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Comment by mcv | Hacker News Reader

Health care can never be a free market because decisions to buy are always made under duress. Pay for health care or die. That nobody is actively holding a gun to your head doesn't matter a great deal.

Labour can be similar, depending on how the economy is organised. If you need a job in order to eat, then you can't freely reject a job offer. Only for fairly wealthy people is the labour a free market. Unless you get a good social security system (welfare, UBI, etc). Then people may be able to walk away from a bad job offer.

Low unemployment is also making the labour market behave more like a free market; there are other jobs available, and employers can't rely anymore on job seekers being desperate for a job.

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Your comment actually presents an idea that many choose to ignore, that healthcare is actually two markets in one.

For routine primary care like regular checkups or an appointment for some symptom bothering you, you absolutely are not under duress. You won't die because you took 5 minutes to choose a doctor on ZocDoc. With more transparency in costs of service, this could definitely become a market, ie "for $XX per month, get unlimited visits to our partner doctors' offices".

For emergency situations, surgeries, and things that require expensive ongoing care like cancer, you're correct in that you're under duress and can't really shop around. This is the market in which the usage of insurance makes sense, as it's a rare occurrence that would be catastrophic to pay for out of pocket for the majority of people.

I think we can do a great deal to lower cost of healthcare to Americans if we think of it in this two market approach, and handle each accordingly.

Even getting routine care, I've had 0% success gaining any transparency at all. Maybe it works for generic GP services, but for imaging or other testing, I've tried and completely failed. "Contact our billing department and they may be able to tell you" is the best answer I get.

I'm ready to vote for forced transparency at all levels. I'm tired of this opaque negotiated pricing with insurance companies that manages to maximize my out-of-pocket costs.

Transparency and high deductibles for everyone would instantly lower costs dramatically. I have to take testosterone, and you have two primary options. One is a gel that you rub on every day that's really hard to dose correctly due to absorbency issues, and the other is a weekly injection. I wasn't even offered the second option until I asked for it. The gel was $400 a month and the injection is around $20 a month. I generally hit my deductible a month or two in to the year for various reasons and the difference in copays isn't enough for me to care, generally. Medical insurance needs to be insurance again.

The way I've usually seen this split is "emergent" vs. "non-emergent" (as in "emergency).

You are correct that non-emergent care is a WAY bigger market than emergent. Most people completely ignore this. Chronic conditions like diabetes and Crohn's, end-of-life care (hospice, assisted living), dialysis, smoking cessation and weight loss, blood transfusions, most flavors of oncology (cancer treatment), knee replacements, etc.

We need way more cost discipline in non-emergent situations. Changing the perception that all care is emergent might be the single biggest thing we could do to lower healthcare costs. It would let people see that there should indeed be a market in everything from X-rays to MRIs and we could finally have a sensible conversation about cost.

A problem with this split is preventive care. You want to incentivize prevention, otherwise non-emergency issues can become way more costly emergencies. And just like that are both tied together, again...

That's why preventive care is almost universally covered in Netherland, despite the fact that many other things are not or partially covered. I can visit my physician any time for the smallest thing.

There is a huge additional set of decisions that are not made under duress, but are made in an information vacuum. Two recent examples from my own health history:

My optometrist wants me to try a new kind of contact lens. She cannot (or will not) tell me what they will cost. She can't tell me what they would cost me personally because she just doesn't know - all they can do is send a bill to my insurance company and find out how much they pass on to me. Which is essentially asking me to write a blank check. Nor can she tell me the sticker price on these contacts so that I can at least know the upper bound, because she simply does not have (easy?) access to that information - the billing department does. Probably I'll stick with the same brand I've been using for years, because at least there I can safely assume they'll cost about the same now as they did last year.

Similar story for my doctor offering me a flu shot while I was getting a checkup. She couldn't tell me the price, she didn't know the price, she couldn't get access to the price, etc. I usually go to the pharmacy, where they bill $30 and insurance covers it all. So I figured, "How bad can it be? And it'll save me some time," and let her give me the flu shot. Big mistake - the doctor's office billed $300, insurance (quite reasonably, TBH) only agreed to cover a portion of it, and I got stuck with a $200 bill.

There's two problems there. One is the lack of price transparency. The other, though, is the prevailing attitude - in both cases, the doctor's opinion, which I think is most everyone else's opinion, too, was, "Who cares what it costs? If the insurance covers it, it's basically free to you." Which just ain't true, especially for routine care stuff like this. The insurance company isn't getting their funds from some magical fountain of money. From a "see the forest not the trees" perspective, they will have to pass every cent of these costs (and more) on to me.

Both of these problems are solvable.

At least for dentistry that is changing: I had a filling recently, due to a cavity identified at a prior checkup.

At the end of the checkup, a front-office staffer went on to Delta Dental’s web site, pulled up my record, and requested a treatment estimate. The answer was returned within a minute.

