5 ms·

It's accurate that what we have is not insurance. Real health insurance would look more like life insurance, with fixed premiums that can't increase if your hea

It's accurate that what we have is not insurance. Real health insurance would look more like life insurance, with fixed premiums that can't increase if your health degrades over time. My car insurance doesn't cover an oil change. Nor would any reasonable person expect it to. Normal costs are not something to be insured against. Having customers pay out of pocket for most health care costs would create market pressure to reduce these costs. Does my perfectly healthy baby need a doctor with ten years' schooling to give him a vaccination? No. On the other side of the coin, if I'm paying for it, wait times would decrease. Maybe I'm willing to pay a little bit of a premium if an appointment means being seen when my appointment is scheduled for rather than a half hour later. What prevents this happening is perverse incentives from federal (and state) income tax policy. Employer provided health "insurance" can be paid for with before-tax dollars. Amazing fact: those who aren't young and healthy consume a disproportionate amount of health care. The only way to bring down the cost of health care is to make people more frugal, and no one is ever frugal with someone else's money.

ahoyhere 17y ago
This is a great metaphor. Because if you don't change the oil in your car, your engine will slowly grind itself to death. People need to consume healthcare; it's not a luxury good. And vaccinations are rarely given by the actual drs - that's what nurse practitioners are for. The problem in the US is not -- let me repeat -- NOT because healthcare services are too available because people don't have to pay. Many people avoid and delay going to the dr, because of costs, or inconvenience -- even for lifesaving tests and treatment. Hell, I had great insurance that cost $500 a month and still ended up paying amost $2k in total costs when I sprained both my ankles. (Long story.) And something like 80% of US bankruptcies are due to unexpected medical bills. The real problem is that there aren't enough doctors, and that's because the doctors' offices/hospitals are trying to be "lean" -- and that's because costs are so great. Lean is great for software, not for social services. And the reason the costs are so huge is that the whole system, from education to insurance, sucks. Compare the US to a country like Austria, with body of nationalized healthcare and -- to carry the metaphor -- a limb of private care. I moved here last August and I'm still constantly amazed by how well this country works (and how untrue most of the US' self-aggrandizement turns out to be). There are barely waiting times to see doctors, even highly sought-after specialists in Austria. You can hop into the ER in a major city and get in and out in under 2 hours. You never see the kind of wait times here that you see in the US, even in suburbia. (I moved here from various parts of Maryland, not exactly the most populous place in the lower 48.) There are more doctors. There are more female doctors. There are more doctors who really care. To my mind, this is due to several factors, including but not limited to: a) free higher education, meaning anyone who can do the work can become a doctor; b) low cost/high standard of living, meaning it doesn't take much means to survive while going to school; c) an ethic of social services; d) a nearly-single payer system reduces a huge amount of overhead & cruft; e) it's easy to manage patient billing and relationships with the insuring parties, because there are so few and they are not structured to for-profit; and d) no doctors are being driven out of business by high malpractice insurance premiums, due to all of the factors above. I had to go to the ER on a road trip thru the country a couple weeks ago. I immediately saw a doctor and nurse practitioner, and they were double-teaming me - one measuring my blood-pressure, the other drawing blood; one checking my blood-ox levels, the other listening to my chest, etc. I had x-rays, I had an EKG, and lab work, all inside of 2 hours. Then I got my medicines and left. And I paid... $0 for the ER visit, and about $12 for the medicines. On top of that, I was in there for what I suspected was bronchitis/pneumonia (I have crap lungs). But, unlike every time I've had that in the US, the doctors I saw looked at me and realized it was similar symptoms to both deep-vein thrombosis and congestive heart failure. Which is true. My heart's fine, but no one in the US has ever analyzed me that thoroughly when I presented with "obvious" symptoms. They were so on the ball, it was a world of difference. I felt safe and now I know my heart's fine. I've never had a medical experience that good in the US. Not for a second did they treat me with the jaded disregard you usually experience in US ERs. Clearly the cheap and easy availability of great care is not a problem. I really wish that I knew why Americans are, on the whole, always blaming the end-consumer for what are systemic deficiencies.
- lionhearted 17y ago
  I completely agree with you analysis of all the problems with the American system, though I'd suggest a different way to address the problem because there's some very real downsides to Austria's system as well. For fixing America's medical and insurance - in lieu of of free higher education, it'd be simple to drastically reduce requirements to practice medicine. To practice medicine in the United States, doctors have to go through crazy rites of passage, including years of their lives and hundreds of thousands of dollars. Groups like the American Medical Association have intentionally tried to keep the requirements very high, as that keeps doctors' fees and wages up by restricting supply. Undergraduate + medical school + residency is way more than necessary to become a competent doctor. Could anyone really claim with a straight face that 4 years of intense study, plus 2-4 years of hands-on apprenticeship wouldn't far more than enough to practice a specific kind of medicine? People pick up many skillsets as difficult as medicine to a competent degree in a lot less than 10 years and hundreds of thousands of dollars of costs. As for Austria, it's an interesting case, huh? Austria has one of the longest traditions of social services in Europe - Otto von Bismarck, Prussian Chancellor, was huge on it. Austria has lots of practice and does a pretty good job of offering a number of services. There's a few downsides, though. Of course, most people have probably heard the argument about how it slows growth and innovation, and there's some truth in that. Typically people counterargue, "Yes, but it's a worthy tradeoff to improve quality of life in the present." And there's merit in that too. But using Austria as a specific example - one of the real dangers of socialization of important elements of an economy is that it makes it much easier for the government to go totalitarian, as was seen under the Nationalsozialistische Deutsche Arbeiterpartei, the National Socialist German Workers' Party. Limited socialism can work with a very strong constitution to limit governmental powers. But without that, politicians become in control of the courts, military, and economy. That's a very dangerous combination. One of the tricky parts about socialism is that it can't adjust fast enough to fill diverse wants and needs. Governments