myrmidon 1y ago
How would higher hospital density help quell healthcare costs, though? Isn't that just more infrastructure, administration overhead and staffing that victims have to pay for, in the end?
- wat10000 1y ago
  Where would you expect bananas to be cheaper: a town with five grocery stores, or a town with one?
  - ceejayoz 1y ago
    I mean, that depends. A town with ten people and five grocery stores will be inefficient, and probably have very expensive produce as a result.
    - wat10000 1y ago
      A town with ten people won't have five grocery stores in the first place. Nobody's going to spend a bunch of money to open a store in a place where there isn't a customer base to support it.
      - ceejayoz 1y ago
        > Nobody's going to spend a bunch of money to open a store in a place where there isn't a customer base to support it. Tell that to the waves of cupcake shops, craft breweries, and now cannabis dispensaries in my area.
        wat10000 1y ago
        Right, luxury items are definitely an apt analogy here. Man, people really do love to argue, huh.
        ceejayoz 1y ago
        The point is that business decisions aren't magically correct. People can, and do, open stores in oversaturated markets. When your cupcake shop flops, that's sad; when hospitals close, that can be devastating to a community. It makes at least theoretical sense for states to try and prevent that impact.
        wat10000 1y ago
        Avoid the impact from hospital closures by preventing them from opening in the first place? Hospital closures are devastating if they're the only one in the area, or remaining facilities don't have enough slack. They aren't devastating in an oversaturated market.
        ceejayoz 1y ago
        > Avoid the impact from hospital closures by preventing them from opening in the first place? Yes? That's the idea. I won't say it always works, but it's the idea; preventing the existing facilities from closing. > They aren't devastating in an oversaturated market. It certainly can be, if the oversaturation puts all of them on shaky financial grounds.
      - goodpoint 1y ago
        There is such thing as market failure due to oversaturation.
  - palmotea 1y ago
    > Where would you expect bananas to be cheaper: a town with five grocery stores, or a town with one? I'm not defending the "Certificate of Need" regulations, but your thinking is sloppy: healthcare is not a product like bananas. That analogy will mislead more than it will inform. If every person has to buy 10 bananas a day or they will die, the town with 5 stores may have more expensive bananas, because they can just raise prices to cover the excess capacity and people will pay.
    - wat10000 1y ago
      If we look at "food" more generically, rather than bananas specifically, we are literally in that situation where every person has to have X amount per day or they will die. And competition still works great. There are two things that set healthcare apart here. One is that sometimes people need unusual treatments to stay alive that are extremely expensive, and our desire not to let people die is at odds with the normal market mechanism where products that cost too much just don't get purchased. The other is that sometimes people have emergencies so urgent they can't really choose their provider. But the vast majority of healthcare doesn't fall into those categories, and normal market mechanisms work fine for those. Competition would lower prices for most healthcare just like it does for food and everything else.
    - ajmurmann 1y ago
      They can't just raise the prices because people will bring their business to the competition. I've personally done this for CT scans. In my local market we literally got a scan for 2k where the hospital we'd usually go to wanted 10k. The same works for non-emergency surgery as well. Take a look at https://surgerycenterok.com/ https://surgerycenterok.com/ it's such a breath of fresh air to see the full price for each procedure right there. People travel there from all over the country to get needed procedures. So competition clearly works but the system doesn't really enable it. For example insurers don't want to work with the linked center because they won't give them rebates but charge everyone the same price. More details: https://www.econtalk.org/keith-smith-on-free-market-health-care/ https://www.econtalk.org/keith-smith-on-free-market-health-c...
      - 1y ago
  - h2zizzle 1y ago
    The town where you can see the banana prices on the shelves, if not online, and where there's a collective refusal to pay (perhaps through an organizer payer) if the price is too high.
  - cogman10 1y ago
    In the town closest to central america. The labor to produce, ship, and shelve the banana determine it's cost along with whatever margin the store that sells the banana is willing to take. Walmart, for example, could be perfectly willing to sell a banana at a loss if they think that will get you in to buy a TV. This is why dollar stores exist and often kill off local grocers. They can sell a lot of non-perishable goods at a loss and win back by understaffing the location and overcharging on non-perishable goods. I live in a city with probably around 50 different clinics, but they are all associated with 3 major medical groups. It isn't a lack of buildings that's preventing competition.
