A video on why U.S. health care costs are so high


BaalChatzaf

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Have a peek at this vid (about 7 minutes) and say what you think about the point being made.

http://www.youtube.com/watch?feature=player_embedded&v=qSjGouBmo0M

Ba'al Chatzaf

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I guess his main point is that the USA doesn't have "centralized negotiation" like other countries do. In other countries the government dictates how much it will pay health care providers and for what, if you want to call that "negotiation." The USA has such "centralized negotiation" for Medicare and -- probably less so -- Medicaid. But non-govt-controlled spending in the USA is about one-half. From what I have read, the "for what" is much different in other countries compared to the USA. In other countries there is more use of palliative care and use of drugs rather than surgery.

Two things he does not mention are (1) the amount spent to extend the lives of old people a few days, and (2) the extent to which health insurance is job-related. It is my understanding that #1 is much higher in the USA than other countries, and #2 is little or none except in the USA. If the USA did not have job-related health insurance, the individual health insurance market would be much larger and probably much more price-competitive.

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I guess his main point is that the USA doesn't have "centralized negotiation" like other countries do. In other countries the government dictates how much it will pay health care providers and for what, if you want to call that "negotiation." The USA has such "centralized negotiation" for Medicare and -- probably less so -- Medicaid. But non-govt-controlled spending in the USA is about one-half. From what I have read, the "for what" is much different in other countries compared to the USA. In other countries there is more use of palliative care and use of drugs rather than surgery.

Two things he does not mention are (1) the amount spent to extend the lives of old people a few days, and (2) the extent to which health insurance is job-related. It is my understanding that #1 is much higher in the USA than other countries, and #2 is little or none except in the USA. If the USA did not have job-related health insurance, the individual health insurance market would be much larger and probably much more price-competitive.

He also does not deal with the costs of developing new treatments, medicines and medical technology. Once these things become commodities there is a lot of shifting around that can be done. But FIRST, we must have the stuff to shift around.

Ba'al Chatzaf

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There's a lot in there to comment on, but in regards to "centralized negotiation", I ask why do we need it? He says that individuals don't have any negotiation power, and in some ways that is true. If you're unconscious and dying, you can't stop and negotiate which hospital to go to or what services to receive. However, often it's a matter of, in fact, having negotiation power but not using it. I don't have any statistics, but I would think that a hefty chunk of healthcare costs are not for life-threatening situations, but those in which individuals can do a little bit of planning.

I once negotiated with my health insurance to cover a hospital stay at a "non-preferred" facility because I had first researched the cost of the stay at that facility as opposed to the preferred facility. Part of that research included finding out that my surgeon would charge me less based on the facility. I saved myself and my insurance company money and they were happy to waive the non-preferred status. My surgeon saved himself some additional administrative overhead that the non-preferred facility required of him, and he was happy, too.

Always ask for itemized bills and question the services and products you are paying for. If you didn't use the box of Kleenex, then don't pay for it.

Most hospitals and many private healthcare professionals would much rather discount your bill in exchange for immediate payment than to collect the full amount over time. But you have to ask. And most people don't.

Just because a doctor wants to order an MRI doesn't mean you to have to agree to it. You can negotiate that with your doctor. Of course that requires you to understand your diagnosis and the types of treatment available. Yes, I am suggesting that average people inform themselves and discuss their options intelligently with their doctors.

At dinner last night a friend was worried because she got a letter saying only 3 days of a recent hospital stay were going to be covered by insurance. She was going to have to figure out how to cover the other days. I asked her why only 3 days were being covered. Dunno. I asked her was she going to appeal. Nope, didn't know she had that option. I asked wasn't the appeal process stated in the letter. Oh, yeah, maybe it was. Thing is, there could be lots of reasons for this to have happened. Maybe it was a mistake in medical coding or a standard practice of the insurance company that only takes a phone call to handle. It never occurred to my friend that she had the power to question this and probably even change it.

Individuals have power. Whether or not they choose to exercise it is another thing entirely.