are rock-and-hard-placed: A fast moving, fast changing government makes lots of mistakes. A slow moving, slow changing government doesn't adapt very fast. But one thing socialism is really, really, realy good at is making what Clauswitz (another Austrian-Prussian, genius military scholar) called "total war". That's where your entire economy, culture, and civilization is focused on conquering or destroying another civilization. Every major combatant during World War II went to a more socialized economy, including the United States and England. Government assumed control of much of the production and media. The Allies needed to, because the Germans and Japanese were that focused. One of the reasons that France fell is because it was severely overwhelmed in terms of technology: Less aircraft, less artilery, less mechanized infantry. The American and English governments saw this, and took greater control over their economies. But could any of this have happened without government control of economies in the first place? A charismatic, psychopathic Austrian-Prussian Lance Corporal took over leadership of the National Socialist Worker's Party (Nationalsozialistische, shorthand "Nazi"), and they already had large control over the nation's factories, food, banking, education, medicine, media, and so on. The "trusting the government" culture lets the inevitable bad government run by a psychopath run amok. You could take North Korea as another example - they have the fourth largest army in the world (fourth! despite being #47 in total population!). All they produce effectively is military, but they do a pretty good job of it. So a bit of a tangent there - I'm with your analysis completely about why the costs are high in the United States. I just also point out the very real dangers of state control of the economy. More government power leads to an easier path to totalitarianism and aggressive war. That's one of the reasons Bismarck, a real expansionary conquerer type himself, introduced the culture of social services to Prussian Austria. It builds national loyalty, especially with government-run education. It endears the people to the government and makes them reliant on it. And it lets them flip into "war mode" easily when the political leadership wants to. There can be some advantages, but there's quite real dangers. I share the take as a casually interested historian, and would be very happy to hear some other people's replies and analysis.
lionhearted 17y ago
Very good points. This is one most people don't realize or fully understand: > Employer provided health "insurance" can be paid for with before-tax dollars. Employers that offer health insurance write it off as an expense. They don't payroll taxes on it (unemployment or social security). That means it's roughly 10% cheaper for the employer to offer health insurance instead of pay the equivalent in salary. From the employee's side, an employee pays tax on salary before medical spending under normal circumstances, but health insurance is untaxed. So if an employee gets higher salary, he'd pay taxes on his salary, then buy his antibiotics. If insurance covers it, no taxes. That's why insurance covers inane little things - both employers and employees want all medical spending to be covered by health insurance for tax reasons. Health insurance covered = no payroll taxes for employer, no income taxes for employee. Now, the massive question is -- Why? This seems crazy, no? For most other perks, there's some taxes paid at some point. That's why your company doesn't buy all your food, housing, clothing, everything, and write it all off for you. Answer: Lobbying. Insurance companies lobby hard and donate lots of money to political candidates. Both parties - Republican and Democrat - are in on this arrangement. This is one of the reasons insurance is so crooked - perverse incentives that both parties support. On insurance, the Republicans say, "We're lowering your taxes!" The Democrats say, "We're helping people!" That's not quite right for either of them. They're making the system complicated and driving up costs that make the insurance companies and medical complex wealthier at everyone else's expense. The artificially inflated costs make the system much worse for middle class people, as they lose flexibility in choosing their doctors, getting exact treatments they want, and so on. It hurts people who make responsible health and budgeting decisions, because they'd rather have the salary than the insurance coverage - but then their employer would pay 10% of what they gave in salary, and the employee would pay 30-60% on the income. As opposed to 0%/0% taxes on the insurance. It hurts the poor the worst, because they're least likely to have health insurance at all, and they get stuck in the artificially high priced market. Just a terrible system all the way around. It'd be much better to cut taxes a few percent for all brackets and eliminate the health insurance writeoff entirely. Or alternatively, allow anyone to write any health expenses off the taxes. There'd be many, many better ways than the current system, which is bad for everyone except insurance companies, some medical people (though many of them feel handcuffed by the system and also dislike it), and of course, the politicians getting campaign money, sports tickets, dinners, vacations, gifts, and the rest of the legally-sanctioned corruption.
catzaa 17y ago
> It's accurate that what we have is not insurance. Real health insurance would look more like life insurance, with fixed premiums that can't increase if your health degrades over time. That is what I have. It is called a “hospital plan”. It only covers me when I am in an accident and need to go to the hospital. And it is amazing what cost savings it induces over people with full blown medical schemes. I found that things such as spectacles is over priced by 300%-400% (you can get away a lot cheaper). Dentists will take useless digital x-rays to rape a medical scheme – and most people don’t mind because they aren’t paying for it. Doctors also take useless digital ex-rays (for any slight back problem) - even though they aren’t experts and will only look at it for a few seconds. Doctors sometimes prescribe the newest (and most expensive) anti-biotic instead of a cheaper thing that will also do the trick. Paying out of pocket eliminates all that.
RyanMcGreal 17y ago
The only way to bring down the cost of health care is to make people more frugal, and no one is ever frugal with someone else's money. If that's true, why does every single country with universal, single payer health care spend about half as much money, per capita, on health care as the USA? Shouldn't they be paying more?
- Retric 17y ago
  Minor correction, the US government and Canadian government spend the same per capita on healthcare, but there the average person does not need extra insurance. Per capita countries with universal healthcare spend less. The reason should be obvious, less paperwork.
shpxnvz 17y ago
Does my perfectly healthy baby need a doctor with ten years' schooling to give him a vaccination? No. For what it's worth, my perfectly healthy baby has never been given a vaccination by a doctor. Shots are given by one of the more cost effective and numerous nursing staff, and are scheduled so that they coincide with a regular well-baby checkup. Not that I disagree at all with your point, just that this particular example doesn't really stand up.