  - anubistheta 1y ago
    Exactly. The more suppliers are in a market, the more competition there is. Thus lower prices and a better selection. People don't like a monopoly is other areas of life. Healthcare is no different.
  - myrmidon 1y ago
    I don't think that is a good comparison at all. Unlike grocery stores, hospital ERs don't get frequent repeat customer interaction, so that makes the competition aspect basically completely inapplicable. As typical ER visitor, - You wont know what "quality" of care you are going to get beforehand - You will have very limited capability of selecting the hospital - You will be unable to compare prices beforehand So why would any of those 5 hypothetical hospitals decrease prices? More competitors won't do shit if the market is uncompetitive by design.
    - wat10000 1y ago
      An ER is only a small part of what a typical hospital provides. And life-threatening, must-get-treatment-immediately-or-die emergencies are only a small part of what a typical ER provides. Yes, there are some kinds of care that aren't very amenable to competitive market forces, but the vast majority is.
      - deleted 1y ago
        [deleted]
    - esafak 1y ago
      That's what reviews and word of mouth are for. Don't you do research before picking a hospital and doctor? We do need price transparency though.
      - myrmidon 1y ago
        > Don't you do research before picking a hospital and doctor? No. Preventing rapid unplanned end of life is the main purpose of hospitals in my view. Enough time to make a choice of hospitals (or even to collect information on specific hospitals) is a luxury that I would not expect patients to have.
        esafak 1y ago
        For every emergency I plan a visit to the hospital at least 10-20 times. Emergencies are the exception, by definition. I think everyone with health insurance, which the Census Bureau says is 92% of Americans, since they will not go directly to the ER.
  - jasonlotito 1y ago
    1. One accepts only Visa, one only MC, one only Amex, one only cash, and one only accept bitcoin. 2. One offers bananas to walk in visitors, but the others have a minimum wait time of 1 month to a year. 3. One is a mile away. One is an hour away. Still in the same county. 4. None of them offer an easy to understand menu. You can't just order a banana. You ahve to order Banana Services and meet with Banana specialists. You can't take the banana home. 5. You wake up in a banana shop and you didn't get a chance to shop around before being presented with a bill. They don't take your payment of choice, so it's 10 times as expensive. 6. Some won't let you buy a banana. Instead, you have to buy a banana service. Per banana pricing is the lowest here, but the total cost is higher if you just want a banana. Which banana store do you buy from? A, B, C, D, or E? I'll take the first choice you make and let you know if you picked correctly. Anything other than the correct choice is a failure.
  - taeric 1y ago
    My expectation on cost of banana will be more on how much it costs to ship to said town? Similarly, which town has higher tax burden to cover? Assuming any sort of health inspection on places that store food, the town with more stores has a higher burden. Which is all to say, my gut is it is far more complicated than that allows for. Not a useless model, but also not a very actionable one.
- pfdietz 1y ago
  But the victims don't have to pay for it -- excess infrastructure is a bad investment that those who built it pay for. The builders are not guaranteed a return on their investment.
  - myrmidon 1y ago
    I don't really get it. If you are arguing that the customer is not paying for inefficient providers, then I strongly disagree. Customers always end up paying for inefficient supply chains. If you end up with an inefficient allocation of hospitals/doctors (local overprovisioning), it's always gonna be the patients that are gonna pick up the bill for this in the end through higher average prices. Inefficiencies are doubly bad because you potentially don't just pay the pure cost for the inefficiency (middlemen, waste etc.) you even pay for margins on top. I think the assumption that such inefficiencies could lead to actual savings for customers (by magically making the providers decrease their profit margins) is highly overoptimistic.
    - pfdietz 1y ago
      > Customers always end up paying for inefficient supply chains. Obviously not. There is nothing that compels a customer to do business with an inferior competitor, if there is an alternative. The end result of having a sufficiently inefficient supply chain can be that the company involved goes out of business, as it cannot operate at a profit.
