Obamacare IS Socialized Medicine!

Caduceus with First-aid KitHave you ever stopped and considered why the government wants you to have health insurance? The Affordable Care Act (ACA) was supposedly designed to make health care affordable for millions of individuals who could otherwise not afford health coverage or would choose not to enroll due to costs. Worse yet, the ACA was designed to make medical care “affordable” for many individuals by foisting the costs on others who are not at risk of health problems. Obamacare was premised on the idea that benefits one person would never expect to use should be subsidized for others who may need them. That is the very definition of socialized medicine!

Medical care is a service that not everyone places the same value on. Even controlling for health status, different people will want to see the doctor and pursue medical interventions at different rates. Thus, requiring everyone to have similar health benefits does those who want less medical care a disservice. This was the subject of a recent article in the New York Times column, The Upshot by economist Austin Frakt. In his column, Frakt discussed the problem with “one-size-fits-all health insurance.  In the process, Frakt also raises a concept similar to what an economist colleague, NCPA senior fellow Gerald Musgrave, discussed with me a few years ago. You cannot buy a health insurance policy that only provides, say, 1990s technology the way you can choose to economize by buying a used car or a pre-owned home.  (As an aside, neither can you choose a hospital that buys its equipment used/refurbished. Much of medical equipment is leased and later sold abroad when the lease is up to avoid competing with new equipment)

For that matter, the ACA does not allow individuals to take out a $25,000 deductible to lower premiums. Nor does it allow individuals to forgo all coverage for medical benefits above, say, $500,000 (or $50,000 which would be enough for about 99 percent of the population). A person who has lead a healthy lifestyle and reaches middle age in perfect health does not qualify for a discount lower than a similar-aged person whose health status is a hot mess. And it doesn’t end there.

Someone who does not have Hepatitis or a rare disease cannot agree to forgo high-priced treatments for those diseases. Neither can you buy medical coverage that does not include maternity benefits just because you are male and incapable of having babies. A couple who has undergone a permanent contraceptive procedure cannot avoid coverage that omits family planning or maternity benefits. Let’s say you are a Mormon, whose religious beliefs precludes alcohol, tobacco and other addictive substances. You are not allowed to sign a waiver forgoing the right to chemical dependency treatments in return for lower premiums. Neither are Scientologists allowed to forgo coverage for mental health conditions their religion does not treat using medical therapy. For that matter I know of no health insurance plans that will only cover medical care received in foreign countries. There used to be one available on the far southern border of California that only covered Mexican doctors but it’s doubtful that one still exists.

The ACA was designed with the idea in mind that demand for medical care should not be a function of income. Moreover, the ACA was designed to spread the cost of medical care across diverse groups regardless of the health risks and preferences of health plan members. It was designed to maximize cross-subsidies, which is precisely what’s wrong with the Affordable Care Act (ACA). Under those conditions, it’s no wonder premiums in the exchange are skyrocketing.

The “Affordable Care Act” was poorly named; it did not make care affordable. It made health coverage semi-affordable only for those newly-eligible for Medicaid and those earning up to 250 percent of the federal poverty level. The ACA took away the right of consumers to purchase the benefit package and type of coverage they prefer. It also took away the flexibility for insurers to experiment with differing plan designs.  In the process, the ACA made health coverage decidedly unaffordable for millions of people who do not qualify for subsidies and have to purchase individual insurance on their own. It’s time to repeal the costly regulations and replace them with something that allows coverage that is truly affordable (and flexible).

Comments (63)

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  1. Ron Greiner says:

    Overdose of Socialism. FOX News just reported that the average cost for a person on Medicaid is $8,000 a year! WOW, just because you are broke doesn’t mean you are sick. Who is scamming who?

    In IOWA a 25-year-old male can get insured for $850 a year and Medicaid cost is $8,000 per person per year!!

    Doctors won’t take Medicaid because they pay so little. America is too brainwashed to live in a free society. We deserve being $20 Trillion in debt with hundreds of Trillons in unfunded liabilities.

    America – suckers for socialism.

    • Barry Carol says:

      Try recalculating after removing the cost of skilled nursing facility and assisted living custodial care which conventional insurance doesn’t cover. Then you will probably find that it is comparable in cost to large employer coverage on a per covered life basis. Children on Medicaid are also quite inexpensive to cover.

