Controlling healthcare costs.

[gavin]

I was on a long car trip recently and this idea came up. I'm from a business background so I think of things in terms of economics and markets.

It seems to me that one of the biggest issues with the cost of healthcare is that service providers (hospitals, doctors, etc.) usually just provide a service and then bill the patient and the insurance company afterwards. There is no sort of initial price negotiation or even advertisement of prices. Sometimes, there's not even time to do any of that due to the nature of the the service (i.e. pulling bullets out of an individual's chest). This means that the prices of products in hospitals are not exposed to market conditions.

Addtionally, doctors often breach their fuduciary responsibilities by giving the patient a produce that is marked up by several thousand percent of the normal value. An aspirin is a prime example of something that can be market at $9 but only cost a few cents. The patient is not knowledgeable enough to understand that they can just take a tylenol or another type of pain medicine because the doctor doesn't explain it. So we just trust that the doctor is serving our best interest when we could have the same pill with us in the very same room (such as the wife's purse).

If hospitals had to post prices for services, even though they are largely in flux, then hospitals would have to compete with eachother based on not only service but price. This is fundamental and necessary in a capitalist society if the government isn't going to regulate things like this. The next step would be to encourage patients with insurance to take cheaper options. If my out of pocket expense has been paid, then I don't have to worry about price since my insurance would cover it. But if my insurance motivated me to find another option or if it cost me directly to go more expensive routes then I'd be more likely to do so. Perhaps individuals could begin establish a worst case scenario list of "if this happens to me, then take me to this service provider"

This may not eliminate the need for health insurance, but it should lessen it by a huge amount. Any thoughts, comments, concerns, insults?

[cphite]

If hospitals had to post prices for services, even though they are largely in flux, then hospitals would have to compete with eachother based on not only service but price.

This.

The main reason that healthcare costs keep rising is exactly what you are alluding to above. People have no idea what they are paying, so they don't even think about it. So there is absolutely no incentive on the part of providers to be competitive in terms of pricing. In fact, what you get is just the opposite - the incentive is to charge as much as they can get away with.

If you really want to drive costs down, there needs to be some direct effect of price on the consumer. There has to be some incentive to shop around for better prices. For example, if insurance were reserved for extreme situations - a serious injury or illness, or long-term conditions - and people paid out of pocket for the more minor and routine stuff. Or, if insurance paid a fixed percentage of all expenses, but still required a percentage of the total be paid by the consumer (again, with protection in place for serious injuries, illness, etc)

A great example of this can be seen in the area of laser eye surgery. Because it is not generally covered by insurance, providers are forced to be competitive, and the prices have come down considerably over the years relative to similar procedures.

Unfortunately, most governments seem to be pushing in the opposite direction. For example, one of the main things The Affordable Care Act does is increase the amount of insurance that people have to carry. So even those of us who would choose to carry far more limited insurance, and who would shop around, will no longer have that option.

[Izawwlgood]

No mention of tort?

[Yakk]

Item: Other nations have better outcome health care that costs much, much less.

Item: None of these nations have menus at their emergency room with prices on them.

Item: Health insurance companies have little to no incentive to drive costs down in general. They have lots of incentive to drive costs up in general (as their competition is a mixture of "no health care" and "paying out of pocket" -- paying out of pocket is worse, their product is better), then cut a percentage off them.

[CorruptUser]

An aspirin is a prime example of something that can be market at $9 but only cost a few cents. The patient is not knowledgeable enough to understand that they can just take a tylenol or another type of pain medicine because the doctor doesn't explain it.

Tylenol can interfere with other drugs (tylenol + alcohol = liver damage) in ways that are different from Aspirin. Also, Aspirin is a blood thinner, so it may have different effects on the body. Oh, and if your doctor tells you to take aspirin, just buy Acetylsalacyla- Acetylsallal- Asyllable- "generic aspirin".

[gavin]

No mention of tort?

What good it tort reform going to do in an industry that isn't exposed to competition? They have no incentive to lower prices just because operating costs are lower. In fact, they stand to gain significant profits by keeping things the same and the demand for their product (life) is at an all-time high. Couple that again, with the fact that you don't know if another place is cheaper and any place can make just as much profit as they want.

So hopefully it's clear that reducing tort reform and making insurance cheaper is kinda a joke when we look at the real problem. Cheaper insurance will only reduce premiums and maybe not by much. Out of pocket expenses and non-covered procedures will still hit home.

Tylenol can interfere with other drugs (tylenol + alcohol = liver damage) in ways that are different from Aspirin. Also, Aspirin is a blood thinner, so it may have different effects on the body. Oh, and if your doctor tells you to take aspirin, just buy Acetylsalacyla- Acetylsallal- Asyllable- "generic aspirin".

Yes, that's what I meant. The patient may be able to take some pain medication that's already in their possession but they aren't knowledgeable enough to know that it won't interfere. The doc will still tell you its aspirin, you just won't know that you can take your own aspirin because you're made to think their aspirin is holy.

[cphite]

Item: Other nations have better outcome health care that costs much, much less.

Item: None of these nations have menus at their emergency room with prices on them.

Item: Health insurance companies have little to no incentive to drive costs down in general. They have lots of incentive to drive costs up in general (as their competition is a mixture of "no health care" and "paying out of pocket" -- paying out of pocket is worse, their product is better), then cut a percentage off them.

Statistically, the United States has higher survival rates for trauma care, serious illness, long-term illness, you name it, than nearly anyplace else in the world. We also enjoy shorter wait times for both emergency and non-emergency medical care. There is a reason that people come here from around the world when it really matters, rather than vice-versa.