- vlovich123 1y ago
  No, actually it would be lower for the same reason competition always leads to lower prices. Uncompetitive hospitals that can’t meet need would naturally go out of business. A “need” certificate is similar to the cap that med schools have - it’s effectively a pricing cartel to keep salaries/revenue high
  - milesskorpen 1y ago
    There are extremely high fixed costs + we require hospitals to do unprofitable work (they aren't allowed to turn anyone away from the ED, for example). In many small regional chains, their profitable hospitals in one area fund unprofitable hospitals in other regions. Overall we have a crisis of hospitals shutting down, not a crisis of oversupply.
  - jplrssn 1y ago
    > competition always leads to lower prices I don't see how this could be true for emergency visits. Would an ambulance drive you to the cheapest hospital within some fixed radius?
    - hamdingers 1y ago
      Hospitals typically lose money on emergency visits and make it back on scheduled inpatient care and outpatient services. This would accelerate a poor performing hospital's demise, because ambulances will go to the closest one but patients who have options will look elsewhere.
    - theptip 1y ago
      If you now have two ERs within driving range, you have the choice to go to the cheaper one if you are conscious and in a stable enough condition to reflect. This is the sort of thing people already think about in the US.
  - thunderfork 1y ago
    [dead]
- opo 1y ago
  Here is a summary of a number of studies of the effects of Certificates of Need: https://ij.org/report/striving-for-better-care/overwhelming-evidence-shows-that-con-laws-lead-to-higher-health-care-spending/ https://ij.org/report/striving-for-better-care/overwhelming-...
h2zizzle 1y ago
Oh, well that's BS. Urgent care clinics have proliferated like crazy over the post decade or so. The supply to fill the vast majority of urgent medical needs which hospital ERs used to have to carry alone is there. But it's true that that supply often goes unused. Why? Because ERs HAVE to tend to and stabilize patients when they present; UCCs can turn you away if you can't demonstrate the ability to pay. The problem is not restrictions on medical facility construction, it's inefficient use of what we already have. In general, America has an issue with defaulting to "building new", as if we have an everlasting greenfield, rather than careful provisioning of the already overbuilt infrastructure base. Capitalists love being freed of prior obligations, with no regard for how they contribute to an even more unwieldy set of obligations in the future. Enough. You can't just do as you like. Help solve the actual problem.
- pfdietz 1y ago
  BS, eh? https://www.health.ny.gov/facilities/cons/ https://www.health.ny.gov/facilities/cons/
  - alostpuppy 1y ago
    That’s just New York, yeah? Does every state have similar regulations?
    - pfdietz 1y ago
      So, unless every state has a regulation, that regulation doesn't exist and has no effect? Any other goal lines you want to redraw? Let's get that out of the way now instead of going back and forth. (To answer: in my personal experience Illinois also has such a regulation.)
    - ch4s3 1y ago
      Slightly more than half have CoN laws and other states have a number of restrictions of facility construction that complicate building smaller clinics.
  - kotaKat 1y ago
jasonlotito 1y ago
This doesn't solve the issue presented in the study. PE hospitals exists in states with and without these restrictions. So while CON might be an issue, it doesn't reconcile the issue of PE. In fact, PE priorities is exactly one of the things CON was setup to handle. Regardless, you have to explain how removing CON solves the PE issue mentioned when states without CON had the same issues.
- RHSeeger 1y ago
  You seem to be under the mistaken impression that - There is a specific list of regulations that cause the problem - Each regulation in that list is present everywhere the problem exists Neither one of those are true. Instead, there are many regulations and, combined, they add up to causing the problems. The specific regulations can and do vary by location; but the result is the same.
  - 20after4 1y ago
    I think the problem is obsessive optimization of profit at the expense of literally everything else. Greed is bad, especially in a field that is at least in theory centered on taking care of people. You can't take care of someone by exploiting them for the maximum possible profit.
  - jasonlotito 1y ago
    > You seem... No. You are 100% wrong. The context of this discussion is PE. So comments discussing this involve PE. So while you are correct in general, you are wrong specifically. In light of that, I stand by what I said: you have to explain how removing CON solves the PE issue mentioned when states without CON had the same issues. Maybe this isn't possible, but then we accept that this is not an answer to PE, which again, topic of conversation.