      • Allan says:

        The problem is that the government likes to mix up all these numbers so one can make the excuse you are presently making. It would be interesting if we could seperate all these numbers and see the actual cost for that individual. My bet is that the cost is way higher than it should be, but that is purely a guess based upon my view of how government functions. I wonder if anyone has better numbers.

        • Jimbino says:

          You can establish that the cost of domestic health care is far higher than it should be by comparing the costs for a procedure with the equivalent in Brazil, Argentina, Costa Rica, Cuba, Hungary and Czech Republic, all widely available online.

          The only problem you will run into is that the costs for treatment are almost universally hidden in Amerika out of the influence of insurance and healthcare providers in keeping Amerikans in the dark.

          Compare prices for common procedures like colonoscopy, cataract surgery or root-canal, for example. Also check the prices of common meds like metformin and especially those drugs like mebendazole or metronidazole that you can get over-the-counter with no doc prescription in most of those foreign countries. Of course it helps if you can speak Portuguese and Spanish, for starters.

          • Allan says:

            No one questions that we are paying too much for what we are getting. Can we get a cataract removed in this country for the cost in many others? No, not even if it were done in the most efficient way. I can buy a better meal in Mexico for a fraction of what I pay here.

            Having said that all care is not equal and outcomes in the US have been shown in many instances to be better than elsewhere. We have infrastructure costs not seen elsewhere along with malpractice and a higher standard of living. All these things will make US prices higher, but my bet is that with a true market system we could almost immediately lower prices by 30 to 50% with further reductions in the future.

          • Jimbino says:

            Here’s one of hundreds of examples comparing costs in the USSA and Brazil:

            Typically, there are two costs associated with an EKG — the cost of the procedure itself and the cost of the analysis of the readout.

            Uninsured patients can expect to pay $500-$3,000 total for an EKG. An EKG averages $1,500, according to NewChoiceHealth.com, but some locations charge as high as $2,850. Typically, prices are higher for services in metropolitan areas, than in smaller rural communities.

            Here’s is a typical price charged the private (uninsured) patient in Brazil:

            CÓDIGO Descrição do exame Valor
            20010010 ELETROCARDIOGRAMA – ECG R$ 177,00

            R$177 corresponds to about $50. A person has go be out of his mind to carry health insurance in the USSA when he can get medical care in one of the many Latin countries.

            • John Fembup says:

              Jimbino, because you so often praise the medical and insurance systems in Latin America would you mind sharing where you live?

              Your comment above suggests you live in Brazil. If so, how nice for you that all you ever wanted, including cosmetic surgery, is available to you there.

              But if you live in Brazil or any other Latin Akmerica country for that matter – I don’t understand why you still care enough about America’s so-called health care system, to criticize it continually. I mean, you could be out at the beach enjoying the fine spring weather instead of grousing over a computer.

              btw as you must know, Brazil is proposing to build up its tourism by charging tourists a new tax to fund treatment for tourists who are mugged.

              http://www.nytimes.com/2016/12/07/world/americas/brazil-rio-de-janeiro-tourism-crime.html?_r=0

              Good thing Brazilian medical care is so inexpensive.

            • Allan says:

              Excluding Cuba:

              Concord study on outcomes for common cancer. One of the few good international studies and well respected. A few ratings from one on down When we get to the more uncommon cancers many countries just send their patients to the US.

              Breast cancer (women) US #1 Brazil # 27
              Prostate cancer US #1 Brazil # 21
              Colorectum (women) US #2 Brazil # 23
              Colorectum (men) US #2 Brazil # 16

    • John says:

      Rob,

      Healthcare is bankrupting America today because we didn’t do what every other wealthy country did long ago: Socialized medicine.

      Sincerely,

      American Pharmacist

  2. Bob Hertz says:

    Note to Devon: many of the ACA restrictions that you abhore are based on an extreme fear of people making a wrong choice. A healthy person agrees to a $50,000 annual limit, and then gets a cancer that costs $500,000 to treat. A person agrees not to cover hepatitis, and then they get hepatitis. To carry it further, a healthy person chooses not to buy any insurance, and then they fall off a roof.

    I suspect there are good answers to the standard liberal fear that inspired much of the ACA. I think that you have to address those fears to make your points completely.

