Comment by jswinghammer | Hacker News Reader

Comment by jswinghammer | Hacker News Reader

I would list a few reasons that US health costs are so crazy:

1.) Insurance drives up the cost and hides true costs from consumers. What we buy isn't even insurance it's pre-paying for health care (thinking of HMOs here). My wife took medication for awhile that was $50 a pill. We paid $100 for 3 months worth of the stuff. Those true costs are hidden from us.

2.) You can't outsource it to China or India. If you've been to a Toys R' Us ever you will notice that every toy there is pretty cheap by any standard that you'd want to use. The reason is the cheap outsourced labor. If you want stuff that isn't made in China you end up paying prices that are much higher and more consistent with what you'd expect from the rate of inflation in the last 30 years.

We've been engaging in a devaluation of the US dollar for the last 30 years (continuing a trend that's been happening since 1910). Those new dollars have to end up somewhere so they end up in cost of medicine, lawyers, computer programmers, etc. As a computer programmer it benefits me but after meeting some family who are in less in-demand fields times are tough even for those who have jobs.

It's a mistake to think that market forces work in healthcare. When your doctor says you need a test or a certain prescription, and here's where to get it, you listen to your doctor. You don't haggle with him about where and how much. Dealing with our medical system is difficult enough without having to shop around while you're sick.

This wan't your point, precisely, but I just wanted to point it out.

The times when I have had a high-deductible health insurance I definitely want to know about the prices, but it's hard to get that option, because the doctors assume that you aren't paying for it. Do I really want to pay $100 for an X-ray of my teeth? Not necessarily: last time the dentist said my teeth were great and they are feeling fine to me, so maybe I don't need an X-ray every year, but they don't ask if I want a $100 X-ray, they just tell me to do this and that and then charge $100. I went to one doctor for an eye exam and they charged me $350 because they assumed I had insurance. The same exam at another place cost $50. You could make your same argument about car repair (when you're car isn't working you just want it fixed), but there the standard practice is the give an estimate. In fact, places that do work without asking you and then charge you for it are looked at as shady.

When the patient doesn't personally pay for the service, the cost of the service has every incentive to go up. Is the service better? Generally, yes. Is the "better-ness" necessary? In the case of my teeth, probably not.

Doing an X-ray every year even when it is not needed, does cost more and does not improve your health. Actually, your body gets more doses of radiations increasing the risks. Thus one can say that at the more expensive place your health gets worse.

Yeah, but you're talking about the most bland of the bland sort of health concerns.

Emergency medicine, life threatening medicine, you don't shop around for the lowest cost, cause you won't be able to be happy about how much money you saved when you're dead.

Not all healthcare is a surprise emergency. Auto insurance covers collisions, but it doesn't cover oil changes or gasoline.

I agree with your point on "pre-paying for health care". If health insurance was really an insurance, only covering unexpected occurrences, like a car accident, while people had to pay out-of-pocket for normal expenses, like doctor's visits, you'd likely see a significant reduction is costs as people couldn't afford the currently astronomical prices and demand would dry up.

I also believe an issues with the health insurance industry is that businesses are their primary customers, not consumers. That substantially reduces competition and incentives to provide good customer service and rates. If insurance was not provided by the employer and everyone had to purchase their own health insurance just like they do car insurance, I'm certainly we'd see a lot more commercials saying, "Save 15% or more by switching to Blue Shield!"

One more problem: essentially tying healthcare coverage to employment and giving all kinds of tax-breaks to employers to offer it. You're artificially limiting the population that can get coverage, increasing the risk for insurers. Also, by creating a large population of uninsured (who still have to get emergency treatments and public health safety treatments (think epidemics etc)) and you drive the cost up for others who pay for healthcare.

I would list a few reasons that US health costs are so crazy:

1.) Insurance drives up the cost and hides true costs from consumers.

[...]

The problem with this argument is that all the available evidence says exactly the opposite. Private U.S. health-insurance exposes more of the cost of health care to the patient than any other first-world health system, and yet it's more expensive than any other first-world health system (including America's own socialist insurance scheme, Medicare).

Moreover, the trend over the last 30 years or so in private U.S. health insurance has been to increase the exposure of the patient to costs of care (i.e. we pay much more in deductibles and co-pays than Americans a generation ago did). The result has not been a decrease in health care inflation. Quite the contrary, actually.

You had me until your dollar devaluation stuff, 1910 really? That was before the depression and WWII and both Brenton woods agreements. And the last 30 years have been known for historically low and stable inflation. How come everyone is a hard money fanatic nowadays? Has Ron Paul infected everybody?

You can "outsource" some of it. I know fellow Brazilians who work in the US and come back for dentists. In part because our dentists are better (or so I've heard), but mostly because they are a lot cheaper.

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