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Comment by elzbardico | Hacker News Reader

What is incredibly amazing is how much health care costs in the US. Government expenditures Per Capita are over twice of the nations like Canada, UK, Australia, and Japan. And most of this for medicare, for which only a fraction of the population is eligible.

And yet, this is not enough, and people need private health insurance. Then you look at the prices of common medications, and most of them (mind you, a lot of them made in India or China) are sometimes ten times more expensive than the SAME medications in any other developed country and even more expensive for the same medications in Under Developed countries.

It looks like the invisible hand of markets is not working here. But at the same, the political process is also blind to the real issues.

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Medicine is the most regulated and subsidized industry in the US. This is theft by regulatory capture[0]. Globalism is magically not applied to medicine, simply stopping being protectionist on prescription drugs would save consumers billions of dollars a year, it's easy, it's obvious and no politician will ever do it.

[0]https://en.m.wikipedia.org/wiki/Regulatory_capture

Not no politician. https://khn.org/news/article/drug-imports-canada-senate-sand...

Both of those guys face lots of negative press, any perceived slip up and the "other sides" journalists are chomping at the bit to call them out. In my experience the more milquetoast, don't rock the boat types tend to get the kid gloves.

We also had a president who said he wanted to implement this once. Not that he was perfect but amoung other things they fabricated evidence of some weird pee fetish and attached a narrative that Tom Clancy would consider too unrealistic to publish and repeated it on the major news networks non-stop. When you control a 1/5th of the GDP all sorts of funny little things like that seem to happen.

You're also forgetting that medicine is cheap everywhere else because US citizens pay 99.9% of the bill.

Every new medicine, every name brand medicine, every generic is paid at an exorbitant rate in the US which allows companies to provide cheaper medications to other countries. Every new surgery, every new technique, literally every part of the medical process is subsidized IN FULL by Americans.

Put it simply - if the US decided collectively we will not pay any more than cost for generic medication the entire world's healthcare system would collapse overnight. Most of the west would no longer be able to socialize their healthcare. 3rd world nations would likely halve their life expectancy. This is why, in my opinion, the US will never be able to do a medicare-for-all type situation. It's already unaffordable on the current tax basis strictly to take care of Americans. The unmentionable cost of subsidizing literally the entire planet's medical system through paying insane prices for everything makes it unaffordable even in some fever dream scenario.

When you're getting your cheap healthcare and free medicines take the time to thank your nearest American. They are dying so that you can afford to live. Your insulin is only cheap/free because some poor sap in America is paying quite literally 1400x your cost. The taxes other countries pay into their medical system pales in comparison to the amount of money Americans pour into their healthcare to keep it cheap everywhere else. There is simply no comparison to how badly Americans get bent over.

An interesting story I heard on the radio:

A father got a call from his daughter that she went to the emergency room, because she had a vitamin C pill stuck in her throat and she was scared. In NY, they are required to give an estimate of costs, and estimated $1600 for the exam and the can of ginger ale they gave her to drink so she could swallow it.

Fast forward a few weeks, and they got the bill. They ended up charging his insurance $2,200, and the insurance company valued the trip at $3,500 (presumably to bump up his co-pay? not sure).

The radio host (a lawyer) recommended reporting both the hospital and insurance company to the state regulators who oversee hospitals and insurance companies. Obviously, this is an instance of price gouging and abuse.

The question I have is, are state regulators sufficiently empowered to take action here, not only to help this family, but prevent such abuse in the future? I think the answer is likely not- part of the benefit of being so heavily regulated is they seem to get more leeway.

Personally, my wife went into an ER for a migraine that had lasted 3 days. A few drugs, an hour stay in a dark room, and we were sent on our way. This was not a busy ER; I think there was maybe one other patient there the entire time we were. After whatever the insurance covered, I was expected to pay $900. One of the drugs was given intravenously so it acted faster, but... if these had been available OTC or if doctors could operate out of pharmacies and prescribe something on the spot, it would have been so, so much cheaper.

The joys of regulatory capture, I guess.

