Results 1 to 8 of 8

Thread: Why we need health care reform

  1. #1
    Join Date
    Jan 2004
    Posts
    8,178

    Why we need health care reform

    Elisabeth Rosenthal at the times has been on a tear lately about our health care system and the problems with it. She takes what I think is a good approach in looking at the cost of care/procedures that we get and comparing it to the cost of the same procedures as associated care in other countries.

    http://www.nytimes.com/2013/06/02/he...abethrosenthal

    The $2.7 Trillion Medical Bill
    Colonoscopies Explain Why U.S. Leads the World in Health Expenditures

    MERRICK, N.Y. — Deirdre Yapalater’s recent colonoscopy at a surgical center near her home here on Long Island went smoothly: she was whisked from pre-op to an operating room where a gastroenterologist, assisted by an anesthesiologist and a nurse, performed the routine cancer screening procedure in less than an hour. The test, which found nothing worrisome, racked up what is likely her most expensive medical bill of the year: $6,385.

    That is fairly typical: in Keene, N.H., Matt Meyer’s colonoscopy was billed at $7,563.56. Maggie Christ of Chappaqua, N.Y., received $9,142.84 in bills for the procedure. In Durham, N.C., the charges for Curtiss Devereux came to $19,438, which included a polyp removal. While their insurers negotiated down the price, the final tab for each test was more than $3,500.
    In many other developed countries, a basic colonoscopy costs just a few hundred dollars and certainly well under $1,000. That chasm in price helps explain why the United States is far and away the world leader in medical spending, even though numerous studies have concluded that Americans do not get better care.

    Whether directly from their wallets or through insurance policies, Americans pay more for almost every interaction with the medical system. They are typically prescribed more expensive procedures and tests than people in other countries, no matter if those nations operate a private or national health system. A list of drug, scan and procedure prices compiled by the International Federation of Health Plans, a global network of health insurers, found that the United States came out the most costly in all 21 categories — and often by a huge margin.
    The entire article is NOT about colonoscopies and is worth a read. One thing that always seems to come up, though, is doctors claiming that their patients demand these expensive, unnecessary tests. I have never asked my doctor for any specific test. I asked my doctor and he said that he very, very rarely has a patient request any specific test, and on the few occasions that he has, he can typically explain to the patient why that test is unnecessary and it becomes a non issue...if nothing else he says that if he tells them "your insurance will not cover it in this situation" that is ALWAYS the end of the conversation.

    At the same time, this is the same doctor that sent me for a $6000 MRI to diagnose a kidney stone when a $250 X-ray would have done just as well. His explanation? He had no idea what an MRI cost, or what an X-ray cost. He also has no idea what the prescriptions he writes cost to be filled because what may cost $4 to be filled at a Wal Mart pharmacy may cost $200 to have filled at a Medicine Shop pharmacy.

    Largely an office procedure when widespread screening was first recommended, colonoscopies have moved into surgery centers — which were created as a step down from costly hospital care but are now often a lucrative step up from doctors’ examining rooms — where they are billed like a quasi operation. They are often prescribed and performed more frequently than medical guidelines recommend.

    The high price paid for colonoscopies mostly results not from top-notch patient care, according to interviews with health care experts and economists, but from business plans seeking to maximize revenue; haggling between hospitals and insurers that have no relation to the actual costs of performing the procedure; and lobbying, marketing and turf battles among specialists that increase patient fees.

    While several cheaper and less invasive tests to screen for colon cancer are recommended as equally effective by the federal government’s expert panel on preventive care — and are commonly used in other countries — colonoscopy has become the go-to procedure in the United States. “We’ve defaulted to by far the most expensive option, without much if any data to support it,” said Dr. H. Gilbert Welch, a professor of medicine at the Dartmouth Institute for Health Policy and Clinical Practice.
    I can tell you from experience that surgery centers are typically a FANTASTIC investment...if you can find one that is not closed....typically they are owned by a group of doctors and not open to outside investment.


