5 ms·

"a health system that can set prices with impunity because consumers rarely see them — and rarely shop for discounts"

by mitmads 13y ago

girvo 13y ago
Kind of defeats the whole "free market" thing, doesn't it?
- drawkbox 13y ago
  It isn't really a free market though, it is a fixed market. If it was true free market it would be individual to service, that is why prices are all over the place. We just need to return to individual health care plans, paid for by employees individually (or give them cash health benefits). If your employer paid your auto insurance we'd have the same problem. Not sure how you fix it, maybe by temporarily making it illegal to allow a company to provide health benefits through insurers to fix this. Employers should only be allowed to give you the money for an individual plan (most startups sometimes do this instead). Employers don't pay your auto insurance, home insurance or other insurance. Maybe a one time convert of employer groups to individual groups managed for risk, then, for privacy, for business, for better health care the individual has that (also probably a back up plan for those in need). Why should employers know about your health? This is ancient thinking where you stayed with a company forever. It's also a privacy thing. I think it would also combat ageism. It will also make starting companies and competing much easier with less friction. It would also allow employees to more easily go from job to job, when you have an employer plan it is a scary predicament sometimes. Cost can only be competitive if they are seen, they will be seen if it is moved away from employer provided.
  - cmircea 13y ago
    Or how about have national healthcare? Like every other decent country on this planet?
    - roel_v 13y ago
      Describe "national healthcare". I see people who like to bitch about the US throwing this term around a lot, but what do you mean by it? One single, state-organized health care provider that gets funded 100% by other taxes or a flat-fee contribution that is the same for everybody? State-set price controls? Price controls on what - costs of procedure or insurance plan? What about coverage of those plans, determined by the state?
      - cmircea 13y ago
        State organized and owned healthcare. You pay for it as a taxpayer and don't have to worry about going bankrupt because of a disease that can happen to anybody. For an example, the UK's NHS. Private healthcare is still perfectly legal and fine, as is private health insurance, if you deem the state services are not suitable for you. Hospitals should be helping people, not ripping them off >.<
    - drawkbox 13y ago
      Possibly, but you can't make that leap directly, people/industries don't move that fast. First step is move away from company provided, I am sure there would be renewed interest for it in many against it now, or some workable private and public system where prices are known, more direct.
    - olefoo 13y ago
      Only after we have explored every other possible solution. This is America, and no socialism is possible; unless you are a homeland security contractor.
      - cmircea 13y ago
        What the hell? State provided healthcare = Socialism?! That's bullshit. What about the police department? Or the fire department? Or the post office?
        edent 13y ago
  - refurb 13y ago
    You don't even have to make it illegal for your employer to pay your insurance premium, just take away the tax deduction and watch how fast your employer stops paying.
    - sokoloff 13y ago
      I suspect they still would provide it, because it would be a competitive advantage. I get better rates on health insurance through my employer than I could get on my own, presumably because the average working person is cheaper to care for than the average person. So, my company (and most companies) would still find an advantage in hiring if they offered health care. (I'm assuming above that you're talking about taking away the employee tax advantage for this insurance (the avoidance of personal income tax on it). It occurs to me at the end of my reply that you might consider treating it as a non-business expense and that the company would have to pay corporate income tax on the money they use to buy health insurance. I agree that doing that is a big hammer, but it also seems like a terrible idea. If the company has a legitimate business purpose in spending its money that way, namely to better compete for employees, then it's a legitimate business expense, IMO. Trying to enforce social change via the tax code rarely results in precisely the "clean" outcome that people lobbying for those changes intend, or purport to intend.)
- gordaco 13y ago
  No captive market can ever be a free market. And everything health-related is a captive market, because you can't afford not to pay for the service.
  - chii 13y ago
    > because you can't afford not to pay for the service. you mean you can't afford to not _have_ the service? you can certainly be unable to pay!
gwgarry 13y ago
that means capitalism is working right?
stephen 13y ago
I blame employer-provided health insurance. It leads to people thinking "hey, it's free!". The story I've heard is that at some point (WW2-ish?) there was some sort of government-induced cap on wages, so employers couldn't compete for employees merely on a cash salary. So, as an unintended consequence to the original government action, employers started offering health insurance as a non-cash benefit. (Please correct me if I'm wrong, I am admittedly going on hearsay.)
- gwright 13y ago
  That seems accurate. Here is some history regarding health insurance in the US that backs up that story: http://www.ebri.org/publications/facts/index.cfm?fa=0302fact http://www.ebri.org/publications/facts/index.cfm?fa=0302fact
DanBC 13y ago
Why aren't the insurance companies working to drive prices down? I understand the theory: People buy insurance; the insurance companies 'police' medical providers and regulate (through the market) the pricing of services. From the outside it doesn't look like that works. From the outside it looks like very many more (often unneeded) tests are conducted. And it looks like the insurance companies are not squeezing the providers of health care, but are squeezing the patients.
- anateus 13y ago
  Most private health insurance in the US is provided by employers. Thus, the people paying for the services are not the patients but insurance companies, and the insurance companies are selected by employers not the patients.
  - DanBC 13y ago
    But that says nothing about why insurance companies are not pushing prices down. They get paid by employers, but they'd make more profit if the health care they buy is cheaper. Since I regularly hear that prices are cheaper if you negotiate with the doctors it seems that insurance companies are not doing that negotiation. So, given that they appear to be losing out on some profit, why? Why aren't they pushing the costs down?
    - refurb 13y ago
      They are pushing costs down. That's why when you get a bill from your insurance and it says "Procedure X - $5000" followed by "Negotiated rate - $1000 accepted". Insurance companies figure out what stuff should actually cost, then enter into contracts with providers that says "Hey I know you're still making a decent profit if I only pay you $100 instead of $150, so take $100 and you'll make it up on volume when you become one of my preferred providers."
- gwgarry 13y ago
  The insurance companies are going to "negotiate" with the hospitals in which the hospital's bargaining position will be to offer fewer services, or the reduce the level of service provided. That's what it looks like from the inside. The insurers put as much money in their pockets. And the hospitals do the same. The patient gets hit with a large bill and fewer sub-par services. Everyone wins. Except the patient.
saber_taylor 13y ago
Does this mean there should be an app so you can comparison shop while in an ambulance? Hey no, I want to go to Hospital B.

