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Comment by s1artibartfast | Hacker News Reader

The problem is that there are no incentives to optimize benefit versus price.

Socialized systems, the state looks at each new drug and decides if the benefit is worth the additional cost. They will either agree to Buy it, not buy it, or negotiate the price.

When private individuals purchase Healthcare out of pocket, they do the same.

It is only in an insurance Market with mandatory treatment coverage where drugs and Medicine get purchased no matter what the cost is.

If you asked a private individual or socialized system to pay 500K to extend someone's life 2 months, both would refuse.

Someone with insurance that they've been paying for has no reason to put the brakes on

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> Someone with insurance that they've been paying for has no reason to put the brakes on

Especially when the insurance company itself can just pass the costs along in the form of higher premiums because people are legally required to buy insurance.

The 2017 TCJA repealed all federal penalties for not having health insurance, making the individual mandate to have health insurance moot since 2019.

https://www.commonwealthfund.org/publications/fund-reports/2...

These people still get indirectly subsidized when they receive healthcare they can’t pay for and providers have to collectively eat the cost. Removing the penalty simply enables inefficient freeloading on the system (as these folks are likely to be stuck with medical debt or have to declare bankruptcy from medical bills they will never be able to repay).

I don’t understand the idea of freeloading here. Insurance companies charge rates the market will bear. They are still going to charge these rates if insurance payouts to the freeloaders go away. This is not a perfect market where competitors will spring up overnight to provide insurance at lower rates if the cost of doing so goes down.

Health insurance rates are highly regulated. Everyone pays higher rates due to people who don’t pay, because providers build their uninsured costs into what they charge insurance payers. They’d go insolvent otherwise.

https://www.healthcare.gov/how-plans-set-your-premiums

https://www.healthcare.gov/health-care-law-protections/rate-...

Additionally, "legally required" was a dubious way to describe the state of affairs even before then: you could continue to live freely your entire life without ever enrolling in an health insurance plan either by demonstrating participation in some other communitarian health share program or by paying a tax.

Protections of the ACA include the requirement to submit premium increases for state and federal review, and limits on how much of premiums can be used for anything other than medical costs. This means that they cannot legally "just" pass costs along, and that even when they can those costs are effectively a representation of the limited power anybody has to negotiate with healthcare providers, which is hardly something one can pin on insurance companies.

And of course on top of that, it's inaccurate to say that people are legally required to buy insurance. It's wholly without basis for the last 3 years or so, and even before 3 years ago it's a dubious representation of the options available to people.

I think it's the exact opposite actually. Insurance is incentivized to go along with Healthcare cost increases because it lets them increase their premium and profit. If you have a 10% profit margin and need approval to raise cost, higher healthcare costs overall is the best way to increase your net revenue while keeping the same profit percent.

It is the classic problem of Cost Plus contracts

>incentive

The incentive should be: the people want it, the corporations should figure out how to deal or fail, and the government should be held accountable until the people get the healthcare they want.

As with any “slow turning ship” sometimes it takes a bit of a push.

Seeing other nations do it better is not enough push.

When people start to protest over this, momentum will build.

The problem is: sick people make terrible protestors.

I would argue that most people don't want to optimize benefit for dollar spent. This is why you get rhetoric about death panels and garbage like that.

Almost nobody's going to turn down ludicrously expensive cancer treatment because the money could be better spent on preventative medicine

Sick people make terrible protesters. They also make terrible decisions about how Healthcare should be rationed.

Prices will continue to rise until somebody in the system decides they are unwilling to pay more. Right now there's no one in the US taking on that role.

I posit that part of the reason we (in the US) are in this current climate is because of active actual choice by the capital owning class toward profit over people, because sick and in-debt people will work for a little as possible.

I think prices will rise until corporations find it’s too expensive to find new labor when a lot of it can no longer work. Like a paperclip bending over and over.

WE may be saying the same thing.

Humans will pick profit over people every time. The problem is that we have made it so the most profitable option is not the best at helping people.

I propose we change the laws and spending so the most profitable business is one that helps people the most.

You propose what exactly?

It’s nothing exact, as it’s anecdotal and incipient thought, at best. We may be indeed saying similar things.

I think, though, that a nation state’s job, if it wants to exist at the gunpoint they all exist at, it should enforce a rule that corporations within critical for life industries (healthcare, housing, power, food, education, utility, etc), are not to provide profit, shareholder return (dividend/buyback), or other similar during times when they raise consumer prices greater than inflation or layoff any employees for financial reasons or have over a certain amount of employees on public funded support programs. (Welfare, etc.)

The corporation and its profit to the owners should come second to the consumer and the corporations labor force.

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