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Comment by ta1234567890 | Hacker News Reader

Off topic but on the same line. One of the most annoying things about being a consumer in the US is the ubiquitous unknown-until-last-minute pricing.

You rent a car, you don't know what the total is going to be. You go to the hospital, you don't know how much you're going to have to pay. You book a hotel and don't know the total until you check out. You go to a restaurant and even if you order just one thing and saw the exact price on the menu, that's not going to be the total. You go to the grocery store, see all the prices on the items, add them up, and then when you go pay, surprise!

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Have you ever bought a house here? You go through a 1-2 month (minimum) process of providing financial documents from the past six months or more to mortgage originators, and no one can tell you how much to bring to closing until 24 hours before. It’s insane.

It is crazy. Not a house, but friend had a baby in SF/Bay Area. Neither the hospital, doctor or insurance would tell them how much the delivery would cost, not even an estimate. It took a whole year after their hospital visit to get the bill, it was $85k for a c-section and 3 days at the hospital. Fortunately their insurance took care of most of the bill. But can you imagine getting a surprise bill for $85k a year after the fact? Or not having insurance? Terrifying!

We have two kids (in NC, US)), both were c-sections, we had insurance on the first one, but because she was born in Feb, we had to pay the deductible twice, because even though it was the same pregnancy, it was "over two billing years". And even with insurance we still ended up paying the rest of the bill over 3 or 4 years. Second kid was with no insurance, I think we'll finish paying that one when he turns 10 years old. I don't know about other areas in the US, but around here you can at least setup a payment plan with the hospital and they are 0% interest rate.

Don't get me wrong, I'm not a fan of insurance companies, but they seem pretty up front with the fact that deductibles are based on date of service rendered.

They are, but it's still dumb. It puts extra demand on the medical system in December as people try to squeeze in their elective procedures in a year where they already paid their deductible, and it incentivizes you to not get care early in the year in the hopes that "it just goes away" and then sometimes it gets a lot worse and costs a lot more than if you had just gone in the first place.

Deductibles should be a rolling 12 month bill. If you have something major in December you should be good until next December. This would eliminate all of the issues with deductibles rolling over on Jan 1. It would even bring extra profit to the insurance companies because people might decide to stick with their provider another year since "I already made my deductible until November".

I narrowly avoided that issue when my kid was born late in the year. But yeah, you end up paying almost double for the same thing because of the deductible and out of pocket max resets in the new year.

That said, I was able to take advantage of it by making sure my surgery was scheduled before end of year. Ended up paying something like $200, rather than $1500 if it had happened in January.

Random comment - UCSF will now provide a billing estimate for procedures. They actually look up your coverage and figure out the out of pocket for you based on deductible, co-insurance, etc.

I did this and it was pretty close.

Of course, they don't make any guarantees that's it accurate. But hell, it's a start.

It's worse than this suggests.

If they couldn't provide an estimate because unexpected things happen and they can't predict all services that will be required, that'd be one thing. But they can't even provide a list like, "if you need an aspirin, that costs $X. And if you need..."

Well that is actually a pretty tough one. How are they supposed to predict how long the delivery will take or whether the mother will need a c-section? Even if the hospital were able to perfectly predict all of the procedures and line items they still would not be able to tell you what you, the individual, would ultimately pay. Even if they know your insurance information they still would not know how close you are to hitting your deductible or annual out of pocket max. There are a million different things that eventually go into figure out what the end "customer" will actually end up paying.

And just because they "billed" your insurance $85k doesn't mean they were actually paid $85. Billable vs allowable and all that mess.

However, if you went into the hospital and asked for the cash cost of a routine procedure they very likely would be able to give you a close approximation to what you would end up paying.

> How are they supposed to predict how long the delivery will take or whether the mother will need a c-section?

In their case it was a scheduled c-section. In any case they can at the least give you a range: min-max.

Additionally, hospitals keep very accurate track of their c-section rates, so even if they are not able to predict yours in particular, they can definitely tell you what your odds are ahead of time.

And, there are other countries and healthcare systems in which they internally take care of the stats/metrics so that they make a decent amount while you pay a reasonable amount that they tell you before you choose to get the procedure.

The hospital doesn't tell you the estimate of anything because they are afraid of the liability (or maybe just accountability).

