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Comment by Someone1234 | Hacker News Reader

This is why the very concept of insurance discounts are problematic. It might sound counter-intuitive to argue against "discounts" as a solution to bringing costs down, but it actually would.

Medical facilities are forced to artificially inflate bills. Insurance then artificially gets a discount back to a sane price. This helps insurance look like they're "doing something" even when they aren't e.g. High Deductible when you pay 100% up to the deductible ("at least I got the insurance rate!").

Out of network also suffers from this. The networks themselves are discount networks and prices for uncovered patients are artificially high.

If you banned insurance discounts and insurance had to pay the same dollar to dollar cash price (without kickbacks/incentives), it would help the uninsured, it would help re-align patient/insurer motivations (i.e. both demanding low cash prices), it would make price transparency actually meaningful, and it would eliminate insurance networks.

But ideas like this, and removing employer provided healthcare (e.g. everyone on an open health insurance exchange) are politically impossible in the US because no politician can get elected for "taking people's employer insurance and taking their discounts." Even if they're the right thing to do to simplify, reduce costs, align goals, and force insurers to compete again.

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> If you banned insurance discounts and insurance had to pay the same dollar to dollar cash price (without kickbacks/incentives)

It never occurred to me before that this is an option. That sounds like a good idea.

I also wonder why health insurance should be allowed as an employee benefit. How does it make any sense to tie my access to healthcare with my employment status?

Whatever historical reason there may have been to start it, the only reason it exists now is to give big businesses more power than smaller businesses, and individuals.

That's reductive. If I have a choice between a job that offers health insurance and one that doesn't, all other things being equal, I'm definitely taking the former. That's also surely a large part of why it continues to exist.

I’m talking about the legal reason for it to exist, since employers can purchase insurance with pre-tax money, and the bigger and more white collar/younger the employer, the less their insurance costs.

Right but the reason large insurers can offer good insurance is they are a much larger risk pool.

I work for a Fortune 500 and my daughter has probably cost the insurance $1m. No big deal rates didn’t even raise.

Before I worked for a contractor and we cost THEM a million bucks, and they had to get rid of the low deductible plan, and boost insurance rates by $50 per WEEK per employee. We single-handedly destroyed their risk pool from three months of NICU stay, making it so they could no longer offer affordable insurance. Rather than accept the new rates we got cheaper plans on the Marketplace. Unfortunately though those aren’t tax deductible but we still came out ahead.

It’d make far more sense to just have a marketplace for everyone and make the risk pool the entire US population, rather than let giant corps get good rates while small companies get devastated when an employee or their children get sick.

> Before I worked for a contractor and we cost THEM a million bucks

Was this a large group insurance plan (usually 50+ or 100+ employees depending on the state)? If it were a small group insurance plan I don't believe your utilization would increase the rates, since AFAIK all the small groups in one state/region and insurance provider are combined.

If the employer was large enough to have a large group insurance plan, but still fairly small, I suppose one person's utilization could noticeably increase rates at the next plan negotiation. I believe this is why some companies that are too big for small group insurance plans utilize "professional employer organizations" to participate in a larger risk pool.

Yeah it was maybe a 50-100 person company. The new company is substantially larger.

You can literally (if indirectly) blame the Nazis.

WWII wage-price controls:

https://www.npr.org/templates/story/story.php?storyId=114045...

WWII also motivated universal health care (NHS) in the UK.

How does this make sense, though?

> "The war economy is an entirely different ballgame," Thomasson says. The government rationed goods even as factories ramped up production and needed to attract workers. Factory owners needed a way to lure employees. She explains that the owners turned to fringe benefits, offering more and more generous health plans.

Why is a healthy plan better for employers than paying cash and letting employees buy their own health care / insurance?

The 1943 IRS ruling that health insurance is tax free, and the legislature failing to correct that, is more of a problem. This blatant failure isn't an "accident", it's bad lawmaking that biases toward business, against people.

