Broken Health Care
How much does a C-Section cost? The answer is complex, but At One Hospital, Anywhere From $6,241 to $60,584.
When a woman gets a caesarean section at the gleaming new Van Ness location of Sutter Health’s California Pacific Medical Center, the price might be $6,241. Or $29,257. Or $38,264. It could even go as high as $60,584.
The rate the hospital charges depends on the insurance plan covering the birth. At the bottom end of the scale is a local health plan that serves largely Medicaid recipients. At the top are prices for women whose plans don’t have the San Francisco hospital in their insurers’ network.
“It is shining a light on the insanity of U.S. healthcare pricing,” said Niall Brennan, chief executive of the Health Care Cost Institute, a nonprofit that analyzes medical costs. “It’s at the center of the affordability crisis in American healthcare.”
Trump Fought Secret Prices
On June 27, 2019, President Trump issued an Executive Order titled “Improving Price and Quality Transparency in American Healthcare to Put Patients First“
Informing Patients About Actual Prices. (a) Within 60 days of the date of this order, the Secretary of Health and Human Services shall propose a regulation, consistent with applicable law, to require hospitals to publicly post standard charge information, including charges and information based on negotiated rates and for common or shoppable items and services, in an easy-to-understand, consumer-friendly, and machine-readable format using consensus-based data standards that will meaningfully inform patients’ decision making and allow patients to compare prices across hospitals. The regulation should require the posting of standard charge information for services, supplies, or fees billed by the hospital or provided by employees of the hospital. The regulation should also require hospitals to regularly update the posted information and establish a monitoring mechanism for the Secretary to ensure compliance with the posting requirement, as needed.
The American Hospital Association fought the ruling on first amendment rights.
On December 29, the U.S. Circuit Court of Appeals in the District of Columbia upheld a district court’s ruling that the transparency requirement was legal.
Hospitals are now required to publish the rates they charge specific insurers for 300 common services considered “shoppable” in a way consumers can easily access.
Trump fought secret pricing and won. It was one of the best things Trump accomplished in his term.
Shocking Details
Depending on Who Pays
- Heart Procedure: $89,752 to $515,697
- Spinal Fusion: Under $50,000 to Over $250,000
- Hip Replacement: $3,264 to $81,617
- C-Section: $6,241 to $60,584. The cash rate is $38,264.
Those are not rates that vary across the country or based on the skill of a doctor. Those are rates at the same hospital that depend on who is footing the bill.
Problems and Skin in the Game
The penalty for noncompliance is a mere $300 per day. Thus, I am surprised there is any compliance with Trump’s executive order at all.
The second problem is many don’t care. Once a person has met their deductibles they do not care.
Those on Medicare or Medicaid do not care.
Those with no insurance, no job, and no ability to pay do not care either because no one is ever turned away.
Unless and until there is skin in game in the pocket of the consumer including consequences for not buying insurance these problems will not vanish.
No insurance? OK. We will treat your pain and even fix a broken leg, etc. But Chemo? An emergency heart transplant? Where should the line be?
Medicare for All?
The problems with Medicare are obvious.
- There are no cost controls anywhere.
- There is unlimited demand for free services
We need more competition and more transparency. Trump’s executive order was a welcome albeit small step in the right direction.
Mish
Take a look at how prescription prices can vary. Online my script is anywhere from $9.90 to $236.98. An order of magnitude of 23 times!
The status que wants to divide and conquer. We don’t have a free market b/e that assumes “perfect information” and health care doesn’t want you to have that. Nor “substitute goods”. We just have a oligopoly of chaos.
Some reasons why US Health Care costs are high…
#1 Obesity
#2 Related to obesity, poor nutrition and lack of exercise
#3 Non payment of hospital bills
#4 A litigious society
You forgot the big ones. Liberty and freedom. These are the underlying reasons why people are unhealthy.
By that argument Americans would be obese since the end of the Revolutionary War.
Actually, hospitals don’t actually charge different payers different amounts, they simply agree to accept varying reimbursement from them. A charge master is a charge master is a charge master. But hang on folks….with a new minimum wage of $15 in at least 26 states on the horizon, these prices will continue their insane escalation. This is a GREAT time to be a high quality, low priced international hospital….with an eager eye for medical tourists!!!