A few days later, I got a copy of the estimate in the mail for my records. I didn’t have any other dental events (which might’ve affected the estimate), so on the day of the filling, I paid the amount as part of the office visit. A few days later, I got the Explanation of Benefits for the procedure, confirming the amount paid was correct.

If I had chosen to, then I would’ve gotten all that over the web instead of on paper.

As far as I’m concerned, the dentist’s office is where I want them to be, in terms of billing processes. My eye doctor is able to do something similar, looking up lens & frame benefits etc. on computer, no I don’t have to be billed after the fact.

The flu shot cost is really terrible, up here in Canada my doctor asked if I wanted a flu shot last time I went in and there was no cost passed onto me directly. There are pharmacies that dispense flu shots for money but it's also pretty easy to qualify for a discounted shot if you need one and people not having the flu makes all of society run better.

Charging 200$ for you to be healthy and able to work the full season while also avoiding being a carrier of a disease is absolutely terrible.

Yeah, that kind of extreme lack of transparency makes a free market utterly impossible. Particularly if you ask explicitly, they should be able to tell you a price, or you should be able to tell them up front that you'll only pay the part that's covered by the insurance.

Springing costs on you that you never agreed to and aren't covered, should be illegal. you're literally being forced into a transaction you never agreed to.

> My optometrist wants me to try a new kind of contact lens.

My optometrist wanted me to as well. When I wasn't sure, he was nice enough to offer a prescription for both, so I could make the choice later.

That obviously doesn't work in every case of unknown cost, and doesn't really change your point, but I thought it was worth pointing out as a nice tip for anyone in the same situation in the future.

Re: the flu shot story — that’s called balance billing and it is illegal if the provider was in network and the procedure was covered.

https://www.healthinsurance.org/glossary/balance-billing/

I don't know what order your experiences happened in, but one thought in the first is wrong because of the second: There is no upper bound.

It's something I've seen in other comments here in the past, too.

I want to know why the doctor charges $300 for a procedure that a pharmacy offers for only $30. Is there any reason for it besides just wanting to extract more money?

Appeal the flu shot claim. Most insurers cover vaccinations at zero cost to members. Your doctor may have coded the claim incorrectly.

Your definition of "duress" is so extreme as to be absurd. Just about all important decisions would be thought of as being made "under duress" which means you can justify unlimited intervention into any segment of the economy because someone will always either need the good or the job.

In the US, only about 5% of healthcare expenditures are for emergency care. That means there is huge opportunity for people to shop around. The problem in the US is that there's no actual healthcare market, so shopping is impossible. No prices are displayed so customers can't make informed decisions, most areas are operating under healthcare monopolies, and most areas enforce a perverse set of laws that make it difficult for competition to enter the market.

I think the argument here is that people are too reactionary with their health and aren't capable of planning in advance. I would say if public and private interests were in alignment here it could look something like the lobby against smoking cigarettes. People are giving up smoking in droves because of many public campaigns to educate people. If people were only reactionary they would smoke until they started getting sick, but people are capable of being educated to behave rationally in a free market, I think.

I'm trying to plan in advance. My doctor wants me to get a couple tests done. It's not urgent, but the results will inform the future steps I take in managing my health. So far I have not been able to get a single provider to tell me how much it will cost. The tests are known, there is no secret, no emergencies will come up during the test, but still they can't tell me. They need to talk to my insurance company first to even have some idea, and even then no guarantees they will be able to give me a dollar figure.

There’s a vast amount of healthcare spend that’s not made under duress. Non-US systems have embraced the free market here as a means to control cost. The common example I throw out is that France publishes a list of reasonable and customary costs for common outpatient treatments. Your insurance will reimburse you 80% of that. If you want to go to a doctor that charges 10x that, well, that’s your choice and your money. With cash up front operations, doctors don’t require a huge staff to interface with insurance. They also don’t have to build in extra cost to deal with float and/or possible non-payment.

Emergency care and care for the truly poor is handled with a different process.

I believe there is a trend in EU to change this towards a system where private health care providers are payed based "patient health" instead - sounds like a better economic incentive if it succeeds. (should probably provide a source here, but I forgot the name for it)

There are time, as in emergencies, where the purchaser doesn't have the ability to shop around. But in general free markets work fine for food despite the fact that without food you'll also die. The problem is more that it's hard for the consumer to know the quality of what they're purchasing.

The consumer often doesn't know the cost, either.

It's like a restaurant that doesn't tell you the prices until after you've eaten, except it's the only way to get food.

In countries where the consumer pays for their treatment they generally do get the prices up front, as in a restaurant. That's also how things used to work in the rest of the world before the rise of health insurance and national health services.

One big step toward fixing it would be to require providers to post price lists. Another would be to prevent separate prices for different insurers and uninsured clients.

Yes, there will remain distortions in the healthcare market, but at least there would be a way for people to make informed decisions.

By your argument there can't be a free market in food, you need that even more than you need health care.

Yet somehow in the US there is a market in food. And it is gigantic with way more options than most other places.