viscountchocula 1y ago

Certificate of Need: basically, prove to regulators that there is enough "need" before opening up new facilities. https://en.wikipedia.org/wiki/Certificate_of_need https://en.wikipedia.org/wiki/Certificate_of_need

bilbo0s 1y ago
As someone already pointed out, PE owned hospitals are in states with, and in states without, CON requirements. Certainly on the face of that fact it would appear the existence, or nonexistence, of CON requirements has no effect on PE hospitals charging more and having far inferior outcomes. Do you have a hypothesis as to why CON requirements are driving inferior outcomes and increased cost metrics at PE owned hospitals? (A hypothesis that accounts for the fact that PE owned hospitals underperform even in the absence of CON requirements.) Serious question. I'm trying to get my head around this.
- SkyBelow 1y ago
  Sample hypothesis with only minimal amount of knowledge on it. PEs seek to make profit, and are looking for places where they can either raise prices or lower costs (which will quickly correlate with worse outcomes) while not losing customers (yes, you could call them patients, but PE will view them as customers), or at least losing so few that the overall numbers result in more profit. One way of doing this is looking for barriers to competition/moats. CON is just one type of moat, and so is one factor PEs evaluate, but the presence or absence of other moats can still override the presence or absence of this one moat. One could try to work this out from data with some sort of regression, but with so many possible moats and a relatively limited number of data points, it would be easy to overfit the data. In comparison, non-PE hospitals might have some profit motive (or keeping to budgets, not going bankrupt, ect.), but will be less driven by this mentality and thus their relationships to moats will be more complex, and so something like a CON requirement won't be as fully exploited to raise prices or lower costs. This also fails to account for other ways that PE can seek to make money, which involves more complex parts of law and financing that I'm not well versed on (I've ready some things about real estate, but don't know enough to fairly analyze the claims).

betaby 1y ago

In the USA/Canada number of doctors minted is caped by the cartel of doctors. That costs non-trivial money and lives lost. Source: https://thedailyeconomy.org/article/how-congress-created-the-doctor-shortage/ https://thedailyeconomy.org/article/how-congress-created-the... and many others

insane_dreamer 1y ago
That’s not a regulatory issue
- topkai22 1y ago
  Since the government (federal or state/local) authorizes those organizations to certify physicians and restricts medical care to only those who have been certified, it is.
- nick__m 1y ago
  What kind of issue it is then ? If a regulation permits the doctors associations to set the allowed number of doctors residency, naively it is a regulatory issue.
  - insane_dreamer 1y ago
    It's a funding issue. There aren't enough residency slots available given the number of medical school grads. Residency is a requirement to get a medical license--which is issued by the states, not the federal gov. The reason there aren't enough residency slots is because they are heavily subsidized by the federal gov and they put a cap on the funding. No one else wants to foot the bill, so the slots remain limited, thus the licenses remains limited.
- tptacek 1y ago
  It obviously is. A federal government policy decision caps the number of doctors we have, and another federal government policy decision restricts a huge number of basic medical services to those doctors.

johnisgood 1y ago

FDA drug approval processes and insurance regulations.