Actually, the differences is not the different prices for which hospitals charge different payers, but the reimbursement they agree to accept from the payers. Folks, add to this a new $15 minimum wage in at least 26 states now, and prices will escalate even more insanely. This is a good day for international hospitals and medical tourism.
My country has better health outcomes on pretty much any measure than the US at half the cost per capita. And one reason certainly seems to be an anti competive protection racket for health care providers. On a visit to CA. I when to a pharmacist to get a tube of cream for my son. About $10 over the counter at home. In CA. was $60 and I had to get a doctors prescription. All up about 15 times the cost.
Pharmaceuticals are just as sticky a wicket as hospital costs in the U.S., perhaps even more so since the typical citizen is prescribed so many things each year. This comparison is several years old and understates the current gap-
Bust the trusts. It’s racketeering.
The key to reasonable health costs is the importance of price discovery. It’s essential not only for options, futures, and derivatives. ALL MARKETS need price discovery! Until customers can shop medical services by price, there is NO competition. Without price discovery, there is no need to innovate to reduce prices, no need to be an efficient supplier, etc. So yes, Mish is entirely right that Trump’s plan was a big step forward.
How long before Biden signs an executive signs an Ex. Order to the contrary?
“many other developed nations provide pretty good health care (arguably better than the US overall), for 40% to 50% less cost. “
I have discussed that at least a dozen times.
Other nations have caps on education costs, doctors costs, time delays to get a surgery (Canada), etc etc, and above all the right to die and not wasting money so someone lives another 3 months in critical care in pain.
The problem is not that easy to fix but it would help to have less expensive education, more doctors, and above all RIGHT TO DIE that I have discussed countless time only to have false claims that I have not gone over this.
2019 IMF lists the U.S. #7 per capita GDP, the U.S. also lists #6 for disparity.
Those figures may be off, but not by much.
We’re the only OECD without socialized healthcare or college, and we’re now irreversibly immersed in globalization.
It leaves the question – If we’re among the wealthiest nations, yet one of the widest gaps in wealth, and other parts of the world’s labor is substantially cheaper, how will we compete?
IMO, this is the result of a combined “Trickle down” tax policy with the advent of globalization over 4 decades, the end result – “Job creation” from tax cuts went over seas, causing more social entitlement spending, more periodic stimulus, more debt for both households and government, less tax revenues.
I might have been worried about “free stuff” a decade ago, now I’m worried about my retirement.
The natural decay of society; where everyone sees there’s a problem but there is no will to do anything about it. Trump did a VERY good deed when he forced hospitals to publish how much they charge.
The truth is that fundamentally America doesn’t want to change its system, it’s expensive cruel, and fits in some kind of righteous deterministic outcome scenario that most Americans appear to want or prefer.
Although right now, the Covide Vaccine scenario that is playing out in Canada makes me wish I was living (I can not believe I am saying this) in the US…
“is unlimited demand for ankle surgery because of its low price is pretty absurd. “
Stop misquoting me. I did not say unlimited demand for every service. It was a generalized and accurate statement.
And a true one especially if one looks at what Democrats want: Free education, free shelter, free living wage, free this, free that and on top of it all unrestricted immigration.
Sheeesh
Yes, on those terms, and it should be damn obvious what I was discussing, there is unlimited demand for free stuff
Sorry Mish. I didn’t mean to misquote or misrepresent you.
However I do believe that largely your description of the problem causing high prices is inaccurate.
You are of course correct that ‘free’ medical care can increase demand. The way other countries cope with that is by waiting lists, people pay with their time rather than money. This is generally for non urgent treatment.
EG; I am considering getting the plates removed from my ankle. I can either wait 9-12months or pay ~$5000 for the cost of the surgery. That $5000 could be covered in part by private health insurance depending on my plan.
