We pay for socialized healthcare, and then some, it's just that most of us don't get it.
I view the problem as impossible to solve until there is a collapse.
[1] https://en.wikipedia.org/wiki/List_of_countries_by_total_hea...
[1] https://www.commonwealthfund.org/publications/fund-reports/2...
[2] https://www.washingtonpost.com/world/2021/08/05/global-healt...
If a workplace or insurer says to a hospital “if all these people come for a checkup, what can you do in pricing?” Is that something that should be blocked?
Hence the fact that, as the article documents, people routinely are getting charged more with insurance than the cash price they would be charged with no insurance. (If you tried to pay the cash price then it doesn't count against your deductible, so it would be rare to do that.)
There was a serious effort by health insurance to restrain medical spending with the HMO/limited medical network era of the early to mid-1990's, which led to a massive pushback from people who hated having to change doctors all the time. In large part because they were so widely hated that no one has tried to revive them (modern HMO's are not nearly as limited in networks) they also were the one period in the last 40 years when medical cost growth was held down.
I think what we have there is a very expensive medical school system. And things snow ball. Especially given a doctor role. A doctor studies and goes through practical training a good 8 years. That's college/uni + health center fees that stack up with interest over a long period of time.
Doc then needs to make a living in accordance to his past effort, more than a living, get enough to earn the status he deserves. Now the thing is, taxes accounts for a lot given the high band income. So we could say the doctors are earning too much, but reality is 70% of their gross income goes to multiple tax tiers. 1/ income tax 2/ debt pay back 3/ insurer, continous training fees and other things that are sort of imposed on medical professional.
I'm not a doctor, but I couldn't figure out how even a surgeon could justify such high pay, in the million dollar per year in many US positions. But looking comprehensively as the taxes imposed on them, everything makes sense, all they have left is 200k per year. Cashiers and other clerks earn a quarter this amount, but that's for any less than what doctors are making not many would go through all these hops and be privileged enough to even take the risk of such a financial investment.
The argument that many doctors come from wealthy families doesn't invalidate the simple fact debt still exists and somehow needs to be paid back, and in most cases it does get paid back.
Solution? Get rid of income taxes, make medical schools optional to practice, just make exams open to any participant, affordable education channels will pop up by themselves. Don't regulate medical malpractice, practicians should rather have their lives ruined instead, it's actually a stronger incentive to proper practice than having a big insurer paying the millions in settlement cases.
The medical sector is far more tied to other industries and regulating costs than it looks. I only included 3 obvious contributors to high staff cost, there are numerous supply chains to look at to also account for other spendings that seem unavoidable but in reality pointless for health care.
"When reality doesn't confirm your axioms, double down on the axioms" puts the fundamentalist in market fundamentalism.
The argument is against free market rules . Sorry if that wasn't made clear to you.
The premises are that in a rather laissez faire market, prices are obscured and tend on the over profiting side. With competition not actually leading to the outcome one would expect in a free market.
One pays 100 bucks,another pays 700 bucks. And an RMI shot ( decades old tech ) still costs thousands of dollars.
Edit: can't write proper English with auto correct.
All those make society worse. Alternatively: - subsidize or cap education fees so that students don’t go into crushing debt - reduce inefficiencies resulting from a for profit insurance system by switching to a single payer social insurance system - cap malpractice claims and put in better controls against frivolous lawsuits - doing all this also lower doctors wages
It doesn't need to be argumented against anyway, the economy cannot take much more tax levels, we are probably defaulting on paying taxes we are asked to pay at this point.
In a free market. Cut the imposed taxes, and let people be judge of which service they want to purchase given clear pricing.
Society worse? See the handling of the pandemic, I don't think the source of the problem comes from lack of regulations.
I would like a source for that. The US median household income is ~$66k.
I say a quarter, the source is me. Based on commonly known compensation information. A cashier earns anything between 25k and 70k. That's common knowledge. Source : go check what brick and mortar shops would pay you for a full time position operating a till and saving Hello thank you good bye to customers. You will get minimum wage all the way up (or down) to over (or below) median wage in certain cities in particular shops, or simply generous (or greedy) owner who don't follow wage market trends.
The comments on this thread are interesting. Counter post are very pedantic rather than argue the substance of comments
I would get rid of government medical licensing and setup third party accreditation.
The point is that there’s no magic bullet here. There’s no mustache twirling trillionare villain that we can shut down and get the UK’s spending numbers.
Cutting healthcare spending significantly, which I think we should do, would cause hardship for a huge number of people and entire regions on the country.
There’s real truth in the parable, but what it doesn’t get at is the transition costs in human misery of getting from an economy based on breaking and fixing windows to a better one.