palmotea 1y ago
> FDA drug approval processes What, specifically? Just abolish them all, and return to the pre-1938 status quo (e.g. marketing radium water to cure what ails ya)? Or specific reforms to make the drug approval processes more effective? https://en.wikipedia.org/wiki/Radithor https://en.wikipedia.org/wiki/Radithor
- cogman10 1y ago
  Best way to make the entire process more efficient would be centralizing R&D and approval and nationalizing the manufacturing of drugs. MAYBE you could license out the rights to produce drugs on 10 or 20 year license agreements. Turn it into a pure R&D effort and not one driven by profit.
  - ajmurmann 1y ago
    Who is gonna decide how the R&D money gets spent? What's their skin in the game and their feedback mechanism? Why will they do a better job picking what to research than current pharmaceutical companies?
    - cogman10 1y ago
      > Who is gonna decide how the R&D money gets spent? Same way the NHS previously funded medical research. Grants and grant review. You can expand that department and effort. > What's their skin in the game and their feedback mechanism? Believe it or not, some people just want to research and look into cures for diseases. Shocking I know. Feedback can be reviews of their work and blackballing bad actors that consistently kick out bad research. > Why will they do a better job picking what to research than current pharmaceutical companies? Because they already are. Pharmaceuticals aren't doing the majority of research, they are taking NHS funded research and running it through FDA approval. Ozempic, for example, didn't come from pharmaceutical research, it came from grant research into lizard spit.

mothballed 1y ago

[flagged]

hiddencost 1y ago
Hoodrats?
- mothballed 1y ago
  Source: worked ~1 year in an inner city ER alongside a doctor seeing every case. Yes it was the hoodrats abusing the system.
  - habinero 1y ago
    Working all of one year before you got fired doesn't make you an expert, sorry. It's probably best you moved on from healthcare, you don't seem suited for it with your attitude.
    - mothballed 1y ago
      Unfortunately my attitude is the only one that will actually help you fix things because I'm bringing you a sober view of what the situation is. And people much "better suited for it" who worked in inner city ER generally had even less rosy thoughts than I did, if you want to defer to "experts" it's hilarious you would think this is unusual takeaway and that my opinion wasn't formed in large part by the experts thinking the very same thing (which of course they are never going to tell to the patients, you're probably not going to hear it unless you actually work in an ER and are close and comfortable enough with doctors for them to risk themselves to tell you what they really think as it's totally unacceptable to say it publicly).
      - habinero 1y ago
        Sure, buddy. "Everyone thinks this way, they just don't say it" has been the rallying cry of people with bad minority opinions forever.

kriops 1y ago

[flagged]

potato3732842 1y ago

That's like saying "it's ok if I shit in the river, it's a big river". When a million other people do it you've got a water quality problem. Each and every one of these regulations can in abstract, be justified by some useful idiot looking at only the first and second order inputs and outputs and not looking at the totality of the effects. Nobody with a brain would defend shitting in the river, but here you are asking for individual turds so that they may be justified on the basis that the individual dropping them was relieved and their individual impact on water quality was minor.

scott_w 1y ago
No it's not. Shitting in a river is always a net negative. Regulations can be positive, negative, or ineffective. Trying to "just count" the regulations to determine quality completely discards this critical dimension and betrays an almost childlike view of the world.
- potato3732842 1y ago
  >Shitting in a river is always a net negative It beats anything open air by miles. Sure, an outhouse would be better but river > street. >Trying to "just count" the regulations to determine quality completely discards this critical dimension and betrays an almost childlike view of the world. You're grasping at straws here. I am under no obligation to give such an infantile opinion (the one I initially replied to) a response at length. This is not the venue for such minutia.
  - scott_w 1y ago
    > I am under no obligation to give such an infantile opinion Responding with “I know you are but what am I?” is just proving my point.

deleted 1y ago

[deleted]

pfdietz 1y ago

Another issue is the requirement that doctors adhere to "standard of care" regardless of cost. If they don't, they are subject to malpractice lawsuits. Elsewhere, quality of a good or service is traded against cost. But in medicine, there's a cost ratchet as ever more expensive and marginally more performant treatments are introduced.

bilbo0s 1y ago
This is another example of a requirement that both PE owned and non PE owned hospitals, presumably, followed.e (I would hope neither of them were ignoring standards of care in the treatment of patients.) Yet the metrics are substandard at only the PE owned hospitals. So you would need to outline how this requirement unduly burdened the PE owned hospital relative to the non PE owned hospital for it to be the cause of the discrepancy. There may be such a reason, but you haven't outlined it in your post.