Why is a healthy plan better for employers than paying cash

Wage-price controls prohibited that.

and letting employees buy their own health care / insurance?

Risk-pooling, information asymmetries, "shoe-leather" frictions (having to shop around, individually, for everyone), bargaining power.

Healthcare markets poorly.

It doesn't and it didn't used to be that way. During labor shortages in WWII, laws were passed to limit salaries and keep companies working. The workaround was to start offering "benefits" and they just never went away.

Wish more people talked about / knew this!

How a big part of the reason the US healthcare system sucks is just a weird fluke of history!

Inertia's definitely important but 75 years is a long time, long enough to discount it as a valid excuse. But if we're allowed to dig into history a contra example is another ~70 year old system, the UK's NHS. That system managed to pull itself up by its bootstraps in spite of the loss of empire, material shortages, and left over war ruins, and a superficially more discouraging class system than our's that turns out to have more upward mobility than our system. Weird.

Indeed, it’s too bad this is not more widely known.

The NYT has a nice overview [1], the relevant passages below. Wikipedia’s coverage [2] is excellent as well.

“In 1942, with so many eligible workers diverted to military service, the nation was facing a severe labor shortage. Economists feared that businesses would keep raising salaries to compete for workers, and that inflation would spiral out of control as the country came out of the Depression. To prevent this, President Roosevelt signed Executive Order 9250, establishing the Office of Economic Stabilization.

This froze wages. Businesses were not allowed to raise pay to attract workers.

Businesses were smart, though, and instead they began to use benefits to compete. Specifically, to offer more, and more generous, health care insurance.

Then, in 1943, the Internal Revenue Service decided that employer-based health insurance should be exempt from taxation. This made it cheaper to get health insurance through a job than by other means.”

[1]https://www.nytimes.com/2017/09/05/upshot/the-real-reason-th...

[2] https://en.m.wikipedia.org/wiki/Health_insurance_in_the_Unit...

I also wonder why health insurance should be allowed as an employee benefit.

It's an excellent way of reducing worker mobility.

It's also far cheaper, on the whole, to insure a group of people vs an individual because there is less variance in the rates of usage.

The logical conclusion, then, is that the most cost-effective structure is the maximal one (a single risk pool including the entire population, a.k.a. universal coverage).

And the evidence from countries that have implemented this supports that conclusion!

Not necessarily, people who are unemployed tend to get sick more often with the most common cause being substance abuse. A company with workers that are drug tested is likely to spend less money on substance abuse programs than a group of random individuals.

I think you need to back up claims like that with a source. Are companies themselves spending money on substance abuse programs for their employees? Are substance abuse problems the biggest factor in health insurance burden?

No insurance provider has only one customer. They always pool risk across all of their customers. A company signing up lots of their employees doesn't increase the size of the pool -- it just adds an intermediary.

The reason often cited for employer-based coverage is that it avoids some self-selection problems, but that's a different and complex topic.

Self-selection is certainly a fundamental economic problem of health insurance. Large employers can make their own deals with insurance companies, and small employers can participate in small group health insurance plans (which effectively combine all the small businesses in a region/state into one group).

>> A company signing up lots of their employees doesn't increase the size of the pool -- it just adds an intermediary.

I'm not exactly sure what you mean by that. For large group insurance plans, rates are determined by the risk (calculated by the insurance provider, with certain legal restrictions) of your individual employees. If you have 100 employees and 10 of them get a chronic illness, your rates will go up. Similarly, an employer with older employees will have higher rates than an employer with younger employees. The pricing is per group (employer), not based on the entire pool of the insurance provider's customers.

For very large employers, I believe it's common to self-insure, i.e. make a deal with an insurance provider to provide care to your employees at the rates negotiated between the insurance provider and health care providers, but the employer just pays out the total cost of delivered care rather than premiums. Then you get into stop-loss insurance and other interesting complications.

That's what insurance is, no matter how you get it.

How many people chose to keep their insurance with their existing job rather than to forego it in order to start a company?