The problem with healthcare in this country is that it encompasses many types of medical / business services none of which has an incentive to reign in costs. In fact, the opposite is true in that they try to maximize profit at every turn. A relative of mine in Portugal recently required emergency surgery. My relative, who does not have any medical insurance coverage, elected to use the best hospital in the area and was required to pay the €12,000 (Euros) surgery cost up front. A bargain compared to the US where as a retiree I am paying Medicare and supplemental medical insurance costs of almost $10,000 a year for my wife and I.
Huh? 12k Euros is more than $10k US.
Not the point. The same surgery in the US would have billed the Insurance company $75,000. With deductibles being what they are it would likely have cost the patient a few thousand dollars. The real issue is the outrageous cost of healthcare in the US.
$10k per year for 2 people? Should be closer to $6,000.
Case in point at how our government saves money. Florida eliminated infant circumcision as an option under Medicaid because it’s arguably considered cosmetic. 5, 10 years later there was a increase in child circumcisions done for therapeutic reasons which involves a urologist and an ansetheologist and costs thousands of dollars more negating the savings.
I had some throat surgery back in Dec. Had to have a growth cut off the back of my tongue and inserted a bit of filler into the vocal folds due to apparent atrophy. I think I believe the whole operation took under 1 hour under general.
The MD/hospital (Stanford) billed $69,132.27 via 16 items, many with the same exact codes but different prices. Medicare allowed a total charge of $4,159.13, zero of which was out of my pocket. [lol]
I always wondered what the purpose of bills like this was? The biling people know exactly what Medicare is going to pay them, so why bill a very large number knowing it will be knocked down? Do they use the difference as some sort of tax write-off? Or are they trying to impress someone?
My presumption is that the original “billed amount” is their official charge, in the absence of any discounts, only everyone gets a discount of some sort. The reason the discount is so extreme on Medicare/Medicaid is that the prices are set under their costs, meaning that those with insurance and self-pay have to subsidize them.
Or Medicare knows what the real costs “should be” for the time and work performed and it is the hospitals problem if they can’t meet that number.
As an example, why is some bread that retails for $1.69 for a 24oz package while another brand of bread of the same type and weight retails for $4.99?
Is the $1.69 version somehow being subsidized to offer that lower cost or is the $4.99 bread just grossly overpriced?
Yep. Grossly inflated prices because ‘most’ payers get a discount. You get screwed if you are in a position where you don’t get a discount.
The problem isn’t Medicare or Medicaid it is the privately run hospitals and insurance companies and the history about the chargemaster.
While it is a lightweight format, this is actually a good explainer:
I live down under, broke my ankle and required surgery. It cost me $0 out of pocket to have it done by one of the better ankle surgeons in the city if not the country. (This is the case regardless of insurance.) But the notion that there is unlimited demand for ankle surgery because of its low price is pretty absurd. The care and rehab assistance I received was great, but I would not choose it again.
On the flipside, my one experience of medical care in the US was actually good and ‘cheap’. This was a clinic on an expensive ski mountain so I expected eye watering prices, but once I asked about pricing and signed the form that I wouldn’t be claiming on US medical insurance the price dropped rapidly. I got to see a specialist quickly and cheaply.
“Politicians have spent decades asking how to pay the bill, instead of asking why the bill is so high…”
(Might have something to do with the amount of money the funnel into campaigns and lobbying.)
Excellent video.
“Disease is the biggest money maker in our economy.”
― John H. Tobe
Once again today the dollar is trending up…..barely, and with lots of dips. The dollar bottomed Wednesday and bounced….then dropped down to touch the same bottom (90.27) yesterday. Made it all the way up to 90.72 this morning but currently falling again.
Gold and silver are spiking when the dollar dips…but I doubt the trend will be much higher unless the dollar daily cycle fails and we drop below the January low….it still looks like the dollar will head higher to me…..but boy is it ever sluggish.
Lots of good comments….I am very aware of the problems here, but I have a hard time seeing any of it getting fixed with Big Insurance calling all the shots….which they are.
I still like single payer. Imho it’s the only way to get rid of this monstrosity the corporate insurance industry has built. One payer, one price. No profits to CEO’s and no bonuses for screwing the public.