    The next article:

    http://www.nytimes.com/2013/04/21/su...abethrosenthal

    Is It Time for Off-the-Shelf Birth-Control Pills?

    WHEN a federal judge recently ordered the Food and Drug Administration to make the morning-after pill available to women of all ages without a prescription, the ruling was a political embarrassment for the Obama administration and unleashed protests from abortion foes and abstinence advocates. But that controversy may look like a tempest in a teapot compared with a broader and no less heated discussion that is roiling the medical community: should birth-control pills of any type require a doctor’s prescription? Or should they be available, like Tylenol, on pharmacy shelves?
    It is important to note that the morning after pill is basically a big dose of the same stuff that is in normal birth control pills....you can take 5 of you normal birth control pills and get the same result as taking the morning after pill. The judge required over the counter sales because it had been proven safe. So the morning after pill is safe enough to sell over the counter, but birth control pills, at 1/4 the dosage, is not?

    While oral contraceptives bring with them some tiny risks, especially if used improperly, they arguably pose fewer dangers than many other medicines bought freely at the pharmacy, experts say, including nonsteroidal pain pills like Motrin (which can cause stomach bleeding) and decongestants like Sudafed (which may raise blood pressure). With a simple packaging insert about proper use and precautions, women would be fully capable of using them safely, the gynecologists’ group maintained.

    “Nonsteroidal medicines kill far more people than birth-control pills,” said Dr. Eve Espey, a professor of obstetrics and gynecology at the University of New Mexico, who was involved in writing the position paper. “For most women, the absolute risk of taking the pill is far less than the risks incurred in pregnancy.”
    You would think they could come up with some kind of relatively simple guideline like "If it is less dangerous than ibuprofen it can be sold over the counter". We could say "Less dangerous than aspirin" but there is a LOT of stuff less dangerous than aspirin.
    Gynecologists themselves seem divided on the issue. A recent poll found that a majority of gynecologists and family doctors in training opposed the practice, worried mainly about safety. The researchers at the University of Missouri who conducted the survey concluded that the fear was irrational, revealing “a knowledge deficit” about “the safety of oral contraceptives.”
    I am going to disagree with the researchers. It is not a knowledge deficit. It is human nature. Nobody is going to respond with "because I want to continue to charge $200 per person per year to dispense prescriptions for the stuff" when you conveniently provide a "safety" option.

    But Dr. Donna Harrison, executive director of the American Association of Pro-Life Obstetricians and Gynecologists, said her group believed that it was “foolish to make these medicines available over the counter” because of the potential for misuse and also because the practice served to abandon and isolate younger women who needed a doctor’s counsel. She cited studies showing that women who had ready access to over-the-counter emergency contraception had higher rates of sexually transmitted diseases.
    Pro life people confuse the hell out of me sometimes. The only thing that we have ever found that statistically impacts the abortion rate is availability and affordability of birth control. Yet generally pro life folks prefer to restrict access to birth control. If you want to avoid abortions, I would think that you would support efforts to make birth control easy to get and affordable so there would be fewer unwanted pregnancies and fewer abortions. Instead it seems like "pro life" actually means "anti sex"

    Meanwhile, the F.D.A. will not comment on the idea because of the “ongoing legal issues” concerning the judicial ruling on the morning-after pill, Plan B, said Stephanie Yao, a spokeswoman. The morning-after pill, also known as emergency contraception, contains the same hormones as some birth-control pills, though delivered in a short blast and higher dose.
    Hopefully the FDA will decide to take the courts ruling as an indication that birth control pill, which are the same as the morning after pull but lower strength, should be sold over the counter as well.

    Politics aside, there are procedural hurdles to clear before packs of birth-control pills can be sold without prescription. First of all, a drug maker would most likely have to apply to the F.D.A. to make the switch. At the very least, that would involve serious investment in studies to show that patients could understand labels and use the pills as directed. And over-the-counter sales could upend drug company profits. After all, some oral prescription contraceptives sell for close to $100 a month, with insurers paying the bulk of the costs, while generic pills cost under $10.
    The real problem...the FDA is way to integrated with the drug industry....it is primarily staffed by people who started out at pharmaceutical companies and when they leave the FDA they can count on being immediately snapped up by a drug company at an inflated salary.