It's just lazy or maybe too convenient, to say it can't be done. I mean if already health insurance companies can give you a fixed monthly amount to pay, then they know very well how much it's going to cost them, why not tell us?

> And, there are other countries and healthcare systems in which they internally take care of the stats/metrics so that they make a decent amount while you pay a reasonable amount that they tell you before you choose to get the procedure.

That's a difference in the financing system, which hospitals have about as much say in as consumers do.

The insurance companies (including government payers like Medicaid and Medicare) don't just control reimbursement, they control what providers can bill to customers, too. And that includes (by usual and customary charge rules) influencing what they can and need to charge to customers that aren't even being reimbursed by the payer in question.

>no one can tell you how much to bring to closing until 24 hours before. It’s insane.

In some ways, yes.

In other ways, it's insane that people are able to borrow 5-10x their average annual income for an item (the house) that they have very little expertise in analyzing. In that sense, it's a process that is surprising it works at all.

Nobody is mortgaging 10x their income. You'll have tough time getting 5x.

That doesn't sound right. You can definitely get a million dollar loan with $250k down on a $200k salary. I'd say it's pretty common. My friends own homes and fall into that category.

That’s 5x, actually less because of the deposit amount.

That's the point.

> You'll have tough time getting 5x.

5x isn't tough. It's easy. In fact, better.com will give it to you right now.

Ok, fair, but for the 80%+ of the U.S. that aren't high income earners 5x won't be as easy. I obviously didn't include a ton of nuance in my original post.

Wouldn't that make it a $750k loan on a $200k salary? So 3.5x

No. A $1 million dollar loan. So that the house you buy is then $1.25 million. If you have the money, try it on better.com

It’s insane.

You spelled "profitable" wrong.

This site seems pretty decent: https://www.bankofamerica.com/mortgage/closing-costs-calcula...

Your bank should be upfront about their lender fees, points and origination costs.

Third party fees are either fixed or a simple percentage of the sale price.

The rest can be tricky, but should not be a deal-breaker for a new homeowner. Basically you are just paying the expenses for a short while up front. Interest through the end of the month, real estate taxes through the end of the quarter, Home owners and mortgage insurance and real estate taxes for the escrow account to cover 2-3 months.

According to the FTC, [1], price transparency could supposedly harm competition, and it could drive companies towards price fixing.

[1] https://www.ftc.gov/news-events/blogs/competition-matters/20...

The last time I attempted to get a quote on how much a medical visit would require under a PPO, I couldn't. The price was literally unknown, and seeking medical attention meant unknown, unlimited liability.

The FTC article you cite is actually in favor of the type of transparency lamented by the comment you are responding to.

> The staff comment explained the risk that the latter type of transparency might harm competition by enabling competing providers to coordinate or collude on price

Where "latter type" referred to "plan structures and contracted fee schedules between health plans, hospitals, and physician service entities." (The "former type" was "actual or predicted out-of-pocket expenses, co-pays, and quality and performance comparisons of plans or providers" which is what would effect parent's experiences; the FTC "encouraged" that type of legislature.)

I don't necessarily agree with the FTC here, but their comment isn't covering the lack of information that causes consumers have no idea what the bill is until they've already incurred the bill.

> under a PPO... seeking medical attention meant unknown, unlimited liability.

Most, if not all, health plans in the US have annual out of pocket maximums on the order of $10,000 per individual.

Ah, that's a fair point, "unlimited" was a bit strong. The last PPO my employer offered has a maximum on the order you cite. (It does have a few exceptions and situations it doesn't apply to, however.)

My own experience here is driven by having gone in for what I expected to be a $50-$100 visit (a doctor took a look at my vocal chords); it was $4,000. How that is justified, I still don't know. (Thankfully, insurance covered some of it, but for such a minor visit, it was still way more expensive than I expected.) I don't know that "well, it can't be more than $10,000" is much comfort when you're walking in for something that seems minor, such as lingering effects of a cold (this example) or an infected finger (I was unable to obtain any pricing for this, prior to the visit).

A few years later, surgery would have cost me ~$300. (But that was under an HMO. And I got a quote, in advance!)

(While my initial post specifically mentioned PPOs, as that is what I'm used to, there are also those without insurance, which doesn't have the max out-of-pocket of an insurance plan.)