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There's a lot in there to comment on, but in regards to "centralized negotiation", I ask why do we need it? He says that individuals don't have any negotiation power, and in some ways that is true. If you're unconscious and dying, you can't stop and negotiate which hospital to go to or what services to receive. However, often it's a matter of, in fact, having negotiation power but not using it. I don't have any statistics, but I would think that a hefty chunk of healthcare costs are not for life-threatening situations, but those in which individuals can do a little bit of planning.

I once negotiated with my health insurance to cover a hospital stay at a "non-preferred" facility because I had first researched the cost of the stay at that facility as opposed to the preferred facility. Part of that research included finding out that my surgeon would charge me less based on the facility. I saved myself and my insurance company money and they were happy to waive the non-preferred status. My surgeon saved himself some additional administrative overhead that the non-preferred facility required of him, and he was happy, too.

Always ask for itemized bills and question the services and products you are paying for. If you didn't use the box of Kleenex, then don't pay for it.

Most hospitals and many private healthcare professionals would much rather discount your bill in exchange for immediate payment than to collect the full amount over time. But you have to ask. And most people don't.

Just because a doctor wants to order an MRI doesn't mean you to have to agree to it. You can negotiate that with your doctor. Of course that requires you to understand your diagnosis and the types of treatment available. Yes, I am suggesting that average people inform themselves and discuss their options intelligently with their doctors.

At dinner last night a friend was worried because she got a letter saying only 3 days of a recent hospital stay were going to be covered by insurance. She was going to have to figure out how to cover the other days. I asked her why only 3 days were being covered. Dunno. I asked her was she going to appeal. Nope, didn't know she had that option. I asked wasn't the appeal process stated in the letter. Oh, yeah, maybe it was. Thing is, there could be lots of reasons for this to have happened. Maybe it was a mistake in medical coding or a standard practice of the insurance company that only takes a phone call to handle. It never occurred to my friend that she had the power to question this and probably even change it.

Individuals have power. Whether or not they choose to exercise it is another thing entirely.

THe demand for medical services is inelastic. This is an open invitation to predators. The way to battle the sharks is through tough bargaining and wielding much economic clout. Unfortunately we do not have a big private entity going to bat for purchasers of medical services. I wish we did, then we would not have to rely on government which is run by the base, the stupid, and the dishonest.

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Centralized negotiation for a large population was the last point, but not the only one.

Also, I agree with JTS and DLD above. Managing your own health care is important - vitally important, actually - but not something most people do, or want to do. Mostly, we accept a baseline of whatever we are as "normal." We had a discussion here about people who come to work sick. I did not link a recent CNN Health story that the average adult in America has three colds per year. I find that astounding. No wonder so many even here think that being sick is normal.

I do negotiate with my doctors. They hate that. But it is my life.

I just had dinner: 8 ounces of yogurt, a multiple vitamin, an E, a D, a B, and an A. The other day, I had to get some medicine for the cat. I walked to the vet: a mile uphill, a mile back down. In fact, its kind of funny, but I have a bus stop at my corner, but, with three stops between us and the transit center, it arrives half full. So, I walk two stops up the road. It takes longer, but I get the seat I want. One Sunday night when I was new in town, I got caught after the buses stopped running. I walked home eight miles. Nice night for a walk, but not exactly a cardio workout, either.

Everyone is different, of course, and some generalization still apply. Basically, though, if you do nothing, that's what you get.

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The term 'health care', as commonly used, does not mean literally 'care of health'. With more health care in the literal sense, there would be less need for health care in the popular sense.

That's right. It should rightly be called sickcare.

And why are US sickcare costs so high?

Because almost everyone expects someone else to pay their bills...

...commonly known as a Ponzi scam.

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There is an interesting article about health care costs in yesterday's (9/26) Wall Street Journal.

Title: Hospitals Give Health Law Real-World Test.

Subtitle: Accountable-Care Organizations Are Among the Health Act's Main Cost-Cutting Efforts.

These Accountable-Care Organizations (ACOs) are having some successes. "Commercial insurers have created more than 200 ACOs with health-care systems in recent years. Now, the Affordable Care Act is giving the concept a government-funded test by authorizing Medicare to set up pilot ACOs."