ahoyhere 17y ago

This is a great metaphor. Because if you don't change the oil in your car, your engine will slowly grind itself to death. People need to consume healthcare; it's not a luxury good. And vaccinations are rarely given by the actual drs - that's what nurse practitioners are for. The problem in the US is not -- let me repeat -- NOT because healthcare services are too available because people don't have to pay. Many people avoid and delay going to the dr, because of costs, or inconvenience -- even for lifesaving tests and treatment. Hell, I had great insurance that cost $500 a month and still ended up paying amost $2k in total costs when I sprained both my ankles. (Long story.) And something like 80% of US bankruptcies are due to unexpected medical bills. The real problem is that there aren't enough doctors, and that's because the doctors' offices/hospitals are trying to be "lean" -- and that's because costs are so great. Lean is great for software, not for social services. And the reason the costs are so huge is that the whole system, from education to insurance, sucks. Compare the US to a country like Austria, with body of nationalized healthcare and -- to carry the metaphor -- a limb of private care. I moved here last August and I'm still constantly amazed by how well this country works (and how untrue most of the US' self-aggrandizement turns out to be). There are barely waiting times to see doctors, even highly sought-after specialists in Austria. You can hop into the ER in a major city and get in and out in under 2 hours. You never see the kind of wait times here that you see in the US, even in suburbia. (I moved here from various parts of Maryland, not exactly the most populous place in the lower 48.) There are more doctors. There are more female doctors. There are more doctors who really care. To my mind, this is due to several factors, including but not limited to: a) free higher education, meaning anyone who can do the work can become a doctor; b) low cost/high standard of living, meaning it doesn't take much means to survive while going to school; c) an ethic of social services; d) a nearly-single payer system reduces a huge amount of overhead & cruft; e) it's easy to manage patient billing and relationships with the insuring parties, because there are so few and they are not structured to for-profit; and d) no doctors are being driven out of business by high malpractice insurance premiums, due to all of the factors above. I had to go to the ER on a road trip thru the country a couple weeks ago. I immediately saw a doctor and nurse practitioner, and they were double-teaming me - one measuring my blood-pressure, the other drawing blood; one checking my blood-ox levels, the other listening to my chest, etc. I had x-rays, I had an EKG, and lab work, all inside of 2 hours. Then I got my medicines and left. And I paid... $0 for the ER visit, and about $12 for the medicines. On top of that, I was in there for what I suspected was bronchitis/pneumonia (I have crap lungs). But, unlike every time I've had that in the US, the doctors I saw looked at me and realized it was similar symptoms to both deep-vein thrombosis and congestive heart failure. Which is true. My heart's fine, but no one in the US has ever analyzed me that thoroughly when I presented with "obvious" symptoms. They were so on the ball, it was a world of difference. I felt safe and now I know my heart's fine. I've never had a medical experience that good in the US. Not for a second did they treat me with the jaded disregard you usually experience in US ERs. Clearly the cheap and easy availability of great care is not a problem. I really wish that I knew why Americans are, on the whole, always blaming the end-consumer for what are systemic deficiencies.