>Fast forward a few weeks, and they got the bill. They ended up charging his insurance $2,200, and the insurance company valued the trip at $3,500 (presumably to bump up his co-pay? not sure).

This makes no sense. Insurance companies NEVER pay more than they are asked to pay. It's half the reason why medical billing is such a royal pain. A doctor or pharmacy knows they've left money on the table if they get exactly what they ask for from the insurance company.

And there's no way that increasing the coinsurance for the patient (co-pays are fixed dollar amounts so there's no "bumping it up") does anything for the insurance company. If your coinsurance is 20%, the insurance company is still paying paying 80% whether that's 80% of the $2200 or the $3500. Even if the person had an HDHP plan and was paying all of that out of pocket, all the insurance company raising the the cost from 2200 to 3500 would have done was move the patient $1300 closer to their deductible and out of pocket limits and make it more likely the insurance company is paying out more money in the future.

More likely is that the ER billed $3500 and the insurance's allowed amount was $2200.

This was a point of contention for a minute on the radio show- the host was flummoxed as well that the insurance company "valued" the trip higher than what the hospital billed for.

It's possible that the (clearly upset) father on the phone had the story mixed up, but I'm not sure that NY law would allow an estimate for a medical bill to end up being billed at more than double the original estimate. Hell, in my state car repairs can't exceed 10% of the original estimate without approval from the customer. Either way it shakes out, if the story is real the state commissioners are going to have fun with it.

On US healthcare bills there is:

Billed Amount - what the provider/health system tags as the “billed amount” Allowed Amount - what the insurer sets as the actual total $ allowed to change hands for the visit Patient Responsibility - the portion the patient is responsible for.

The Billed Amount is supposed to exceed the Allowed Amount by 2.5-5x typically so that the Allowed Amount the insurer/provider has negotiated “saves” money thanks to Insurance ostensibly in how the bill is displayed.

Put differently, your provider/health system is supposed to per the billing contract put in an inflated value well in excess of expected payment so your insurance company can reduce it so you can “save money” superficially on your bill. It is as smoke and mirrors as it sounds. Sounds like your provider / HS forgot healthcare billing 101 in this case.

The Billed - Allowed Amount value is also usually called Contractual Adjustment

> if these had been available OTC or if doctors could operate out of pharmacies and prescribe something on the spot, it would have been so, so much cheaper.

Just a tip for future cases, a lot of those pharmacies have small clinic in them staffed by a nurse practitioner. They can prescribe most things in most states. If it happens again, you can probably take her and her discharge paperwork and have the nurse write out prescriptions for whatever it is. Should be way cheaper unless the meds are something exotic that only a hospital pharmacy would carry.

It's pretty close to having a doctor in the pharmacy for anything you'd feel okay not going to the hospital for.

This is the chart of what they can prescribe per state (you'll have to look up what schedule the particular meds she needs are): https://www.ama-assn.org/sites/ama-assn.org/files/corp/media...

I've refused simply treatment from a hospital that I can just do at home. They billed me for them anyway - so I refused to pay the entire bill. The refused to budge and remove the charges, so I never paid them.

Nothing happened after that.

I've rarely gotten an accurate medical bill (vastly inflating the time I was seen by the doctor is the most common mistake), and if it's inaccurate I just don't pay.

State regulators are VERY empowered to make everyone's life a living hell.

They may not be able to beat back the general case, but if you get them involved the hospital and the insurance company will almost instantly fold.

And it's worth doing, because regulator offices work off of accumulated data - so the more complaints they get, the more they have to go on.

I had to do this once.

It gets even worse than that.

When our first child was born, in the States, it was in a birthing center associated with the local hospital. This was in its own building, but in that building they have a room they call the "ER" -- this is where they decide whether to admit you, in terms of being ready to give birth. The entire function of that room, though, is just to charge exorbitant ER rates for admitting into the birthing center. (A 10 minute dilation exam.) This is completely fraudulent, of course, but they've been getting away with it for many, many years.