Yes there is actually. If there was political will to do it, simply cutting off the insurance companies out of the loop will bring costs nearly in line with the rest of the developed world. The insurance companies provide no value (they're not doctors), all they do is add their overhead to profit from the work of the doctors and nurses.
And cutting healthcare spending would provide prosperity for many more.
A friend of mine used to work as an independent advocate for sick people in NYC. Basically people who were getting screwed by some aspect of the American healthcare system would pay her to do nothing but deal with bureaucratic red tape and bullshit. Like a healthcare lawyer almost. And of course she saved people more money than she cost, so she was constantly getting new clients. She only stopped because it was soul sucking work and incredibly depressing.
Now let's imagine a system that's so broken with bureaucratic BS that it makes sense to hire someone for this. All of the 'healthcare workers' that my friend would speak with on the phone for her clients were essentially overhead and only necessary because the system is geared more towards ripping people off than actually helping anyone.
We don't need any of these bureaucrats. They can all be fired.
Half of $4T/yr is $2T/yr or over $415K/yr for the average nurse or doctor.
So, either “vast bulk” is well under half, nurses make a ton more than I think, or some assumption above is incorrect.
It could be this - plenty of nurses make well over $100k, plenty of doctors make well over $500k. It varies a lot based on location, specialty, overtime, but there are some good livings being made.
If so, that could account for a lot of the "worker compensation".
But, the median wage for a medical doctor is <$250k in the US. I would be surprised if the pay amongst doctors is so unequal that the average is making >$500k.
That being said, there are a ton of people who work in hospitals beside just "doctors and nurses".
I wouldn't be surprised if all this factored in was close to 50% of the total pay.
20% of $4T is $800 billion. There are ~209,000 primary care doctors in the US (https://www.ahrq.gov/research/findings/factsheets/primary/pc...), not counting specialists, etc. Each doctor therefore is responsible for ~$4M. Assuming for no reason whatsoever that specialists and outside labs, etc., take 50% of that, each doctor's practice gets $2M. Making ye olde "everybody costs $100,000 / year" assumption, that works out to 20 people including the doctor: nurses, receptionists, lab techs, janitors, etc.
Doesn't sound terribly unreasonable.
$2T/yr divided by just the 9.8 million = 204,081, which puts average comp in the 160s. Sounds right; around here your average nurse makes about $80k/yr with excellent benefits, and they are sort of the median employee.
And that's just the employees providing care. There's also an enormous bureaucracy.
Good luck incentivizing the smartest kids to go through the torture chamber that they have to in order to become a doctor without the high pay potential. I suspect, proportionally, many smart parents and kids have already chosen to avoid careers in medicine due to the coming squeeze in pay.
The better way to decrease labor costs is to increase labor supply. Make it so you do not have to sacrifice your 20s to become a doctor. Make it so kids are not looking at hundreds of thousands of dollars of debt by the time they are a doctor and in their early 30s when they need to be thinking about starting families.
There is no physical limitation why we cannot start preparing kids for careers halfway through high school and have them working by 25. Or why residency spots are so limited so there is a cap on how many doctors are added.
I’d rather have the smartest kids go into a field where they can do work that impacts millions or billions of people.
Anyway my point isn't to prove you wrong (picking random numbers and doing random extrapolation won't do that), but just to say that your point, will reasonable on the surface, probably needs to a bit more analysis if one is to take it too seriously.
edit: I would really appreciate the downvoters' thoughts. I'm really failing to see the fault in my thought process here. Please enlighten me.
However, I stand by my original claim that most doctors aren’t doing the kind of work that we collectively would want the very brightest people to do, if we had the choice. It’s just not leveraged enough.
Doctors, however, bring in money and can generate revenue. Their decrease in pay would probably be via quality of life at work. The biggest complaint I see lack of autonomy and being managed like a cog in the machine. Most likely, individual doctor will have no negotiating power with the people that pay them (governments and managed care organizations, aka insurers). Therefore, they will need to become part of a doctor group, usually as an employee. If you are at the bottom of the totem pole here, the employer is probably going to want to squeeze as much out of you as possible. Expect this to vary based on how desirable the area is you live in and how many competing doctors there are.
I also see many healthcare groups using nurse practitioners and physician's assistants far more than before. So when you go in for a healthcare visit, you will not actually see a doctor, but rather a PA/NP, who is (supposedly) under the purview of a doctor. But I am not aware of any standards that would prevent a doctor from having to be in charge of too many PA/NP that quality would start slipping, so I presume the workload will get higher and higher if doctors do not have much leverage with the employer. Again, probably will vary on how desirable the area the doctor is in and if the doctor's employer can choose to be picky or not.