Economically speaking a 20-something will have fewer responsibilities than say a 40-something with a family and children.

So many startups have been funded by 20-somethings having the ability to couch surf and live off their parents health insurance -- likely because they're the only ones that can afford the risk.

There's a phrase for it even: Job lock. It's a real employer benefit.

The same way tying work visas to employers limits employee mobility and increases the "slave labour" effect. People end up stuck in jobs they hate just because they have health insurance and will have to go without it for a period if they change jobs. That's utter bullshit.

Well, that's what COBRA coverage is for to bridge the gap between jobs. Also if you lose your job you can usually get insurance from the state at little or no cost while on unemployment.

Ahh COBRA. "You've just left your job and have all the regular expenses still, but you won't mind an extra $1500 a month for health insurance, right?"

Well, without COBRA you'll have to pay $2500 for the same coverage.

It's definitely a terrible system, but if you have a pre-existing condition how fair is it to the next insurance company to take you. That's like taking your crashed car to Geico and saying fix it. There has to be some way that the insurance company can make money on the odds.

If you have insurance and a pre-existing condition, it's probably going to be a net-neutral to the insurer (for every one coming on to their system, there's one leaving to another).

The preponderance of a given condition is not a function of having insurance (though complications thereof can certainly be increased by NOT having insurance). And has already been factored in by actuaries into policy pricing.

The biggest issue is that we see health insurance AS insurance, not amortized healthcare costing.

> There has to be some way that the insurance company can make money on the odds.

That's the thing, they see an opportunity to increase profit.

A few comments on that, as someone who has worked in the industry of developing software for health insurance claims management and benefit processing:

1) insurers are incentivized to deny claims, often talking about how "unfair" it might be for "them" to have to pay for a treatment. The irony is that "they" are not paying for anything - the risk pool is. Those premiums were calculated based on actuarial assessment, plus insurer overhead calculated in. What they mean by "them" having to pay out is that we cut into their profits, as they don't refund money to risk pools if the entirety of the pool is not used - they keep it, in addition to the admin overhead.

2) insurers have been known to be outright unethical, if not illegal in denying claims. Some prurient examples: denying Heli EMS for car accident victims from the scene to a trauma center because of "lack of pre-approval" (sorry, as a paramedic I am not "hold[ing] for a nurse consult" as I call an insurer to decide whether they are going to deign to pay for this patient's transport, and retroactively canceling coverage for "failure to disclose a pre-existing condition" that was actually unknown at the time of disclosure, i.e. "You were seeing a physician for maladies X, Y and Z. You had not been diagnosed with anything at that point, but later were, and maladies X, Y and Z were symptomatic of that. Ergo, you had that condition at that time, though you did not have a formal diagnosis, and failed to disclose that you had it. Accordingly we are voiding your coverage for breach of contract".

This is despicable behavior on insurers part to kick people down when they are in need.

It should be illegal to drop a person's coverage if a clear diagnosis was not made prior to an incident that required medical intervention and cemented a diagnosis on paper.

> Some prurient examples

Not sure these are "prurient". You may mean salient.

I don't know all the details, but COBRA prices have always seemed exorbitant, likely to discourage people from doing this. In my early 20's, when I had about the worst health plan ever, COBRA was still hundreds of dollars a month. Out of pocket, I bought a plan for something like $45 a month instead. I have trouble believing what COBRA offers is the same price as what a company pays - and if it is, they are getting hosed big time.

COBRA prices are exactly what the company + the employee pay, plus 3% for administrative overhead. What it illuminates is just exactly how much health care costs combined, even when the number the employee is paying is large, but manageable.

Employers now document their insurance costs for each employee on their W-2 forms, in case you want to see how much yours is paying for you.

Thanks for the insight, I'd always wondered. Now I find it even slightly more depressing.

As far as I can tell, the main advantages of getting health insurance from an employer are 1) the tax deduction and 2) favorable group insurance plans.

