Efficiency of Medicare vs Private Insurance

[PhantomWolf]

You can get a reasonable measure of the cost this way, but it's the cost of doing something in a very specific way. The problem is that the way you're currently doing it (or even what you're doing) isn't necessarily optimal. Fixing the price will tend to freeze the process as well. It stifles innovation. Why become more efficient, or do things in a more efficient manner, if you can't earn more money by doing so? Why do things better if you can't charge a premium for it?

You are assuming that the price can never change or be review once set. Yearly reviews are a good thing, not only because new services can arise in that time, but other services might have gotten cheaper, or more expensive. Fixing the price and then never looking at it again would be stupid.

The incentive to innovate and become more effiencent is in that the innovation or effiecency gains you a greater profit. If you have been paid for 5,000 heart bypass surgries at $20,000 a pop and you figure out how to do them for only $17,000 each, you just made an extra $15 million dollars.

But they do over longer time scales. And no matter how you try to arrange your bureaucracy, you're still removing the normal price signalling mechanisms. That will always come at a cost. Maybe you're satisfied paying the cost in order to achieve some other benefit, but you can't avoid paying it

.

But you are still looking at a fixed long term price, rather than an annually reviewed floating price. The market is still the one that sets those prices, because they are the best judges of what those costs. What it does mean is that providers who have higher costs due to ineffiencies or poor procedure will need to catch up with those that can do better it at a lower price, thus creating the competition that isn't in the business currently. This is a win for the end user both in cost and also in the actual care itself. It means that regardless of the hospital you end up in, you can expect to get the same level of care rather than only the rich hospitals having good care and those in poorer areas being unable to provide decent services. That can only be good for end users.

On top of that, there is no reason to not allow people to purchase their own Health Insurance if they want to go private and pay an extra premium, or even allow Health Providers to offer private services above and beyond what they have already had purchased by the State, as long as they don't neglete their State paid for procedures in favour of private ones.

The "private sector" in health care in the US didn't resemble a free market before Obamacare, and it severely distorted price signalling. Like I said before, it had the worst properties of a free market but without the benefits.

And it can't either, without the ability to have multiple hospitals all servicing a single area and advertising prices, you can't get anything like a free market model in Health Care. Patients can't just get on a plane and fly across the country to get a better deal or order up a procedure over the Internet, they have to take what they are offered in the local area, and even that might be further diminished by what Insurance or lack there of they have.

 

[Neally]

Even if that's true it would have gone up anyway and now you have a whole host of benefits you never had before and more are coming, all of which would never happened without the ACA.

1. It is true, and the increase is ON TOP OF the increase of the other stuff, which BTW Obamacare does nothing to control.
2. As I said, stuff that I don't want or need. How would you like to have mandated to your auto insurance policy coverage for a repair or replacement of a torn convertible roof, even though you don't own a car with with a convertible roof? Too bad -- you get it and now have to pay for it whether you like it or not.

 

[Dancing David]

I suppose you have evidence for that claim?

My concern is the same as incorporation and liability. If you have a hypothetical state (not Illinois) that has consumer protections and provisions, and then you have state that does not, insurers will go to the state where they have less liability and oversight.

Which is why some states are preferred for corporate headquarters over others. And in the case of state exchanges, I would be concerned about the oversight provided by the laws of that state.

All hypothetical of course.

 

[Dancing David]

Yep, and the result is an increase in the monthly premium for those people like me that didn't want or need the mandated added stuff. Obamacare has caused my medical insurance to go up.

How much of that was from Obama care and not general price rises?



Right now care of the indigent shift to the hospitals. Like when my daughter worked full time for State Farm, in a very nice job. Even as a full time employee there was a waiting period of a year or so before she could get their crappy 80/20 high cost health insurance through Aetna.

She has a major big time infection that could have damaged her kidneys, so she went and got help, she paid a small portion of the costs and the hospital ate the rest.

This is already part of why hospitals charge what they do, it is already driving up costs for every one.

