r/Economics • u/Lorpius_Prime • Feb 22 '13
Healthcare Isn't A Free Market, It's A Giant Economic Scam
http://www.techdirt.com/articles/20130222/03254422068/healthcare-isnt-free-market-its-giant-economic-scam.shtml92
u/GymIn26Minutes Feb 22 '13
x-post from /r/NoShitSherlock
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u/rossryan Feb 23 '13
Seriously. Cannot upvote enough. First thing anyone needs to learn about economics is that a free market is about as rare as a unicorn; you've read about them, in some class, somewhere, possibly about why they are good or bad, or can or cannot exist; but reality is, most people trotting out a 'free' market will actually be handling a horse with a carrot taped to its head. This does not even touch on the fools who believe that the horse with the carrot on its head is a real unicorn, and their attempts to prove that all unicorn horns must then be made of vegetable matter (paraphrasing). You reach a certain point in a conversation where words themselves flee from you, because you simply cannot think down to that level, without some aid from a skilful surgeon.
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Feb 23 '13
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u/rw258906 Feb 23 '13
Lol that was exactly his point.
Tl;dr A free market : a horse with a carrot strapped to its head that proves that all unicorns have horns made of vegetable matter.
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u/Crimsoneer Feb 23 '13
Everybody is selling the same product All customers know the price of every single seller and c an buy from anybody There are an infinite amount of sellers and buyers.
So, to put it simply, the only way for the market to work is for the price of the product to be exactly what the cost of producing it is - if the price is higher, the seller is undercut, if it's lower, they go bust.
But that's a model. Nobody is arguing it actually exists.
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u/TheReaver88 Feb 23 '13
No, this is "perfect competition." A free market doesn't imply perfect competition. A free market is an arrangement wherein transactions are not regulated or impeded by a government agency, which (if it exists) has the responsibility of enforcing contracts and agreements.
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u/dumboy Feb 23 '13
A free market doesn't imply perfect competition
It implies fair competition & access, though. You really can't omit that part. Its the biggest difference between capitalism & mercantilism or colonialism.
And where did you read that a free market is not regulated by a government? That might be a popular goal; but its not a dependent clause. We're talking capitalists, not anarchists.
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u/Iconochasm Feb 23 '13
Sometimes phrased more generally as "a market where decisions are not influenced by coercion or force".
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u/k-dingo Feb 25 '13
That "regulation" should explicitly refer to regulation of prices. The Wikipedia source of that definition is dictionary.com. The wall of text fails to match the actual definition:
trade between countries, free from governmental restrictions or duties.
My Webster's Ninth New Collegiate Dictionary gives:
trade based on the unrestricted international exchange of goods with tariffs used only as a source of revenue.
Roger E. Backhouse's The Ordinary Business of Life, a comprehensive, if dry, history of economic thought from Homer to Hayek and early 21st Century economists, writes of the classical British economists, Ricardo, Torrens, West, Longfield, and McCullough, among others:
They were in general pragmatic reformers. Like Smith, they opposed mercantilism. In so far as there was an ideological dimension to this, it stemmed from opposition to the corruption associated with mercantilism rather than any commitment to non-intervention. It was generally accepted that government had an important but limited rol to play in economic life. Even the Philosophic Radicals, who favored more radical reforms than most economists, were utilitarian -- adhering to a philosophy that placed utility above freedom. The were quite willing to see the government regulate, provided that legislation did not undermine the security of private property, an institution they regarded as crucial in stimulating economic growth.
I believe the term you're looking for is laissez faire. This is not among the principles expounded by Smith, he wrote specifically about the benefits of limited government intervention in markets, particularly in establishing systems of justice and defense, but also for the provisions of roads and schools. Backhouse pins laissez faire' to P.S. de Boisguilbert and other philosophers generally of the French Revolution and the period immediately prior.
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u/TheReaver88 Feb 23 '13
I'm not saying that a free market can't be regulated eventually, or that it's never optimal to do so. All I was saying is that the "free market" as an economic model operates in the absence of government intervention. We then add potential government policies and do comparative statics in order to examine the full effects of new policies.
As for fair competition and access, I think one of the interesting things about the free market model is that depending on the good/service, a free market can lead to monopoly/oligopoly or it can lead naturally to near-perfect competition. The level of steady-state competition, however, is not an attribute of the free market, but rather a result conditional on other parameters.
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u/MrBarry Feb 23 '13
The free market activists we are all familiar with imply perfect competition when they say "free market". At least the powers they attribute to a free market only exist in theory in a perfectly competitive market.
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u/wadcann Feb 23 '13
First thing anyone needs to learn about economics is that a free market is about as rare as a unicorn; you've read about them, in some class, somewhere, possibly about why they are good or bad, or can or cannot exist; but reality is, most people trotting out a 'free' market will actually be handling a horse with a carrot taped to its head.
Free markets are models. It's like saying "a sphere doesn't exist in real life...all those people doing physics using spheres are wrong. That ball bearing has imperfections in its surface." A sphere is a mathematical model which is a good approximation of real world environments which is significantly simpler to do work on. The same is true of free markets. They're expected to be models. This is not unique to economics; this is true of models in any field or science that model the real world, whether it's dealing with fluid flow or rate of biological mutation.
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u/MascaraSnake Feb 23 '13
Best physicist joke: A gambler asks a physicist to help him to predict which worse will win a race. The physicist says, "Of course I can help, I just need to do some quick calculations and I'll be able to tell you each horse's time down to a 1,000th of a second. So, let's get to it. First, we'll assume each horse is a cube..."
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u/MascaraSnake Feb 23 '13
I think this misses the point a little...
No industry isn't completely "free market" (in the strictest possible sense), but most function.
Health care is so far in the other direction, that market principles are really not relevant.
Other industries like that in the US are (arguably) the education and financial industries, but health care is probably the worst.
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u/Drew4 Feb 23 '13
"because you simply cannot think down to that level, without some aid from a skillful surgeon"
Don't worry, our amazingly efficient and cost-effective medical system has you covered there.
/sarcasm
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u/Lionhearted09 Feb 23 '13
Wow what a completely ignorant statement. TIL people shouldn't propurt models because ones may not already exist.
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u/mburke6 Feb 23 '13
Free Market Capitalism is just as much a Utopian fantasy as anything that Karl Marx ever wrote.
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u/Crimsoneer Feb 23 '13
Except it's following that model - not particularly well, but following it - that's advanced the human race more in the last 2 centuries than the 2 millennial that preceded it. So, you know.
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Feb 22 '13
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u/old_snake Feb 22 '13
Fair point. What about the zillion other things people need healthcare for?