    Otherwise an FDA panel could sit down, look at the tens of thousands of pages of research on birth control, and make it an OTC drug in an afternoon.

    Dr. Espey said gynecologists might resist for financial reasons as well, since young women often visit the gynecologist annually solely for the purpose of getting a contraceptive prescription. (Pap smears, which used to be recommended once a year, are now advised only once every three.) “They worry that if patients can go to the pharmacy and get their pills, they will have fewer visits,” she said.
    Well duh....

    The next article is here:

    http://www.nytimes.com/2013/07/01/he...orld.html?_r=0

    American Way of Birth, Costliest in the World

    LACONIA, N.H. — Seven months pregnant, at a time when most expectant couples are stockpiling diapers and choosing car seats, Renée Martin was struggling with bigger purchases.

    At a prenatal class in March, she was told about epidural anesthesia and was given the option of using a birthing tub during labor. To each offer, she had one gnawing question: “How much is that going to cost?”

    Though Ms. Martin, 31, and her husband, Mark Willett, are both professionals with health insurance, her current policy does not cover maternity care. So the couple had to approach the nine months that led to the birth of their daughter in May like an extended shopping trip though the American health care bazaar, sorting through an array of maternity services that most often have no clear price and — with no insurer to haggle on their behalf — trying to negotiate discounts from hospitals and doctors.
    I dont have time to comment the entire article, but it is worth a read.
    If ye love wealth greater than liberty, the tranquility of servitude greater than the animating contest for freedom, go home from us in peace. We seek not your counsel, nor your arms. Crouch down and lick the hand that feeds you; May your chains set lightly upon you, and may posterity forget that ye were our countrymen. —Samuel Adams

  2. #2
    Join Date
    Mar 2005
    Posts
    11,660

    So what to do?

    We know it costs more for just about every procedure. This article, like numerous others, thinks they have the magic bullet of health insurance price problems but the truth is there are numerous things that make our health insurance cost more:
    • drugs cost more
    • procedures cost more
    • doctors are paid more
    • we have more procedures done
    • we use more expensive procedures
    • we have more technology
    • too much regulation

    ...just to name a few.

    I hear all this but I don't hear a solution that makes sense. Universal health care? I'm not sure how having one payer will lower all of those costs. Would the government just demand all doctors take a pay cut? Don't count on it. Free market principles? This probably won't work either because we crossed the threshold of assuming health care is a right.

    So what solution is out there that would actually work?

    And as for your kidney stones, you could have gotten a $125 Ultrasound and seen it better than X-Ray and MRI. You're lucky they didn't call for all three which is what they normally do.

  3. #3
    Join Date
    Jan 2004
    Posts
    8,178
    Quote Originally Posted by Steeeeve View Post
    We know it costs more for just about every procedure. This article, like numerous others, thinks they have the magic bullet of health insurance price problems but the truth is there are numerous things that make our health insurance cost more:
    • drugs cost more
    • procedures cost more
    • doctors are paid more
    • we have more procedures done
    • we use more expensive procedures
    • we have more technology
    • too much regulation

    ...just to name a few.

    I hear all this but I don't hear a solution that makes sense. Universal health care? I'm not sure how having one payer will lower all of those costs. Would the government just demand all doctors take a pay cut? Don't count on it. Free market principles? This probably won't work either because we crossed the threshold of assuming health care is a right.
    Where "too much regulation" comes into play in our system is primarily on the drug end of things....the pharma companies have bought the government. That is how they get away with 11,000% markups.

    The rest of the industry badly needs regulating. When you cant call a hospital and get a price for a procedure, something is wrong. When doctors are forced to charge uninsured patients more than insurance companies pay because it is required by their contract with the insurance companies, something is very wrong...in any other industry that would be referred to as "price fixing" and it is a felony.

    We are not using more expensive procedures...that is largely the point of the article. We are just being charged a lot more for the exact same procedure.