 

[Chuck Guiteau]

Here's a crazy idea:
Why don't we make it cheaper for insurance companies to operate? In a free market, it would seem to me that competition would drive premium prices down and more people could afford healthcare?
Is that wacky, or what?

 

[Random]

Here's a crazy idea:
Why don't we make it cheaper for insurance companies to operate? In a free market, it would seem to me that competition would drive premium prices down and more people could afford healthcare?
Is that wacky, or what?

Actually, increased competition between health insurance companies can drive health insurance prices up. One major way health insurance companies save money is by obtaining a major portion of the health care consumers in a geographic area, then going to the hospitals and doctors in the area and saying “We cover most of your patients. Give us a discount price for our patients or we will encourage them to go to a different hospital/doctor.”

The Hospital/Doctor caves, gives patients insured through that company a discount rate, then passes the costs onto other patients not covered by that company (that’s why you can’t find anyone willing to give you a straight answer on how much a procedure costs). If there are too many insurance companies in the area, they each loose their individual leverage with the hospitals, and premium prices rise.

 

[WildCat]

We can count on the same kind of venue shopping that happened in the credit card market. Insurance companies will move operations to whatever state enacts regulations that most favor the company over consumers. You will not even have the right to vote against the legislators that enacted the rules that favor insurance companies.

Except under the ACA the feds are setting the standards. The states can only exceed them.

IMHO is should be entirely the feds involved, states shouldn't be allowed to regulate health insurance companies at all. Much cheaper and more efficient to comply with one set of rules than 50 sets of rules and regulations to comply with. Some states have just 2 insurance companies to choose from, and most have just a handful.

 

[WildCat]

As insurance companies are not allowed to sell across state lines thats a pretty silly question.

However, if my insurance company screws me over here in AZ I can seek remedy through my states laws, my attorney generals office, my BBB, my legislatures, and other venues. If my insurance is based in another state with different regulations and accountability I am unlikely to persuade anyone in that state to take up my cause. I can not appeal my situation to anyone but the company itself that alone would result in worse customer service.

ETA: My guarantee was more of a "mark my words" rather than "its happened and I can prove it."

Why would those resources not be available to you if the feds write all the rules and regs?

Here's my problem with the ACA and the states: states can make all kinds of demands on insurance companies, who will have no choice but to raise premiums to offset the costs. But under the ACA it's the feds, not the states, subsidizing those costs to those who can't afford them. So the states can require all sorts of expensive goodies, and the feds get stuck with the bill. There's no incentive to keep costs in check.

 

[Neally]

How much of that was from Obama care and not general price rises?

Too much.

She has a major big time infection that could have damaged her kidneys, so she went and got help, she paid a small portion of the costs and the hospital ate the rest.

If she has a "good job" there is no reason for the hospital to write off the expense. They could collect on the debt just as any other company could collect on a debt.

 

[Biscuit]

1. It is true, and the increase is ON TOP OF the increase of the other stuff, which BTW Obamacare does nothing to control.

The ACA does a great deal to control cost, from mandating efficiency to fighting fraud.

2. As I said, stuff that I don't want or need.

You may not want the following now but you may very well need them in the future, at which point you will want them.

1. No lifetime cap
2. No dropping you for pre-existing conditions
3. Keeping your children covered till 26
4. No annual cap

There are more. I hope you and everyone else stays healthy forever but its not likely.

How would you like to have mandated to your auto insurance policy coverage for a repair or replacement of a torn convertible roof, even though you don't own a car with with a convertible roof? Too bad -- you get it and now have to pay for it whether you like it or not.

What is the analogous aspect of the ACA you are referring to?

 

[Biscuit]

Why would those resources not be available to you if the feds write all the rules and regs?

Here's my problem with the ACA and the states: states can make all kinds of demands on insurance companies, who will have no choice but to raise premiums to offset the costs. But under the ACA it's the feds, not the states, subsidizing those costs to those who can't afford them. So the states can require all sorts of expensive goodies, and the feds get stuck with the bill. There's no incentive to keep costs in check.

I would have no problem with federal oversight but wont opponents claim that the fed is getting between you and your doctor?