I'll bet some politicians will try to grab whatever credit they can for the government.

WSJ on-line subscribers can read the article here.

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In a completely free market, implying a total separation between government and doctors, doctors would be in the business of putting themselves out of business.

Putting themselves out of business means helping people to get well and to stay well and to not get sick in first place.

Any doctor who is not in the business of putting himself out of business, that means he is no good, and doesn't deserve any business, and would not get any business.

The doctor who is the most effective in putting himself out of business would get the most business.

Doctors would have to do their best to put themselves out of business, in order to stay in business; otherwise people would prefer a better doctor.

This competition continued, would eventually result in little need for doctors, and low cost of doctor's services.

Get government out of doctoring.

---

Someone will say something about snake oil. Snake oil is still with us. It is called drugs. Drugs don't reverse diseases. Government promotes snake oil.

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You are opposed to snake oil? Are you opposed to shark cartilage? Honey? ...

Snake oil originally came from China, where it is called shéyóu (). There, it was used as a remedy for inflammation and pain in rheumatoid arthritis,bursitis, and other similar conditions. Snake oil is still used as a pain reliever in China. Fats and oils from snakes are higher in eicosapentaenoic acid(EPA) than other sources. Snake oil is still sold in traditional Chinese pharmacy stores.

http://www.princeton.edu/~achaney/tmve/wiki100k/docs/Snake_oil.html

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Well Jerry, your government provides the rest of your country free access to the snake oil sales force, at one-half the cost per capita (that is per individual, there is more to us than our heads) than it costs in the US. The Globe reports that the number of doctors and their salaries are at an alltime high.

You are making valiant efforts here but doctors are not just going to slink away in shame and people are going to keep going to them.

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In a completely free market, implying a total separation between government and doctors, doctors would be in the business of putting themselves out of business.

Putting themselves out of business means helping people to get well and to stay well and to not get sick in first place.

Any doctor who is not in the business of putting himself out of business, that means he is no good, and doesn't deserve any business, and would not get any business.

The doctor who is the most effective in putting himself out of business would get the most business.

Doctors would have to do their best to put themselves out of business, in order to stay in business; otherwise people would prefer a better doctor.

This competition continued, would eventually result in little need for doctors, and low cost of doctor's services.

Get government out of doctoring.

---

Someone will say something about snake oil. Snake oil is still with us. It is called drugs. Drugs don't reverse diseases. Government promotes snake oil.

While I totally agree with your logic, it's impossible for the government to ever get out of doctoring as long as everyone expects someone else to pay their bills. And because they do, they're getting exactly the healthcare system they deserve. So let them choke on the rotten system they created in their own rotten image.

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Not up here we aren't.

What's "up here"? Canada? Anyways, I was referring to "down here" where everyone expects the government to make someone else pay their bills.. There is no way any collectivist system could ever work under those irresponsibly unsustainable conditions. Even at that, I do really admire Ted Cruz actually making a stand.

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Well Jerry, your government provides the rest of your country free access to the snake oil sales force, at one-half the cost per capita (that is per individual, there is more to us than our heads) than it costs in the US. The Globe reports that the number of doctors and their salaries are at an alltime high.

You are making valiant efforts here but doctors are not just going to slink away in shame and people are going to keep going to them.

I was talking about a free market. There is little or nothing in Canada or USA resembling free market, as I count free market, in the doctoring profession.

With government control of the doctoring profession, you should expect the worst. For example, prescribing poisons for health, which is a ridiculously ridiculous idea.

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The term 'health care', as commonly used, does not mean literally 'care of health'. With more health care in the literal sense, there would be less need for health care in the popular sense.

That's right. It should rightly be called sickcare.

And why are US sickcare costs so high?

Because almost everyone expects someone else to pay their bills...

...commonly known as a Ponzi scam.

A proper casualty insurance scheme where the premiums are proportional to the risk or hazard is NOT a Ponzi scheme.

Unfortunately all the government based scheme proposed so far is that we are all force to put our money in one pot and pay out from it. The only way that can even pretend to work is by rigorous rationing of medical services. Bummer.