    So what solution is out there that would actually work?
    Hard to say. We could do what every other first world nation has done and go to single payer health care. There are a lot of folks who argue that single payer would not work here. Frankly those people are stupid. What they are saying is that we are not smart enough to implement a program that every other first tier nation has. You say you are not sure it would cut costs...it certainly has in every other nation. Why not here?

    We could revert to free market health care....which would mean outlawing health insurance and making consumers actually shop for their services which would force hospitals and doctors to actually compete for business. We could institute a safety net for those who need services but cannot afford to pay for them....food stamps for medical services.

    If we just cant stand the idea of either single payer or actual free market health care, we could require that hospitals and doctors use a universal pricing model where everybody (including insurance companies) pays the same for a procedure and require that they advertise their rates. Then do away with the 15% cap on insurance companies profits AND put a public insurance option back on the table.

    Frankly what we have now is pretty much the worst model imaginable for health care costs. In the last 15 years there have been 4 times that insurance industry leaders have been called in front of congress to testify and on all 4 occasions they admitted that the insurance industry employes policies specifically designed to increase health care costs. We have a system here where the actual customer (the insurance company) is working to drive up costs in order to increase their cut. That is no different from a corporate purchasing agent buying higher priced goods in exchange for a kickback.

    The reality is that nothing is going to happen until either we are completely bankrupt or close enough to it that Americans decide to take back their government. Right now there is just too much money in the insurance racket and our elected representatives have all been bought. At one time the republicans were talking about kicking the entire mess back to the states. Every state that studied the issue found that the most cost effective way for them to proceed would be to do away with health insurance, build/buy hospitals, fill them with salaried doctors, and start treating people. The republicans pulled the plug on that immediately. Apparently when they realized that getting the federal government out of health care would pretty much put the insurance industry out of health care they decided that the constitutionality of the situation was a lot less important than they originally thought.

    And as for your kidney stones, you could have gotten a $125 Ultrasound and seen it better than X-Ray and MRI. You're lucky they didn't call for all three which is what they normally do.
    An ultrasound at our local hospital is $1,100.00.
    If ye love wealth greater than liberty, the tranquility of servitude greater than the animating contest for freedom, go home from us in peace. We seek not your counsel, nor your arms. Crouch down and lick the hand that feeds you; May your chains set lightly upon you, and may posterity forget that ye were our countrymen. —Samuel Adams

  4. #4
    Join Date
    Mar 2005
    Posts
    11,660
    Quote Originally Posted by daewoo View Post
    Where "too much regulation" comes into play in our system is primarily on the drug end of things....the pharma companies have bought the government. That is how they get away with 11,000% markups.

    The rest of the industry badly needs regulating. When you cant call a hospital and get a price for a procedure, something is wrong. When doctors are forced to charge uninsured patients more than insurance companies pay because it is required by their contract with the insurance companies, something is very wrong...in any other industry that would be referred to as "price fixing" and it is a felony.

    We are not using more expensive procedures...that is largely the point of the article. We are just being charged a lot more for the exact same procedure.
    It's regulating the correct thing. Primary Car Physicians have upwards of 90-150% overhead. There are several examples of doctors that have stopped taking insurance and cut their prices in half or less. A large portion of this overhead is just negotiating prices, billing, following up on bill questions, and other BS issues but there is a portion that relates to federal compliance and reporting that is outdated and irrelevant to health care. Perhaps it would be more helpful to adopt some uniform convention or standard instead for billing and to cut the regulation to a bare minimum.

    Again though, you are charged a lot more for the same procedure but no one seems to say what we plan to cut. Less money means someone gets paid less. Contrary to popular belief there aren't like 2 guys sitting in a room at a hospital just lighting $100 bills on fire. Most of the money goes towards salary (~60-70%). So are we going to cut the pay or doctors, nurses, or both? I just don't see that ever happening. Going to cut the other 30-40%? Also doubtful as that relates to equipment and overhead which may or may not be easy to just cut.