For 1, it's just completely insane that all medical expenses aren't automatically tax-deductible. It's silly that it's advantageous to have my employer pay $200 a month for my insurance plan rather than just pay me an extra $200 and let me use that on whatever plan I want.

For 2, that may be a little trickier politically. Group insurance gets more efficient the larger the group, assuming there's a mechanism to prevent adverse selection. So obviously, we want to increase group size. That was one of the claimed justifications for the individual mandate.

It does seems like an artifact that after-tax premiums aren't always deductible. We already have a model for how to do that in the homeowner's mortgage interest deduction: insurers (banks) report the total of your premiums (mortgage interest) to the IRS, you get to deduct that value from your AGI.

If you're paying for insurance with after-tax dollars, you can deduct it as long as you're a) itemizing, and b) have total medical + premium expenses >7.5% of AGI, but given that people who pay for insurance with pre-tax dollars get that benefit regardless of those criteria, it seems like it'd only be sane to relax the rules so that people paying with post-tax dollars get the same break.

Isn't 2 a great argument for nationalised healthcare insurance?

At the bare minimum it could be an argument for a public option, which was initially part of the Obamacare proposal until Lieberman threatened to cooperate with the GOP to block it.

For 2 the simple solution is to make the whole country the risk pool.

Not the simplest politically, of course, but yeah, that's one of the primary economic arguments for nationalized health care or at least nationalized health insurance.

Yeah, I keep wondering recently: why does the expenses of a corporation reduce their taxes, but the expenses of a human to stay alive (food, medical) not reduce their income tax?

In the US, we have something called the "standard deduction" which is more practical than everyone tracking things like a corporation that has accountants.

It really bothers me that some employee compensation is lower because of health insurance being a standard employee benefit. An employer saves thousands of dollars if an employee doesn't need to enroll in their insurance (they may get it through their spouse, the VA, or are enrolled in medicare). That savings is not required to be passed down to the employee and its almost never is in practice.

If you’re interested, there is a long and sordid history behind how we got here.

In the past, insurance just paid whatever the hospital charged it was called “usual and customary”. This came about because public plans were getting ripped off and gov’t said “no, you can’t charge us whatever”.

Cycle through a series of different reimbursement systems in order to get a grasp on costs and you end up where we are now - chargemaster rates are ridiculously high (because they aren’t allowed to charge more than that) and the payers negotiate rates down as best they can so you end up with massive gross-net differentials.

It’s really a complete mess.

This is a good place to start if anyone is interested.

https://en.m.wikipedia.org/wiki/Usual,_customary_and_reasona...

"Rebates" were a major element of anti-trust concerns against Standard Oil, in 1911:

http://sites.gsu.edu/us-constipedia/standard-oil-co-of-new-j...

They remain a massive concern with monopolies today.

> it would eliminate insurance networks

It wouldn't. Insurers would still need to approve providers' prices, and those negotiations would have other levers that could be pulled.

But broadly speaking, yes--requiring insurers pay the same price that is advertised and available to the uninsured public is basic price-transparency policy.

Or they would just cap prices for specific procedures. Then the patient could use price transparency to see if they'd wind up with an overage bill, and consider if they'd be willing to pay the remainder (e.g. if the doctor was preferred).

Right now insurance either do cover something or they don't. That in itself is problematic. If insurance would cover a procedure up to e.g. $500 at one medical clinic why do they cover up to $0 at another? Shouldn't it be $500 here or $500 there?

Networks inherently pit you against both the insurer and healthcare provider. Instead you and your insurer should be on the same "side" against healthcare providers.

> Right now insurance either do cover something or they don't.

That's vastly oversimplifying. Insurance often covers part of something.

Maryland addresses this by setting prices state wide that are the same for all payers. There is an independent commission that sets the prices. https://hscrc.state.md.us/Pages/default.aspx

I've gotten into a long, annoying fight with my insurance company about whether they would cover a certain procedure.