My concern with “single payer” gets to the crux of why the “health care system” is so currently abusive. The crux is that Congress is composed of people whose job is ostensibly to represent the people, but is de facto, to be part-time corporate spokespeople and part-time corporate lackeys with the power to craft legislation.
So, any plan they come up with, is just going to rearrange the deck chairs on the titanic.
Take for example, the “Affordable Care Act”. I recall listening to Ezra Klein (from the Washington Post) saying that it was very clear from watching the whole process of crafting this legislation that we need fundamental reform to the legislative process if we are ever to lower costs.
In other words, we may move the costs around, but they will just go from our insurance and out-of-pocket costs to higher taxes. In return, we may just have less choice and slower health care. No matter what, the overall price will not come down, as long as we have the political system that we have.
“The crux is that Congress is composed of people whose job is ostensibly to represent the people, but is de facto, to be part-time corporate spokespeople and part-time corporate lackeys with the power to craft legislation.”
EXACTLY.
It is government meddling that has driven up the cost of medical care, just as it is government meddling that has driven up the cost of college. Government meddling will drive up the cost of electricity and heating bills.
“It is government meddling that has driven up the cost of …”
This is only half the problem.
It’s the government’s job to regulate on behalf of it’s people – the problem is the government is legally bribed via campaign funds.
Just look back to the consequences of the 2009 creation of the ACA, 2010 was a sweep for the party that opposed regulating costs, hurting profits to the sector.
Our government is privately owned by the biggest bidders via campaign funds, elected officials that don’t fall in line don’t get re-elected.
That’s utter nonsense. Nearly all other wealthy countries have just as much or more government involvement in their healthcare systems, yet have much more rational and efficient systems than we do. So, government in and of itself is not the issue. Our government could study the best solutions from all those other wealthy countries and institute a solution that would be a best fit for Americans, it’s just that there are too many in America that don’t want it to do so as they have too much interest in maintaining the current broken one.
Oh yeah, government meddling.
You need to check out who writes the healthcare legislation the government passes….hint: it isn’t your congressman.
Americans who live to make it to Medicare have a burden lifted off their shoulders….unless they’ve had their bennies paid by an employer. I’m there now, so I really don’t have a dog in this fight anymore.
Even Medicare was way better back when it WAS single payer…Medicaid was better when it was single payer.
“….I am very aware of the problems here, but I have a hard time seeing any of it getting fixed with Big Insurance calling all the shots….which they are.”
This statement is blatantly true, the 2010 elections proved it beyond doubt.
If I recall, during the ’09 healthcare reform debates, UNH alone was spending $1 million per day in propaganda, lobbying and campaign funds.
The masses were terrorized with messages of “death panels” – “Socialism” and “Government takeovers”.
Ironic, the government that accounts for 50% of the sector’s revenues would be accused of a “takeover” when it tries to reduce costs that have become so extreme that it’s costing lives.
There was a huge change in the 1990’s. At the time I was involved in Tuxedo rental. At the start of the 1990’s, almost all high school Seniors wore a 27-29 inch waist pant, or a 31-33 waist, with a moderate number of 34-36 pants, and few above that. By the end of the 90s there were few 27-29 waist a moderate number of 31-33, and most were 34-36 or 37-39. So, in a decade the waist size of the average high school student went up about 5 inches.
First of all, part of this is understandable, that being the huge difference between Medicaid and full-pay. Hospitals are forced to handle Medicaid patients at a huge loss. If Medicaid patients were all they treated, hospitals would go broke, or at least, turn into ramshackle dumps. Basically, it’s a way of making everyone pay for the medical care of the poor without having it show up on the government books.
It is also understandable why rates are different between network and non-network payers. What is less understandable is why they are different for different insurers. If I was an insurance company that had a contract with a hospital, and I found out that my price was higher than other insurers using the same hospital, I would be furious.
What this doesn’t go into at all is the rate paid by uninsured people. They presumably are charged the out-of-network price. Of course, from that price, the hospital or doctor is willing to negotiate a discount for prompt payments, but how big the discount is varies from doctor to doctor.