Regardless of whether they can ultimately fix the problem, bringing regulators and/or state legislators into the conversation is often enough to make providers and insurers get a lot more reasonable (I mean, the figures involved still won't actually be reasonable, but more reasonable, at least) in a hurry, because regulators and legislators are annoying enough to deal with that they'd really rather not.

But all of this means you're probably gonna lose the equivalent of a work week or two of hours playing go-between with everyone involved, largely sitting on hold on hospital billing department and insurer phone lines. Record everything because they all have a habit of "losing" their own fucking records. Reference numbers aren't enough, they'll say they can't find it—record the calls (check your state laws and make sure you comply, which may require nothing in some states, or may require your notifying each person who comes on the line in others)

slightly OT, but I'm hoping the new CGRP meds will eventually be OTC. They work well and don't have any major issues that would make sumatriptan prescription (small risk of cardiac related issues and serotonin syndrome). That being said...just came on the market so the powers that be need to "recover their investment"...

In addition to people mentioning the information asymmetry, healthcare demand is also inelastic and not substitutable. I have MS. If I sub out my treatment, I increase my odds of losing the ability to ever walk again. Likewise, if I have a relapse and end up in the hospital, I need steroids immediately.

Healthcare demand seems to be boosted by the profit motive. The healthcare industry has an incentive to increase healthcare usage - by oversubscribing unneeded drugs and procedures and through constant daytime adverts about "talk to your GP about thing which has a list of side effects longer than the commercial break"

In the US we actually use quite a bit less healthcare than some other places in the developed world (Japan, for example). Which is what you would expect, that our high prices would reduce the consumption of healthcare. We in the USA have come to believe, as a society, that healthcare is exorbitantly expensive. But it's not actually exorbitantly expensive to provide healthcare, we just pay exorbitantly high prices. Which actually helps convince us that healthcare is, by nature, exorbitantly expensive.

I can tell you from sitting in meetings with insurance brokers that people (employees) consume healthcare with very little regard for price. ER and urgent care usage is too high, MRI's vary in price in the same city by 400%, but there is no price discrimination going on for the consumer because they just pay a copay or less (if they've hit their deductible) - it's "free". You say we actually use quite a bit less healthcare, but I'm not sure who "we" is. "We" make dumb decisions about healthcare - preferring UC clinics to preventative healthcare and sanitation, we overpay because we can't price shop services, we don't know the actual costs of what we're consuming and so make very dumb decisions, and sorry, that opaqueness is by design. It's a fantastic money machine.

Notice, you're not complaining about employees using too many health services, you're complaining about you and your employees getting massively overcharged for the (let's be honest, relatively few) healthcare services they get.

My point is -- almost none of those things should have exorbitantly high prices, because they don't actually cost that much.

Do urgent care centers actually use an exorbitant amount of resources to provide health care services? They do not. Does getting any MRI actually consume thousands of dollars of resources, even counting labor? It does not.

To me, the main reason we still have not had meaningful healthcare reform in this country is that Americans have seen the made up numbers on those ridiculous works of fiction called "medical bills" and "statements of benefits" for long enough, that they think they are real. They are not.

Yep, I wasn't (intentionally) disagreeing with you, though if I were nit-picking, I'd say they're using too much of the wrong services - going to the emergency room for a tooth ache or some similarly minor reason would maybe get a second thought if they saw how much it cost. When I went for several years without any insurance (starting a business), I became far more discriminating on the services I was paying out of pocket for, and also opted not to go to the hospital for minor stuff I would have gone to when I had insurance.

Yeah, this is definitely part of the reason for the cost, but overall healthcare is pretty inelastic.

(Ads for meds are so odd: I spent a couple of years in Canada and they don't do that there and it was bizarre coming back to the US and hearing them.)

Another reason for this is that Americans are so litigious: tests are ordered because otherwise the patient can sue. Which in turn is the case because the only way to hold companies/professionals accountable is to sue them. I'm not sure what the answer is.