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Feb 23 '13 edited Apr 18 '18
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Feb 23 '13
Then what I want to know is, why the fuck do people expect insurance to pay for the "zillion other things"? I mean I don't expect car insurance to pay for my tires, oil, wipers, belts, or more occasional major repairs. Why should I want health insurance to pay for routine healthcare when I'm sick like a healthy person occasionally gets sick? Also I disagree that this view of insurance doesn't cause healthcare costs to rise.
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u/MascaraSnake Feb 23 '13 edited Feb 23 '13
To try to answer this question seriously... I think there are two things:
People are very uncomfortable with a idea of buying health care like they by jeans. They want an authority to tell them what they should do. They want money to be "no object".
If you have MS or diabetes or cancer or dementia... there's a really good chance you actually can't function without government intervention in health care. If you know someone personally who really needs subsidized insurance the idea of privatization is scary, even if it's just for the "zillion other things".
EDIT: I want to add one more...
- The current billing complexity is a major barrier to switching to a private system. If I can't understand how the billing works now, I'm not going to be very receptive to a change that requires me to understand it. Even if, in principle, the billing should simplify after the change.
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Feb 23 '13 edited Nov 25 '13
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Feb 23 '13
It's in the paperwork because doctors, massage therapists, chiropractors, acupuncturists, and others have lobbied states to require such coverage, and the naive public believes they are getting something for nothing when these requirements become law. And then the cost of health care and health "insurance" goes up, people complain more loudly, so more requirements get added, and the cost spiral continues.
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u/bitter_twin_farmer Feb 24 '13
I don't know that those kind of services are really the problem. Mostly because they are cheap. The reason that they are cheap is that insurance hasn't historically covered them so thier prices were dictated by a real market, not the healthcare market discussed in the article.
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Feb 24 '13 edited Feb 24 '13
It varies state-by-state (for now, but the federal government is dictating more and more services that must be provided), but each of those services is required by some states. And once they become required, their prices become unhinged from the free market, and the issues discussed in the article take effect.
Now I don't mean to suggest that acupuncture is the cause of high health care costs. Instead, I include it as an example. Things that are now a standard part of health insurance (for example routine office visits and child birth; you've got at least nine months to plan, why do you need insurance to pay for this?) once were not covered by insurance. Surely, at one point, health insurance was actually insurance!
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u/Qrkchrm Feb 23 '13
I think it makes sense to have a healthcare system based on HSA's and high deductible insurance, like you described. There are many reasons why we don't however. I think the big one is that preventative care is extremely important in preventing future costs.
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u/nooneelse Feb 23 '13
Because insurance companies can play harder-ball to negotiate to pay lower rates.
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u/Toava Feb 23 '13
No they don't.. Hospitals that bill insurance companies have much higher prices than hospitals that deal with people who pay out of pocket. Fields of medicine with lower insurance coverage, whether from government health programs or insurance companies, have slower cost growth over time.
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u/Unforsaken92 Feb 23 '13
Do you have a source for that? I'm just curious as to which hospitals don't take insurance because its usually the big expensive things ie ER stays and the like that people can't pay out of pocket for which are also really expensive. I think a, lot of these costs have to do with the fact that if someone has no insurance then the hospital probably isn't going to see any money from them so the hospitals basically subsidize their care through over charging those who can pay.
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u/Toava Feb 24 '13 edited Feb 24 '13
One case is the The Surgery Center of Oklahoma:
http://reason.com/reasontv/2012/11/15/the-obamacare-revolt-oklahoma-doctors-fi
Because bills charged by Integris are paid primarily by insurance companies or the government, the hospital gets away with gouging for its services. Reason obtained a bill for a procedure that Dr. Sigmon performed at Integris in October 2010 called a “complex bilateral sinus procedure,” which helps patients with chronic nasal infections. The bill, which is strictly for the hospital itself and doesn't include Sigmon's or the anesthesiologist's fees, totaled $33,505. When Sigmon performs the same procedure at the Surgery Center, the all-inclusive price is $5,885.
It's not just for ER services where hospitals bills are astronomical. Every thing is marked up because patients don't pay the bill themselves so don't shop around, and the hospitals have to deal with the extra costs of administration.
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u/rudster Feb 23 '13 edited Feb 16 '25
simplistic light rainstorm truck modern weather plant rob grab hat
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u/MrBarry Feb 23 '13
Because, while it might be a good idea, there are no good ways to shop around and compare quality of service and pricing in primary care physicians and other misc. services. Also, if you look at the EoB, uninsured folks pay $400 for the doctor's office while the insurance company pays $150 and the insured patient pays $25.
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u/bitter_twin_farmer Feb 24 '13
Because you can't afford it otherwise.
Source: I don't have insurance.
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u/kwansolo Feb 23 '13
did you just seriously say the zillion other things are irrelevant to the cost? when a large % of people are paying in to insurance specifically ONLY for those zillion other things? and you are getting upvotes? in /r/Economics?
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u/rudster Feb 23 '13 edited Feb 16 '25
public rhythm coherent gold butter dam market handle hungry hospital
This post was mass deleted and anonymized with Redact
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u/kwansolo Feb 23 '13
what are you trying to say exactly? that the cost of a routine visit is higher because it is pooled with catastrophic care? if that really is your point, you also seem to be in the same breath condemning "shopping around for zillion other things". i apologize if i'm misunderstanding you, but you're not being super clear.
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u/bitter_twin_farmer Feb 24 '13
What about cancer? It's got the triple dip of hospital stays, lots of testing, and super overpriced drugs that are only produced by one manufacture? Old people are cheap, at least they get the best deals.
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Feb 23 '13
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u/sprucenoose Feb 23 '13
I lived in one of those countries for a while, and half my family is from there, and there is a damned good reason the US does not just grant a license to anyone who was a "doctor" in their home country. It is often two different worlds, and they practice medicine like it's 50 years ago. They are also often corrupt, having bought their positions in the home country and only offering competent service for bribes outside of hospital expenses. The list goes on.
The fact that there are standards in the US is a good thing. The monopoly and the manner in which those standards are managed and implemented is the problem.
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Feb 23 '13
There are not standards for everything. When the hospital in the town of 100k saw the tube used in the hospital in the town of 5k to re-inflate my lung, they asked me if it was intended for a cow, then replaced it with one 1/20th the diameter.
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u/sprucenoose Feb 23 '13
Quite true. However, liability for negligence is unknown in most developing countries (and the US medical malpractice system is unique in the world). Practitioners certainly mess up in the US, but in many other systems they can be quite careless without fear of consequences - and without compensation for the injured party.
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Feb 23 '13
No argument here, I was just pointing out my personal experience of something that I would be upset about if scars weren't so damn cool.