I am very interested in your definition of the word “market”.
Linked from https://www.cdc.gov/nchs/fastats/health-expenditures.htm
In 2018, hospital care is about 33%. Professional services (physician and clinical services, 20%, dental services, and other) is about 26%. Retail medical products is 12% (prescription drugs, 9%).
Net cost of health insurance is 2.6%, which is "Difference between premiums earned and benefits incurred. This is the amount of health insurance spending attributed to nonmedical benefit expenses such as administrative costs, additions to reserves, rate credits and dividends, premium taxes, and profits. This category includes the net cost for private health insurance companies that insure enrollees in Medicare, Medicaid, CHIP, and workers’ compensation (health portion only)."
It would be nice to have a breakdown of hospital budgets, but I cannot find any.
At a naive look, if insurance cost would be less than 10% of the final cost of a service (assuming that a generic service can represent health cost in general), one would expect the difference to be in that range - but the article shows a much higher variance.
Any credible source for this?
Most of the cost is actually going to those who profit from the system without contributing any actual health care. That is, very much not the actual healthcare workers.
When you see a doctor for 15 minutes and get charged $300-$400, the vast majority of that money does not go to the actual doctor. It's the overhead people, the administrators and the insurance company who are taking most of the money.
Please be more specific. What fraction is spent on front line value add labor, like doctors and nurses, vs administrative flak?
She works longer hours than I do. Her work is much more stressful (literally, life and death decisions almost every day). She can be sued for malpractice while I can only be fired for my screw ups. Her Medical education (undergrad + MD + medical residency) took three times as long as my Engineering degree with much larger student debt at the end.
And yet, as an SWE I make more money than she does. American doctors and nurses are not overpaid, certainly not if compared to the SWE crowd at HN.
American health care is a chaotic poorly organized mess with lots of money simply going to waste. Bringing an order to it (single payer system is one example) can restore some sanity, fairness and financial accountability.
What does this look like? Is there money going into the system that’s not going to anyone / any company at all?
> What does this look like? Is there money going into the system that’s not going to anyone / any company at all?
It means that money efficiency and productivity are low. A surgeon is idling because an OR is not setup because stuff is poorly organized, etc. It was mentioned in this thread already that with similar outcomes US healthcare costs are way higher than comparable systems in other countries. Low efficiency per dollar is a money waste.
EDIT: formatting.
See also: https://en.wikipedia.org/wiki/Health_system#International_co...
The sums are so high we are in macroeconomic territory. There may be a few billionaires with private jets and yachts here and there but this is a detail, we are in the trillions here. It is money that moves around, making the livehood of millions of people, you may be one of them, and it it is not the case, probably one of your friends and relatives.
So what? Are doctors too well paid? Are health institutions inefficient? Are there too many useless medical procedures? Where is the money going where it shouldn't go? Or maybe it is just the price of really good health care.
https://www.healthsystemtracker.org/health-spending-explorer...
>Are doctors too well paid?
https://www.medscape.com/slideshow/2020-compensation-overvie...
https://www.kaptest.com/study/mcat/doctor-salaries-by-specia...
Based on what US doctors have to go through to start earning that pay, I would not say they are paid too well given the alternatives available to a person smart and driven enough to become a doctor in the US. For example, I would advise my kids that finance/tech/law/engineering has better a better pay to lifestyle ratio than becoming a doctor. Giving up your 20s and early 30s is an enormous sacrifice.
>Or maybe it is just the price of really good health care.
I suspect this is the price of a small number of people getting really good care, while a somewhat larger number of people get decent care, and then a very large number of people get (or do not) get care, and when they do, it is with very high variance of quality.
However my wife is a doctor who is fellowship trained, so she didn’t start making real money until she was 32. But she made a good bit above the median salary for many years before that. She also doesn’t feel like she sacrificed her 20s. She had plenty of fun, although she says med school was much harder than her engineering degree.
And now she makes much more than I do as a principal engineer, and she works less than 30 hours a week.
She doesn’t have to worry about interview prep or job hopping. She has absolute job security in any economy. She gets paid for continuing education. She is highly respected (people are much more impressed that I married a doctor than that I’m a principal engineer lol).
There is a legal framework protecting her autonomy and decision making at work. Not even the CEO of the hospital can overrule her.
In short, she is almost completely above the rat race, and is a true professional in ways that we (software engineers ) are not.
I would 100% recommend our children become doctors.
On the other side, politicians are doling out what responsibilities that were previously restricted to doctors to nurse practitioners and physician's assistance, effectively using 1 doctor's license (and liability) to increase the supply of healthcare (effectively lowering the quality of healthcare since you are no longer being seen by a doctor).
https://www.nationalreview.com/corner/the-overproduction-of-...
