Comment by skohan | Hacker News Reader

Comment by skohan | Hacker News Reader

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The problem with privatized healthcare is that it's not a problem which market forces will solve naturally. Sure for some things, like elective surgeries (lasik for example) or routine dental care, people can shop around, and prices will reach a sane level. But the majority of healthcare does not work like that.

For instance, in the case of lifesaving treatments, the demand is essentially infinite, and this is a fact which Pharmaceutical companies use to raise the cost of treatment to astronomical levels. When the alternative to expensive treatment is death, there is simply no countervailing market force to bring costs down.

The same goes for pre-existing conditions. It may have been fine for you and your wife to pay for a reasonably-priced high deductible plan, but without the ACA, that simply would not be an option for a huge number of people. Without government regulation, there is absolutely no incentive for an insurance company to cover a chronically ill or high-risk individual. The rational way to operate that type of business in order to maximize profit would be to cover healthy people only, and remove anyone from your coverage who is likely to file a large claim, and we have seen this come to pass.

> Sure for some things, like elective surgeries (lasik for example) or routine dental care, people can shop around, and prices will reach a sane level. But the majority of healthcare does not work like that.

This is precisely because there is no health "insurance" middlemen for purchasing those services. The market drives those costs down.

If - like in pre-ww2 America - instead people saved up for the inevitable doctors visits and paid out of pocket directly to the doctors and hospitals, costs would be FAR lower both due to competition and price sensitivity. This is the fundamental problem with using health "insurance" for expected costs, rather than just unpredictable emergencies.

Yes but it is also because those specific types of treatments respond well to market forces: they are common enough for there to be a lot of competing providers, and if the price is too high, people can elect not to receive those services.

For a counterexample, look at dental surgery. This is also often not covered by insurance, but it's much more expensive, and low-income individuals often take on debt and risk their financial security to undergo these procedures because the alternative is often a severely degraded quality of life. The difference is that the demand is much less flexible, so providers can get away with higher prices. Many healthcare procedures fall into this category.

And what if you happened to not be able to save? Or if something was too expensive for your savings? Or if you chose the wrong savings vehicle and the stock market tanked just when you needed that new hip? How much should you save? How do you know?

Pre-WW2 America isn't a place most people would want to return to in terms of healthcare. It was far far less advanced, people died much more easily and you may recall a certain Great Depression which made it so those savings weren't quite as reliable as people hoped.

Oh and when you go to the ER after getting hit by a bus, are you going to call around for the best deal?

You might argue that's what insurance is for, but now you end up back where we are today, with a middle-man paying for things. Things that are essentially guaranteed to happen but unpredictable in their magnitude.

I'm not saying we shouldn't have more market information, but it's just incorrect to say the market will solve this. Serious medical problems are a, "your money or your life" situation, pure unregulated markets are going to really struggle in this area.

>Pre-WW2 America isn't a place most people would want to return to in terms of healthcare.

I dunno, the differences weren't huge, and at least people didn't go bankrupt (data not from the US, but close).

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2625386/

"Life expectancy of mature women taken from Hollingsworth8 and OPCS data for England and Wales

Date Life expectancy of women at 15 years (years)

1480–1679 48.2

1680–1779 56.6

1780–1879 64.6

1891 61.6

1901 62.6

1911 66.4

1921 68.1

1951 73.4

1961 75.7

1971 76.8

1981 78.0"

1989 79.2

That seems to indicate a 16% increase in life expectancy between the last pre-WW2 data point and the most recent data point. That's pretty huge, especially when you consider that those are averages, meaning that the disparity is made up not so much of old people dying older, but more of young people not dying from illnesses that are now preventable.

As a specific and personal data point, I have chronic kidney disease, which developed rapidly when I was 25. With pre-WW2 medicine (no transplants, no dialysis), I might have lived to 26, maaaaybe, and even then only if I'd been able to control my blood pressure long enough for renal failure to set in instead of a stroke or heart attack.

Thanks to modern medicine, I'm now nearing 40 with a good prognosis; there's no reason to believe it will impact my life expectancy, and the impact on my quality of life is relatively minimal. Compared to dying in my mid-20s, that's a vast world of difference. I will not willingly go back to pre-WW2 medicine, thank you very much.

Not to derail whatever point you're trying to make but its important to note if you use WW2 as the middle point, you're splitting the data between a pre-penicillin world and post-penicillin world. If anything I'm amazed that its only a 16% increase after such a massive change.

Yup, that's because it's about averages.

To take a contrived and simplified example, imagine a hypothetical world in which everybody dies on their 90th birthday by default, but a handful of diseases cause 25% of the population to die on their 30th birthday instead. That brings the average life expectancy to 73.75y.

Now imagine a bunch of medical breakthroughs bring the 30-year-old mortality rate down from 25% to 7%. That enormous difference brings the average life expectancy to 85.45y.

That's in increase in life expectancy just shy of 16%, despite the fact that it comes from a 72% reduction in 30-year-old mortality rates.

That's obviously a massive oversimplification, and real distributions look different, but it illustrates the problem with just looking at average life expectancies; it makes it look like everyone's life span has just been scaled up by 16%, which is not the case. If you look at it from the perspective of, "what are the chances my life will be cut short by some preventable disease?", the magnitude of the change is much greater. Some of that change is due to very cheap innovations like bread-mold-as-antibiotic, and some of it is due to very expensive innovations like organ transplants. Either way, I for one am glad those days are over, despite the appealing economic simplicity.

"If - like in pre-ww2 America - instead people saved up for the inevitable doctors visits and paid out of pocket directly to the doctors and hospitals, costs would be FAR lower both due to competition and price sensitivity."

So like, real question here... How does would that work if you're poor, chronically ill, have cancer, need an organ replacement, have HIV, etc? How do I know if I'm getting my money's worth, given I do not have medical education? What happens if I can't make a choice of what services I consent to because I've been rendered incapacitated due to a medical emergency?

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