lionhearted 17y ago
I completely agree with you analysis of all the problems with the American system, though I'd suggest a different way to address the problem because there's some very real downsides to Austria's system as well. For fixing America's medical and insurance - in lieu of of free higher education, it'd be simple to drastically reduce requirements to practice medicine. To practice medicine in the United States, doctors have to go through crazy rites of passage, including years of their lives and hundreds of thousands of dollars. Groups like the American Medical Association have intentionally tried to keep the requirements very high, as that keeps doctors' fees and wages up by restricting supply. Undergraduate + medical school + residency is way more than necessary to become a competent doctor. Could anyone really claim with a straight face that 4 years of intense study, plus 2-4 years of hands-on apprenticeship wouldn't far more than enough to practice a specific kind of medicine? People pick up many skillsets as difficult as medicine to a competent degree in a lot less than 10 years and hundreds of thousands of dollars of costs. As for Austria, it's an interesting case, huh? Austria has one of the longest traditions of social services in Europe - Otto von Bismarck, Prussian Chancellor, was huge on it. Austria has lots of practice and does a pretty good job of offering a number of services. There's a few downsides, though. Of course, most people have probably heard the argument about how it slows growth and innovation, and there's some truth in that. Typically people counterargue, "Yes, but it's a worthy tradeoff to improve quality of life in the present." And there's merit in that too. But using Austria as a specific example - one of the real dangers of socialization of important elements of an economy is that it makes it much easier for the government to go totalitarian, as was seen under the Nationalsozialistische Deutsche Arbeiterpartei, the National Socialist German Workers' Party. Limited socialism can work with a very strong constitution to limit governmental powers. But without that, politicians become in control of the courts, military, and economy. That's a very dangerous combination. One of the tricky parts about socialism is that it can't adjust fast enough to fill diverse wants and needs. Governments are rock-and-hard-placed: A fast moving, fast changing government makes lots of mistakes. A slow moving, slow changing government doesn't adapt very fast. But one thing socialism is really, really, realy good at is making what Clauswitz (another Austrian-Prussian, genius military scholar) called "total war". That's where your entire economy, culture, and civilization is focused on conquering or destroying another civilization. Every major combatant during World War II went to a more socialized economy, including the United States and England. Government assumed control of much of the production and media. The Allies needed to, because the Germans and Japanese were that focused. One of the reasons that France fell is because it was severely overwhelmed in terms of technology: Less aircraft, less artilery, less mechanized infantry. The American and English governments saw this, and took greater control over their economies. But could any of this have happened without government control of economies in the first place? A charismatic, psychopathic Austrian-Prussian Lance Corporal took over leadership of the National Socialist Worker's Party (Nationalsozialistische, shorthand "Nazi"), and they already had large control over the nation's factories, food, banking, education, medicine, media, and so on. The "trusting the government" culture lets the inevitable bad government run by a psychopath run amok. You could take North Korea as another example - they have the fourth largest army in the world (fourth! despite being #47 in total population!). All they produce effectively is military, but they do a pretty good job of it. So a bit of a tangent there - I'm with your analysis completely about why the costs are high in the United States. I just also point out the very real dangers of state control of the economy. More government power leads to an easier path to totalitarianism and aggressive war. That's one of the reasons Bismarck, a real expansionary conquerer type himself, introduced the culture of social services to Prussian Austria. It builds national loyalty, especially with government-run education. It endears the people to the government and makes them reliant on it. And it lets them flip into "war mode" easily when the political leadership wants to. There can be some advantages, but there's quite real dangers. I share the take as a casually interested historian, and would be very happy to hear some other people's replies and analysis.