The idea I have heard is to allow cross state sales with state by state regulations. This would get the feds out of the health insurance business and leave it to states. This would create the problem I foresee.

If we are going to have nationwide sale of HI with strong federal oversight lets just do UHC.

 

[Neally]

The ACA does a great deal to control cost, from mandating efficiency to fighting fraud.

What, my insurance company needs Obamacare to tell it to fight fraud? Sorry no. Prices have gone up and will continue to do so since there is nothing in it to control the major drivers of medical costs.

You may not want the following now but you may very well need them in the future, at which point you will want them.

1. No lifetime cap
2. No dropping you for pre-existing conditions
3. Keeping your children covered till 26
4. No annual cap

2 & 3 don't apply to me. Thanks to Obamacare I now pay for something I don't want or need.

There are more.

There sure are. More that I don't want or need, yet am forced to pay for.

What is the analogous aspect of the ACA you are referring to?

See the above. Also:
Coverage for contraceptives
Coverage of mental health services
Coverage for addiction recovery

The new regulations almost certainly mean rising premiums, which have already edged up according to experts. That doesn't even take into consideration the overall rising costs of healthcare, which insurers pass on to customers.

"Insurance companies are still free to add to the premium for the additional benefits that they're required to offer," says Caryl Carpenter, professor of health care management at Widener University. "People with insurance can also expect an increase not because of the Affordable Care Act, but just because health care costs are still going up."

- http://www.usnews.com/news/articles/2012/06/28/what-the-obamacare-ruling-means-for-consumers
What? You thought all those great new benefits were going to be free?

 

[Dancing David]

Except under the ACA the feds are setting the standards. The states can only exceed them.

I will have to look into that, I had assumed there was considerable latitude for states in setting the parameters of the exchanges.

the guidelines are somewhat broad
-granter , no denials
-limit to price variation within a state exchange
-regulation of rescission
-life time and annual limits eliminated

Now I do not see where it says that they have to offer the same coverage, or that between states they have to be comparable at all.

?

 

[Dancing David]

Why would those resources not be available to you if the feds write all the rules and regs?

The Feds don't that is why they are state exchanges, what source are you using?

 

[Dancing David]

Too much.

And that was how much, and how did you figure it?

If she has a "good job" there is no reason for the hospital to write off the expense. They could collect on the debt just as any other company could collect on a debt.

Really so you think that a $2,000 bill for a bladder infection is a reasonable sum? She made higher than the minimum wage before she moved into Tier II at the call center, so around here a good wage is more than $10/hour.

She did have a good job, and rent and power and other bills, no credit card debt.

But that is your choice, I prefer something that would be affordable to all.

 

[Dancing David]

Neally, who provides your insurance, how is it obtained?



If I am unemployed I will be denied insurance until the exchanges are set up. Period.

 

[Biscuit]

What, my insurance company needs Obamacare to tell it to fight fraud? Sorry no. Prices have gone up and will continue to do so since there is nothing in it to control the major drivers of medical costs.

What are those major drivers you speak of because I am certain the ACA does indeed address these.

2 & 3 don't apply to me. Thanks to Obamacare I now pay for something I don't want or need.

So Ignore 1 and 4 because of what?

Must be nice to know your medical history and your medical future all at the same time. I believe Randi has a prize for you.

There sure are. More that I don't want or need, yet am forced to pay for.

You have such a lack of knowledge of the ACA how can you possibly know this? How can you know you won't benefit from these changes. EVERYONE gets sick and EVERYONE benefits when sick people can get the care they need.

See the above. Also:
Coverage for contraceptives
Coverage of mental health services
Coverage for addiction recovery

You are being forced to pay for contraceptives? Prove it.

You are never going to have mental health issues? Prove it.

Addiction recovery is mandated? Prove it.

What? You thought all those great new benefits were going to be free?

You thought you weren't paying before? You can pay for your own insurance and millions of other uninsured people through your premiums or you can just pay for your own insurance and get a policy that can't screw you when you need it most. If you would rather the former than I guess you are just SOL.