    Hard to say. We could do what every other first world nation has done and go to single payer health care. There are a lot of folks who argue that single payer would not work here. Frankly those people are stupid. What they are saying is that we are not smart enough to implement a program that every other first tier nation has. You say you are not sure it would cut costs...it certainly has in every other nation. Why not here?
    It didn't cut cost in other countries, it just caused them not to rise as fast as the USA. You gotta remember that most countries went to single payer well over 20 years ago. During that time our costs skyrocketed while everyone else just had large increases. Over the last decade the rate of increase has been about even between the USA and single-payer countries. I'm not sure why this is or whether or not this will continue. It still comes back to the fundamental question, what are you going to cut exactly? I was talking with the CFO of a hospital here in Virginia after the healthcare law passed and I asked him straight up what this law meant and he went on about how it wasn't a big deal but one thing he said I will never forget: "No matter what, doctor's will always be driving Mercedes to work". I just don't think having a single payer is going to all of a sudden bring doctors with $150k in debt to their knees where they will happily take a 30% pay cut. It's just not in the cards. Sure you could do some things with drug companies and equipment manufacturers but that isn't going to be enough (although if we fixed the drug cost problem it would likely cause single payer drug prices to rise faster than US drug prices...I think it is obvious we are subsidizing everyone else on drug cost).

    We could revert to free market health care....which would mean outlawing health insurance and making consumers actually shop for their services which would force hospitals and doctors to actually compete for business. We could institute a safety net for those who need services but cannot afford to pay for them....food stamps for medical services.
    And this is not feasible. Unless we have another civil war and one side splits off to form a try "liberty" country I see a better chance of doctors taking a pay cut.

    If we just cant stand the idea of either single payer or actual free market health care, we could require that hospitals and doctors use a universal pricing model where everybody (including insurance companies) pays the same for a procedure and require that they advertise their rates. Then do away with the 15% cap on insurance companies profits AND put a public insurance option back on the table.
    That 15% cap is hilarious; it's an incentive to increase costs. Yeah, I'd agree with this but at this point we are talking about limiting the rate of growth, not closing the gap to other countries. Frankly I think the former is more realistic.

    Frankly what we have now is pretty much the worst model imaginable for health care costs. In the last 15 years there have been 4 times that insurance industry leaders have been called in front of congress to testify and on all 4 occasions they admitted that the insurance industry employes policies specifically designed to increase health care costs. We have a system here where the actual customer (the insurance company) is working to drive up costs in order to increase their cut. That is no different from a corporate purchasing agent buying higher priced goods in exchange for a kickback.
    It doesn't seem the insurance companies are lying. They simply are trying to do what companies have a fiduciary duty to do, maximize return for those that have a profit interest. It is the job of Congress to not be XXXXXX.

    An ultrasound at our local hospital is $1,100.00.
    Must be a non-profit university hospital (if anything like Virginia). Here the non-profits charge more than the for profits; I don't understand why to be honest. Generally $1k ultrasound gets you an OB scan for twins. Kidney stones are easy to scan from what I understand and take like 20 minutes.

  5. #5
    Join Date
    Mar 2005
    Posts
    11,660
    To supplement what my post: http://www.commonwealthfund.org/~/me...artbook_v2.pdf

    Slide 5 shows annual increases in health care expenditures over a decade. Notice the US is lower than the UK and Canada (although basically right around the average). So I don't single payer is going to make things cheaper nor make our rate of growth any better.

  6. #6
    Join Date
    Jan 2004
    Posts
    8,178
    Quote Originally Posted by Steeeeve View Post
    It's regulating the correct thing. Primary Car Physicians have upwards of 90-150% overhead. There are several examples of doctors that have stopped taking insurance and cut their prices in half or less. A large portion of this overhead is just negotiating prices, billing, following up on bill questions, and other BS issues but there is a portion that relates to federal compliance and reporting that is outdated and irrelevant to health care. Perhaps it would be more helpful to adopt some uniform convention or standard instead for billing and to cut the regulation to a bare minimum.