The dumb thing is, the bill won't hit my deductible cap for the year! (The procedure was done in 2018.) So, in any case, I will pay the full bill and the insurance company will pay nothing. But if the insurance company processes the bill, then I get the "discount".

This is mind-bogglingly stupid.

It's actually brilliant rent seeking. Evil but brilliant. They provide no service and negative value for the user. In exchange they help large employers maintain a way to restrict employee movement and value for shareholders.

Honestly blue Cross blue shield is just like Facebook ..users are the product not the customer.

Illuminating analogy, thank you.

You might be able to negotiate with the medical provider itself. Say you want to pay without insurance and ask about the cost and doing any reductions.

The number on the bill before the insurance discount is entirely imaginary, no one pays it.

There is always a built in cash discount for people without insurance.

For example, for a while I was having trouble getting insurance cards (stupid reasons) at a new position so I was paying out of pocket for prescriptions and office visits.

They were less expensive paying cash than with insurance pre-deductible.

> The number on the bill before the insurance discount is entirely imaginary, no one pays it.

Until they don't pay it. Then that entirely imaginary number becomes a very real debt that gets sold and reported.

I did call them. They said they would be able to lower the rate from 2.5x the insurance rate (which is what they billed me for) to 1.7x.

I was all set to settle my bill actually, but the woman in billing (at the doctor's office) urged me to not give up and file another appeal. Apparently even she agrees that this is bullshit.

The whole experience has been surreal.

I had a run-in like that some years back. The insurance was rejecting the bill as a duplicate (it wasn't, the doctor legitimately ordered the test done on three different samples. Two got processed on the same day.) The lab wouldn't just accept the negotiated rate and just kept re-billing without listening to me telling them what they were doing wrong, the insurance wouldn't budge and simply "pay" it ($0 out of their pocket) on my assurance it was legit.

I ended up with the last laugh, though--eventually the insurance rejected it as billed too late, denied, drop it. Instead of collecting the negotiated rate they got $0.

Voters are well aware that they would have to pay more if their silo’d employer group health plans with healthier white collar employees were removed, so they vote accordingly. Voters don’t want to pay extra to subsidize those that can’t afford healthcare, and the politicians reflect that.

That's not really relevant. Who pays premiums is separate from how the structure works. USA has various welfare programs for the needy, with wide support. Social Security is one of the largest and most popular items in the Federal budget.

It’s the big reason people don’t want to be dumped on healthcare.gov. Employers can get cheaper premiums due to having healthier pools of employees and the rest of society, and they get to pay with pre tax dollars to boot, which has never made sense.

Social Security DOES NOT come out of the general fund (tax revrnues) so cannot have any effect on the budget (which is the plan of how to spend the general fund). Social Security is paid out of the separate Social Security Fund. The only way it affects the General Fund is via the contracted repayment of borrowed monies (and interest) owed to the SSF which the government seemingly wants to default on.

That's just not true under any possible light you want to look at the issue.

Single payer has proven in pretty much every western country to be massively less expensive than the insurance system in the USA.

I was agreeing with Someone1234 about people not wanting to lose their employer based healthcare.

US voters haven’t had the option for single payer, but they did have options for removing employer sponsored healthcare.

It's less expensive in aggregate, but on an individual level rates will almost certainly go up (even if they're lumped into taxes). Individuals cast votes, so if individuals are negatively impacted, they're going to vote against it.

The only way to dodge that is to subsidize it, whether by reducing the budget elsewhere (cough cough the F-35 program cough cough) or raising taxes (cough cough on the ultra-rich cough cough).

I actually doubt it. Whenever I go back to Italy I can easily buy glasses at full price for the same price I get WITH insurance in the USA. Same story for a lot of other stuff, like dental work etc...

Insurance pushes the price of care up by about 5 to 6 times in my estimation, single payer would fix it.

> But ideas like this, and removing employer provided healthcare (e.g. everyone on an open health insurance exchange) are politically impossible in the US because no politician can get elected for "taking people's employer insurance and taking their discounts." Even if they're the right thing to do to simplify, reduce costs, align goals, and force insurers to compete again.