"a health system that can set prices with impunity because consumers rarely see them — and rarely shop for discounts"

by mitmads 13y ago

"a health system that can set prices with impunity because consumers rarely see them — and rarely shop for discounts"

girvo 13y ago

Kind of defeats the whole "free market" thing, doesn't it?

drawkbox 13y ago
It isn't really a free market though, it is a fixed market. If it was true free market it would be individual to service, that is why prices are all over the place. We just need to return to individual health care plans, paid for by employees individually (or give them cash health benefits). If your employer paid your auto insurance we'd have the same problem. Not sure how you fix it, maybe by temporarily making it illegal to allow a company to provide health benefits through insurers to fix this. Employers should only be allowed to give you the money for an individual plan (most startups sometimes do this instead). Employers don't pay your auto insurance, home insurance or other insurance. Maybe a one time convert of employer groups to individual groups managed for risk, then, for privacy, for business, for better health care the individual has that (also probably a back up plan for those in need). Why should employers know about your health? This is ancient thinking where you stayed with a company forever. It's also a privacy thing. I think it would also combat ageism. It will also make starting companies and competing much easier with less friction. It would also allow employees to more easily go from job to job, when you have an employer plan it is a scary predicament sometimes. Cost can only be competitive if they are seen, they will be seen if it is moved away from employer provided.
- cmircea 13y ago
  Or how about have national healthcare? Like every other decent country on this planet?
  - roel_v 13y ago
    Describe "national healthcare". I see people who like to bitch about the US throwing this term around a lot, but what do you mean by it? One single, state-organized health care provider that gets funded 100% by other taxes or a flat-fee contribution that is the same for everybody? State-set price controls? Price controls on what - costs of procedure or insurance plan? What about coverage of those plans, determined by the state?
    - cmircea 13y ago
      State organized and owned healthcare. You pay for it as a taxpayer and don't have to worry about going bankrupt because of a disease that can happen to anybody. For an example, the UK's NHS. Private healthcare is still perfectly legal and fine, as is private health insurance, if you deem the state services are not suitable for you. Hospitals should be helping people, not ripping them off >.<
  - drawkbox 13y ago
    Possibly, but you can't make that leap directly, people/industries don't move that fast. First step is move away from company provided, I am sure there would be renewed interest for it in many against it now, or some workable private and public system where prices are known, more direct.
  - olefoo 13y ago
    Only after we have explored every other possible solution. This is America, and no socialism is possible; unless you are a homeland security contractor.
    - cmircea 13y ago
      What the hell? State provided healthcare = Socialism?! That's bullshit. What about the police department? Or the fire department? Or the post office?
      - edent 13y ago
- refurb 13y ago
  You don't even have to make it illegal for your employer to pay your insurance premium, just take away the tax deduction and watch how fast your employer stops paying.
  - sokoloff 13y ago
    I suspect they still would provide it, because it would be a competitive advantage. I get better rates on health insurance through my employer than I could get on my own, presumably because the average working person is cheaper to care for than the average person. So, my company (and most companies) would still find an advantage in hiring if they offered health care. (I'm assuming above that you're talking about taking away the employee tax advantage for this insurance (the avoidance of personal income tax on it). It occurs to me at the end of my reply that you might consider treating it as a non-business expense and that the company would have to pay corporate income tax on the money they use to buy health insurance. I agree that doing that is a big hammer, but it also seems like a terrible idea. If the company has a legitimate business purpose in spending its money that way, namely to better compete for employees, then it's a legitimate business expense, IMO. Trying to enforce social change via the tax code rarely results in precisely the "clean" outcome that people lobbying for those changes intend, or purport to intend.)
gordaco 13y ago
No captive market can ever be a free market. And everything health-related is a captive market, because you can't afford not to pay for the service.
- chii 13y ago
  > because you can't afford not to pay for the service. you mean you can't afford to not _have_ the service? you can certainly be unable to pay!