Having prices out in the open will be very helpful for everyone. I personally am very well aware of how different the rates are. I went without insurance for the last 20 years or so. As a result, when I needed care, I would price shop, calling various doctors and getting prices. They are very, very different from one doctor to the next. For example, I needed to visit a urologist for a routine visit. The local Doctor group (who essentially has a monopoly) wanted about $650, and would discount it by 10% if I paid at the time of visit, so $585. One 40 miles away would charge $400 and would discount it 50% if i paid at the time of visit, so $200. The less expensive one was my preference anyway, as he had higher ratings online, and I had personal experience with both practices from 25 years ago for another issue.
Yes, prices are crazy. Yes, transparency is at least part of the answer. When you go to buy a TV, you can price shop. As a result, vendors compete on price, and prices keep going down, while quality goes up. When you buy medical treatment, you can price shop, but few do, so prices rise, and quality remains hard to evaluate.
“Yes, prices are crazy. Yes, transparency is at least part of the answer. “
I debate that transparency is, in fact, almost the whole answer.
The problem lies in costs of pharma and med supplies that are just paid by insurance & Medicare(aid) with far less scrutiny than if the consumer were able to shop.
Elected Government regulators, lawmakers, receive campaign funds from the industry, the healthcare debate and resulting 2010 election shows us what happens when elected officials stand up to massive campaign donors.
50% of all healthcare costs are paid by the government with tax dollars, we have socialized costs paid to privately owned, publicly traded companies who then funnel some of that money back into legalized bribery via campaign contributions.
Despite this, our health industry claims to be free market…yet 50% of all revenues are tax dollars, they brainwashed the masses with messages of “socialism” and “government takeovers” in 2009.
It all comes back to money in politics, and it’s not just the healthcare sector.
It is hard to find the price. I was trying to figure out the cost of an ultra-sound. To do that, I had to get the treatment code from the hospital. Then, I had to call my insurance company to find out what portion they cover.
Also, the hospital said they have a contract with some 3rd party independent provider to interpret the imaging. So, I had to figure out what treatment code they use and why my insurance will cover.
For some procedures, it’s difficult to find the treatment code. The provider will refer you to the billing department, who will say they don’t know what the treatment code is going to be, until they receive info from the medical experts providing the treatment.
Then, try to all of the above with every provider in your area. It would take forever. So, I think most people just go to a convenient doctor and wait a month to see what the bill is going to be.
By the way, once I had to get an X-Ray and I just asked what the raw cost would be, assuming I had no insurance. And the billing department couldn’t tell me. They said it depends on how many images the technicians take. They estimated a ball park figure that ranged from something like $500 to $1000. I think it ended up being $1000, but my insurance covered almost all of it, which meant it was about $50.
It’s a “confusopoly”.
Confusopoly (aka Dilbert’s confusopoly) is confusing marketing designed to prevent the buyer making informed decisions. Dilbert’s author Scott Adams defines confusopoly as “a group of companies with similar products who intentionally confuse customers instead of competing on price”.
There are so many extras though that it is hard to get a flat price.
One example of people getting screwed who thought they had a firm price was when an MD would bring in an out-of-network assistant MD, which then resulted in someone getting a $4k or more bill for the services of the assistant.
I may be wrong but I always thought when I heard these stories that this was done on purpose and the two MD’s spilt the billed amount between them.
Shocking Details… Housing overvalued, Stawks overvalued, Fed pumping 1.5Trillion, why not HealthCare overvalued?? What? its ok for BTC Amazon Tsla to be nosebleed but not when it comes to fixing a knee or c-section?? Follow the leaders. Contractors in Sutter area are charging 700 sq/ft on rebuilds and almost 200$ /hr on general stuff.
The solution is to turn our “sick”care system into a health care system….this can be done by changing the tradition medical model of testing ( looking for issues for which to invoice ) to running complete nutritional profiles on each American. Most chronic illness is due to a deficiency of one type or another. Seniors are particularly vulnerable to deficiencies. For instance,Vitamin D has been shown to be protective in all respiratory illness including COVID-19. Other nutrients are protective against heart disease,diabetes,dementia. Currently ,Doctors are not allowed to screen for deficiencies,unless the patient asks for a particular test. The system is a”SICK” care system,not HEALTH care !!!!! Often a drug leads to another drug which leads to another and so on. Loading seniors up on drugs is big “sick” business !! Our Nutritional profiles need to be normalized and maintained; this would be far less expensive than the current approach.