But I wouldn’t recommend my kids go into family medicine. If you’re say a pediatric emergency medicine doctor, or a maternal fetal medicine doctor, there just aren’t enough of you to be just a cog.
Increasing the number of mid level practitioners has been happening for a while, but it hasn’t had much impact on salaries [1]. My wife isn’t concerned.
Edit: I noticed that you already mentioned this in your other thread.
Also in the US physicians salaries are also directly paying for physician training thanks to large student loans unlike in many other countries.
I deal with surgeons from time to time through work. Maybe their training is hard but being a surgeon is pretty much an almost guaranteed ticket to becoming a multi-multi-millionaire. These guys are extremely well paid.
There's a few issues here. First, surgery can have bad work life balance depending on the subspecialty. Some spend a lot of time on call, some basically work 9-5 or less.
Second, unlike basically every other very high paying profession, surgery requires working with your hands, and physical and mental stamina to endure hours of operating. Just getting through med school requires above average intelligence and hard work, but you don't need to be a super genius. The abilities that make someone a good surgeon don't necessarily translate to any other profession that is that highly paid.
Third, surgery is a very direct path to what most people would consider serious wealth for someone who is smart enough/hardworking enough to get into med school, but didn't necessarily get into one of the top tier schools that some of the other very high paying careers recruit from.
All that aside, surgery isn't the only specialty that is very highly paid.
> that allows them to work a Mon to Fri 8 to 5 job
Many very highly paid subspecialties work Mon to Fri 9-5 and some even less.
>maybe even work from home
Radiologists routinely work from home, and there are remote opportunities for other doctors as well.
>and live in a popular city as opposed to living in a less popular area (many doctor's get paid more for living in less popular areas, for obvious reasons).
That is only true for certain specialties and subspecialties. My wife's sub speciality requires her to live in cities with a population of at least 500k or so. Many of the very highly paid subspecialties are similar.
Even for family medicine the difference is only 5-10%.
Another huge chunk is spent on the bureaucracy of administrating the payments system, with patients, hosptials, insurers and general practicioner offices all fighting over payments. This is a deadweight cost that other systems don’t have to carry.
Drug costs in the US are much higher than elsewhere, as (I understand it) medicare & medicaid are prevented from negotiating the prices they pay the in way national healthcare systems do in the EU & a myriad set of obfuscatory tactics are used by drug companies to maintain much higher prices that are achievable elsewhere.
& probably lots of other little things too. But those are the big three I think.
I am not sure how to fix this but an important first step would be to mandate full transparency of all pricing. In addition the same service should cost the same for uninsured and insured patients. Same for in- and out-of-network billing.
Right now a patient basically has no way of navigating this. Even if you are insured there is a much greater than zero probability that you will get hit with some random charges you could not have anticipated. You just have to hope for the best when you go to a hospital.
- $4,089 "Transfers from government domestic revenue" (Medicare & Medicaid ?)
- $3,642 "Compulsory prepayment" (ACA private insurance ?)
- $1,267 "Social insurance contributions"
- $1,626 "Other domestic revenues"
Again, I'm not from the US so I don't know how to interpret those numbers. But it seems gov spending is >$4,089 which is already higher than most western countries with national health insurance.
[1] https://apps.who.int/nha/database/country_profile/Index/en (select USA)
[2] https://apps.who.int/nha/database/Select/Indicators/en (in indicators select everything under 'Health Expenditure Data' > 'Revenues', country USA, all years, unit 'current US$ per capita')
And since no other country with a huge diversified economy is willing to run external deficits large enough to meet foreign demand for reserves, the dollar is pretty much the only good choice. There just isn’t enough gold to clear trade in a $80+ trillion global economy.
This is merely viewing the same thing from a US-centric perspective. From a rest of the world perspective, the largest competitors in EU were destroyed in WW2 (deservedly so imo), China was nowhere and India was impeded first by British colonization and then by Bretton Woods which only focused on EU nations.
America is ahead but make no mistake that the gap is large only because WW2 destroyed other nations and Bretton Woods system was the first step in prevention of other nations from building up rapidly.
In places where public healthcare exists, there is also a huge amount of voluntary personal health responsibility. People look after their health, and expect the same of their neighbors. The current state of Americans would be an unreasonable burden on public healthcare.
That being said, taxes pay so much for healthcare, that we'd probably still be able to pull it off.
That's a cost that is incurred towards the end of life without any 'trying to prolong life' involved, a surgery to do the repair is frequently going to immediately make the person more comfortable.
And there's all sorts of similar things that just happen more often to older folks.
Don’t look to us for any ideas how to do your healthcare!