Category: Health Care Costs

Report: Hospitals Who Want to Collect Fees should Provide Better Cost Estimates

Hand Holding Cash ca. 1998

Historically hospitals have not really had to worry about collect directly from patients. On average patient cost-sharing is only about 3% when patients enter the hospital. Health care providers generally focus on insurance reimbursement. Maybe that is changing with the growing prevalence of high deductible plans. Now hospital patients can potentially owe several thousand dollars depending on whether they’ve met their deductibles and their cost-sharing arrangements.

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The Silly Appeal of Expanding Medicaid for All

DocsMeanMany people believe Obamacare was a conspiracy, with asinine design features intended to cause the program to fail. The primary goal in the minds of conspiracy buffs’ was to usher in a single-payer program of Medicare for All once Obamacare collapsed under adverse selection. The theory goes something like this: with nowhere to turn except the government, Americans would finally throw up their hands and acquiesce to government intervention. Seniors purportedly all love their Medicare, so why not expand the program to cover even more people?

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CBO: Other Peoples’ Money is Popular, as is Freedom to Choose

stethoscope-on-moneyThe big news on Thursday was that the Congressional Budget Office (CBO) released its score of the American Health Care Act (AHCA). The CBO claimed 23 million people would lose coverage within a decade under provisions found in the AHCA.

  • About 10 million people would purportedly lose coverage due to the repealing of the individual and employer mandates.
  • Another 5 million are low-income individuals living in states that did not expand Medicaid.

Basically, this is another way of saying 10 million people will decide they’d rather keep their money than have poor-value health coverage. It’s hard to understand how someone can lose something they never actually had?

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Technology & Cost Containment—Why Doesn’t Medical Technology Bring Down the Cost of Healthcare?

Capture14Technology is a significant driver of high health care spending. For instance, many treatments common today were not available 40 years ago. Yet, treatments and therapies that have been in use for decades are still quite expensive. In typical consumer markets, the quality of technology gets progressively better while the (real) inflation-adjusted prices often fall as older technology is surpassed by newer technology. This is especially true of consumer electronics but also of true of automobiles, appliances and other types of consumer goods. The inflation-adjusted prices of consumer goods have held steady because consumers are price sensitive, rewarding the firms who successfully compete for their business.

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A Bill to Establish a Single-Payer Health System Advances in California

Capture47A bill has passed its first legislative hurdle to establish a government-run program of universal coverage in California. The California Senate Health Committee passed the measure 5-2. Next it will be debated by the Senate Appropriations Committee. The sticking point is how to fund such an endeavor.

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How to Solve the Pre-Existing Condition Problem

moneyThe primary sticking point in health reform is what to do with high -cost individuals who have pre-existing health conditions. People with episodic medical needs are easy to insure, while those with persistent needs are far more difficult unless insurers are allowed to underwrite enrollees’ risk. Republicans have long favored high-risk pools to cover individuals who are otherwise uninsurable. Prior to the Affordable Care Act (ACA) just over two-thirds of states had some type of high-risk pool. Most people turned down prior to the Affordable Care Act could ultimately obtain coverage either at a higher price or after meeting some preconditions. In 2011, high-risk pool enrollment varied from 0.1% in Alabama to a high of 10.2% in Minnesota. By most accounts only about 2% of people are uninsurable. However, one Kaiser Family Foundation study argues the actual rate may be a dozen times higher.

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Weak Idea at Bernie’s: Bureaucrats Should Not Negotiate Seniors’ Drug Prices

Capture14Senator Bernie Sanders and Representative Elijah Cummings — along with a few other liberal Members of Congress — want to change the way Medicare purchases drugs for seniors. It is a popular talking point mainly because many Americans naively assume Medicare does not bargain over the price of drugs. Even President Trump has perpetuated the bogus idea that having the government negotiate the price of drugs would lower Medicare’s drug costs. This may sound appealing to many because drug makers don’t elicit much sympathy these days. Yet, seniors, drugmakers and taxpayers alike have a stake in the outcome because drug therapy is the most convenient and efficient way to care for patients.

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Shopping for Health Care is Easier than You Realize

yuConventional wisdom holds that it is nearly impossible to compare prices for medical care like consumers do in other markets. It’s easier than you realize — my wife and I do it just about every time we see our doctors or fill a prescription. Health plan deductibles have nearly tripled over the past decade. Shopping for medical care is more important than ever.

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Mayo Clinic Admits it Prioritizes Privately Insured

Hand Holding Cash ca. 1998

Hand Holding Cash ca. 1998

The Mayo Clinic has admitted it places Medicaid and Medicare patients in a lower priority than patients with private insurance. This is something that many doctors and hospitals likely do. It is well known that Medicare pays physicians only about 80% of what private insurers reimburse for the same coverage. Medicare reimburses hospitals about 70% of private payers. Medicaid rates are a fraction of Medicare’s rates.

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CPI: Medical Price Hikes Match Inflation

BLSBoth the Consumer Price Index and the price index for medical care rose just 0.1 percent in February. This is the sixth month in a row we have enjoyed medical price relief in the CPI. Even prices of prescription drugs dropped by 0.2 percent. Some components – medical equipment and supplies, outpatient hospital services, and health insurance jumped a bit, but not enough to drive overall medical prices higher. Medical price inflation contributed nine percent of CPI for all items.

Over the last 12 months, however, medical prices have increased much more than non-medical prices: 3.5 percent versus 2.7 percent. Price changes for medical care contributed 11 percent of the overall increase in CPI.

More than six years after the Affordable Care Act was passed, consumers have not seen relief from high medical prices, which have increased over twice as much as the CPI less medical care since Obamacare took effect.

See Figures I, II, and Table I Below the fold:

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