    Again though, you are charged a lot more for the same procedure but no one seems to say what we plan to cut. Less money means someone gets paid less. Contrary to popular belief there aren't like 2 guys sitting in a room at a hospital just lighting $100 bills on fire. Most of the money goes towards salary (~60-70%). So are we going to cut the pay or doctors, nurses, or both? I just don't see that ever happening. Going to cut the other 30-40%? Also doubtful as that relates to equipment and overhead which may or may not be easy to just cut.
    As things stand right now 15% of our health care costs go to insurance company profits. Another 40% of those costs are administrative overhead...mostly billing. When Uwe Reinghart testified in front of the senate on health care reform he said:

    “We have 900 billing clerks at Duke. I’m not sure we have a nurse per bed, but we have a billing clerk per bed… it’s obscene.”
    That is pretty typical. Our local hospital has more people in their billing department than they doctors and nurses combined.

    Since insurance companies are just payment transfer agents, you are basically talking about 55% of our health care dollars being spent on billing and payment transfer.



    It didn't cut cost in other countries, it just caused them not to rise as fast as the USA. You gotta remember that most countries went to single payer well over 20 years ago. During that time our costs skyrocketed while everyone else just had large increases. Over the last decade the rate of increase has been about even between the USA and single-payer countries. I'm not sure why this is or whether or not this will continue. It still comes back to the fundamental question, what are you going to cut exactly? I was talking with the CFO of a hospital here in Virginia after the healthcare law passed and I asked him straight up what this law meant and he went on about how it wasn't a big deal but one thing he said I will never forget: "No matter what, doctor's will always be driving Mercedes to work". I just don't think having a single payer is going to all of a sudden bring doctors with $150k in debt to their knees where they will happily take a 30% pay cut. It's just not in the cards. Sure you could do some things with drug companies and equipment manufacturers but that isn't going to be enough (although if we fixed the drug cost problem it would likely cause single payer drug prices to rise faster than US drug prices...I think it is obvious we are subsidizing everyone else on drug cost).
    First of all, it did not cut costs in other nations, but none of those other nations had the kind of grossly distorted market that we have here. Those other nations all transitioned from a free market system...something we have not had in this country since WWII.

    Second, Doctors in the UK and Canada drive Mercedes...though the 2 Canadian doctors I know personally drive infinities. Personally I think that is a wise decision...Mercedes is dead. Infinity is up and coming.

    Third, our problem here in the US when it comes to doctor pay is when it comes to specialists. General Practitioners annual earnings in the US is on par with GPs earnings in other nations. It is specialists that push doctors earnings off the charts both because they are extremely expensive and because 70% of US doctors are specialists as opposed to 30% in the UK and about half in Canada. The high number of specialists in this country is the result of our insurance driven health care model. Insurance companies offer higher payments for specialists. This has pushed doctors into specialties, and as the number of specialists grew past the number of GPs organizations like the AMA started pushing guidelines that moved a lot of procedures that traditionally were done by GPs into the realm of specialty medicine. The article I linked earlier talks about this in regard to colonoscopies. They used to be performed in your GPs office during the course of a regular exam visit. Now they are performed by a specialist in a surgical center.

    And I absolutely disagree with the idea that we are subsidizing everybody else on drug costs...at least the way you mean. There is not a single country on the planet earth that requires that drug companies sell at a loss. Some countries negotiate with drug companies for their drug costs. Others require that they submit documentation showing their total costs to develop and produce a drug and base their fixed price on that. When they calculate that fixed price, though, the companies are only allowed to include the costs that the COMPANY actually paid. Since over 90% of the cost of drug development in the US is paid for through NIH grants, that number is pretty small....in most cases companies do not even submit the information, preferring to take the small hit rather than make their ridiculously small R&D costs a matter of public record. We do know that Pfizer spends MORE on executive bonuses each year than they do on R&D.

    Finally, doctors probably don't want to take a pay cut. Nobody ever wants to take a pay cut. Too bad. Life is hard.