Are you saying that if you get a $500k[1] bill from the hospital, "most, if not all health plans in the US" will cover at least $490k?

[1]: Given that a mere c-section (30min, super standard procedure) + 3 days at the hospital can be $85k. It's probably pretty common for hospital bills to exceed a few hundred thousands for anything more complicated or requiring a long stay at the hospital.

Yes, that was actually passed as a part of ACA, which set requirements for maximum out of pocket for ACA-compliant plans.[1]

For 2020, it's ~$8k for an individual and ~$16k for a family. Most non-high deductible plans are a few thousand for an individual and high-deductible plans can be close to $10k.

[1]https://www.healthcare.gov/glossary/out-of-pocket-maximum-li...

Yeah. So when you don’t have insurance or your insurance plan has an issue and doesn’t cover the absurd bill you got that is incentivized to be high because of this system, you can be royally screwed. I think medical is the biggest reason for bankruptcy.

Around 10% of people don’t have health insurance. I’d be surprised if there aren’t some crappy health insurance plans around for another portion of people that ends up not covering enough when things go bad.

Excuse me, but WHAT

Price transparency can harm prices. Competitors can use it as a mechanism to signal appropriate prices to each other in order to reduce pressure to reduce prices. It's highly industry/context specific but transparent pricing does not always mean better pricing. In fact, in limited contexts, price fixing can lead to better pricing.

I think Westinghouse was the big FTC price-transparency-can-be-bad case.

That's orthogonal to the post's issue, though: he paid exactly the price he was quoted for services rendered; that he didn't understand the services he was consuming isn't really Amazon's problem but it's great they jumped in to help a $0 account (which, of course, was self-serving)...

Transparency to customers cannot be harmful in a free market. Nobody is asking for the full cost structure to be published.

Price fixing will only happen if there is no actual competition for customers, otherwise being the cheaper service is the easiest tool to increase your share of the market. Besides, isn’t that already the reality with prices being fixed in partnership with insurance providers?

The context of the FTC article is healthcare.

There are simpler mechanisms for communicating price fixing - like saying "we won't be beaten on price" - that don't need to mention the price at all.

Agreed. Pricing transparency in healthcare has been wonderful for pricing (see The Atlantic's Fallow's article).

My point was that pricing transparency is not a panacea. It seemed that some people were reacting as though pricing transparency is a magical salve.

AWS: In my experience, AWS pricing has been transparent and great and they generally take steps to keep you from foot-gunning yourself. This article discusses a case in which the author foot-guns himself using a predictable mechanism AWS can't really prevent. I'm unsure of what else AWS could do to protect him from himself... (Anyone can throw out simple solutions without understanding S3's implementation complexity: they could seriously throttle their own product! ... but that might be seriously complicated and might hamper the value of the product to others. Besides, if you buy a M1A1 tank, you should be very careful about using it: it could use tons of fuel... He bought an M1A1, left the keys on the dash and then was surprised when he found got a huge fuel bill...).

They could allow pre-paid plans.

Jesus Christ. Do they employ economists at the FTC? That’s a horrifying bullshit argument to be coming out of a federal agency.

LOL!

For those who don’t know, the issue in the US with not knowing the hotel or car rental costs is typically taxes. Different places have different taxes and those are often not shared at the time one books.

I’ve been using fixed price services (they exist) just so I don’t run into what Chris did. They aren’t evangelized as well.

That's just the excuse for doing it. But tax rates are known ahead of time, they could just add the tax to the price and put it on the sticker, just like pretty much every other place in the world does.

In my opinion, it's a very deceiving practice that could definitely be fixed if businesses really wanted to fix it. But there's no incentive, because if you show your prices including tax and fees, they'll seem more expensive than the competition.

In the case of hotels, my experience is that with a lot of them you book online, pay the total, but then when you go check out, they've added some extra fees. Sometimes this happens before booking, you browse the options and choose based on price, but when you go check out, the total has changed because they've added not only taxes but some other fees as well. My most recent experience having this issue was with AirBnb just two days ago.

Taxes are different in France and in Spain, and all the prices in every place will show you the price of what you're doing, tax-included. One can move freely between the countries, use the same currency, and settle down in either place (given you're in the EU). This works despite the languages being different, and the governments being different. It also happens to work in quite a few more countries too.