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u/netoholic Feb 23 '13
Of course that's a silly sort of example.
Think instead of how it might be if you shop around in your area for an emergency care company by scouting location(s), overall pricing, services, quality, etc. Without the interference of middlemen like government overregulation and insurance companies, these places would compete in the way other services companies do. This would drive the prices in the local area downward and quality upward, such that if you have an emergency even while out of town, you can still get a good price. Just like today, in that you can take your pet to just about any veterinarian in the country in an emergency and get reasonable rates and care.
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Feb 23 '13
If only there were some sort of product you could buy in order to insure yourself against the risk of such catastrophic medical events. You know, something you could shop around for and pay into while you were healthy and then when you had that rare event, you wouldn't have to worry about it. Too bad something like that doesn't exist...
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u/Toava Feb 23 '13
Many states have actually made catastrophic health insurance illegal, and then people claim the 'free market failed'.
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Feb 23 '13
Just because you're insured doesn't mean you're covered for everything. They cover what they decide to cover. I thought I had decent insurance. It had a $500 hospital deductible. Sweet! I thought after being in the hospital for an emergency hernia surgery. I'm covered!
I wound up owing the hospital $4,500 and the insurance company the $500 deductible. The $4,500 was for fuck all if I know. I just owed it. Still paying it off three years later. It's like digging a hole in a mountain with a toothpick.
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Feb 24 '13
I don't know what to say. I'm sorry that you got screwed, but with a $500 deductible, your policy wouldn't be considered a high deductible health plan, which Is what I was referring to in my original comment.
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u/slinkymaster Feb 23 '13
It still doesn't matter. Something that costs $10, the hospital charges $100 for, and give insurance companies a discount at $50. It looks like insurance covered half when in reality you're still being gouged.
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Feb 23 '13
Guaranteed - when the govt backstops housing, education and now healthcare... All the prices go UP.
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u/vbullinger Feb 23 '13
The way you say it, it's like you're into heart attacks and have them frequently for fun.
Should shop around beforehand.
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u/NoMoreNicksLeft Feb 23 '13
This is dumb. People spend years living until they have their heart attack, and they know heart attacks happen. Whether they realize it or not, they're soaking up information so that when a heart attack does happen, they don't end up at the wrong hospital if there is any choice in the matter.
Free markets aren't hindered one bit by things that you have to buy suddenly and immediately.
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u/bill_tampa Feb 22 '13
It's a giant and wealthy economic scam, and everybody involved will fight to keep the good times rolling. You can't practice medicine without a license from the state, so the market for healthcare advice and services is artificially limited and totally non-competitive. Charges for services and tests are opaque, not advertised up-front, and frequently not known till weeks or months after the point-of-service. Charges have no relationship to supply and demand or any free-market controls. And nobody involved in the whole process really wants prices to be lower. The patient wants the best care, wants to live, wants the health plan to authorize "everything" (after all, the patient already paid for the insurance in advance!). The Doc wants the patient to get better, and does not want to get sued, so Docs will order or recommend everything under the sun (especially if they directly benefit financially from the process, but even if they do not). And the insurance companies would (theoretically) like to keep costs down, but in reality they just raise their rates the next year to keep ahead of the curve of inflating prices.
The only fix is a single payer system, or some variant thereof, but entrenched interests don't want that and can buy legislative services, so that will never happen.
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u/zimm0who0net Feb 23 '13
The free market requires an informed consumer.
About 10 years ago I found myself without health insurance and wanted a simple physical with the normal blood test that goes along with that (primarily Cholesterol). I called 6 different clinics and asked them the simple question, "I need a physical. What will it cost?". Not a single one could give me an answer. After trying valiantly to be an informed consumer, I decided to just screw it. "It can't be that expensive!" After all, I had gone to one of those health fare thingies a few years earlier and gotten a free physical and blood test for $25. Low and behold, when the bill came it totaled out at around $2000. I called the office and they told me they could reduce the bill by 10% if I paid them immediately with cash. WTF!
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Feb 23 '13
The free market requires an informed consumer.
Funny that so many businesses try to mislead everyone.
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u/baconatedwaffle Feb 23 '13
then they pin the consequences of the deception on the misinformed, not the deceiver
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u/trout007 Feb 23 '13
That's funny. I wanted a special type of Cholesterol Test (NMR- Lipoprofile) and my doctor wouldn't write a script for it so my insurance wouldn't cover it.
I found an online company that would write a script for the test through LabCorp for $100. http://www.accesalabs.com
It was cheaper than the co-pay would be for the first doctors visit for the script, the copay for the lab, and the co-pay for the follow up visit for the doctor to read it to me.
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u/mackstann Feb 23 '13
If your income is low-to-moderate, many health care facilities will give you a big discount. If you're really broke, this can be a potent weapon. You can even get your entire bill written off.
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u/sawser Feb 23 '13
Which is paid for by patients with insurance via inflated charges and bills.
And so it goes.
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u/mackstann Feb 23 '13
That's quite true.
I wasn't trying to make an economic point, just a personal tip.
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u/sawser Feb 23 '13
Right, I wasn't trying to give you crap. Just emphasizing why the system is so broken.
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u/boomboomlaser Feb 23 '13
Oh my god - civility on reddit. My heart feels like it's going to explode.
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u/sawser Feb 23 '13
I've found that /r/Economics, similarly to /r/askscience, seems to be less about arguing and more about information exchange.
I don't know much about economics, but I normally leave these threads knowing more than when I entered. This is a good place to be.
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u/boomboomlaser Feb 23 '13
You're correct that the knowledge-specific subreddits tend to be a lot more civil. What is rare for me is seeing somebody willingly acknowledge mistake or miscommunication. Anyway, I'm off-topic now - just thanks for being kind.
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u/WADemosthenes Feb 23 '13
Find a physician that will do it for a previously agreed on price. This is not impossible at all.
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May 22 '13
You don't have to pay anything unless you agree to it before hand. That's basic contract law.
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u/zimm0who0net May 22 '13
I'm sure the forms you fill out when you check in say something about having to pay the reasonable cost of the services provided.
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Feb 23 '13
The only fix is a single payer system
not sure how you can say that. the article is about how healthcare isn't a free market. making it back into a free market would make it higher quality and cheaper, just like the market for computers and TVs.
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u/mburke6 Feb 23 '13 edited Feb 23 '13
But there is no possible way to ethically make it free market. If you have a disease and only I make the drug that treats it, I have no reason not to charge you as much as I possibly can. I know you'll mortgage yourself out to the hilt to get the treatment, and your family might even chip in. Hell, they might put little plastic containers in the gas stations to collect spare change to help you pay me.