    That 15% cap is hilarious; it's an incentive to increase costs. Yeah, I'd agree with this but at this point we are talking about limiting the rate of growth, not closing the gap to other countries. Frankly I think the former is more realistic.
    Limiting the rate of growth just isn't good enough. We need to actually cut costs. There is no way you are going to convince me that in a system where over 50% of costs go toward billing and funds transfer that we cannot cut costs significantly.

    It doesn't seem the insurance companies are lying. They simply are trying to do what companies have a fiduciary duty to do, maximize return for those that have a profit interest. It is the job of Congress to not be XXXXXX.
    No. They are not lying. If they were lying I could almost give congress and the American people a pass on some of this asshattery. As is, they show up, tell the truth which is basically "{We are giant douche bags and we are fleecing all you suckers" and somehow we still have nitwits arguing that the system we have now should not be touched.

    Must be a non-profit university hospital (if anything like Virginia). Here the non-profits charge more than the for profits; I don't understand why to be honest. Generally $1k ultrasound gets you an OB scan for twins. Kidney stones are easy to scan from what I understand and take like 20 minutes.
    It is not a university hospital, it is a non profit community hospital. The reason that it is insanely expensive on a lot of things is that they have farmed out pretty much everything. Example...the hospital does not have ultrasound machines and ultrasound techs, they have a company that they have contracted with to provide the service and they basically rent them space in the hospital. Captive market (there is nowhere else locally to get the service) + profit motive = high prices.
    If ye love wealth greater than liberty, the tranquility of servitude greater than the animating contest for freedom, go home from us in peace. We seek not your counsel, nor your arms. Crouch down and lick the hand that feeds you; May your chains set lightly upon you, and may posterity forget that ye were our countrymen. —Samuel Adams

  7. #7
    Join Date
    Mar 2005
    Posts
    11,660
    Quote Originally Posted by daewoo View Post
    As things stand right now 15% of our health care costs go to insurance company profits. Another 40% of those costs are administrative overhead...mostly billing. When Uwe Reinghart testified in front of the senate on health care reform he said:



    That is pretty typical. Our local hospital has more people in their billing department than they doctors and nurses combined.

    Since insurance companies are just payment transfer agents, you are basically talking about 55% of our health care dollars being spent on billing and payment transfer.
    10 cents on the dollar goes to health insurance companies. Of this, 3 cents is profit. This is debatably a high end estimate. Total "admin costs" probably are less at hospitals than primary doctor's offices. It is in the 40-50% neighborhood at your PCP but 20-25% at a hospital (talking billing, accounting, etc...not patient record keeping). Having a single payer system will at best cut half of that. Why? Because you still need billing clerks. Medicare is the worst offender when it comes to paying bills. Those 1000 billing clerks at Duke probably spend 60%+ of their time negotiating with Medicare.

    Further, the guy from Duke is being a little dishonest when he says he has more billing clerks than hospital beds. There are a thousand billing clerks at Duke because they have over 200 locations in their system. There are 900 beds in their flagship hospital. Most hospitals have a billing staff in the 20+ range (depending on size).

    First of all, it did not cut costs in other nations, but none of those other nations had the kind of grossly distorted market that we have here. Those other nations all transitioned from a free market system...something we have not had in this country since WWII.[/quote]I agree it shouldn't have cut costs in other nations. I just don't see it cutting it here. No one is going to cut a doctors pay by 33%

    Third, our problem here in the US when it comes to doctor pay is when it comes to specialists. General Practitioners annual earnings in the US is on par with GPs earnings in other nations.
    Not true. I thought it was too but turns out I was wrong. http://www.oecd.org/health/health-systems/41925333.pdf (see page 16)

    It is specialists that push doctors earnings off the charts both because they are extremely expensive and because 70% of US doctors are specialists as opposed to 30% in the UK and about half in Canada. The high number of specialists in this country is the result of our insurance driven health care model. Insurance companies offer higher payments for specialists. This has pushed doctors into specialties, and as the number of specialists grew past the number of GPs organizations like the AMA started pushing guidelines that moved a lot of procedures that traditionally were done by GPs into the realm of specialty medicine. The article I linked earlier talks about this in regard to colonoscopies. They used to be performed in your GPs office during the course of a regular exam visit. Now they are performed by a specialist in a surgical center.
    I've seen this 70% figure but I can't confirm it via a reputable study. Nevertheless, specialists are paid a lot and we have a lot of them. But again, how is single payer going to force salary cuts on them?

