Real efforts to reduce healthcare costs

[Kiyoat Husker]

I titled this thread to be a catch-all for positive health care reform that is not just another political attack on the ACA.  The forces that make healthcare unaffordable have been around long before the ACA, and were not caused by it, or exacerbated by it.

I don't expect to see very many entries in this thread, but here's at least one:

http://www.reuters.com/article/us-usa-generics/u-s-states-allege-broad-generic-drug-price-fixing-collusion-idUSKBN1D0201

A large group of U.S. states accused key players in the generic drug industry of a broad price-fixing conspiracy, .......

The states said the drugmakers and executives divided customers for their drugs among themselves, agreeing that each company would have a certain percentage of the market. The companies sometimes agreed on price increases in advance, the states added....

The price of doxycycline rose from $20 for 500 tablets to $1,849 between October 2013 and May 2014......

This is the problem I have with conservative supply-side economics (trickle-down) that are anti-regulation, and think that less regulation always leads to more competition and lower prices.  I'm sure that it happens that way sometimes, but more often there are monopolies and collusion schemes, too.

 

[BigRedBuster]

We have this crap going on and the political idiots keep talking about insurance premiums.  The insurance companies don't give a crap if a bottle of doxycycline costs $20 or $1,849.  They just pass those costs onto us as higher premiums.  The insurance company down the street is being charged the same amount so who cares?

And people wonder why we are spending 2.5 times more for procedures or drugs than other developed countries.  

Trump rants on and on about stopping the insurance companies from making a killing off of the ACA.  Fine...great....I'm all for that.  BUT....that's not where the biggest problem is.

 

[Kiyoat Husker]

I don't claim to have all the answers to why heathcare is so expensive in America, but I'm tired of political forces and special interests driving the conversation.

Here's a Forbes article that tries to answer this question:

https://www.forbes.com/sites/physiciansfoundation/2013/10/03/whos-to-blame-for-our-rising-healthcare-costs/#bf0e87677e0b

For many years and in countless articles, physicians have been the scapegoat for rising healthcare costs in the U.S......

Technology, administrative expenses, hospital costs, lifestyle choice and chronic disease conditions have all had greater impacts on rising overall healthcare costs than physicians....

There is consensus among experts that technology is the most important driver of healthcare spending increases over time....

 

[TGHusker]

I don't claim to have all the answers to why heathcare is so expensive in America, but I'm tired of political forces and special interests driving the conversation.

Here's a Forbes article that tries to answer this question:

https://www.forbes.com/sites/physiciansfoundation/2013/10/03/whos-to-blame-for-our-rising-healthcare-costs/#bf0e87677e0b

I saw my doc yesterday. He once had his own private medical business for decades.  He is now a part of a hospital network of docs.  He gets paid a salary now and the network has all of the expenses and the bulk of the paperwork compliance. But he said he is pushed by the network for 'production'.  They want the docs to make sure patients are regularly coming in for whatever reason. He says he is not playing that game and he is too old to change his ways - mid 60s.   All of the health care regulations & insurance company requirements made his job and the jobs of many other doctors to become paper pushers and pill pushers.  Spending all of their time completing forms and having not enough time to properly treat a patient - thus easier to push a pill - which plays into big pharma's  trap.  So many docs either sell out to the networks or go to a cash basis - no insurance.   It is difficult being a provider these days - insurance companies, big pharma, and the govt pretty much call the shots.

 

[BigRedBuster]

21 graphs that show America’s health-care prices are ludicrous

What these graphs show are not caused by "lifestyle choices and critic disease and conditions.  It doesn't have to do with technology either since all the technology is the same.  If you get an MRI in France, it's not different than an MRI in the US.

This is directly related to the American people being shielded away from the real costs and hospital administrators and care providers have no motivation to control these costs because insurance will just pay them and pass them on.

 

[Kiyoat Husker]

21 graphs that show America’s health-care prices are ludicrous

What these graphs show are not caused by "lifestyle choices and critic disease and conditions.  It doesn't have to do with technology either since all the technology is the same.  If you get an MRI in France, it's not different than an MRI in the US.

This is directly related to the American people being shielded away from the real costs and hospital administrators and care providers have no motivation to control these costs because insurance will just pay them and pass them on.

Link is broke.

 

[BigRedBuster]

Link is broke.

fixed

 

[RedDenver]

21 graphs that show America’s health-care prices are ludicrous

What these graphs show are not caused by "lifestyle choices and critic disease and conditions.  It doesn't have to do with technology either since all the technology is the same.  If you get an MRI in France, it's not different than an MRI in the US.

This is directly related to the American people being shielded away from the real costs and hospital administrators and care providers have no motivation to control these costs because insurance will just pay them and pass them on.

Amazing/frustrating! Great article.

 

[Kiyoat Husker]

Really the answer is: depends on who you ask.

The article I linked was written by a doctor and doctor's advocate, and basically said: "It's not the doctors! ".

The data and graphs you linked were created by a global insurance trade organization, and basically said: "It's not the insurance companies!".

Each had good data that pointed in a different direction.  I like the WaPo article that was linked further down in your article 

https://www.washingtonpost.com/news/wonk/wp/2013/03/15/why-an-mri-costs-1080-in-america-and-280-in-france/?utm_term=.418c1d43138b

some quotes:

There is a simple reason health care in the United States costs more than it does anywhere else: The prices are higher.

[...]