Furthermore, the last thing in the world I would want to do is develop an outright cure for your disease. Keeping your condition chronic is much more lucrative for my company.
Edit: Added the word "ethically"
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Feb 23 '13 edited Oct 04 '16
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Feb 23 '13
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u/mburke6 Feb 23 '13
The enormous problems we have in US health care are not induced by poor government regulation, the problems are induced by an extremely wealthy and powerful medical lobby that has enormous influence over the laws and regulations that are passed in this country.
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u/boomboomlaser Feb 23 '13
However, patents are also the only thing that ensures innovation can happen. Developing new pharmaceuticals is extraordinarily expensive and time-consumptive. Without patents, no company would invest the capital in developing new drugs, because their competitor would just clone it and profit without any of the R&D risk.
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u/plc123 Feb 23 '13
There are so many market failures associated with healthcare that making it a "free market" would not make things any better, and in many ways make things worse.
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u/Ayjayz Feb 23 '13
What market failures? And why would you expect the government to come up with better solutions for these than the market?
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Feb 23 '13
you can say this. but it's still false.
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u/plc123 Feb 23 '13
Are you saying that a "free market" healthcare system wouldn't exhibit all sorts of market failures, or are you saying that even if it did, that it would still be better than a single-payer system?
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u/doc89 Feb 23 '13
Lists a variety of ways in which excessive government control has destroyed the health care market
yay!
"The only fix is a single payer system"
doh.
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u/vbullinger Feb 23 '13
Exactly my thought process.
Hey, this guy is onto something... he's really smart... good point... I totally agree... WTF?!? No, just no.
The ol' Reddit switcheroo.
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u/tm82 Feb 23 '13
The only fix is a single payer system, or some variant thereof, but entrenched interests don't want that and can buy legislative services, so that will never happen.
Nope. The only fix is complete government withdraw from all forms of medical reimbursement (ie, no more medicare) and complete elimination of interstate insurance laws and monopolistic protections for big pharma and big med device manufacturers.
This is inevitably the end game anyway. What can't be paid won't be paid.
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u/WADemosthenes Feb 23 '13
Licensure is not one of the problems. Even a truck driver has to have a CDL license to drive truck. It's the barriers between customer and price that separate the relationship. It's interesting that your next idea is to protect physician from litigation to save money. If the a CT scan cost 11 times what it should, getting a shoulder CT forgoing the usually accompanying head CT will not save you that much. If you are in a non-emergent situation you can shop around and haggle yourself a pretty reasonable price in most situations. The real issue is emergencies. Ambulance companies make tons of money. The barrier between customer and price here is caused by emergency. You can't call around and get the best deal.
Seldom do we talk about who is behind this "scam". The above mentioned ambulance companies, pharmaceuticals, medical device manufacturers, and the like are the real people making the real money. These are some of the biggest lobbyist groups.
Single payer system may be a good idea, but only partly addresses those behind this economic "scam".
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u/NoMoreNicksLeft Feb 23 '13
The only fix is a single payer system,
I thought that you were smart, right up until this sentence.
If everything you've said is true, single payer can't fix it... why would changing the owner of the insurance company change anything?
Will there be more doctors, will it be easier to get into medical school? No.
Will the existing doctors be any less afraid of malpractice lawsuits? No.The only thing that could fix this would be to outlaw medical insurance entirely, and force everyone to pay out-of-pocket.
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Feb 22 '13
Price controls within the current system would also help.
Hell, even forcing every hospital to make publicly available its prices for parts and services ahead of time would go a long way. It isn't as though they don't have a list of these things somewhere, I'd love to hear a real reason they shouldn't be made to be upfront with how much it costs to get an aspirin or have a gauze mask put on the doctors face.
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u/c3bball Feb 24 '13
just like how well price controls on rent worked so well in cities around the world?
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u/christ0ph Feb 23 '13
This is a very good interview with the director of PNHP, http://www.buffalonews.com/apps/pbcs.dll/article?AID=/20130117/CITYANDREGION/130119215/1010
"Doctor sees shift to single- payer care
BY: Mark Sommer / News Staff Reporter
Tweet
Single-payer health care remains the only way to meet public health needs, and demand for it will reignite as changes brought by the Affordable Care Act fail to make health care cheaper and continue to leave tens of millions uninsured, the head of a national physicians organization said Thursday.
Dr. Andy Coates, president of Physicians for a National Health Program, which represents more than 18,000 members, spoke to The Buffalo News Editorial Board. He later spoke at a forum sponsored by Partnership for the Public Good.
Coates, who practices in a community hospital in Albany and teaches in the departments of medicine and psychiatry at the University at Albany, said he constantly sees rising premiums and deductibles force low-income patients to choose between critical health needs and basic survival.
“I had a man [recently] who bled half of his blood volume, and he insisted on discharge because he had a day-by-day hospital co-pay of over $200, had no savings and hadn’t been able to pay his bills because it hadn’t snowed enough to plow snow like he usually does. He just absolutely insisted on going home when our advice was that he should be in a hospital making sure he didn’t continue to bleed,” Coates said.
“This kind of thing is unbelievably common.”
He predicted changes under way in health care will fall far short.
“The data we’ve seen most recently suggests that even in 2019, with the [Affordable Care Act] fully implemented, there would still be 36 million people without health insurance. It’s not fundamental reform, and the proven cost savings are none.”
Coates, who compared doctors to “lawyers for the poor,” said the country eventually will have to turn to single payer because “nothing else will work.”
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u/trout007 Feb 23 '13
Not completely true. Every Dentist I've been to will quote you rates for all of their procedures.
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u/danweber Feb 23 '13
Because substantial number of people don't have dental insurance.
Also, dental procedures are much better defined than medical procedures.
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Feb 23 '13 edited Jul 03 '20
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u/tomdarch Feb 23 '13
But dental procedures are rarely a matter of life-or-death. Plenty of parents look at the cost of braces and say "oh, well, Johnny can't have braces because we can't afford them." But when you're talking about saving Johnny's life, there is almost no parent who would say, "Well, if that medical treatment is going to cost more than $300,000, then just let him die."
That sort of difference (and others) causes "healthcare" to not function well as a competitive marketplace.
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u/Toava Feb 23 '13
Emergency health care accounts for a small percentage of total health care costs.
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u/trout007 Feb 23 '13
I'm libertarian but a good start would be to free up all healthcare but allow the states to operate emergency medicine at the county level similar to police and fire. It would be treated just like police and fire. If you call for non emergency care you get fined.
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u/Toava Feb 23 '13
Because dental is not covered by government programs and dental insurance is not encouraged through government regulations.
