No, those were the administrative costs for the insurers. Maybe it was unclear since I didn't include the preceding sentences. "Nor is it easy to measure administrative costs among private insurers. For one thing, which private insurers? When the Congressional Budget Office examined this issue, it found that administrative costs -- including advertising and profits -- accounted for 12 percent of the average insurer's dollar. But that hid substantial variation among insurers."
Which supports what I said. Companies offering policies in many states will have higher administrative costs in order to comply with the regulations in those different states. Think of a small state like Wyoming, which is 1/30 the population of Illinois. Yet administrative costs of complying with the regulations are roughly the same, since it's a fixed cost which doesn't correlate with population.
I agree with eliminating pre-existing conditions and other discrimination based on health, so no quibble there. I don't quite buy the claim that regulation is the cause of the higher administrative costs though. Do you have any proof for that?
I think it's obvious it requires more time, effort, money, and personnel to comply with 50 sets of regulations than it does for one. It's not like these regulations fit on a post-it note...
Yes, I understand your proposal. My claim is that prices would then tend to stabilize at a certain standard level. Therefore there would hardly be any competition and no need for multiple private insurers, which would by definition have smaller pools and higher costs than one centralized single payer system.
The experience of countries in which this is in place doesn't support that view. The Netherlands, for example, has fierce price competition among the private insurers. So much so that they actually lose money selling the basic policies, and make their money selling the extra coverage.
This implies to me that the minimum mandated coverage would be insufficient. Or that the "Cadillac" plans would be a small niche market for the well-off. At any rate, a single payer system doesn't necessarily preclude this kind of supplemental coverage. Why not go to single payer for your minimum mandated portion of the coverage and let private industry make their profits on the extras?
You could do that, but then there is no price competition at the basic level. Government bureaucracies tend to become bloated and inefficient over time, even in health care. Our public hospital system here in Cook County is extremely bloated with political payrollers, so much so an outside consulting firm hired by the county determined that 30% of the staff could be eliminated and we'd still be in the top tier of staffing in the industry. All that bloat costs money, and it's not easy to fix. That report I mentioned sits on a shelf where it's been for years, ignored and gathering dust while the bloat continues and more tax dollars are poured into the system. This is what I wish to avoid nationally.
No, your system by design has smaller pools of insured. If your system had only 5 insurers, they would each have a pool 1/5th the size of a single payer system. One central system is the largest possible pool, and therefore the most cost efficient, as risk is spread out from cradle to grave over the entire population.
Once you reach a certain size the risk variance become negligible, and our population is large enough and number of insurance companies small enough where this shouldn't be an issue at all. Bigger doesn't necessarily mean more efficient, particularly in the absence of competition..
Well sure, at the moment Medicare patients are the most costly to treat because they are the oldest and sickest. If medicare was opened to all it would become much cheaper. And I'm not going to simply take Mayo's word for it that they're a low cost hospital. We have no idea what kind of unnecessary costs they may have.
It's not that they're the costliest to treat, it's that Medicare doesn't pay enough for the treatment given. And in the industry, in stats compiled by 3rd parties, the Mayo Clinic is usually at or near the top as far as keeping costs low goes. You don't have to take their word for anything.
Question: if you want to require all insurers to provide plans to everyone for the same prices, do you also want to require providers to bill their services at the same rate for every insurer? How will you account for regional differences in cost of living, real estate, doctor's salaries, etc. that would cause one hospital's costs to be higher than another?
I don't think the differences are all that great where that becomes an issue. A Target store, for example, sells a particular model of television for the same price here in Chicago as they do in rural Indiana. In general, high-cost areas are also high-volume areas so they tend to cancel each other out.
) are realizing that. Too bad we have no competition in the US, and aren't going to get any under the idiocy passed by the House nor the foolishness being considered by the Senate.