    • Devon Herrick says:

      As usual, all good points! Economists are prone to point out that people tend to be too risk averse. People at no risk of cancer buy coverage for cancer. But, if more people did not have unlimited benefits, when they found themselves with a dread disease lik cancer, the cost of treatment would not be nearly as high. When a majority of people who contract cancer do not have coverage for it, the hospitals/oncologists/drug makers could not charge as much as they do.

    • Jimbino says:

      The simple answer is that it is a clear violation of the rights of the risk-accepting to force them to subsidize the medical care of the risk-averse among us through insurance premiums or taxes. The Amish and Mennonites understand that very well and are exempt from Obamacare and Social Security.

      • Allan says:

        You are 100% correct. I still haven’t figured out how the ACA was consisdered constitutional. I shouldn’t be surprised when Supreme Court Justices like Ginsberg take sides in our election calling Trump a faker, or defends the use of foreign laws in our own courts. Trump was criticized for mentioning that a hispanic judge might rule in the same fashion because of his ethnicity yet Supreme CourtJustice Sotomayor in a lecture said her ethnicity could be an asset in deciding cases. I agree with her that different perspectives can help judges in the decisions before them, but not decisions of the Supreme Court which are interpreting the law, not judging cases. Spreme Court Justice Breyer also said that sometimes Supreme Court decisions had to be partially based on outcomes.

        We are in trouble when the Constitution is held in such little regard. That has led to things like the ACA which are a gross intrusion of government into our personal lives. Hopefully Trump will support justices that believe in the Constitution and believe that it is altered only through amendment.

  3. Bob Hertz says:

    What is the old saying, Hard cases make good law?
    Let me probe this a little further.

    I agree with you we cannot afford insurance policies that cover every single ailment, every single diagnostic test, every drug and every therapy at top dollar.

    So it should be possible to cut back somewhere on insurance.
    The tough part is saying where.

    Here are my initial thoughts.

    1. Private or public insurance must cover contagious diseases.

    2. Insurance should cover accidents and injuries. We do not want the 30 year old who falls off a roof to limp around the rest of his life because he could not afford good orthopedic care.

    3. Insurance should cover life-threatening emergencies. I say this as someone whose life has been saved twice in the last decade by top notch ER care in St Paul MN.

    4. Children should be insured, privately or publicly. If they have a disease, they have done nothing to “earn it.”

    So much for the easy rules.

    Seems to me that the hard part is what to do about self-contained chronic illnesses that frequently, but not always, develop from years of bad health habits. (smoking, diet, et al.)

    The argument could be made that if these illnesses go untreated due to lack of insurance, the nation is really no worse off. This sounds harsh, but was America worse off in the 1950’s when far more 50 and 60 year olds died of high blood pressure, lung cancer, or just pneumonia? Of course the individuals and their families were terribly worse off, but the sun came up the next today and no cities were depopulated.

    Devon, you are correct that if fewer people were insured for cancer, the prices for treatment would go way down.
    However, the oncologists cannot work for free. I will stop here because at the moment, I just do not have the answer for what is the right amount of insurance for self-contained chronic illnesses.

    • Allan says:

      “What is the old saying, Hard cases make good law?”

      No. It’s hard cases make bad law.

    • Devon Herrick says:

      Bob, your items 1 – 4 are a great start. For other interventions you could potentially use a cost per life year saved to assess the value. When I was in school, the rule of thumb was something like $100,000 per life year saved. It’s higher now. But this cruel calculus is premised on the idea that there are limits to what society can afford to pay to save a life.

      • Barry Carol says:

        I like QALY metrics conceptually. In theory, there would be nothing to stop insurers from offering a base insurance plan that coveres drugs up to, say, $100K per QALY. Then they could offer an enhanced plan at a higher premium that would cover drugs up to $250K per QALY and maybe a platinum level plan that covered them up to $500K per QALY. People could then choose the level of coverage they wanted based on their budget and their risk tolerance.

        There are indeed limits to what society can afford. The challenge is figuring out how and where to set them. Of course, for anyone prepared to spend his or her own money, there are no limits aside from the individual’s own resources.

        • Allan says:

          “There are indeed limits to what society can afford. The challenge is figuring out how and where to set them”

          Once again you are dictating price. Except for those that must be supported by government, government should have no part in that decision.

          • Barry Carol says:

            My comment suggested that insurers would set the QALY limit that they were willing to cover and the premium at which they were willing to cover it, not government. You can’t even give me credit for a free market comment when I make one. Geez.