To be fair, the current president ran partly on a platform to end surprise billing and has asked congress to deliver legislation to this effect

I'm part of a medical bill sharing plan. Its not insurance, but if I have a valid medical bill, I can submit it and in most cases I will be reimbursed from other members sending me checks directly.

It works pretty well, though I've never had to use it. There is a private forum for members to discuss tactics on getting the biggest discounts. A member will typically ask for a self pay discount as we don't have "insurance". In many cases that knocks 25%-50% of the bill off right there. But you are still dealing with the normal hospital or clinic billing department at that rate.

If you continue to decline this "discounted" rate and push to be transferred (in person or over phone) to the billing department's higher ups, you might even be able to get the bill lowered even more... but you must reject these as well. Eventually you will be turned over to a collections company, and right before they file against your credit score you will actually have the most bargaining power. Typically you will be able to knock another 50% off of the bill.

There are many testimonies on the forum of people getting heart surgery or chemo and having bills in the $100k-$150k range and yet in the end, and after lots of phone calls and added stress... they walk away with paying only $20-30k.

So basically, "insurance" does this bargaining for you.

Kind of curious what the incentive is for the individual members to keep their costs low other than group identification?

Obviously the sharing ministry only has so much income per month. If the current total member needs are not met, then monthly member rates go up. So keeping your personal medical expenses down helps keep the monthly membership fees down.

I'm unsure how I feel about this ethically. I don't disrespect anyone doing it, but the situation feels wrong. The discounted end price should have been the first price, or you've transferred costs into a real world loss for the system overall against your payment, and some imputed cost gap.

Overall I think a NHS is better.

We judge "fair" prices by what is listed on www.healthcarebluebook.com In most cases 90% of the cost is not the procedure or doctor, but a "facility" charge. This coincides with the extreme administrative costs of healthcare: https://i.imgur.com/NZFoE5K.jpg

> Medical facilities are forced to artificially inflate bills.

Are they? Or are they allowed to get away with it?

Remove the finger of blame by noting that a self-perpetuating spiral feedback loop is created.

The question becomes how to break out of the loop.

(GOTO considered essential?)

People seem to think they can just break the loop by dumping insurance companies because hospitals have done a very good job of painting themselves as the victims.

If we try that, I'd expect medical expenses keep going up and confused_pikachu.gif until people figured out that hospitals were never on their side. If this takes long enough, "bring back insurance companies" will be the solution, and then it won't work, and then we're back in an infinite loop with a longer cycle.

Hospitals need countervailing price pressure, and anyone who doesn't accept that is liable to vote for catastrophically bad policy.

> If you banned insurance discounts and insurance had to pay the same dollar to dollar cash price (without kickbacks/incentives), it would help the uninsured, it would help re-align patient/insurer motivations (i.e. both demanding low cash prices), it would make price transparency actually meaningful, and it would eliminate insurance networks.

An alternative approach would be to limit how much higher th e price could be compared to the median insurance re-imbursement for a particular procedure. If you set the limit low enough, then going out of network would not be much more expensive. And the total cost of having insurance and using them may be more than just paying out-of-pocket.

We shouldn't seek to ban insurance or force them to work one way or another.

The problem you identified is correct but the solution isn't right. You should let people be free to choose to freely associate with one another (or whatever insurance policy they prefer).

Instead, get rid of legislation that makes hospital bills something awful for unensured people. Many things are driven by the insurance companies but others are by hospitals or even just politicians with bad ideas. Remove the barrears of entries and things tend to get better too.

My concern about socialized medicine are the stories I hear about unreasonable rationing (e.g. https://www.dailywire.com/news/45698/thousands-elderly-patie...). Maybe there is more to the story, but I haven't been able to find anything on the progressive side that addresses it. Can anyone point me in the right direction?