Ba'al Chatzaf

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A proper casualty insurance scheme where the premiums are proportional to the risk or hazard is NOT a Ponzi scheme.

Sure it is, Baal.

Every insurance participant expects someone else to pay their bills.

If they didn't, they'd simply pay their own bills.

Exactly that same corrupt third party payer system infests other sectors of the economy besides Insurance... Government, Education, Credit, Healthcare, Debt, Law, and Unions.

I avoid ALL of these sectors as if they were zombies, because they will SUCK you dry and SPIT out your financial corpse. Anyone who has enslaved themselves to them through the something for nothing feelings of being entitled to others paying their bills, is getting exactly what they deserve.

Greg

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A proper casualty insurance scheme where the premiums are proportional to the risk or hazard is NOT a Ponzi scheme.

Sure it is, Baal.

Every insurance participant expects someone else to pay their bills.

If they didn't, they'd simply pay their own bills.

Exactly that same corrupt third party payer system infests other sectors of the economy besides Insurance... Government, Education, Credit, Healthcare, Debt, Law, and Unions.

I avoid ALL of these sectors as if they were zombies, because they will SUCK you dry and SPIT out your financial corpse. Anyone who has enslaved themselves to them through the something for nothing feelings of being entitled to others paying their bills, is getting exactly what they deserve.

Greg

You are totally wrong. A properly funded insurance plan is a mode of risk sharing. It goes all the way back to Lloyd's of London insuring ships. People paid for their statistically expected casualty losses. If there were no such plans then there would have been much less invested in sea commerce to the detriment of the economy and Europe.

By the way do you have a health insurance plan or do you self insure yourself against medical casualty?

Ba'al Chatzaf

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You are totally wrong. A properly funded insurance plan is a mode of risk sharing.

...only for people who expect someone else to pay their bills.

I chose the path far less trampled... to accept the personal responsibility of assuming my own risks in life.

By the way do you have a health insurance plan or do you self insure yourself against medical casualty?

Your question was already answered in the previous post.

Exactly that same corrupt third party payer system infests other sectors of the economy besides Insurance... Government, Education, Credit, Healthcare, Debt, Law, and Unions.

I avoid ALL of these sectors as if they were zombies, because they will SUCK you dry and SPIT out your financial corpse. Anyone who has enslaved themselves to them through the something for nothing feelings of being entitled to others paying their bills, is getting exactly what they deserve.

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You are totally wrong. A properly funded insurance plan is a mode of risk sharing.

...only for people who expect someone else to pay their bills.

I chose the path far less trampled... to accept the personal responsibility of assuming my own risks in life.

By the way do you have a health insurance plan or do you self insure yourself against medical casualty?

Your question was already answered in the previous post.

Exactly that same corrupt third party payer system infests other sectors of the economy besides Insurance... Government, Education, Credit, Healthcare, Debt, Law, and Unions.

I avoid ALL of these sectors as if they were zombies, because they will SUCK you dry and SPIT out your financial corpse. Anyone who has enslaved themselves to them through the something for nothing feelings of being entitled to others paying their bills, is getting exactly what they deserve.

The insurance system exists as it is today to give the people who expect others to pay their bills exactly what they deserve.

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You are totally wrong. A properly funded insurance plan is a mode of risk sharing.

...only for people who expect someone else to pay their bills.

I chose the path far less trampled... to accept the personal responsibility of assuming my own risks in life.

By the way do you have a health insurance plan or do you self insure yourself against medical casualty?

Your question was already answered in the previous post.

Exactly that same corrupt third party payer system infests other sectors of the economy besides Insurance... Government, Education, Credit, Healthcare, Debt, Law, and Unions.

I avoid ALL of these sectors as if they were zombies, because they will SUCK you dry and SPIT out your financial corpse. Anyone who has enslaved themselves to them through the something for nothing feelings of being entitled to others paying their bills, is getting exactly what they deserve.

The insurance system exists as it is today to give the people who expect others to pay their bills exactly what they deserve.

No. It is to keep the average cost of casualty close to its expected statistic value. People are paying premiums and not collecting, because they have not had the casualty they are insured against. People collected for casualty have already paid in part of the benefit they are receiving.