The “health care system” should also begin in schools, which teach children and parents how to cook cheap, healthy, and fast. In this way, we wouldn’t have the childhood obesity and diabetes epidemic. This is a huge part of the health care costs in this country.
Even in the 1990s, I recall meeting with doctors from Europe, who would frequently tell me that they don’t have the obesity problem we have in the USA. If you look at old photographs of Americans, we were much thinner 50 to 90 years ago.
And as TwisterTim mentions, annual physical checkups should include a full nutritional test of vitamin D and all other vitamins/minerals. It’s really not that easy to get 100% of your RDI from just food. But vitamin pills don’t seem to work as well as food, and so people should really try to get their nutrients from food.
For example, I’ve read that calcium supplements may not work as well as getting the calcium from food. And if you go throughout your life without enough calcium, then when you break your bone at age 60 or 70, then it may not heal, due to osteoporosis. If people had just known they were not getting enough calcium, then this could have been avoided, by eating healthier.
I think the “$60,584” is probably close to $100K more than that.
It is all about the codes.
You read “c-section” and think that is the cost of the women having her baby delivered that way.
Nope. that $60K does not include the anesthesiologist, the hospital stay, the Kleenex charge, etc.
We all have witnessed how slow and poor our gealth system is by it’s response to covid crisis. This is the most expensive, non-transparent and inefficient system tolerated by the people on the planet.
Look at many countries in Europe abd Asia where healthcare is affordable and efficient. It us clear that our system needs to be demolished and replaced by a brand new system that is affordable without insurance, transparent and efficient.
This cannot be achieved without looking at tge reasons for such high prices starting with the cost of medical education, medicines, equipments, reagents, and so on. A carefully built new system with eyes on cost at every level is a must. An ideal system is where a oerson earning basic pay should be able to pay hospital bills without insurance. It is possible. I do not see the willigness.
I live in France and the heath system is pretty good in general and I have no complaints. My wife went through extensive operations and it does take a load off your mind that you don’t have to worry about how to pay for it. Everybody knows it isn’t “free”. We know it’s in the tax bill but it works. However a good heath care system in normal times does not necessarily mean it works equally well during a pandemic. Just about all European countries have very high death rates as we find in the US and for the same reason which is lack of preparation stemming from lack of experience. We haven’t had widespread epidemics for so long that we have forgotten how to handle them.
It nauseates me that the Healthcare debate revolves around insurance with almost no focus on price.
Total cost of healthcare in 2020 was over $4 trillion, that’s $12.5K for every person.
For comparison, the UK spends $2500 per person.
The bulk of this difference is in supplies & pharmaceuticals.
Insurance has become a place for suppliers to hide pricing.
Personally, I’d prefer a system where we pay directly, where hospitals are mandated to offer loans for larger procedures….at least as a parallel option to insurance.
The consumer would have direct exposure to pricing, to shop, to ask questions.
It would also push healthcare into a true free market.
Our current system of private providers largely funded by tax money is failing, miserably.
Yes. Good ideas.
Please see this post by Karl Denninger. He also has similar ideas and more.
These 2 reforms would be great:
Consumers need to be billed directly for health care costs. Providers must offer each service for the same price to each consumer, regardless of what insurance they have or if they have no insurance.
Providers must post all prices on the web, so that it is easily searchable by eyeball or machine. Eventually, the private sector would create apps that would make it easy to compare.
Side note – I see an irony that Karl Denninger left his own creation, the Tea Party, when his intended message to protest big bank bailouts became distorted to a movement fighting increasing taxes to the wealthy once the Koch’s got their hands on it.
Add another that is equally important: Employees must be billed for the full cost of any insurance, and while they can receive a credit for part of it, that credit must be shown separately so that the employee can see the full, actual cost for insurance.
I have lied and said I don’t have insurance so that I can receive the cash rate. Often cheaper than the amount i would have to pay going through insurance and then paying the “uncovered” portion. This is in part because with work in construction and we get bottom of the barrel insurance.