lionhearted 17y ago

Very good points. This is one most people don't realize or fully understand: > Employer provided health "insurance" can be paid for with before-tax dollars. Employers that offer health insurance write it off as an expense. They don't payroll taxes on it (unemployment or social security). That means it's roughly 10% cheaper for the employer to offer health insurance instead of pay the equivalent in salary. From the employee's side, an employee pays tax on salary before medical spending under normal circumstances, but health insurance is untaxed. So if an employee gets higher salary, he'd pay taxes on his salary, then buy his antibiotics. If insurance covers it, no taxes. That's why insurance covers inane little things - both employers and employees want all medical spending to be covered by health insurance for tax reasons. Health insurance covered = no payroll taxes for employer, no income taxes for employee. Now, the massive question is -- Why? This seems crazy, no? For most other perks, there's some taxes paid at some point. That's why your company doesn't buy all your food, housing, clothing, everything, and write it all off for you. Answer: Lobbying. Insurance companies lobby hard and donate lots of money to political candidates. Both parties - Republican and Democrat - are in on this arrangement. This is one of the reasons insurance is so crooked - perverse incentives that both parties support. On insurance, the Republicans say, "We're lowering your taxes!" The Democrats say, "We're helping people!" That's not quite right for either of them. They're making the system complicated and driving up costs that make the insurance companies and medical complex wealthier at everyone else's expense. The artificially inflated costs make the system much worse for middle class people, as they lose flexibility in choosing their doctors, getting exact treatments they want, and so on. It hurts people who make responsible health and budgeting decisions, because they'd rather have the salary than the insurance coverage - but then their employer would pay 10% of what they gave in salary, and the employee would pay 30-60% on the income. As opposed to 0%/0% taxes on the insurance. It hurts the poor the worst, because they're least likely to have health insurance at all, and they get stuck in the artificially high priced market. Just a terrible system all the way around. It'd be much better to cut taxes a few percent for all brackets and eliminate the health insurance writeoff entirely. Or alternatively, allow anyone to write any health expenses off the taxes. There'd be many, many better ways than the current system, which is bad for everyone except insurance companies, some medical people (though many of them feel handcuffed by the system and also dislike it), and of course, the politicians getting campaign money, sports tickets, dinners, vacations, gifts, and the rest of the legally-sanctioned corruption.

catzaa 17y ago

> It's accurate that what we have is not insurance. Real health insurance would look more like life insurance, with fixed premiums that can't increase if your health degrades over time. That is what I have. It is called a “hospital plan”. It only covers me when I am in an accident and need to go to the hospital. And it is amazing what cost savings it induces over people with full blown medical schemes. I found that things such as spectacles is over priced by 300%-400% (you can get away a lot cheaper). Dentists will take useless digital x-rays to rape a medical scheme – and most people don’t mind because they aren’t paying for it. Doctors also take useless digital ex-rays (for any slight back problem) - even though they aren’t experts and will only look at it for a few seconds. Doctors sometimes prescribe the newest (and most expensive) anti-biotic instead of a cheaper thing that will also do the trick. Paying out of pocket eliminates all that.

RyanMcGreal 17y ago

The only way to bring down the cost of health care is to make people more frugal, and no one is ever frugal with someone else's money. If that's true, why does every single country with universal, single payer health care spend about half as much money, per capita, on health care as the USA? Shouldn't they be paying more?

Retric 17y ago
Minor correction, the US government and Canadian government spend the same per capita on healthcare, but there the average person does not need extra insurance. Per capita countries with universal healthcare spend less. The reason should be obvious, less paperwork.

shpxnvz 17y ago

Does my perfectly healthy baby need a doctor with ten years' schooling to give him a vaccination? No. For what it's worth, my perfectly healthy baby has never been given a vaccination by a doctor. Shots are given by one of the more cost effective and numerous nursing staff, and are scheduled so that they coincide with a regular well-baby checkup. Not that I disagree at all with your point, just that this particular example doesn't really stand up.