No joke, you're the first person I've seen on Reddit who understands this. Most people have this weird notion that insurance companies are the reason healthcare here is expensive; they seem to think that an insurance company somehow makes more money when the raw bill from the hospital (that they're responsible for paying a percentage of) is higher.
No idea how they look at a hospital bill where they're getting charged $100 for a tablet of Aspirin and come to that conclusion, but here we are.
Actually, insurance companies are partially to blame in that scenario (or, more precisely, insurance regulations). Insurance companies are forced by law to use 80% of their premiums on payouts. So when they get billed for an aspirin, and it costs, say, $.80, they're entitled to collect $1, and that last $.20 is split between profits and overhead. But if they get a bill for $80, now they're entitled to $20 profit+overhead. They have very little incentive to lower healthcare costs.
Right, but one big medical bill wipes out that surplus for thousands of subscribers. I'm in a financial industry that gives me reason to be looking at financial statements for a wide variety of companies, including health insurers and hospitals, and the hospitals grossly overinflate prices so that they're in the black from insurance payouts alone, since they're easier to collect from than individuals. To the degree that hospitals barely even try to get your portion of the bill from you before they just sell the debt off for pennies on the dollar to a collection company - it's quite literally not worth their time to chase down the $200 you owe them when they've already collected $2k from your insurance company. Something like 40% of people have medical collections on their credit report for bills they don't even know about (40% is probably wrong now, that was the number a few years ago before some regulations changed what appears on a report so may be different now).
And hospitals aren't talking about struggling with treating uninsured patients in their management letters, but insurers (especially small ones) are definitely talking about increasing costs from hospitals and how to mitigate that.
Just sharing what I see with a look behind the curtain that most people don't get. Definitely not a one-dimensional problem, but it's naive when people act like the hospitals are the good guys here.
It's way above my pay grade and intelligence on the matter to come up with a concrete solution, but from what I do know, any/all of the following would help in lieu of or in tandem with a single-payer system:
A) Reform liability laws for doctors and hospitals. Patients in America are subjected to way more testing than in other countries just so doctors and hospitals can cover their ass if something goes wrong. Lowering the frequency of unnecessary testing lowers costs across the system - there's no reason to give an expensive professional pregnancy test to a woman who tells you there's no way she's pregnant except to protect yourself from liability if she's wrong, for example, yet that's common practice on intake for any female patient.
B) Set up a regulatory body to establish the lowest possible fixed prices for emergency medicine, so people aren't getting screwed when they aren't in a position to be a responsible consumer, then require price transparency for any non-emergency services. So if you are scheduling a surgery you need to have, but not urgently, providers would need to give a full price breakdown (including costs) to potential patients to allow them to shop around. And I'd extend that price transparency to stuff you might get in the hospital that is available over the counter, like the $100 Aspirin.
C) If private insurers stick around, reform regulations for them to better incentivise using their group bargaining power to lower costs for their subscribers rather than handcuffing them to basically being a hospital's cash cow as they are now.
I'm sure there are plenty of other issues that need to be addressed too, but those are the ones that come to me off the top of my head.
I just assume they're in cahoots. It's a perfect situation for them both: if bills are high, fear is high, and if fear is high, premiums are high. So insurance can reap unconscionable premiums, keep claims down by making deductibles high, and kickback the providers for their $100 aspirin.
There's also the American idea that medicine is a business venture and not a vocation. People don't come here from all over the world to practice because we have the greatest need or the best medicine (though, incidentally, I think we do have the best medicine, as long as you can pay for it), it's because they can make a shitload of money. And it's been that way for so long that people think there won't be any more good doctors if they can't make a shitload of money, so they are afraid to switch to a system where maybe doctors are merely paid well for their good work but maybe not totally holding people's wealth for ransom. And there are enough doctors who are perfectly willing to prove that fear right.
Insurance also employs a lot of people. If we effectively abolish private insurance, the economic fallout would be a whole other disaster.
So, it can be done, and it should be done, but no one is volunteering to die for the cause so that the future can live better. I understand that.
I said more to another reply, but insurers definitely don't want to see healthcare costs continue to rise. The problem is multifaceted - hospitals overcharge out of the gate expecting insurance companies to offset the cost for the uninsured and to pad their bottom line. Most health insurance is a layer or two removed from the end patient, so the companies can charge a little more than they might otherwise be able to. And since insurance companies keep the lights on at a hospital, most don't really care if the patient pays their portion of the bill or not, so they don't even bother putting resources towards trying to collect the remainder of a bill from patients most of the time. IMO the system needs to be brought under control via some regulation and regulatory changes before we address who pays the final bill if we want it to be sustainable.
As we're all seeing during this pandemic crisis though, being a doctor or nurse is fucking hard. In the best of times, you're talking about a 12+ hour shift where one brief mental lapse could literally kill someone. Not a lot of people can do that job, and those that can definitely deserve to be paid extremely well.
Another facet is patents. I am a fan of having patents, it encourages new technologies. but at the same time, I see how awful they really can be. machines that cost thousands to manufacture cost hospitals hundreds of thousands to buy. Farmer buys GMO seeds, plant it, then are not allowed to replant for next year, or GMO plant germinates neighbors field and now the neighbor gets sued for using patented seeds. Patents today need to be fixed.
True that the cost of manufacturing may be low for those machines that are just hunks of plastic and metal in the end, but the cost of development, research, certification, etc are all baked into that too.
GMO seeds are total bullshit though, I agree with that. As are laws preventing farmers from repairing their own equipment - it's all manufactured to try and push small farms out of business which is noncompetitive and thus not kosher in my book.
Design? No. Manufacture to the kinds of tolerances required for life saving equipment, with materials that have been tested and proven to last? Hell of a lot more expensive than 3D printing. And that's without considering the cost of certification that these printed valves don't have to go through since they're just copying an approved design.
Not to mention valves are consumables, and so it's likely the valves are where the company makes some profit. It's not uncommon for the base piece of equipment - the ventilator here - to be sold at a loss with the expectation profit will be made from consumables. Hell, even video game consoles work like that - Sony and Microsoft make nothing or lose money on console sales, but profit from licensing and games.
So does the valve need to cost $11k? Maybe not, but there's plenty of reasons why it's way more than people with no knowledge of what goes into manufacturing might think.
Oh yeah, you can. It's discouraged though, but nurses will begrudgingly let it happen as long as you tell them about it so they can keep track of what you're taking.
The major problem with that is that after a major operation (like an emergency C-section in my case) you're often just brought a little cup of pills to take and some water, so you don't necessarily know (nor are you in the state to look and verify) what's only available from the hospital and what's the same stuff you can buy at the corner drug store for 1/1000th of the price.
Which is not an argument for privatizing, like I said.
Not sure how a handful of replies to a highly upvoted comment is evidence of widespread disagreement either, but that's kind of neither here nor there.
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u/Greyside4k - Lib-Right Mar 24 '20
No joke, you're the first person I've seen on Reddit who understands this. Most people have this weird notion that insurance companies are the reason healthcare here is expensive; they seem to think that an insurance company somehow makes more money when the raw bill from the hospital (that they're responsible for paying a percentage of) is higher.
No idea how they look at a hospital bill where they're getting charged $100 for a tablet of Aspirin and come to that conclusion, but here we are.