Hmmm? I thought that hospitals often charge double if you don’t have insurance, because you don’t have the benefit of an insurance company bargaining for you.
However, I think state-supported hospitals may have regulations against doing that.
There are laws that once they find out you have insurance they can’t give you the cash rate.
I shop around as if uninsured first. A couple doctors had me sign a declaration of uninsured so they wouldn’t get in trouble if it was discovered I was insured.
MRI. $300 vs $2500.
I should clarify, I think this works on small common procedures. I don’t think this would work on large procedures requiring specialists. At that point you would clear your deductible and max out of pocket by a long shot.
“There is unlimited demand for free services “
Unless you have numbers that prove that, I call fake news. Do you think that if colonoscopies are free there will be a mad rush to get them? The only reason that demand for “free” services may be high is because hospitals push the services to increase revenue.
Actually, colonoscopies are free under Obamacare to people over 55.
Mine under Medicare cost me $50. The colon cancer discovered during the colonoscopy cost me $2500 for surgery and chemotherapy.
It’s not so much that people are “taking advantage” of free services as that many people have medical issues that need attention but hesitate to visit an MD for a variety of reasons from cost to availability.
My cost for regular Medicare + a supplement plan is about $300/monthly. My only out-of-pocket cost, after the annual part B deductible (currently $204) is a $20 office visit fee.
Knowing what my cost for anything is up front and not having to deal with pre-authorizations or rejections allows me to take full advantage of Medicare to fix/resolve things that I needed done but just had too much friction and out-of-pocket costs previously. If an MD says I need a test, I don’t hesitate to schedule it.
The Swiss health care model which the Isaelis have also adopted is the best compromise if one wants some free market discipline and ensure that the bottom rung of the ladder get subsidized health care
How is the Swiss system essentially different from the “Affordable Care Act”? I thought that the Swiss system also tries to incentivize or pressure everyone to have health insurance. Do they do that? What % of people are insured?
Everyone is insured. There are several isurance companies that offer a regulated basic plan. If you don’t buy insurance you will be garnished. Those that can’t afford get a subsidy stipend. Companies that provide the basic insurance can then offer an unregulated premium policy that fill in the gaps. There are ome key differences
It would help if rates and services were published. The classic example is the MRI where every hospital has their ow rate and there is no rhyme or reason. Prices are all over the place.
“It would help if rates and services were published.”
It sounds like that’s what Trump was trying to do.
See my reply to “Frilton Miedman” who begins with “It nauseates me that the Healthcare debate revolves around insurance with almost no focus on price.”
Without being too repetitive, I echo Karl Denninger, who recommends that:
The Swiss model is actually quite different than the Israeli one (although at their core they are both based in the old German Krankenkasse model).
In Israel you pay a health tax to the government which uses a capitation scheme to distribute the proceeds back to the insurance companies (there a four competing ones). Everyone is guaranteed a certain minimum level of coverage and you can increase your coverage by purchasing a supplemental plan from the insurance company (these are not very expensive, max $50 per month). It is definitely a good model.
I understand why deductible look attractive, but they are not IMHO. In a system where you have $6K deductibles, most people can not afford that. Sure if you are making over $100K but for the rest of America, the choice is not to go to the doctor unless it is an emergency so all preventive medicine is out the door as well as medications that could make people’s lives better. Talk to primary care docs in rural America and they will confirm this. It is just not clear to me why this country feels it is ok for so many people to have no medical insurance. Wouldn’t we want people to be healthy? And most of the rest of the world has figured out how to do this. Let American continue to be proud of the most expensive and least effective medical system in the world – unless you are rich.
Nailed it. My deductible is $7.5k…..major deterrent to preventative care….or care at all.
I don’t think a lot of preventative medicine is really all that helpful, unless you want to call “eating right and exercising” preventative medicine.
E.g., the cholesterol-lowering drugs are supposed to prevent fatal diseases, but the evidence is not clear they actually increase lifespans.
Even some cancer-screening is questionable, such as the PSA test for prostate cancer. The recommendation has vacillated in recent years between it is helpful to get the screening to it may be more harmful than helpful given false diagnoses, etc.
