How is the US so inefficient at healthcare? We spend more per person (or per GDP?) than many (most?) other countries and we get less in return.
Where is this money going?
So you have a bright idea. You'll open up an excellent well run hospital, using best practises, big picture approaches, and due to all that you'll save everyone money. Of course opening that hospital will take patients away from existing more expensive providers. But it is a free country, and in other commercial sectors that seems like progress. In many states you can't do this by law. You have to show there is unserved "need" and get a certificate of need, including that existing providers are not harmed. https://en.wikipedia.org/wiki/Certificate_of_need
In a more free market, insurance wouldn't be tied to specific states - you could buy insurance from any firm in the nation willing to provide it. Hospitals would be allowed to expand and compete and go out of business like restaurants are - there wouldn't be any "Certificate of Need" process preventing that. Doctors wouldn't be tied to specific states or nations and medical schools wouldn't have their enrollment limited via licensing rules.
In short, we have an artificial shortage of both doctors and hospitals which makes healthcare inherently expensive and low-quality compared to what it might otherwise be.
That's an idea that sounds good but turns out to be a nightmare in practice. You would end up with a classic "race to the bottom" scenario of the sort seen in credit card regulations, corporate tax rates, and employee disability reimbursements -- eventually you would end up with a state that allows such egregiously poor insurance practices that every company would flock there to avoid more onerous regulations.
The current system is byzantine and a nightmare to deal with -- I still wake up in the middle of the night with implementation guides scrolling behind my eyelids -- but it's an improvement over a policy that would, in effect, let the payers pick and choose the least-protective regulatory structure.
Oh, and let's not neglect that hospitals have no choice but to jack up prices to insane rates because insurance companies will just negotiate them down heavily.
The whole system is messed up.
Let's say you have some crazy medical test, like an MRI. It costs roughly $2,000 to run the test (totally random number out of my hat). If a hospital is negotiating a contract with an insurance company, and says "An MRI costs $2,000 here" the insurance company will say "We will pay you $500".
So, to make sure they can be correctly compensated by insurance carriers they instead say "An MRI costs $8,000", the insurance company will then say "Okay, we will pay you $3,000". It's total luck to get the correct amount, so you will usually WAY over compensate and end up getting more than you NEED to be reimbursed in return, just to provide a safety net for insurance carriers messing around with you.
Under most cases people with amazing low-deductible plans are fine, they pay their $500 deductible for the year plus 20% of the remaining and make off quite well for the procedure. People with high deductible plans (like mine) get screwed, I would end up having to meet my $2,500 deductible and then pay 20% after that (up to my annual out of pocket max, which is $5000).
Because hospitals have to play this stupid game with insurance companies, it's rare that you can get charged the "real" price of any procedure or lab time. People without insurance can negotiate extremely discounted rates based on financial need, but if you are underinsured you are stuck with whatever contracted rate the facility has with your insurance company.
It seems like cost controls are the root of the problem.
KP is an HMO, and does own its provider network rather than contracting with providers (for most things, at least), but that's not a defining characteristic of HMOs. Many HMOs have contracted, rather than insurer-owned, provider networks.
That said, PPOs also have in-network restrictions. They're looser, but PPOs are also often significantly more expensive.
In my limited experience, it's not the network restrictions per se, but that people want to continue going to a specific doctor or to a specific hospital. My relative who is a partner at a law firm rails against Obamacare because of the ridiculous premiums her firm has to pay. But they only pay those premiums because she demanded a policy that allowed her to continue seeing the same doctor she's seen for over 20 years. She's smart and almost always votes Democratic; the cognitive dissonance in her rants would be comical if it weren't for the fact that so many people exhibit that kind of thinking.
I use Northern California Kaiser and love it. For one thing, it's ridiculously inexpensive, all things considered. And I don't expect the kind of relationship with my doctor portrayed on television. Kaiser is very technologically savvy and data driven. (Though that doesn't mean they used the latest & greatest tech). Their doctors are disciplined to attend to patients efficiently. I've never felt rushed or anything of the sort (even during the 48 hour birth of my son), but neither the doctors nor staff will linger unnecessarily.
But because Kaiser works as a holistic entity, some people may feel neglected. Kaiser dis-intermediates you from the doctor and his personal staff. Appointments are booked on the web or via a call center. For illnesses, you first contact the Kaiser nursing call center, where a nurse and on-call doctor will do a preliminary diagnosis over the phone and often even write a prescription. For common injuries like sprains, etc, you might be scheduled to see a doctor at their sports injury center or similar specialized department, which at my medical center is conveniently (and I doubt coincidentally) located across the corridor from the imaging department. Follow-ups with a doctor will often use their electronic messaging system (basically, web mail).
I _love_ that aspect of Kaiser because I appreciate the effort that goes into reducing costs and improving outcomes. For people who want to feel coddled by their doctor and his staff, or use them as an outlet for their anxiety, it's probably a nightmare.
This whole thread is chockablock with fallacies, but let's limit ourselves to this one for now.
Education costs are sunk costs. Doctor's salaries have nothing to do with education cost.
Doctor's salaries are high because the government restricts the number of doctors. That leads to high salaries for doctors. Supply and demand, not sunk costs.
Hint: you've got a bunch more fallacies in your post!
Also, insurance frequently doesn't reimburse enough to cover the actual cost of a procedure, e.g., vaccines.