According to the Telegraph page linked in the DW article,

"eye clinics were unable to keep pace with demand.... In four out of five cases, those affected had chronic conditions requiring long term follow up, meaning they are not covered by NHS targets." https://www.telegraph.co.uk/news/2018/06/06/hundreds-going-b...

While pathetic, it's not clear how it follows, as the DW asserts, "This is what will happen in America if Democrats get their way on 'Medicare for all.'" There are lots of countries with socialized medicine without the problem that NHS has. DW fails to mention that, possibly because of its bias. Private insurers in the US, in the meantime, are widely known to pick-and-choose what they will cover ... and will not.

Edit: here's a description of 'Medicare for All' from Forbes. https://www.forbes.com/sites/teresaghilarducci/2018/07/16/wh...

You don't think that unreasonable rationing is happening in the US right now?

I think that under the current system most of the rationing is in the form of people who don't have insurance not being able to afford care. Therefore, I think convincing the people who do have health insurance to take on some of the rationing will be a tough sell. Many people in the middle class would probably perceive it as "potentially sacrifice your health for the good of society".

You're right to be concerned. But the linked article shows what happens if you have socialised medicine that you then starve of funding.

The US is already paying far more for healthcare than the UK, and that stays true even if we only consider government funding and ignore insurance. There's no reason something similar would happen in the US.

Also, that report mentions macular degeneration, and this is a problem mostly caused by terrible pharma practices.

Avastin and lucentis are very similar. Avastin is older, and is much cheaper than lucentis. They can both be used to treat AMD. The owner has licenced lucentis for use in AMD, and has chosen not to licence avantis for AMD. This means that doctors can use avastin "off label". The rights-holders decided to sue the NHS to prevent this off-label use.

https://www.bbc.co.uk/news/health-30138097

https://www.hsj.co.uk/finance-and-efficiency/breaking-nhs-wi...

See also this, which describes how US healthcare is killing people: https://www.ft.com/content/05f7fa82-a315-11e9-a282-2df48f366...

That's a reasonable conclusion. I guess then my concern would be: what guarantee is there that the US won't be one of the underfunded socialized healthcare systems. In fact, it seems almost inevitable that it would be as soon as the Republican party gained control.

I've been advocating this solution for prescription drugs for many years. The real enemy is the cost-shifting, ban that. I hadn't thought of it when it comes to the doctors but it probably would be a big help there, also.

“Medical facilities are forced to artificially inflate bills.”

I don’t think it forces them. I would say it gives them an excuse to do so.

Hospital's costs don't magically change though. The MRI machine? Expensive as all hell. The liquid helium (or whatever) to run it? Also expensive as hell. Doctor's wages? Nurses wages (they're unionized, fwiw). X-ray machines, X-ray tech's, the cost of reagents, pharmaceuticals and all other medical supplies?

The hospital, a for-profit business in the United States, isn't voluntarily going to give up profit, so they "hack" the system by raising prices. If InsuranceCo says they'll payback 20% of list price, but it costs the hospital $100 to run the test (including some nominal profit; hospitals aren't non-profits, for better or worse), the hospital must charge $500 for the test, just to break even on InsuranceCo's patients.

Which they aren't refuse, because those patients are a significant portion of the hospitals revenues, or due to laws, in some jurisdictions. ER's can't (legally) turn away people they don't like (Eg African Americans or immigrants).

“If InsuranceCo says they'll payback 20% of list price, but it costs the hospital $100 to run the test (including some nominal profit; hospitals aren't non-profits, for better or worse), the hospital must charge $500 for the test, just to break even on InsuranceCo's patients.”

I have never seen a real accounting of these costs so we can see whether they overcompensate. It’s the same with the high drug prices. They always say that other countries underpay and therefore the US has to pay more but you never see any real numbers.

MRIs and most imaging is a huge profit center. Manufacturers will approach providers to form an "imaging group", promising recoupment within 18 months for the highest end machines.

And is been shown that doctors who belong to such are more than 2.8 times more likely to refer patients for imaging.

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