gwgarry 13y ago

that means capitalism is working right?

stephen 13y ago

I blame employer-provided health insurance. It leads to people thinking "hey, it's free!". The story I've heard is that at some point (WW2-ish?) there was some sort of government-induced cap on wages, so employers couldn't compete for employees merely on a cash salary. So, as an unintended consequence to the original government action, employers started offering health insurance as a non-cash benefit. (Please correct me if I'm wrong, I am admittedly going on hearsay.)

gwright 13y ago
That seems accurate. Here is some history regarding health insurance in the US that backs up that story: http://www.ebri.org/publications/facts/index.cfm?fa=0302fact http://www.ebri.org/publications/facts/index.cfm?fa=0302fact

DanBC 13y ago

Why aren't the insurance companies working to drive prices down? I understand the theory: People buy insurance; the insurance companies 'police' medical providers and regulate (through the market) the pricing of services. From the outside it doesn't look like that works. From the outside it looks like very many more (often unneeded) tests are conducted. And it looks like the insurance companies are not squeezing the providers of health care, but are squeezing the patients.

anateus 13y ago
Most private health insurance in the US is provided by employers. Thus, the people paying for the services are not the patients but insurance companies, and the insurance companies are selected by employers not the patients.
- DanBC 13y ago
  But that says nothing about why insurance companies are not pushing prices down. They get paid by employers, but they'd make more profit if the health care they buy is cheaper. Since I regularly hear that prices are cheaper if you negotiate with the doctors it seems that insurance companies are not doing that negotiation. So, given that they appear to be losing out on some profit, why? Why aren't they pushing the costs down?
  - refurb 13y ago
    They are pushing costs down. That's why when you get a bill from your insurance and it says "Procedure X - $5000" followed by "Negotiated rate - $1000 accepted". Insurance companies figure out what stuff should actually cost, then enter into contracts with providers that says "Hey I know you're still making a decent profit if I only pay you $100 instead of $150, so take $100 and you'll make it up on volume when you become one of my preferred providers."
gwgarry 13y ago
The insurance companies are going to "negotiate" with the hospitals in which the hospital's bargaining position will be to offer fewer services, or the reduce the level of service provided. That's what it looks like from the inside. The insurers put as much money in their pockets. And the hospitals do the same. The patient gets hit with a large bill and fewer sub-par services. Everyone wins. Except the patient.

saber_taylor 13y ago

Does this mean there should be an app so you can comparison shop while in an ambulance? Hey no, I want to go to Hospital B.