This is a great example of someone who wants to pretend that the market doesn’t exist, like the previous poster said. You can draw this argument to its logical conclusion and argue that any good that somebody needs is “not a free market”.

The food market is obviously not free because you need to eat. The car market is not free because a lot of people need to drive to work. The plumbing market is not free because sanitation is essential.

I won’t comment on the relative effectiveness of free vs centrally planned economies, just pointing out the logical fallacy above.

You are being willfully ignorant and have a poor grasp of what a "free market" is.

Healthcare isn't a "free market" because of massive information asymmetry (detailed prices for services, consumer education needed to evaluate information), high barrier to competition, and of course the literal product being your life.

Whereas cars are much closer to a free market. Sure, you might need to drive to work, or you can take a bus or other public transportation, ride a bike, walk, move closer or to another area somewhere this is easier to do, find a job that lets you work from home, etc.

If you choose to buy a car you can gather tons of information, pick a product to fit your specific budget, and end up with something that works everywhere. You can sell the product in the future. Contrast this with healthcare where you can't generally evaluate the information, have minimal to no pricing choices (especially in certain time sensitive situations), etc.

Even a good you're compelled to buy can be obtained through a free market. Cars are the perfect example because contrary to your understanding, they are actually a basic requirement for a huge number of people. In addition, the vast majority of healthcare expenditures are not emergency, and aren't complicated so there's no reason why people can't obtain a diagnosis from one place and then seek out the best place to actually receive the treatment.

> ...then seek out the best place to actually receive the treatment.

How do they seek out the "best place" if they don't have complete information on what it will cost? It would be like buying cars with no price-tags or MRSPs - yes, there will be good/prestigious dealerships with excellent staff who can tell you the technical details about the car that's right for you, but you won't know how much it will cost you until each component manufacturer sends you their separate itemized bills for months after taking possession of the car, and you can't take the car back (5x tires, 2x wipers, 1x engine, dealership charges, factory charges, line-assembly person 30 minutes @union rates, 1x battery, 348x bolts,1x suspension platform, transmission, etc). That is not a free market.

The problem lies in executing that "seek out the best place to actually receive the treatment". Its hard when healthcare givers do not give a quote or outright misleads. Readers who are not familiar with the American way might find that hard to believe.

In the real world you can't usually separate diagnosis from treatment. The initial diagnosis may change depending on how the patient responds. And it's not always feasible to communicate the important nuances of a particular diagnosis from one doctor to another. Bungled transitions in care are one of the leading causes of harmful medical errors. Care continuity is important for patient safety.

How does the free market account for the cost of researching options?

I am sure I could find a better deal on many medical purchases, but the cost to find them is significant. Purchasing the default/readily-available option is often the best bet because of the hours or days required to find a better solution. Spending a few hours to save $100 or a few days to save $1000 is a clear loss to me.

Most products are extremely complicated. Food and its effects are extraordinarily complicated, but general knowledge about what foods to eat to stay healthy diffuses through an emergent and bottom-up process, through channels like Wikipedia and word-of-mouth.

Cars are another extremely complicated product. Society has self-organized to create reputable sources of information on the quality of different models.

We don't need government restrictions and monopolization of spending to manage the complexity of the economy. Healthcare faces severe problems because of governemnt intervention, not despite of it.

I'm not pretending the market doesn't exist, I just explain some of its limitations. I admit I could have explained this better. The thing that matters is choice. Without it, there's no free market. Healthcare is not a free market for urgent issues because you can't afford to shop around. Especially if an ambulance is involved, you just get taken to the nearest hospital. Depending on where you live, you may not be able to shop around much for non-emergency issues either.

With jobs, people with ample financial reserves can afford to shop around, but people who live paycheck to paycheck can't.

With food, well, it depends on how many different places sell food. Fortunately, there's usually no shortage of shops selling food. The market for expensive food is absolutely free, because I can say no and eat something cheap instead. But the market for cheap food does indeed not behave like a normal free market, as any economist can tell you: when prices for the cheapest foods go up, people will actually buy more, because they won't be able to afford more expensive food. And if one company had a monopoly on all food and set prices for all food high, it would not be a free market anymore, though that's true for any monopoly. Still, if it were a monopoly on something non-essential, people could still say no.

A free market requires competition. When no competition is possible, there's no free market. When there's an army of unemployed people desperately hunting for jobs, companies can afford to be picky and underpay them; there's no meaningful competition to hire those people, who can't afford to say no, because the only alternative for them is to be unemployed. This can lead to a situation where even people with a job have trouble making ends meet.

Personally I don't view the problem as being about healthcare being a market or not, I view the problem as what a free market optimizes for. Finding the price at which the market clears is very different then optimizing for cost effectively improving the health and wellness of everyone in a society. Sometimes the free market purpose matches with the broader societal goal well, other times it does not.

For the last couple weeks I've been trying repeatedly to vote with my wallet. Since nobody will tell me how much any of this is going to cost, I have zero ability to do that. It is extremely frustrating.

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