I think I'm missing something when people use the excuse of "taxes are different in different places" to say "we don't show taxes out of habit, or because it requires us to change our signs".

In the us the tax rate can change city by city. Even Up code is not enough to know the tax rate. :-/

The store/business still knows ahead of time the exact tax rate for what you are buying at the location you are buying it. So that really is no excuse for not disclosing that info pre-purchase.

> In the us the tax rate can change city by city.

In Brazil, the tax rate also changes city by city, and the price shown to the customer already includes that tax (together with the state tax and the federal tax).

If they rental agency is paying those taxes then they are aware of them, have them entered into their CRM, and can inform you anytime by pulling a simple DB query. There is no excuse in 2020 to not know exactly what the price is and keep that from your customers.

I deal with reputable rental companies. The rental price is based on demand but everything else is a known quantity. I’ve never had the quote priced higher than the online quote. And in a few cases I’ve had it go down by using certain credit cards or loyalty programs.

Hotel I agree, Rental car less so: the final price always seems to be about 2x the advertised daily rate so I think there is more at play than taxes

There are a ton of fees added on to rental cars, especially when you rent at the airport, in addition to taxes. I wouldn't have said 2x the base rate but you can definitely hit 30-40% uplift. When comparison shopping rental car pricing, you absolutely have to know if it's the base rate or the all-in price.

Hotels have some of this but the overall uplift is usually a lot less--at least until they start adding "resort fees" to otherwise discounted rooms.

I always paid in advance, and never noticed this.

I'm not even a tech person and I know that AWS has an option to set billing alerts for whatever amount you want. Damn sure I'd be setting those up if I wasn't 100% sure I knew what I was doing (is anyone ever 100% sure?).

Problem is, it's alert after the fact. And it doesn't actually stop.

Unless you have scripts in place to nuke everything (which you will have to develop yourself since aws doesn not supply them), you have to manually login, and try to shut things of, while bill goes chaching

I always use ADAC (German AAA equivalent) to rent cars, especially for the US, and prepay them. They then send me a PDF that tells the car rental clerk in German, English and Spanish that they are to provide exactly what the voucher says and no further options, like prepaid fuel or supplemental insurances (ADAC rentals include 1M EUR in liability and comprehensive insurance).

The only suspense left is whether I get the compact I signed up for, or some monstrous SUV because they’re all out of more sensible options. A few hints about how bad I am at backing up anything larger than a Camry has gotten results.

Aside from things you order in the room or charge to your room, what is changing on the hotel fees? Typically they are quite straightforward, unlike rental car quotes. You can even pre-pay.

Are you referring to taxes and tips? While not always visible, they can be calculated.

The last time I booked a rental car or hotel, I paid exactly what I was quoted at booking time.

Can you point to some European hosting services that have an upfront cost regardless of usage?

Yes: OVH [1]. They sell by bandwidth rather than by data transfer, which is by far the biggest variable in cloud usage.

[1]: https://www.ovh.com/world/dedicated-servers/rise/rise-1/

I use the small glesys.com and pay for the box with a capped bandwidth.

If my blog or apps are slashdotted (or HNed or whatever we should call it nowadays) they just load slower, degrading gracefully, and never stop or return an error.

They used to have transfer based pricing but then moved to bandwidth based, reps said to simplify billing. Their new KVM service gives you 1g burst and 100mbps average by default. https://glesys.com/vps/pricing is very straightforward.

At my previous employer we migrated to them and were very happy with the VMware infra they provided.

Since It's a Swedish company one can look into their economy to see that they're not going anywhere. https://www.allabolag.se/5566479241/glesys-ab

hetzner.de

I don't recommend them. We used to host an online text game there (MUD) and when one of the players decided to DDOS it, Hetzner just pulled the plug. I moved to soyoustart.com (it's OVH brand) - in following month they sent a couple emails about the server being attacked and that they're trying to mitigate the attack, but game kept working.

Yes they are quick to just drop all traffic to hosts being attacked, that should be noted. Ovh is putting in a little more effort but will also nullroute your IP if it's getting too bad. Generally the hetzner network seemed more stable and less congested to me though.

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