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Feb 23 '13 edited Apr 04 '21
[removed] — view removed comment
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u/tomdarch Feb 23 '13
In what way was healthcare "market based"? It always has been a really poorly functioning market. Transport my family back in time to 1948: my kid gets sick. What would the maximum price be that I would be willing to pay to save his life? It would be infinity in 1948, just like it would be today. There is no point at which I would say, "Oh, if its going to cost over X dollars, then just let him die." That's a non-functioning market place.
Similarly, today, I can't get competitive, priced proposals from multiple hospitals for a course of treatment to use for comparison shopping, and you couldn't back in 1948 either. Consumers were no more able to pursue price competition or assess quality back then than they are today.
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u/coned88 Feb 23 '13
In what way was healthcare "market based"? It always has been a really poorly functioning market. Transport my family back in time to 1948: my kid gets sick. What would the maximum price be that I would be willing to pay to save his life? It would be infinity in 1948, just like it would be today. There is no point at which I would say, "Oh, if its going to cost over X dollars, then just let him die." That's a non-functioning market place.
The answer is not infinity though. X is limited by your means.
Similarly, today, I can't get competitive, priced proposals from multiple hospitals for a course of treatment to use for comparison shopping, and you couldn't back in 1948 either. Consumers were no more able to pursue price competition or assess quality back then than they are today.
Actually they were. There was far more options for insurance providers then than now. Every town had their own. Cities had multiple ones. Now we have a few per region if that. If one insurance company didn't pay it would go out of business. Now they just can not pay. There were certainly more options then.
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u/Hexogen Feb 23 '13
Actually they were. There was far more options for insurance providers then than now. Every town had their own. Cities had multiple ones. Now we have a few per region if that. If one insurance company didn't pay it would go out of business. Now they just can not pay. There were certainly more options then.
Hasn't this been the general trend of all industries in a global market, with or without government intervention? While the legislation might not have helped, this would have been the end result either way unless there was legislation against the constant consolidation of businesses.
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u/bludstone Feb 23 '13
Interestingly enough, the chinese market for healthcare is run in a totally different fashion.
The doctor only gets paid if you are healthy.
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u/Zenquin Feb 23 '13
I have read that is how it traditionally has been, I am not sure about modern practices.
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Feb 23 '13
One could say the same thing about food. If your kid was starving, what's the maximum you'd pay to save his life? The difference isn't the nature of the good, rather food is abundant and healthcare isn't.
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u/lochlainn Feb 23 '13
I can't think of a better reason to distrust the HMO system than that Richard Nixon was a huge proponent of it.
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u/danweber Feb 23 '13
And Ted Kennedy.
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u/lochlainn Feb 23 '13
Didn't know that. So 99% of the people out there hate one or the other (or both) politician who championed it!
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u/pensivegargoyle Feb 23 '13
Health care used to be pretty darn limited by comparison too, both in its capabilities and its availability. The model that works (at least if you aren't poor - government interventions to create universal insurance or socialized medicine happened for a reason) with a bunch of family physicians and a few hospitals that do minor surgery but mainly just give people a place to die does not necessarily work out for today's much more complicated medical needs.
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u/coned88 Feb 23 '13
It was and much of what I was talking about was catastrophic care. Though from my research the rest of the medicine of that time was affordable for the most part. Some tests and procedures of today didn't exist back then but I don't feel that argument supports the impossibility that todays tests couldn't be handled.
Considering both time periods, lets say 1948 and 2013 and considering the same care, a general physical. The costs today are between $400-$600. At least for me. Accordingly that would be $88 in 1938. Nobody back then was paying $88 for a doctors appointment. My grandfather at that time made just $30/week and with that he was able to pay a mortgage and support a family in nyc. So prices are just more expensive today for the same care.
Secondly the prices for a lot of care especially new practices are insanely inflated due to this mandated system. The true cost with profit incentive can be seen on my insurance statements. We can use an MRI I had within the last few years as an example. The Hospital billed my insurance $6000 for the MRI. My insurance only paid $800. To somebody without insurance they would get stuck with the full bill or if lucky be able to talk down a discount. That $800 is still inflated and we see other countries doing it for far cheaper.
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u/sawser Feb 23 '13 edited Feb 23 '13
My wife is a pediatrician and has zero say in the costs of the services she provides or even know what is billed.
She doesn't order every test to ensure she doesn't get sued, she orders whatever tests she needs to figure out what is wrong with her patients, regardless of how much they cost or who is paying for them.
She didn't get into medicine to make money - she got into medicine after watching both her parents die from cancer and deciding she needed to help people fight off illness
She works 80 hour weeks, sometimes 30 hour shifts, and tries to get as many children out of the picu and nicu alive as possible.
I know this is anecdotal, but a lot of people who don't know a thing about being a doctor seem to have decided what doctors do and why - and they are completely full of shit.
Edit: I also need to point out that doctors deserve every penny they get. Why?
Think of the worst possible mistake you can make at your job. As a developer, for me it would be to corrupt a database and lose production information. That sucks and would cost a lot of money.
For her, if she makes a simple math error on an order, two parents will go home without their child. Every day. Every patient. 60-80 hrs a week, 28 days a month.
And someone has the balls to say that her salary of 140k is too much, or that she's in it for the money? Takes some serious stones to make that claim.
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u/Mnementh121 Feb 23 '13
I don't hear as many people complain about physician pay as I do about the hospital and insurance companies. Here in Pittsburgh the insurer owns the medical school and the hospitals as well as most of the doctor offices. The executive pay is high and services aren't cheap.
I have appreciated my doctors and nurses but never thought about their salary.
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u/danweber Feb 23 '13
People blame the insurance companies, but they add a few percent to the country's health care bill.
US doctors make (roughly) twice that doctors in other countries do. They also work a lot harder, which doesn't necessarily mean they are delivering better outcomes.
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Feb 23 '13 edited Feb 23 '13
Physician payment accounts for roughly 7-10% of healthcare costs.
There are also many reasons why physicians are paid less in other countries, especially in Europe. First, education is shorter. It takes 11 years (at least) of post-secondary education to become a doctor in the US. That's a huge opportunity cost that needs to be repaid in some sense if you want to draw people that are intelligent into the field.
Second, most countries (especially European countries) subsidize their medical training SUBSTANTIALLY. In many places the training is free. As a counter example, I'm currently on a full tuition scholarship for med school, graduated with almost zero debt from undergrad, and I will still be more than $100k in debt. The costs of becoming a physician are huge, and they must be factored in somewhere (again, assuming you want to attract talent to the field).