Did you or your employer get a check back from your insurance company this year?

 

[Biscuit]

How would you like to have mandated to your auto insurance policy coverage for a repair or replacement of a torn convertible roof, even though you don't own a car with with a convertible roof? Too bad -- you get it and now have to pay for it whether you like it or not.

What is the analogous aspect of the ACA you are referring to?

See the above. Also:
Coverage for contraceptives
Coverage of mental health services
Coverage for addiction recovery

None of those are analogous to having to pay for convertible roof coverage when you don't have a convertible.

 

[Neally]

And that was how much, and how did you figure it?

Too much. What's with the demands for the exact amount. My policy went up because of the mandated extra coverage that I didn't want or need.

Really so you think that a $2,000 bill for a bladder infection is a reasonable sum?

Who said anything about reasonable charges? That has nothing to do with the hospital taking a loss on the non-payment of a bill.

She did have a good job, and rent and power and other bills, no credit card debt.

Well then, again there is no reason for the hospital to write off the bad debt.

But that is your choice, I prefer something that would be affordable to all.

What in the world are you talking about?

Neally, who provides your insurance, how is it obtained?

I pay for it out of pocket.

What are those major drivers you speak of because I am certain the ACA does indeed address these.

Are doctors now charging less because of ACA? Do hospitals now charge less because of ACA? Do drug manufacturers now charge less because of ACA? Do manufactures of medical devices now charge less because of ACA? Wait I can answer that last one: No, they now charge more because they are hit with a 2.3% tax.

So Ignore 1 and 4 because of what?

I'm paying for those also. I'd prefer lower premiums than to have those. So, ignore my additional expenses for 2 & 3 because of what?

Must be nice to know your medical history and your medical future all at the same time. I believe Randi has a prize for you.

Well maybe one day you WILL own a convertible. Must be nice to know your future. I believe Randi has a prize for you.

You have such a lack of knowledge of the ACA how can you possibly know this?

So says the guy that didn't even know about the added costs of the mandated coverages. Reminds me why you were on ignore. Bye, bye.

How can you know you won't benefit from these changes.

Really? I mean, you really presume to know that I don't want or need things that I say I don't want or need?

EVERYONE gets sick and EVERYONE benefits when sick people can get the care they need.

Here's a news flash for you: Obamacare doesn't prevent people from getting sick and it doesn't benefit everyone that does get sick.

You are being forced to pay for contraceptives? Prove it.

You are never going to have mental health issues? Prove it.

Addiction recovery is mandated? Prove it.

Prove that you'll never need coverage for a convertible if it was mandated that you have coverage for one. As to the rest, clearly you don't have a clue what Obamacare does and doesn't do, what the requirements are and aren't. Come back after you've done a bit more research on the subject and discuss it with the adults.

You thought you weren't paying before?

I know I wasn't paying for it before. What part of "We are adding this coverage to your policy whether you like it or not, and here's the bill.", do you not understand?

Did you or your employer get a check back from your insurance company this year?

Nope, because they never were "overcharging" me for administrative costs.

 

[xjx388]

I don't need insurance to cover contraceptives; never have, never will.
I don't need insurance for substance use disorders; no one in my family does drugs and if they did, I can pay for those services if and when they become necessary.
I don't need maternity and newborn coverage; I got a vasectomy -ain't gonna have no kids. On the off chance my 23 year old daughter gets pregnant, I am capable of taking care of her.

Therefore, ACA mandates coverage of three areas (see Essential Health Benefits) my family will never need. Like if I'm paying for convertible roof coverage on my car insurance . . . and I don't drive a convertible. Or if the government mandated that everyone can only wear size medium white t-shirts. There is no one size fits all health insurance solution; we all have different needs and wants. All I want is the freedom to select the benefits I want (specifically catastrophic only coverage, over $10k). I can pay for everything else.

Fine, mandate everyone get insurance. But it's ludicrous to make everyone have the same kind of plan. There should be a lot more flexibility in available benefit packages.