Yup. When I was on Obamacare, I had a deductible of nearly $3k. And there were co-pays also. So I didn’t get stuff done that needed to be done as I wasn’t far from Medicare eligibility then and was willing to wait.
You have spotlighted a big problem but come to the wrong conclusion. People on Medicaid and Medicare probably don’t care too much about the cost but it actually doesn’t matter much because these rates have already been pre-negotiated. Similarly with those who go to a hospital which accepts their insurance. The rate has already been negotiated and most likely the procedure has already been pre-approved. You are asking a lot if you expect the consumer to be fully educated on medical procedures and their costs, especially when the hospital won’t tell you. I will agree that there is a huge demand for free services however these are mostly stoked by advertising by a few providers of devices and services. It would be relatively easy to crack down on these few providers. Another way would be to have a nominal deductible. Most seniors and the poor don’t want unnecessary medical treatment although some are not knowledgeable enough to fend off unscrupulous providers.
The big problem is either those without insurance or those who have an unexpected procedure (say they are out of town and suddenly need that C-Section) or need to go to the ER. These people will not have time to research which hospital accepts their insurance (if any). Then the people without insurance (most likely the working poor) will run up a huge bill and then be taken to court, have wages garnished, and perhaps file bankruptcy. Those with insurance (but is not accepted by the hospital) will have a huge deductible to pay (and perhaps run into the same problems of garnished wages or bankruptcy) and then the insurance company will pay the rest of the hugely inflated charges. This increases the insurance costs to everyone.
I don’t know what the solution is but one idea that I have is that people without insurance should have the right to pay 120% of the Medicare allowed amount in cash. This would at least prevent hospitals from ripping off the poor. And to prevent hospitals from ripping off insurance companies (and ultimately the consumer of this insurance), insurance companies that do not have pre-negotiated rates would have the right to pay 120% of the mean of the hospital’s pre-negotiated rates with the insurance companies that the hospital accepts in an out of service area and/or emergency situation.
A couple comments:
Medicare does have deductibles.
All other countries have figured this out by instituting a framework which mandates universal health insurance coverage. Since that idea wasn’t invented here in Ummerica we can’t adopt it.
How about have hospitals advertise prices for typical procedures? Word of mouth will do wonders. They could even have sales on these procedures…
This was on 60 minutes. I don’t recall the details, but I think the gist of it was that they bought up all the competition to create a monopoly. At the point, they could charge whatever they want – no competition. Not in CA, my doctor’s practice was also purchased by one of the larger system’s a few years ago.
MY GOWD ! Those prices, I can t believe my fckn eyes…you actually ARE a utterly insane nation ! In september I had a cervical micro operation( a foraminotomy) in one of the best belgian hospitals, the UZ Brussel, as I wanted a single room(3days), fees almost doubled but even then the total price was below 8K Euro, most of which was paid by the state’s social insurance and the single room extras covered by a hospitalisation insurance costing me 300 euro /year …Your situation is definitely OUTRAGEOUS !
“A study published in the American Journal of Public Health in 2019 found that 66.5% of bankruptcies in the U.S. were due to medical issues like being unable to pay high bills or due to time lost from work.”
This is a uniquely American problem among wealthy nations. Few other countries have these problems, and most other wealthy countries don’t even institute the solutions Mish is advocating for.
Do you really think that 4k Euro for three nights (half of your expenses) is a reasonable price for small room? Ha-ha!
German taxpayers pay your bills not you.
Read “The True Cost of health Care” by Dr. David Belk. He explains in vivid detail the how and why of the scam we call Health care.
What would you expect from a Health Industry that is nothing but criminal racketeering ? Cuba’s life expectancy is the same as the US ….. and re children dying in the dirt , infant mortality rate ….. can you guess ?
Infant Mortality
Compared with other OECD countries, the U.S. ranks No. 33 out of 36 countries (Figure 62). Iceland is ranked No. 1 and has the lowest rate with 0.7 deaths per 1,000 live births.
I live in Indiana; infant mortality here is abysmal
Only now you say it?