            • Allan says:

              You support the ACA which mandates everyone carry ACA insurance which is pooled money. Thus you are starting outside of the free market.

              As far as QALY’S are concerned, that is up to the insurers and the insured to figure out if they are even necessary. But, suddenly they are necessary because we are using mandated pooled money and government uses QALY’s.

    • Jimbino says:

      The reason you have no idea what the “right amount of insurance” is is that the gummint conspires with the medical and drug industry to hide the ball when it comes to all matters involving the pricing of health care and drugs.

      If we had a gummint mandate requiring all healthcare providers to provide pricing info on the Web, we would have price signalling, essential to operation of a free market, and you would know how much you are being screwed. The best you can do now is to research the pricing in other countries that is available on the Web.

      Sad we don’t have Walmart, eBay and Amazon, who publish their prices, running our healthcare system.

      In every case, however, you have to add 25% to every price to account for Obamacare fees for every treatment.

    • Floccina says:

      We do not want the 30 year old who falls off a roof to limp around the rest of his life because he could not afford good orthopedic care.

      A 30 year old can generally amortize a pretty big bill. Good motivation for the hospital to make sure he gets back to work at full speed.

  4. Barry Carol says:

    I’m always accused of being a socialist and a control freak when I ask just how profitable drug and device manufacturers need to be in order to compensate them for the risks inherent in their business and to provide their investors with a fully satisfactory return on their capital relative to other investment alternatives. Currently these companies try to extract every last nickel that they possibly can from both insurers and patients when they know patients buy their products not because they want to but because they have to. Whatever happen to striking a reasonable balance? Of course, if people had to pay for drugs and devices mostly out-of-pocket, many of the innovations we’ve seen over the last 30-40 years probably never would have been developed in the first place. Medical care would be a lot cheaper and life expectancy would be considerably shorter. Be careful what you wish for.

    • Allan says:

      “Medical care would be a lot cheaper and life expectancy would be considerably shorter”

      That is one of the reasons why people carry health insurance. Pooling of money to buy more expensive treatments doesn’t require socialism and government control. It only requires a willing buyer and a willing seller where contract law is enforced.

      Mandating pooled funds that are then controlled by government with price controls etc. is socialism. I guess one could say the biggest difference between these two methods is freedom.

      • Ron Greiner says:

        Barry doesn’t care about your Freedom. Barry’s heart is so big he will decide how everything is financed.

        Barry hated 1972 when people had a $200 deductible and then paid 20% of the next $5,000 in co-insurance but a 3 day stay at the hospital was only $150. Well, the Mayo Clinic was $50 day in 1972. Your run-of-the-mill hospital was probably cheaper.

        Most medical problems were under $5,000 so people paid co-insurance all of the way in ’72.

        Barry thinks people will only get medical care if someone else is paying for it.

    • Devon Herrick says:

      Of course, if people had to pay for drugs and devices mostly out-of-pocket, many of the innovations we’ve seen over the last 30-40 years probably never would have been developed in the first place.

      I believe that is true, but it isn’t necessarily all bad. The treatments that would exist would likely be the more high-value treatments. Hip replacements, CABG surgery, things like that. Absent would be the $25,000 per month orphan drugs and $150,000 cancer treatments that only prolong life by, say, 1.8 months.

      I’m just speculating of course. I also realize that much of the advancement in medical science is incremental (e.g. without the 1.8 month increase how do we get to the 3.6 month increase).

      However, there is an optimal point between dying of diseases easily cured with collective risk pools versus spending 80% of our GDP on health care — most of which provide incremental benefits too small to measure.

      • Allan says:

        Devon, Barry in your highlighted comment commits reductio ad absurdum. It is absurd to believe that insurance didn’t exist before the ACA or that insurance can’t exist without excessive government intrusion. People can voluntarily pool money to buy those things that would otherwise be unafordable and they can do that at a fraction of the price.

        The difference would be that people would be more selective, not less and get a better bang for their buck. Next he will present the red herring argument that we are all subsidizing those that don’t have insurance which at best is a minor problem. His solution is to create a major problem by mandatory insurance for all.

    • Jimbino says:

      Then explain why healthcare outcomes and life expectancy in Cuba, where health care and drugs are so much cheaper, are as good as, if not better than, those in the USSA.

      • Allan says:

        Jimbino, here you have gone a bit too far. Cuba has terrible healthcare for the masses, but a hospital for special people where two of the floors have apparently been modernized for photos.