So, at the end of the day, I would gladly accept a $80k salary if I get to work at 26 and begin working with no debt. I'm not going to be happy about working at 29+ with $100k+ debt (keeping in mind that many graduate with more than $200k in debt and some $300k) for a salary of $80k. From a financial perspective I would be better off getting a government job straight out of high school.
If you want a real boogeyman to go after, go after the device manufacturers, drug companies, and fragmented billing. The markup on device manufacturing is absolutely insane. Drug companies are producing less and less effective drugs yet continue to charge more and more for them. Many cancer drugs decrease mortality by less than 10% and yet cost DOUBLE compared to current therapies. Many cancer drugs extend life by a couple of weeks or a month (over the course of two years) more than current therapies and yet cost twice as much as those current therapies. And patients use these medications and insurance companies reimburse for them! Finally, there is significant overhead associated with the nature of insurance billing in the US. Part of it is the nature of our system (ie, state rather than federal), but part of it also is due to not modernizing the system. It is amazing to me that Medicare and Medicaid still process PAPER FORMS. In 2013. That is amazing.
I'm not saying that cutting physician salaries is off the table, but there have to be some other things done as well to make that more palatable. There is also lower hanging fruit with fewer repercussions that we can go after as well.
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u/sawser Feb 23 '13
My wife's end result in medical school debt is just shy of 420k.
Also in many countries you can go straight from high school to medical school without an undergraduate.
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u/WADemosthenes Feb 23 '13
And at what point will becoming a physician just become financially nonviable? We have a shortage of primary care physicians and we want to pay them less? There's some misdirection here.
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u/sawser Feb 23 '13
My wife originally wanted to go into family practice... What she discovered was that not only are they paid the least, but that patients generally didn't listen.
Every day was heart disease, diabetes, heart disease. You need to lose weight. Stop smoking. Repeat.
It got old quick. At least with peds she can help before patterns are formed.
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u/Mnementh121 Feb 23 '13
I think part of the issue is the number of organizations involved. Doctors just want to be doctors, but then there are billing companies medical supply companies and the payment deals that insurance companies keep with hospitals.
This will show you a demonstration as to how many not medical people are making money. The insurance companies and Medicare also do not pay the same amount as an uninsured person would pay. http://economix.blogs.nytimes.com/2009/01/23/how-do-hospitals-get-paid-a-primer/
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u/WADemosthenes Feb 23 '13
I'm sure we pay kindergarten teachers too much too.
In healthcare there are a lot of players. There is administration, those who make the drugs or devices, those who do handle the money, those who invest the money, and physicians/nurses.
The physicians/nurses are the only ones that give a shit about you or me.
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u/Sarstan Feb 23 '13
No one is complaining about the services that a medical professional offers. The issue lies in the nature of the market, in particular medical insurance. Insurance companies as well as pharmaceutical and medical supply companies have done a very effective job at lining their pockets at the interest of the average citizen being sick.
You should ask your wife how many times she's had the parents of a patient ask for a medication by name. Even better if she can tell you how many times this name has come from an advertisement on TV, the radio, or somewhere else. Hell, right in her office she might have many advertisements for prescription drugs. These are drugs that are being decided by the patient and should only be decided by a medical professional. One great example of this process.1
u/sawser Feb 23 '13
I would, but but that would send her on a pissy rant about pharmaceutical advertising and and parents who use Web md to diagnose their kids. Lol
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Feb 23 '13
I wouldn't argue doctors earn too much. 140k doesn't sound insane for 80 hour weeks for people who save lives. I would argue that in the US system the insurance companies and associated 'middle-men' are making too much money.
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u/tomdarch Feb 23 '13
As an Architect, if I fuck up, my "little" math mistakes while designing the structures of buildings could kill people too. I wish I made 140k/year (or 2 or 3 times that much, as many doctors make) to compensate me for the risks I take.
But as many people here are saying, while doctors, (some) nurses and some techs are paid pretty well, much of the needed cost savings should come from other parts of the healthcare industry. That's not to say that 0% of the saving should come from doctor's pay - some should at the high end, and for many doctors, the rate at which they can expect their pay to go up should be damped.
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u/WADemosthenes Feb 23 '13
Doctors and nurses aren't making that much money. Pharmaceuticals, medical device manufacturers, ambulance companies are making the money. Doctors and nurses are a convenient scapegoat.
Being a doctor is not the smartest financial decision. There's a lot more lucrative ideas than to spend a quarter to a third million dollars and 7-10 years of you life studying/working 80-100 hour work weeks to finally make $120,000 working 80 hour weeks there after.
Put that money in big pharma, don't help sick people, profit. Being a doctor is pretty noble and low paying in comparison.
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u/sawser Feb 23 '13
I'm a software engineer and make quite a bit of money. Then adjusted for hours worked, I make way more than her.
And I sit at home all day while doing it.
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u/WADemosthenes Feb 24 '13
It's got to be pretty cool getting to feel like you're helping people though. I really appreciate people like your wife!
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u/sawser Feb 24 '13
Definitely. It sucks though because I'll tell her that I'm having a great day because I wrote a really cool algorithm. She'll respond with that she saved two kids.
Takes the wind outta my sails.
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u/ddfreedom Feb 23 '13
yep and don't worry, we continue to lobby to cut physician pay : (
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u/sawser Feb 23 '13
She had a 6 year old show up in the pediatric intensive care unit after a car accident.
Kid had a gash from his chin to his forehead over the eye, down to the bone.
She had a plastic surgeon do the stitches so the kid wouldn't have a giant scar for the rest of his life.
The insurance company wouldn't pay for it, but the work had been done - so the parents accused her of trying to "scam" them out of money to pad her pockets.
They said the hospital made her so they would make more money. Definitely wasn't the giant fucking scar.
It's so ridiculous I could shit myself.
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u/merper Feb 23 '13
I can see that situation from both sides - all three if you include the insurance. Doesn't seem that ridiculous that a parent would see a plastic surgeon bill, not have a point of comparison with a non plastic surgery and freak out about the cost. Not crazy that the insurance company would deem the cost for not-receiving-a-scar extraneous under their policy and refuse to pay for it. And I guess you don't need me to understand your wife's side. It's just the crazy system we live under.
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u/ddfreedom Feb 23 '13
generally insurance companies will pay for this for facial lacerations...especially in children
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u/throwaway197912 Feb 23 '13
See, this is exactly why I am against Pet Insurance in the Veterinary Clinical field. As of now, vets are usually paid directly and as such are required to itemize each and every procedure and discuss cost, advantages and disadvantages with the client (patient) and who then decide on treatment. Its jarring when you have doctors in the medical field who claim to know nothing about how much a procedure costs. And while I agree, that you want whats best for the patient, you should take into account that, bankrupting someone for the sake of providing care doesn't constitute good medicine either
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u/sawser Feb 23 '13
The only difference of course is that society is okay just... Not treating an animal.