In the UK we have medical malpractice too (and far to much of it), but we also define what tests are expected. My understanding is the people defining those tests aren't incentivised to overtest (by companies trying to sell the tests) or undertest (through fear of being sued).

Yeah, I imagine having some sort of central authority (NHS) against which even private practitioners can compare themselves helps here. American healthcare is just chaos. I guess the closest thing here would be Medicaid/Medicare but even those are administered through private companies with variances in what is covered.

Also there's probably less resorting to suing in the UK since people whose doctors mess up can get the resulting problems treated. In the US, if a doctor fucks up and you need more treatment, it can bankrupt you and the only way to recoup the costs is to sue.

The article's about health care, not healthcare the neologism.

Everything bad anyone ever said about the Big Dig applies to healthcare.

It's a giant feeding trough for the subsidized industries. They get rich. The people who make the feeding trough run get power and influence. Taxpayers get poor results per dollar to the detriment of all the other things society could have spent that money doing. And idiots who are hoodwinked by the veneer of plausible deniability defend the system.

Either massively socialize it or massively deregulate it, I don't care which. Neither can be worse than what we have.

Just look at crypto for massive deregulation. It would be a disaster.

the "invisible hand" can't work because there is no price list available to consumers. That's the craziest thing to me, you can't get a price list for a procedure ahead of time and compare with competitors to get a better deal. There's no way for price discovery to work without an informed consumer.

So... Imagine there's a law banning surprise bills. No longer separate bills from a hospital and then from a surgeon and then from anesthesiologist and then from the janitor. No "oopsie, sorry, your pimple removal went wrong and you had a cardiac arrest, here's your bill".

How much better will things become?

A law? How come hospitals and doctors that don't have surprise bills out-compete those that do? Surely if this was a thing that patients cum customers demanded, there would be a provider willing to step in an supply it.

Customers demand it, but customers are not willing to pay for it.

With a choice to pay $1k "with a small probability of surprise bill" or $5k all-included most patients will prefer the former.

That's how insurance should work in theory so its not like that's a new idea it's just that modern insurance companies are godawful at that original purpose of not screwing people over.

Healthcare in the US is a broken market due to regulatory capture among other things. If Buffett and Bezos and Dimon couldn’t solve it, it’s probably not going to be solved without the government breaking up the cartel. That’s a valid function of government even by fairly libertarian standards.

My employer recently updated our health insurance offering with a plan from UHC called Surest. They were formerly branded as Bind, but have seemed to pivot after their UHC acquisition (the former Bind program had on-demand coverage, whereas the Surest program is more like a traditional copay plan). Part of this plan is an app where you can type in a procedure, browse a list of providers, and select one based on copay price. They claim that their copay is based on UHC’s evaluation of their efficiency and effectiveness. The copay is supposed to be a singular all-in price covering all services related to the procedure (e.g., no separate bill for anesthesia, etc). Dr visit $10-$65, ER visit $325, etc.

It's impossible to have a free market in healthcare because there is a gigantic information asymmetry between patients and providers. The government has responded to that with regulations, making the market even less free. So I agree, the invisible hand doesn't work in healthcare, but the government has also made things worse.

> It's impossible to have a free market in healthcare because there is a gigantic information asymmetry between patients and providers.

Why would information asymmetry prevent a free market? The free market works for all manner of highly specialized goods and services, for which there is (almost as a rule) a large information asymmetry between buyers and sellers.

Information asymmetry is a classic example of a market failure. Markets with extensive baked in information disadvantages are by definition unfree. Just because other markets are unfree doesn't mean medicine isn't.

In no way is this a free market. Not even close. There are so many market distortions that prevent a healthy market place from operating. If you recall, the ACA act was supposed to help solve many of these problems by making it more affordable. It appears to have exacerbated it.

ACA increases the subscriber pool. The main issue now is the high deductibles which causes folks to ration care. Otherwise your premiums are scaled based on income. You also do get some primary care visits included and a few other things. That's so you catch things earlier before they get expensive. What the ACA really does though, is reduce the financial impact of a catastrophic event. So you are covered and out of pocket say a max of $10k vs $100k+. So let's say you get diagnosed with cancer, well the $10k is manageable (excluding the insurance games).