        Life expectancies can be doctored.

    • Jimbino says:

      Of course, if people had to pay for drugs and devices mostly out-of-pocket, many of the innovations we’ve seen over the last 30-40 years probably never would have been developed in the first place. Medical care would be a lot cheaper and life expectancy would be considerably shorter. Be careful what you wish for.

      That is patently false and Amazon and eBay are proof of it.

      Yes, you sound like a perfect candidate for running the Soviet Union. All that is needed to drop healthcare prices in the USSA is to force all providers to publish their prices as Amazon and eBay do and remove all licensing and certification requirements as Milton Friedman proposed in “Free to Choose” and elsewhere.

      You, no doubt would prefer to force Amerikans to buy insurance to cover their Amazon and eBay purchases! Why not Obamafood and Obamasex, too?

    • Jimbino says:

      Of course, if people had to pay for drugs and devices mostly out-of-pocket, many of the innovations we’ve seen over the last 30-40 years probably never would have been developed in the first place. Medical care would be a lot cheaper and life expectancy would be considerably shorter. Be careful what you wish for.

      That is patently false and Amazon and eBay are proof of it.

      Yes, you sound like a perfect candidate for running the Soviet Union. All that is needed to drop healthcare prices in the USSA is to force all providers to publish their prices as Amazon and eBay do and remove all licensing and certification requirements as Milton Friedman proposed in “Free to Choose” and elsewhere.

      You, no doubt would prefer to force Amerikans to buy insurance to cover their Amazon and eBay purchases! Why not Obamafood and Obamasex, too?

  5. Bob Hertz says:

    Ron’s list of medical prices in 1972 is fascinating.

    For comparison, here are other prices from 1972:

    New House – $27,600

    Average Income – $11,859 per year

    New Car – $3,853

    Average Rent – $165 per month

    Tuition to Harvard University – $2,800

    Movie Ticket – $1.75

    Gasoline – $.55 per gallon

    Postage Stamp – $.08

    Bacon – $.83 per pound

    Eggs – $.45 per dozen

    Fresh Ground Hamburger – $.64 per pound

    Milk – $1.20 per gallon

    A skeptic would say that health care is like education — the more it is subsidized, the higher the price, and then a larger subsidy is needed, ad nauseam.

    • Barry Carol says:

      The difference between healthcare and education is that education is an investment in human capital just as a house is an investment in physical capital. Most people can’t pay cash for either one. They need to finance both over time instead. In other words, loans are appropriate, within reason, in both cases. By contrast, I don’t think people should have to pay for heart surgery or a hip replacement or cancer treatment over a 20-30 year period. That’s what health insurance is for.

      • Devon Herrick says:

        A better way is the Singapore system where you are forced to save over 20-30 years so when you need a hip replacement or cancer treatment you have funds already available. Plus Singapore does require insurance as I recall.

      • Allan says:

        But, if the person would rather take the risk then pay the premium I see nothing wrong with them taking out a loan to pay it off or for them saving in advance to pay the bill. Health insurance is to protect assets or pay for something that would otherwise be too expensive. Taking out a loan is just another mechanism. A loan is probably less expensive if the person is a normal risk or has iliquid assets.

    • Ron Greiner says:

      Bob, Motel 6 cost $6 a night in 1972.

      It is probably smart to have old people pay 5% of their medical bills all of the way in Medicare.

      Today, old women are lonely and will go see the doctor because it is free. Make them pay something and the visits would slow down.

      Sir, you owe 5% of $350,000 with that heart attack. You need a calculator.

  6. Bob Hertz says:

    I have maintained for a long time that if leave out specialty drugs and month-long hospital stays, there are not too many medical procedures which have a true cost over $15,000.

    By ‘true cost’ I mean a procedure done in a free-standing surgery center with mostly salaried physicians and diagnostic tests priced at Medicare rates.

    In fact, if you read the Medicare fee schedule you find an awful lot of procedures reimbursed at $7K-$10K, for which the vicious hospital chargemaster prices at $50,000.

    If I am right, then why are we forced to buy insurance policies with unlimited maximums or even to consider a $500,000 QALY plan?

    I come back to specialty drugs and long hospital stays.
    (I mean Terri Schaivo-long at the far end.)