mimikatz 1y ago

Let nurses do more, let them write some prescriptions, let them open up a shop that puts casts on people with broken bones and minor things which they mostly do anyways.

landl0rd 1y ago

- The AMA froze the number of med schools for decades even as residency availability increased. - The majority of states still maintain "certificate of need" laws for new hospitals, ambulance providers, etc. - The AMA holds a state-enforced monopoly over physicians. - Many states still limit NPs/PAs, requiring physician supervision for things for which those people were trained. - Lack of interstate reciprocity in licensing means mobility is constrained and supply can't follow demand. - Costly medical equipment usually requires first-party repairs; mfgs claim a third-party modification (repair) constitutes remanufacturing under FDA regs. - Stark law makes e.g. physician/hospital value-based care arrangements very hard. It's quite strict and everyone has to tiptoe around it a bit. There's also the huge problem of malpractice insurance costs due to insane tort settlements. Awards need to be capped yesterday because it's too easy to talk a jury into bankrupting people over things that legitimately just sometimes happen. I'm guessing others could give you an even better list. Some of those are a bigger deal than others but it's a huge issue. Insurance net margins just aren't high enough to blame it and drug costs aren't enough of our total healthcare spend to be at fault. It comes down to humans being too expensive. There remain many areas of care where we can't cut man-hours down without sacrificing safety and quality. As such, we should reduce the insane byzantine co-ordination and compliance overhead.

dimal 1y ago
Don’t forget that the AMA has a monopoly on billing codes. Medicare defines the billing value of every procedure as Relative Value Units (RVUs). Then Medicare defers to AMA’s guidance on what these values should be. Insurers default to RVUs x multiplier. So the AMA has the ability to set prices. Oh, and patient value isn’t considered for these units. They are explicitly defined as input driven, so a procedure that is less costly to perform but has higher value to the patient will be billed at a lower value. Hospitals are incentivized to choose procedures that they can bill at a higher rate, and so because of these perverse incentives, they necessarily will ignore cheaper more effective treatments and choose the more expensive ones. I’m a lefty, but the older I get the less I believe in the old New Deal style leftism I’ve been sold my whole life. As systems get more complex, they simply become a way to obfuscate oligarchic control.

maxerickson 1y ago

Certificates of need. To reduce costs, we supposedly perfectly plan capacity and prevent over investment. Should also probably drop requiring an ER for Medicare certification and just directly subsidize ERs.

derbOac 1y ago

Others have kind of mentioned a lot of things I might anyway, and it's hard to summarize what I think is necessary. But to summarize, I think there needs to be a deregulation of licensing or practice laws to allow other types of providers to do more, of the sort they are perfectly capable of doing (and that studies show they can do) — pharmacists, psychologists, and optometrists are just some examples — and I think there needs to be more flexibility and diversity in terms of provider types and degree paths. My guess is there are many types of providers we can't even envision right now because there's such a rigid schema about what healthcare professionals should look like. I also think, for example, there are probably a lot of cases where someone could go from a PA -> MD degree without returning to do a second degree; I might be wrong about that but these are the types of things that should be encouraged at least as experiments. I also generally think there's a lot of choice that could be encouraged in terms of drug access. I generally think people should be able to buy medications and drugs without a prescription, or at least under the monitoring of a pharmacist or something, or at least in most cases. I can think of medications that there have literally been papers written saying that they are safe to give without a prescription decades ago and they still require a prescription; there's also medications that people take for years safely, and it seems kinda absurd to require them to get a prescription for them. My thoughts about the FDA itself are complex and could probably an essay in itself. I'm very in favor of public healthcare, and public healthcare institutions but I also feel a lot should be deregulated or reregulated toward greater openness, choice, and competition. There's probably a lot of areas where there should be more regulation too I suppose — I think antitrust principles should be applied to insurance and hospital consolidation more often.