    And I absolutely disagree with the idea that we are subsidizing everybody else on drug costs...at least the way you mean. There is not a single country on the planet earth that requires that drug companies sell at a loss. Some countries negotiate with drug companies for their drug costs. Others require that they submit documentation showing their total costs to develop and produce a drug and base their fixed price on that. When they calculate that fixed price, though, the companies are only allowed to include the costs that the COMPANY actually paid. Since over 90% of the cost of drug development in the US is paid for through NIH grants, that number is pretty small....in most cases companies do not even submit the information, preferring to take the small hit rather than make their ridiculously small R&D costs a matter of public record. We do know that Pfizer spends MORE on executive bonuses each year than they do on R&D.
    A close relative of mine actually works for a company that receives NIH grants for health research. It really goes from NIH grant to Research Company A (generally a federal contractor) who creates a protein or some chemical formula that is not yet the drug. They patent the technology. They sell the use of the patent to a drug company. The drug company researches how to make the technology into a pill form. The drug company pays for clinical trials and FDA approval.

    So the hard work and risk is done via the NIH grant money. The drug company just makes it usable. Nexium is a good example. AstraZeneca didn't develop the technology, they merely bought it and made it usable. Granted this is not always easy and things could go wrong but they end up spending a few hundred million to get tens of billions from the drug.

    Now, I don't want to beat up the drug companies too much. It's not exactly a great business model. You have a product that makes billions but your next product might fail and put you out of business. It's a very up and down deal. The bigger annoyance is really just the price difference between the US and other countries which is basically akin to a subsidy of drug company profits.

    Finally, doctors probably don't want to take a pay cut. Nobody ever wants to take a pay cut. Too bad. Life is hard.
    That's fine but it just won't happen. Ever. We don't live in a country that can cap wages or a particular position nor do I want to live a country that does that.

    Limiting the rate of growth just isn't good enough. We need to actually cut costs. There is no way you are going to convince me that in a system where over 50% of costs go toward billing and funds transfer that we cannot cut costs significantly.
    The number is roughly $350 billion a year to do this. That equates to 15%. I suspect that is a low number but even it is a more realistic 20-25% you could probably only cut half of that which results in $200 billion or so in savings.

    Like I've said in the past, there is no one magic bullet. It's like a 100 things that add up to huge costs. It's not just overhead or doctor's salary or specialists or too many MRI machines. It's everything. A single-pay health care plan just doesn't address cutting everything; it merely slows growth rates. Sadly, slowing growth rates is not a problem anymore...we have done that.

    In order to actually cut health care costs we need something new.

    It is not a university hospital, it is a non profit community hospital. The reason that it is insanely expensive on a lot of things is that they have farmed out pretty much everything. Example...the hospital does not have ultrasound machines and ultrasound techs, they have a company that they have contracted with to provide the service and they basically rent them space in the hospital. Captive market (there is nowhere else locally to get the service) + profit motive = high prices.
    Interesting. Ultrasound is normally the cheapest diagnostic tool. Even if it took an hour the cost to the hospital with profit and overhead is roughly $150.

    Smart hospitals are starting to move a lot of their services off-site. This cuts down on regulation requirements and cost. Ultrasounds can be done basically anywhere. By having them in a hospital you need to have the ultrasound room equipped to handle an ER patient or ICU patient. So if you go in and just need kidney stones looked at they have all that XXXX you don't need. By moving it off-site you can put all the normal patients in normal facilities and still have an area at the hospital for ER and ICU ultrasound patients. This is actually one area where the US is ahead of other countries.

  8. #8
    Join Date
    Jun 2014
    Posts
    12
    Hundreds of billions of dollars are wasted on an inefficient system. Not to mention the immorality of the way it works now.

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •