Obamacare 5 years later. Crow, anyone?

[Emily's Cat]

sunmaster14 said that people who like (UK) private health insurance are the types for whom cost is really not a consideration. OK well if someone likes something but the cost of the something isn't really a consideration then I think there is no information in their positive view of it.

Ahh - that helps. I thought it was in response to my post immediately prior.

 

[Emily's Cat]

sunmaster14 said that people who like (UK) private health insurance are the types for whom cost is really not a consideration. OK well if someone likes something but the cost of the something isn't really a consideration then I think there is no information in their positive view of it.

I like you, and I've really never considered how much you would cost...

 

[sunmaster14]

sunmaster14 said that people who like (UK) private health insurance are the types for whom cost is really not a consideration. OK well if someone likes something but the cost of the something isn't really a consideration then I think there is no information in their positive view of it.

It's kind of weird that you not only misconstrue what I meant, but you even misrepresent what I actually wrote.

First, I said that people whom I know who like the UK private system are the types for whom cost is really not a consideration. Yes, these people are very rich. Net worths in the tens of millions of dollars. Do you think those people really care about paying an extra $10,000 a year for premium health services? Second, my point (which I thought I had explained sufficiently) was that there are some things money can't buy, or can't buy without earning public condemnation (cf American dentist who likes hunting exotic animals), and that premium health care services is one of them in many places. Given that you wrote a review of a book on this very topic, you should have understood the point.

Actually, rich people in the US would probably prefer a UK type system. They would benefit from the competition and efficiencies that arise in a free market, and they can shunt lower classes into an underfunded system that they are satisfied with because they don't know any better (and it seems free!).

The US advocacy group, Physicians for a National Health Program, recognizes this as a problem:

Why shouldn’t we let people buy better health care if they can afford it?

Whenever we allow the wealthy to buy better care or jump the queue, health care for the rest of us suffers. If the wealthy are forced to rely on the same health system as the poor, they will use their political power to assure that the health system is well funded. Conversely, programs for the poor become poor programs. For instance, because Medicaid doesn’t serve the wealthy, the payment rates are low and many physicians refuse to see Medicaid patients. Calls to improve Medicaid fall on deaf ears because the beneficiaries are not considered politically important. Moreover, when the wealthy jump the queue, it results in longer waits for others. Studies in New Zealand and Canada show that the growth of private care in parallel to the public system results in lengthening waits. Additionally, allowing the development of a parallel, private system for the wealthy means the creation of a permanent lobby for underfunding public care. Such underfunding increases the demand for private care.

 

[sunmaster14]

But it does rather undermine your suggestion that the NHS in its various incanations operate an effective buyers' monopoly within the UK which in turn result in a "take it or leave it" position for drug suppliers as well. If you were unaware of UK PHI operation I'm a bit unclear on how you can be so certain in your position.

Actually, your following post undermines the claim that the existence of PHI in the UK means that there isn't a monopsony in health care. You say yourself that private insurance is mainly used for non-urgent stuff. Would PHI in the UK give you access to a drug that the NHS would not? Or does it only allow you to jump the queue for knee surgery and give you a private room at the hospital?

Indeed as I mentioned, US based large PHI firms are in a similar position inasmuch as they negotiate coverage and treatment costs; they can apply the cost/benefit calculation behind closed doors (in contrast to the NHS, which publishes the information) and moreover have a profit incentive.

Yeah, but there's competition between them. If one insurance company doesn't cover a new expensive drug, another one can lure away customers by touting their more comprehensive formulary. There must be some reason that US consumers pay 2-3x as much for the same drug as the NHS pays. What do you think that reason is?

 

[Francesca R]

It's kind of weird that you not only misconstrue what I meant, but you even misrepresent what I actually wrote.

Ha I can't win, I tried rather hard to represent you exactly.

Do you think those people really care about paying an extra $10,000 a year for premium health services?

Probably not but in my view it means that their liking of it has no information, if cost is really not a consideration. Same as if you said someone so loaded that cost is really not a consideration recommended pretty much anything else.

(Thanks for reading my review!)

 

[Francesca R]

Would PHI in the UK give you access to a drug that the NHS would not? Or does it only allow you to jump the queue for knee surgery and give you a private room at the hospital?

I think the answer is yes to the former. The Department of Health (government) is not the only buyer (negotiating the prices I mean) of drugs, private health care providers can (I think) negotiate their own prices, and buy ones that the NHS does not (still subject to regulation on what they can buy/prescribe though)

 

[Francesca R]

Please set me straight so I can speak coherently!

I find myself wanting to drop this. For now anyway. Apologies.

 

[Architect]

Actually, your following post undermines the claim that the existence of PHI in the UK means that there isn't a monopsony in health care. You say yourself that private insurance is mainly used for non-urgent stuff. Would PHI in the UK give you access to a drug that the NHS would not? Or does it only allow you to jump the queue for knee surgery and give you a private room at the hospital?

UK PHI is analagous to US policies inasmuch as it would give me access to drugs that my insurer was willing to cover. It would not magically get me any treatment I wanted or which my doctor/consultant was willing to prescribe (although it would be open to me to pay cash for such things, if I had deep pockets).

In practice, notwithstanding your implicit suggestions to the contrary, NHS Scotland is pretty much guaranteed to treat me for any medical condition that requires attention and hence the practical implication of PHI coverage is that I will be able to jump a queue and get a nice room in a private hospital.

Yeah, but there's competition between them. If one insurance company doesn't cover a new expensive drug, another one can lure away customers by touting their more comprehensive formulary. There must be some reason that US consumers pay 2-3x as much for the same drug as the NHS pays. What do you think that reason is?

And on that basis there is competition between the NHS and the private sector. If there was a substantive shortfall in NHS coverage in any of the four UK systems then the private sector could dive in. In practice, it doesn't do so other than on aforementioned convenience/waiting list issues.

There are also several UK PHI providers including (in no particular order and not exclusively) BUPA, AXA, and Aviva. UK private hospital operators are usually different, for example BMI, although BUPA does have its own facilities.

If you're going to comment with such certainty on your perceived understanding of the UK healthcare system and failings (or otherwise) of the NHS don't you think you should have perhaps looked into this already?

 

[sunmaster14]

UK PHI is analagous to US policies inasmuch as it would give me access to drugs that my insurer was willing to cover. It would not magically get me any treatment I wanted or which my doctor/consultant was willing to prescribe (although it would be open to me to pay cash for such things, if I had deep pockets).

In practice, notwithstanding your implicit suggestions to the contrary, NHS Scotland is pretty much guaranteed to treat me for any medical condition that requires attention and hence the practical implication of PHI coverage is that I will be able to jump a queue and get a nice room in a private hospital.

And on that basis there is competition between the NHS and the private sector. If there was a substantive shortfall in NHS coverage in any of the four UK systems then the private sector could dive in. In practice, it doesn't do so other than on aforementioned convenience/waiting list issues.

There are also several UK PHI providers including (in no particular order and not exclusively) BUPA, AXA, and Aviva. UK private hospital operators are usually different, for example BMI, although BUPA does have its own facilities.

Thanks for the info.

If you're going to comment with such certainty on your perceived understanding of the UK healthcare system and failings (or otherwise) of the NHS don't you think you should have perhaps looked into this already?

No, why should I? It's not so easy to do for me from the US, and I had no reason to believe there was even something there there. This is why I participate in these threads, to test my ideas and try to learn something. That being said, I don't think that you have shown me that there is real competition among buyers in the UK. I'll note that you didn't try to answer my question. Why are drug prices higher in the US? Do PHI in the UK pay the same prices as US insurers do? If not, why is their bargaining power better than US insurers unless they are benefiting from an NHS monopsony?

 

[Francesca R]

Second, my point (which I thought I had explained sufficiently) was that there are some things money can't buy, or can't buy without earning public condemnation

On that point, I agree (if this is what you mean) that it is highly plausible that the more money can buy, the more affluence matters, and that increasing allocation on the basis of ability (and willingness) to pay both enables and restricts freedoms (along the dimension of income). That is a central justification for income-egalitarian policies, which satisfy those who believe that ability to pay is an unjust metric, and offends those who believe it is. Moreover it is very plausible that allocation via the market worsens what the poor can gain in absolute, not just relative terms (because supply is constrained). That was more eloquently dealt with in this book rather than the one you linked.

 

[sunmaster14]

On that point, I agree (if this is what you mean) that it is highly plausible that the more money can buy, the more affluence matters, and that increasing allocation on the basis of ability (and willingness) to pay both enables and restricts freedoms (along the dimension of income). That is a central justification for income-egalitarian policies, which satisfy those who believe that ability to pay is an unjust metric, and offends those who believe it is. Moreover it is very plausible that allocation via the market worsens what the poor can gain in absolute, not just relative terms (because supply is constrained). That was more eloquently dealt with in this book rather than the one you linked.

Thanks, and yes that was the issue to which I referred. This raises an interesting point about the relative inequality in the US and the UK. Income and wealth inequality are greater in the US, but perhaps there are more privileges that money can buy in the UK so that inequality is more meaningful there. The parallel private health care system in the UK would appeal to the rich here, but would probably appall the middle class.

Perhaps not so surprisingly, things have been changing in the US. More and more premium services are being upsold to the affluent - from expedited boarding on airplanes (which of course has now effectively become a discount for delayed boarding) to concierge medical offices and Uber black car service during peak demand. In ten years, perhaps somebody will start selling guaranteed kidney transplant contracts.

 

[Francesca R]

It pisses me off that "fast track" on British Airways and "boarding group 1" on United Airlines often seem to have more passengers using them than the slow lanes. (Though it probably pisses off the people in the slow lanes more!).

I have no idea if "money can buy more" in the UK than the US but I would have instinctively thought that the reverse is the case, but no idea.

One unrelated thing about inequality (that mitigates it) is that "hedonism" tends to behave as a power law, meaning that someone twice as rich doesn't have anything like double the standard/quality of life, they would have to be two the power of something richer. (Cue another book--I knew I posted these for something)

 

[Architect]

Income and wealth inequality are greater in the US, but perhaps there are more privileges that money can buy in the UK so that inequality is more meaningful there.

I may have misunderstood, as this doesn't appear to make sense.

The NHS provides a baseline level of care that generally (but with some variance across different conditions) provides clinical outcomes on a part with other comparable industrialised nations. It is possible, if one wishes, to buy what is effectively a top-up policy that will shave a little time off here and there, or give more comfortable accommodation, but there is no evidence I am aware of that suggests this has a substantive impact on the clinical outcome itself.

In that sense this is not an inequality any more than, say, my deciding to buy a Mercedes when my neighbours have Fords or Vauxhalls. A Ford is just as capable as getting me from A to B as my E Class, but I prefer the comfort of the latter. My neighbours may instead prefer an extra foreign holiday every year, or be buying a second home out in the country.

The difference, I would suggest, between us and the US is that in the UK (and most other socialised systems) there is universal coverage. if I walk into a US A&E department with no insurance and (say) cancer, they will stabilise me but not provide the chemo.

If I walk into my local hospital in the same circumstances then as long as I am a permanent UK resident who has been in the country for more than 3 months they will give me full treatment - cradle to grave, as it were. No co-pay/deductible/excess. No bankrupcy if I go above an insurance ceiling.

There is undobtedly inequality in the UK; more so than the Scandanavian countries, for example. But everyone is legally entitled to free education of a broadly comparable standard (there are some differences between the home nations), health treatment, and has access to what is sometimes suggested to be a fairly generous (especially if you're looking at it from Calais) welfare net that includes such things as housing benefit, disability benefit, and income support. If rich nobby people want to send their bairns to a posh school for £10k per term then more so the fool them, but it doesn't automatically suggest some sort of Victorian class divide.

 

[Francesca R]

I may have misunderstood, as this doesn't appear to make sense.

As above I have no idea if the UK-US comparison is the way round that sunmaster14 wonders it might be.

But examples of the effect: The more premium health service that rich people can buy, the more the top professionals are attracted to private work, and the more the NHS has to either (i) increase doctors' pay (thus ramping the health budget) or (ii) ration access for more stuff or (iii) settle for less competent health professionals. The more non-state schools are set up for cashed up parents to use, then the more top teachers are attracted to them and the harder it is to get good teachers into state maintained schools. And so on.

I suspect that these phenomena would be driven by increased incomes at the top end, rather than anything else (such as policy differences between the US and UK), because private health and education are technically available to everyone (who can pay) already. Also in neither case can rich folks opt out of the tax obligations to fund the state versions of both.

 

[sunmaster14]

As above I have no idea if the UK-US comparison is the way round that sunmaster14 wonders it might be.

But examples of the effect: The more premium health service that rich people can buy, the more the top professionals are attracted to private work, and the more the NHS has to either (i) increase doctors' pay (thus ramping the health budget) or (ii) ration access for more stuff or (iii) settle for less competent health professionals. The more non-state schools are set up for cashed up parents to use, then the more top teachers are attracted to them and the harder it is to get good teachers into state maintained schools. And so on.

I suspect that these phenomena would be driven by increased incomes at the top end, rather than anything else (such as policy differences between the US and UK), because private health and education are technically available to everyone (who can pay) already. Also in neither case can rich folks opt out of the tax obligations to fund the state versions of both.

Right, although my guess is that cultural differences play a larger role than policy differences (above and beyond the effect culture has on policy). Britain's history as a class-based, and still class-conscious, society probably allows more kinds of privileges to be distributed without engendering a negative reaction from the public.

For example, I think this is less likely to happen in the UK than the US:

 

[RandFan]

Still lurking. Still learning.

 

[Architect]

For example, I think this is less likely to happen in the UK than the US:

Err, what??

 

[Emily's Cat]

I find myself wanting to drop this. For now anyway. Apologies.

Okay. No worries. Someday I'll figure it out