    I favor price controls on specialty drugs. I do not yet have a solution for long stays, other than sending a long-stay patient to a VA hospital which our taxes have already paid for. I know this is not a perfect answer.

    • Allan says:

      “By ‘true cost’ I mean a procedure done in a free-standing surgery center with mostly salaried physicians and diagnostic tests priced at Medicare rates.”

      What makes you think ‘true cost’ can only be obtained by salaried physicians? Competition leads to marginal rates. Why do you think that salaried physicians provide truer competition?

      “I favor price controls on specialty drugs.”

      I will repeat what I said elsewhere. Specialty drugs are created by companies taking considerable risk. Those companies are funded by investors that are generally not concerned with what is being produced as much as they are concerned with the relationship between risk and reward. If the risk reward ratio of pharmaceuticals becomes worse people will invest in toys

  7. Barry Carol says:

    As I’ve noted before, my ablation procedure last year at a leading NYC academic medical center which included an overnight stay in a cardiac observation unit, was billed to Medicare at $222,000!! Medicare actually paid about $15,700 which was accepted as full payment. That excludes the physicians’ bills. How would you like to be a patient who gets a balance bill for $206,000+? It doesn’t make any sense.

    As for specialty drugs, I think they lend themselves especially well to QALY metrics which should be determined by insurers, not government. The problem is that they will probably get too much blowback from bleeding hearts who think we can’t put a price on human life and every possible intervention should be available to everyone at someone else’s expense no matter how cost-ineffective it is. I think it’s cultural attitudes like that among too much of the population that need to change before common sense can be applied to both health insurance and healthcare, especially at the end of life.

    • Allan says:

      “How would you like to be a patient who gets a balance bill for $206,000+? ”

      No one likes it, but I don’t like vanilla ice cream preferring chocolate instead. Should we ban vanilla? The point is there are a lot of alternatives to socialized medicine which is essentially what you are asking for, though in piecemeal form. The control freaks aren’t looking for solutions, they are looking for control.

      “who think we can’t put a price on human life”

      We put a price on human life all the time, but healthcare is said to be different where no amount of society’s money is too much. These control freaks don’t understand freedom, tradeoffs, incentives, etc. They just want to dictate what everyone else is permitted to do. Sometimes the trade off is a bit of immediate short lived comfort for freedom and that trade isn’t worth it.

      You talk about “common sense” being applied to healthcare, but common sense only prevails where there is a willing buyer and a willing seller.

    • Devon Herrick says:

      The billed charges of $222,000 is not a real price. But someone could in theory get stuck with a balance bill because of the way health care is financed in the United States. I like the idea of requiring a meeting of the minds agreement in order for a bill to be enforceable. I’m guessing a patient who was presented with a $222,000 would make other arrangement until they found a facility willing to perform the service for $20,000 to $30,000 (which is probably closer to the market price).

  8. Bob Hertz says:

    Devon, I love that you stated that without a meeting of the minds, medical bills would be unenforceable.

    I have been saying that for 10 years.

    But do you appreciate what an enormous legal revolution this would be?

    I cannot begin to count how many doctors and hospital employees make a great living and are utterly dependent on medical bills being collected as written, or close to it.

    To paraphrase an old Southern senator, those BMW’s and Audi’s in the hospital parking ramp do not pay for themselves. Patients and insurers get backed up against the financial wall every single day and transfer money to the medical sector.

    What the heck, enforcing a meeting of the minds would even cut into the rich revenues of medical collection agencies. I cannot imagine a more deserving group of economic sufferers.

    Keep up the good work, but know that on this issue, you have just joined ranks with a lefty like me.

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  11. Bob Hertz says:

    Devon, you stated that “I’m guessing a patient who was presented with a $222,000 would make other arrangement until they found a facility willing to perform the service for $20,000 to $30,000 (which is probably closer to the market price).”

    This is absolutely true if the $220,000 charge is presented before the care begins, like 2 weeks before. The current crisis however is caused by the fact that the $220,000 charge is presented after the care is completed in most cases!

    • Devon Herrick says:

      Exactly! I would make it harder to collect fees like that, since there was never a meeting of the minds, which is required under contract law. After a couple cases where the fee is uncollectable or sent to arbitration, providers would quickly begin talking to their patients.

      • John Fembup says:

        Devon, I would suggest it’s also a problem that so many people agree to receive a service or product and never inquire about the cost.