Assuming that 10 or 100k of services is 'in network'. The only plan I can remotely afford now offers no functionality in any 'out of network' facility. The columns are all just 'n/a'.

Sure but that's ok.

If you cannot get equivalent care nearby "in network" then you can go out of network and get covered. They won't like it and it can take negotiation but you have that option. All emergency care for example operates this way.

This is why the ACA stuff uses your zip code to offer plans. Remember most of these are State and Federal partnerships with private companies. The companies are just offering up their "networks". You and the State are paying the premiums.. One way to think about it is that the state is paying the employer portion.

This is way better than how it use to be...

"then you can go out of network and get covered"

I can get the care, but nothing in what you're describing sounds like what my paperwork details say. It indicates that any non-emergency services undertaken outside of their network will not be dealt with at all. I'm not sure how this is 'better' than what it used to be, with 'used to be' being last year's plan that would, at least, deal with services delivered out of network, with some % split up to a deductible.

The ACA did not exacerbate the mess. It merely allowed more people access to the system and put in some curbs to the exploitation. A truly free market health care system would be horrible and dystopian. Some things ought not be a free market and health care is one of them.

Laws written by insurance firms may be expected to benefit insurance firms. In our system, the interests of average citizens are not a priority.

I don't think there is any evidence it exacerbated it.

Deductibles were not so high before the ACA.

But coverage was not as extensive there were lifetime limits, and many people couldn't buy coverage at any price.

That is true. But I'm not sure the fix was worth it. Those uninsurable people were often able to get government assistance, and there were charities that helped them.

No one is helping the ordinary personal with a high deductible - and don't forget the huge deterrent it is to seeking medical care.

> looks like the invisible hand of markets is not working here

Holy crap - Fan or no fan, the "invisible hand" isn't a factor in that environment. Healthcare is highly regulated, the market for drugs (for instance) highly rigged by federal reimbursement commitments, the third-party payer system obscures all costs from the consumer rendering them incapable of making informed choices. If you wanted the market to sort out health care, you'd need to get rid of state-level 'certificates of need' to introduce competition on the supply-side, actually achieve price transparency for consumers to avoid price fixing, and massively overhaul medicate part D to bring costs for drugs down. This is in addition to allowing insurance markets to cross state lines.

Total facepalm when I hear people say, "look at healthcare - guess the free market doesn't work". Nobody needs to argue that it should be a total free and open market devoid of regulation - that's a dumb retort, but to not understand how regulation has served to facilitate self-dealing, instituted market barriers, and create a money-go-round, is equally as daft.

> most of this for medicare, for which only a fraction of the population is eligible.

The fraction of the population that is eligible for Medicare skews much, much older than the overall population and so is exactly the population that I'd expect to be more costly.

>> The fraction of the population that is eligible for Medicare skews much, much older than the overall population and so is exactly the population that I'd expect to be more costly.

This is another reason to decouple insurance from our employment. These plans are cheaper because the pool of people is all reasonably healthy, and able to work.

The purpose of insurance is to amortize costs over time and population, but the industry has successfully dumped the highest cost patients onto the government plan.

The reason medication is expensive is the FDA makes its crazy expensive to bring a drug to market. And the U.S. basically subsidizes the rest of the world's drug research.

If the U.S. paid what the rest of world did for drugs there would be a 90% less drug research.

The invisible hand of the market has been crushed by the boot of government policy/regulation. It's bootleggers and baptists at national scale.

Care to explain? From where I'm sitting, it looks like private equity firms and hospital networks have created local monopolies/cartels in healthcare by buying up lots of little doctor's offices, and running the same playbooks around revenue maximization.

I guess it's hard to defect and run a smaller office, because of the demands of dealing with insurance, as well as doctor licensure, but afaik the AMA isn't a governmental agency so much as a professional organization interested in keeping doctor salaries elevated by restricting the entry of new doctors into the field, and they seem to be one of the major problems.

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