Americans don’t see the doctor more often or stay longer in the hospital than residents of other countries. Quite the opposite, actually. 

[...]

“Other countries negotiate very aggressively with the providers and set rates that are much lower than we do,” Anderson says. They do this in one of two ways. In countries such as Canada and Britain, prices are set by the government. In others, such as Germany and Japan, they’re set by providers and insurers sitting in a room and coming to an agreement, with the government stepping in to set prices if they fail.

In America, Medicare and Medicaid negotiate prices on behalf of their tens of millions of members and, not coincidentally, purchase care at a substantial markdown from the commercial average. But outside that, it’s a free-for-all. Providers largely charge what they can get away with, often offering different prices to different insurers, and an even higher price to the uninsured.

[...]

Health care is an unusual product in that it is difficult, and sometimes impossible, for the customer to say “no.” [...]  imagine what you would pay for a television if the salesmen at Best Buy knew that you couldn’t leave without making a purchase.

[...]

unlike in other countries, sellers of health-care services in America have considerable power to set prices, and so they set them quite high. Two of the five most profitable industries in the United States — the pharmaceuticals industry and the medical device industry — sell health care. With margins of almost 20 percent, they beat out even the financial sector for sheer profitability.

The players sitting across the table from them — the health insurers — are not so profitable. In 2009, their profit margins were a mere 2.2 percent. That’s a signal that the sellers have the upper hand over the buyers.

Good article.  Kind-of exonerates health insurance companies as the driver of the system.  Also points to the need for more government oversight for a system where the consumers currently and inherently have little choice.  Unfortunately I don't see that happening.  The middle ground between the right and left is nowhere near having more government oversight.  This will not be fixed soon.  Or ever.

 

[Kiyoat Husker]

A thought just occurred to me.  If Insurance companies are the "Buyers" to the Providers' "Sellers" role, one possible check on prices would be to allow insurance companies more power to negotiate with providers.  There should still be protections for the insured, but consumer choice doesn't seem to be have an affect on the providers prices.  Insurers, on the other hand, could have more clout in controlling prices with buying choices, right?

My head hurts....

 

[BigRedBuster]

A thought just occurred to me.  If Insurance companies are the "Buyers" to the Providers' "Sellers" role, one possible check on prices would be to allow insurance companies more power to negotiate with providers.  There should still be protections for the insured, but consumer choice doesn't seem to be have an affect on the providers prices.  Insurers, on the other hand, could have more clout in controlling prices with buying choices, right?

My head hurts....

Oh...insurers put out a veiled effort to negotiate. When our company meets with our insurance company, they put out this huge effort to convince us they are working for our benefit by negotiating better prices.  Meanwhile, like your post above points out, medicare and medicaid pay at a substantially lower rate.

Hmmmm....who does a better job of negotiating?

 

[TGHusker]

Really the answer is: depends on who you ask.

The article I linked was written by a doctor and doctor's advocate, and basically said: "It's not the doctors! ".

The data and graphs you linked were created by a global insurance trade organization, and basically said: "It's not the insurance companies!".

Each had good data that pointed in a different direction.  I like the WaPo article that was linked further down in your article 

https://www.washingtonpost.com/news/wonk/wp/2013/03/15/why-an-mri-costs-1080-in-america-and-280-in-france/?utm_term=.418c1d43138b

some quotes:

Good article.  Kind-of exonerates health insurance companies as the driver of the system.  Also points to the need for more government oversight for a system where the consumers currently and inherently have little choice.  Unfortunately I don't see that happening.  The middle ground between the right and left is nowhere near having more government oversight.  This will not be fixed soon.  Or ever.

Yes I liked that article also.  Some important quotes in bold.  

This is a good deal for residents of other countries, as our high spending makes medical innovations more profitable. “We end up with the benefits of your investment,” Sackville says. “You’re subsidizing the rest of the world by doing the front-end research.”

But many researchers are skeptical that this is an effective way to fund medical innovation. “We pay twice as much for brand-name drugs as most other industrialized countries,” Anderson says. “But the drug companies spend only 12 percent of their revenues on innovation. So yes, some of that money goes to innovation, but only 12 percent of it.”

And others point out that you also need to account for the innovations and investments that our spending on health care is squeezing out. “There are opportunity costs,” says Reinhardt, an economist at Princeton. “The money we spend on health care is money we don’t spend educating our children, or investing in infrastructure, scientific research and defense spending. So if what this means is we ultimately have overmedicalized, poorly educated Americans competing with China, that’s not a very good investment.”

 

[Kiyoat Husker]

Oh...insurers put out a veiled effort to negotiate. When our company meets with our insurance company, they put out this huge effort to convince us they are working for our benefit by negotiating better prices.  Meanwhile, like your post above points out, medicare and medicaid pay at a substantially lower rate.

Hmmmm....who does a better job of negotiating?

Did you say "negotiate"?  No problem.  We have the "best" people in government to get this deal done!

 

[Guy Chamberlin]

I had my credit card hacked last fall, which caused a glitch in my automatic payments for Covered California (ACA) Blue Cross PPO.

Unbeknownst to me, I had NO insurance for one month while I was switching plans.  But my automatic prescription refill went through at that time, and the $30 worth of Omega-3 capsules (fish oil) I take for my cholesterol suddenly became $530.

I'm no longer covered by Blue Cross, which apparently pays this ridiculous $500 overcharge on my behalf, and now it has gone to a collection agency. I have a stellar credit rating, but I'm inclined to ignore this one forever.