        What else besides medical care do people buy that way? People don’t even buy medical insurance that way.

        But medical care? I think too many people buy on this model:

        “Oh yeah, whatever you say, doc, go right ahead. I’m insured, it’s not gonna cost me anything. And if it does – then my insurance is ripping me off!!”

        • Allan says:

          “People don’t even buy medical insurance that way.”

          People may check price for medical insurance, but all the policies are relatively similar because government is so involved in determining what is offered and what the price is.

          In a free wiling buyer/ willing seller insurance market the insurer’s could have a greater impact on how their insured view costs.

          • John Fembup says:

            Does your comment include the largest insurer in the US ? 😎

            • Allan says:

              You probably are referring to Medicare, but even there insurance offers are severely limited by CMS. I don’t think the Medicare contract no matter which method of Medicare one chooses is sufficiently based upon willing buyer/ willing seller.

              • John Fembup says:

                Yes, I meant Medicare.

                And you get my point. The presence of insurance deters people from asking what something will cost.

                The same people who would never think of buying a meal or a toy for their kids or a washing machine without knowing what it will cost, will commit themselves to medical treatment without knowing or caring what it costs, and therefore not asking. Because they are “insured”.

                Being “insured” means, for most people, they need not worry about cost. So long as this is true, I doubt they will respond to insurers or governments attempts to persuade them to ask what medical treatment actually costs. So long as this is true, there will be cost “surprises”. And those surprises will continue to be blamed in insurance.

                • Allan says:

                  Insurers should not be blamed unless they earn their profits from government largess or monopoly, involve themselves in collusion or fraud or intentionally mislead their buyers.

                  In my office I watched the cash machines ring up because everyone wants the best even though the so called best isn’t needed. Third party insurers have made many Internists into triage agents rather than trained physicians. That is a cost elevator that can only be stopped by the patient.

                  • John Fembup says:

                    We agree except for the “can only be stopped by the patient” and that may be semantics.

                    I do say patients are unlikely to change their behavior without an incentive. Right now, their incentive seems to be to demand insulation from medical costs thru insurance, and blame insurance when they don’t get it. This keeps people from considering that medical costs are the problem.

                    I think fixing that problem is what transparency in pricing is all about. Dont you think the same?

  12. Bob Hertz says:

    John, you raise a good point about people not asking what things cost.

    A lot of people are trusting of doctors and deferential toward them. (I am this way myself.) We feel it is impolite and ungrateful to ask a doctor about costs.

    Right now I have wraparound Medicare coverage, so I do not need to ask about costs. But even when I was under 65 I did not ask.

    When it comes to hospitalization, though, there is usually no one that you can ask about costs ahead of time. The clerk that checks you in cannot tell you the cost. Your own insurer generally will not tell you either.

    When my wife was in hospital to give birth, I did ask someone about costs. I was given dirty looks by every nurse on the floor for the rest of my episode, and my wife feels that she was handled rougher on this childbirth versus her other ones.

    • Devon Herrick says:

      Bob my doctors tend to take cost into consideration. I’ve had then ask about insurance and change their tone when I said I am paying it all due to a high deductible. The didn’t seem annoyed, but trying to be cognizant of my situation.

      About 30 years ago a relative who uninsured at the time gave birth in a small town rural hospital. She remarked that when the nurse noted that she was paying cash, the nurse removed some of the pressure sensitive bar codes from the chart and didn’t stick quite a few on. Each item used had a bar code that were placed on the record to be scanned when an item was consumed. Of course, back then having a baby at a hospital and paying out of pocket was not as risky as today when most hospitals have “list prices” that are 10 times the actual price.

  13. John says:

    I wish Obamacare was socialized medicine… it’d be a lot better.

    • Devon Herrick says:

      Maybe it is more accurate to call Obamacare antisocial medicine.

      • Ron Greiner says:

        So Devon, tell us about Medicaid under VP Pence.

        Repeal In Name Only – or RINOcare.

        So, what might fake repeal look like? For one potential example, look no further than Vice President-elect Mike Pence’s Indiana.

        Let’s spend $8,000 per person on Medicaid but give those poor schmucks high deductibles and mandatory HSA deposits for eligibility.

        Those Governors are crazy. President Trump was smart sending IOWA’s Governor to China and let him scam those people for a while.

        Let’s bundle all the money and give it to local state politicians because those people can be trusted with billions of dollars.