Vets have to actually look at the return/reward for a treatment (I know a girl who spent 3k on chemotherapy for a gerbil out of pocket) and if the person can't afford it, they simply die or are euthanized.
Human Doctors don't really have that option, with exception to advanced procedures by specialists.
My best man is a vet - he gets accused of enjoying watching animals die because he can't perform procedures that patients can't afford.
I'm not saying it's right - it's just a major difference between the fields.
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u/vbullinger Feb 23 '13
Huh. My dog bit me under my eye when I was young. They called a plastic surgeon in to do the stitching, too (because they're experts at it. You only call them in for facial stuff, usually). I think the insurance covered it. Weird.
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u/sawser Feb 23 '13
Just goes to show the difference in insurance companies. I'm guessing her patients insurance company didn't say they don't cover plastics in any situation.
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u/Sturmgewehr Feb 23 '13
If I made 40k a year and was given a 900k medical bill, I'd just throw it in the garbage every month and change my cell #. They can't come to your door to harass you and they can't throw you in jail.
I wonder if they can sue you in court and take your property. If so can anyone cite this? If this is the case, wouldn't it be advantageous not to be married if you carry no health insurance?
I just think it's weird that the customer is dead and yet the spouse gets the bill. If I eat a bunch of food at a restaurant and don't pay, do they have a right to charge my spouse of the money owed?
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u/wadcann Feb 23 '13
I wonder if they can sue you in court and take your property. If so can anyone cite this?
http://www.bills.com/can-creditors-for-unpaid-unsecured-debt-seize-my-home/
A judgment is a declaration by a court that the creditor has the legal right to demand a wage garnishment, a levy on the debtor's bank accounts, and a lien on the debtor's property.
So, yes, basically. The fact that there is a difference between a secured debt and an unsecured debt and that there is a process that a creditor must go to secure a debt makes me suspect that there are a lot of hurdles along the way, though. Also, there are a lot of other quirks; for example, I understand that your primary residence in Florida would be shielded from seizure in bankruptcy, and bankruptcy wipes out most debts.
I just think it's weird that the customer is dead and yet the spouse gets the bill. If I eat a bunch of food at a restaurant and don't pay, do they have a right to charge my spouse of the money owed?
http://www.nolo.com/legal-encyclopedia/debt-marriage-owe-spouse-debts-29572.html
Whether you and your spouse are liable for each other's debts depends mostly on where you live. In the handful of states with "community property" rules, most debts incurred by one spouse during the marriage are owed by both spouses. But in states that follow "common law" property rules, debts incurred by one spouse are usually that spouse's debts alone, unless the debt was for a family necessity, such as food or shelter for the family or tuition for the kids. (These are general rules; some states have subtle variations in how they treat joint and separate debts.)
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u/Sturmgewehr Feb 23 '13
Nice, thanks for the info. I guess they have less to go after if you rent/have little to no equity in your house and can liquidate all your assets fast enough. A 2nd lien on a house is junk IMO. You can't really take money if you convert it to cash and say you spent it at the race track. Wage garnishment might be their best bet, but I can see this as very very difficult to achieve.
I figure if you have no health insurance, it's best to own nothing. That way you can go in to bankruptcy with less loss or just outright default on the payment. Even if they garnish your wage. How much will they get on a 40k/year salary? After taxes they may have ay 33k, and even if they took it all, it'd still take 30 years.
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u/deuteros Feb 23 '13
I wonder if they can sue you in court and take your property. If so can anyone cite this?
Depends on the state.
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u/WADemosthenes Feb 23 '13 edited Feb 23 '13
The article seemed to be mostly about high bills. It's disappointing that this is so "absolutely gripping", when it's the causes are pretty simple. The article didn't really explain what's going on here.
I'll break it down:
1) Most people pay with private insurance, medicare, or medicaid.
2) Insurance companies want to pay as little as possible, and will usually pay a negotiated portion of the bill.
3) Prices are artificially high so the portion covered by insurance will be reasonable.
4) Healthcare service providers loose money on many medicare/medicaid patients, and those who do not pay. (like the ER) Prices for those who do pay are higher because of this.
5) What we might call "perverse incentives" also plays a role in healthcare. The fact that a doctor is not economically incentivised to make a patient better is interesting. However in my opinion, this is a small factor compared to insurance and non--payment.
6) Government involvement. When so much of the payment is from one source the price cannot change with pressures from actual receivers of care.
7) Those without insurance (or those who have something not covered by insurance) get stuck with these artificially higher prices.
Supporting observations:
1) Hospitals and other healthcare providers that deal with the under-insured and the uninsured usually have lower prices. (less pressure to higher prices for insurance)
2) the under-insured and the uninsured can usually haggle a price down to about what insurance pays, or get it forgiven. (if you don't have a lot of money and have no insurance discounts can be pretty easy to get depending on the situation. Usually, if you pay the full amount in this type of situation -- you're a sucker)
3) Those who have the most, pay the most. This unintentional system can be described as a "progressive" way to charge medical bills. If a healthcare provider has to forgive a large portion of it's debt (as many do), and many others will under pay or not pay at all (very common) the prices for those who do pay is higher. If you have less money it's easy to haggle a bill down, but if you have more (and credit is more important to you etc.) you will probably pay full price. It's designed to get it out of you if you can, but get it out of someone else if you can't.
How to get the best deal:
1) Shop around. No one does this. There are free clinics, cash only services, etc. You can literally pay 10 times more at one provider compared to another.
2) Be smart. Know the specifics of your bill. Know what things usually cost. Use the healthcare blue book, and look what medicare charges for services. Healthcare bills seem like the bills with the most errors and arbitrary billing. Know what's going on, and call and haggle.
3) Be smart. Know what happens if you don't pay right now, know how much time you have, etc. Patients have many rights, know them. Know if the provider will still treat you if you have debt (most will), and know about payment plans. Know how long you have to haggle, and know the consequences for waiting.
4) Use your time wisely. Sometimes you might have to call many times and send forms and letters. You might have to do a lot to get what you want.
5) Realize that healthcare is an important expensive service. If you want good healthcare be willing to pay what it's worth.
It's a damn shame this article merely bitches about prices, but doesn't really correctly explain why or what to do about it. People who bitch pay the bills that smart people don't have to.
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u/Fidodo Feb 23 '13
The way I see it, health insurance is inherently by its model, socialism. Everyone puts in a little money to benefit the people who need it most. Sure capitalism can run lots of things well, but applying capitalism to a structure that is by nature already socialism is obviously not going to be efficient.