It is a way of time averaging the statistically expected expense of the casualty.

If the insurance scheme is actuarial sound over the long haul all participants will pay the same amount whether they suffer the casualty or not.

What they are protected against is having two casualty expenses in quick succession rendering them bankrupt.

Also, anyone who has purchased an asset over time (essentially borrow the money) is protecting the lenders interest in the asset purchased with borrowed money. Without such insurance no one would lend anyone money to purchase an asset which is collateral for the loan.

Ba'al Chatzaf

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You are totally wrong. A properly funded insurance plan is a mode of risk sharing.

...only for people who expect someone else to pay their bills.

I chose the path far less trampled... to accept the personal responsibility of assuming my own risks in life.

By the way do you have a health insurance plan or do you self insure yourself against medical casualty?

Your question was already answered in the previous post.

Exactly that same corrupt third party payer system infests other sectors of the economy besides Insurance... Government, Education, Credit, Healthcare, Debt, Law, and Unions.

I avoid ALL of these sectors as if they were zombies, because they will SUCK you dry and SPIT out your financial corpse. Anyone who has enslaved themselves to them through the something for nothing feelings of being entitled to others paying their bills, is getting exactly what they deserve.

The insurance system exists as it is today to give the people who expect others to pay their bills exactly what they deserve.

No. It is to keep the average cost of casualty close to its expected statistic value.

Of course... by others paying your bills.

Do you realize the GIGANTIC bureaucracy that has been created just to monitor, record, control, regulate, litigate, apportion, and TRANSFER money from one person to another?

That bureaucracy produces NOTHING.

So it sure isn't any wonder that the government wants to get into the insurance biz. It's another transfer of wealth scam where it can skim off the top to grow even larger.

People are paying premiums and not collecting, because they have not had the casualty they are insured against. People collected for casualty have already paid in part of the benefit they are receiving.

Have you ever stopped to consider that you're betting against yourself? You lose money as long as there is no calamity, and the only way you can win is to experience calamity.

My way is exactly the opposite. I'm betting in favor of my own self interest. By accepting the personal responsibility of being self indemnified, the more I can avoid calamity, the more I win.

Guess which one spins into motion better consequences?

It is a way of time averaging the statistically expected expense of the casualty.

If the insurance scheme is actuarial sound over the long haul all participants will pay the same amount whether they suffer the casualty or not.

What they are protected against is having two casualty expenses in quick succession rendering them bankrupt.

Well, Baal... that's your own free choice. I choose to accept the personal responsibility for my own risks of life myself.

Also, anyone who has purchased an asset over time (essentially borrow the money) is protecting the lenders interest in the asset purchased with borrowed money. Without such insurance no one would lend anyone money to purchase an asset which is collateral for the loan.

While that's another topic entirely, it's still belongs to the very same liberal socialist third party payer system (Debt, Government, Credit, Education, Insurance, Healthcare, Law, Unions). And explains why I choose not to make debt payments on anything by owning all my possessions outright including vehicles and homes.

Just for a moment take note of all these economic sectors again:

Government

Credit

Debt

Education

Law

Insurance

Healthcare

Unions

And ask yourself... What is the quality they ALL share in common?

Greg

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  • 1 year later...

I dug up this old thread to excerpt from an old article (but I guess, its not old if you haven't read it!)

From TIME January of this year

Oh, sorry, a slight bit of back ground first. This guy Steven Brill, wrote and excellent article (2013) on the costs of surgery in the US. In it he mentioned the chargemaster costs for things like a dollar per aspirin and 7 dollars per gauze strip and even a five dollar charge for the marking of the spot (with a sharpie) that the surgery should occur and 30 dollars for the use of a heating blanket.

Anyway, he followed up with this article in which he himself had a surgery and he documented the charges that occurred. Then he offers some policy changes that would get the systems prices back in line with reality. A few of them were pretty interesting and then he said

"....Better yet, an excess-profits pool would be created. Those making higher profits would have to contribute the difference to struggling hospitals in smaller markets"

Yes, that is verbatim.

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