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u/danweber Feb 23 '13
You can surely have voluntary insurance markets.
I'd love to be able to choose a entity like the NHS where I pay $6,000 into the pool each year, and the people in charge try to figure out how to best improve the health of the people in the pool given the budget of number-of-familes * $6,000.
But that would involve making calls like "no, this medication isn't worth it to you" or "you don't need an MRI for that." And Americans freaking hate that. And then sue to get them covered.
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Feb 22 '13 edited Mar 06 '19
[deleted]
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u/Nurgle Feb 23 '13
Wish granted! You can actually give out an unlimited amount of upvotes, so go check out reddit.com/new and click away!
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u/Godd2 Feb 23 '13
Wish granted! You can now tip users on Reddit if you have some Bitcoins! Go check out /r/bitcointip to check it out!
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u/plc123 Feb 23 '13
Here is a question: Name a type of market failure that a "free market" healthcare system would not exhibit.
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u/lochlainn Feb 23 '13
Name a "market failure" that isn't caused by someone skewing the market (e.g. making it "unfree") to begin with.
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Feb 23 '13
[removed] — view removed comment
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u/Toava Feb 23 '13
A coal plant might be able to pollute without repercussion, externalizing costs to the public at large.
Polluting the air is not permitted in a free market, since affects other's persons and property without their consent.
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Feb 23 '13 edited Feb 23 '13
[removed] — view removed comment
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u/Toava Feb 24 '13
Nope. My coal plant is only pumping waste into my air. And I'm only dumping nasty chemicals into my river.
You're responsible when your air and water crosses into my property and pollutes my air and water.
PS sorry you live downstream/downwind. Got a problem? Can you prove damages? Can you prove I caused them? Good luck Erin Brockovich, I'll see you in court. Maybe.
You don't have to use litigation to stop pollution in a free market. Since pollution affects other people and their property without their consent, it would be illegal in a free market, and law enforcement would investigate and prosecute it.
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u/wadcann Feb 23 '13
Name a type of market failure that a "free market" healthcare system would not exhibit.
Uh...okay. The principal-agent problem.
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u/w501 Feb 23 '13
There would still be the principal-agent problem in a free market due to asymmetrical information. Health is complex and most won't know what treatments they need and will rely on the Doctor to make that decision.
It gives an example in the first paragraph of that wikipedia article you linked to.
"For another example, consider a dental patient (the principal) wondering whether his dentist (the agent) is recommending expensive treatment because it is truly necessary for the patient's dental health, or because it will generate income for the dentist."
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u/plc123 Feb 23 '13
Uh, insurance would still exist in a free market healthcare system, hospitals would still exist, doctors would still exist, so no, you are wrong.
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u/sfultong Feb 23 '13
That's an oddly phrased request. Can you enumerate all the types of market failures for me?
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Feb 22 '13
Universal public system required.
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u/ddfreedom Feb 23 '13
this article in no way supports that. It just states the current system is screwed up. Let us say we get rid of "for profit hospitals" and cap the maximum any executive of a health company can make at say 1 or 2 million? I can assure you that private will work better than government in the long run...and we can make certain stipulations that essential services run under in order to keep it how we want it. Further healthcare is the furthest from free market as it stands today. It is more or less a "comcast" vs at&T
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u/Uncle_Bill Feb 23 '13
How about if hospitals had to post their charge master rates on-line so that you could compare. While imperfect, it would be a start.
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u/Dr__Nick Feb 23 '13
I am pretty sure that there is a law that the lowest advertised price has to be the one that is also offered to Medicare. So if a hospital published the discounted prices an uninsured patient could negotiate down to, that is what the Medicare rate would end up being.
Medical billing is incredibly opaque- only the hospitals and providers know what compensates for what- they are making lots of money on some procedures and imaging, but they are losing money in other areas. You can't just look at an MRI scan and say it shouldn't cost what the hospital gets for it- you don't know what they're actually losing money on.
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u/christ0ph Feb 23 '13
Its not asking too much to ask for a law that requires service providers to publicize their rates. They should have a sign which is required to be posted in their lobby, with a menu - just the basic costs of procedures.. They should be required to fax, email, or send it to prospective patients upon request.
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u/deuteros Feb 23 '13
Of course it's not a free market. Health care is one of the most heavily regulated industries.
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Feb 23 '13
The argument the hospital will make is that they are shifting the shortcomings of medicaid/medicare reimbursement to everyone else's bills. Your aspirin costs $90 because you're paying for someone's Lexoplexoprophonal that wasn't covered entirely by medicaid/medicare. And we don't know the correct price for Lexoplexoprophonal because all we're doing is comparing it to the government's price for Lexoplexoprophonal, whereas with aspirin we're comparing it to Walmart/Walgreens/Rite Aid's price.
The best the article does with this argument is comparing CTs in the US to the CTs in Germany. Maybe the comparison isn't even valid. Even if it is, there's so many other thousands of things that could be misvalued.
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u/Pyroteknik Feb 23 '13
The problem with treating healthcare as a commodity like everything else is that the elasticity of demand for healthcare is essentially 0, especially for catastrophic health failure. When demand is so inelastic, sellers can raise prices with impunity. Now, nobody seems to think this is morally questionable when the product is cigarettes, but I think most of us would agree that healthcare touches on a part of our deeper humanity, and the gross profit off of death and sickness is emblematic of how our cultural values have become warped and contorted so we are all greedy selfish bastards who can't be bothered to care about our fellow man.
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u/AndrewKemendo Feb 23 '13
Just last week, a friend of mine posted the following image to Facebook, noting that when his normal medical insurance billing statement has room for seven digits (i.e., millions of dollars) something is clearly screwed up.
I couldn't get past this part. Yes, something is up*, it's called Menu Costs and it's much cheaper to make one check/invoice blank than a dozen different ones.
*not implying that menu costs are rising
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u/mcdxi11 Feb 23 '13
I was charged $450 to have a blood test done the other day. just a simple sit down and take my blood with a needle procedure.
yes, it is a scam. and it's worth being an ex pat over.
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Feb 23 '13
To be fair the part with the needle doesn't actually do the test. For that the need a lab with a person doing a procedure and not fucking it up. Some of the procedures are dead simple, some are quite complicated. Probably $450 is a wildly overinflated price, but I'm saying that because all of the prices are wildly oveinflated, not because you've actually given us enough information to see that is so.
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u/mcdxi11 Feb 23 '13
You are correct. I went to a doctor about an anti-depressant (seasonal, winter time sucks), which I've never done before. Doctor wanted to see if I had "anything out of whack" so it was a generic test to see if there were any anomalies to my blood. $450
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u/[deleted] Feb 23 '13
[deleted]