Countries with socialized medicine manage lower prices mainly by denying care to people; and if you do get care, you typically wait a lot longer to get it. Do some reading on average wait times for both critical and non-critical care if you're actually interested.

As for your last point, the incentive of an insurance company is to have prices remain relatively flat. Insurance companies typically operate with a relatively low profit margin - around 3.5% is the average - and if prices rise too quickly, they are not able to maintain that margin, because they are generally limited in regards to how much and how often they can raise premiums. Insurance companies aren't worried in the slightest about "competition" from people paying out of pocket; the number of people who pay out of pocket for care is ridiculously small, and there are very few people who even could pay out of pocket for anything significant.

[Czhorat]

Statistically, the United States has higher survival rates for trauma care, serious illness, long-term illness, you name it, than nearly anyplace else in the world. We also enjoy shorter wait times for both emergency and non-emergency medical care. There is a reason that people come here from around the world when it really matters, rather than vice-versa.

Except when people from the US go elsewhere to save costs. Read the thorough list of destinations on Wikepedia's Medical Toursism article.

There are ways to save costs without denying care. One idea is to use a more "evidence based" approach in choosing interventions. Take knee pain for example. Large-scale studies have shown that physical therapy (which is cheap) is as effective in the long run as surgery (which is expensive and more likely to have complications). The smart thing to do, to save money and keep the same standard of care, is to use the data to choose treatments rather than rely on practioners' subjective judgement or personal biases.

getting back to the topic at hand, another big issue is a lack of spending on basic preventative care and a lack of access to primary care physicians or even nurse-practioners for routine, non-emergency care. Too many of the poor go to an emergency room as their only source of care. This is a very expensive proposition and ends up hurting the entire system.

[CorruptUser]

Statistically, the United States has higher survival rates for trauma care, serious illness, long-term illness, you name it, than nearly anyplace else in the world. We also enjoy shorter wait times for both emergency and non-emergency medical care. There is a reason that people come here from around the world when it really matters, rather than vice-versa.

Except when people from the US go elsewhere to save costs. Read the thorough list of destinations on Wikepedia's Medical Toursism article.

Stay the hell away from medical tourism!

Long story short, it's cheaper because the malpractice laws are nonexistent, there is lower standard of care, etc.

[cphite]

Statistically, the United States has higher survival rates for trauma care, serious illness, long-term illness, you name it, than nearly anyplace else in the world. We also enjoy shorter wait times for both emergency and non-emergency medical care. There is a reason that people come here from around the world when it really matters, rather than vice-versa.

Except when people from the US go elsewhere to save costs. Read the thorough list of destinations on Wikepedia's Medical Toursism article.

I guess you missed the point of "when it really matters". Most medical tourism from the USA is elective procedures, and it's nearly always for the purposes of getting a lower price; it's very rarely a matter of seeking higher quality care. Which was the whole point. People who come to the USA for care are generally coming because they have a much higher expectation of success.

There are ways to save costs without denying care. One idea is to use a more "evidence based" approach in choosing interventions. Take knee pain for example. Large-scale studies have shown that physical therapy (which is cheap) is as effective in the long run as surgery (which is expensive and more likely to have complications). The smart thing to do, to save money and keep the same standard of care, is to use the data to choose treatments rather than rely on practioners' subjective judgement or personal biases.

An even better way to save costs is to give the patient direct access to the relative costs of the procedure. If the patient is told that physical therapy is much cheaper, just as effective, AND is directly affected by the difference in cost then he or she is more likely to choose the physical therapy. A large part of the problem with the insurance model is that the patient doesn't really know, and has no reason to care about the cost difference. The choice of treatment should be between the provider and the patient; where both parties have both the incentive and the information to make the best possible decision.

getting back to the topic at hand, another big issue is a lack of spending on basic preventative care and a lack of access to primary care physicians or even nurse-practioners for routine, non-emergency care. Too many of the poor go to an emergency room as their only source of care. This is a very expensive proposition and ends up hurting the entire system.

Preventative care is important from a purely humanitarian perspective; it's a means of limiting suffering. But it is absolutely not a cost cutting measure. Preventative care is actually very non-cost-effective; it's just a matter of numbers. Unless a very high percentage of people would be getting sick without it, or the costs of treating those people would be many times more expensive than prevention, it actually drives spending upward. This isn't to say that prevention isn't a good thing; its just not a cost-cutting thing.

[gavin]

Statistically, the United States has higher survival rates for trauma care, serious illness, long-term illness, you name it, than nearly anyplace else in the world. We also enjoy shorter wait times for both emergency and non-emergency medical care. There is a reason that people come here from around the world when it really matters, rather than vice-versa.

Countries with socialized medicine manage lower prices mainly by denying care to people; and if you do get care, you typically wait a lot longer to get it. Do some reading on average wait times for both critical and non-critical care if you're actually interested.

As for your last point, the incentive of an insurance company is to have prices remain relatively flat. Insurance companies typically operate with a relatively low profit margin - around 3.5% is the average - and if prices rise too quickly, they are not able to maintain that margin, because they are generally limited in regards to how much and how often they can raise premiums. Insurance companies aren't worried in the slightest about "competition" from people paying out of pocket; the number of people who pay out of pocket for care is ridiculously small, and there are very few people who even could pay out of pocket for anything significant.

This simply isn't true. Let's compare the US to Canada and the UK.

As far as straight desireability:
Only .5% (half of a percent, not 50%) of Canadians even got healthcare in the US and 75% of that .5% only got it here because they were already in America when something happened or the closest hospital to where they live happened to be right across the border (in America). The rest specifically came here for something. Perhaps a hospital or doctor that specialised in something that they specifically needed. Even so, that's less than .2% coming here to be here. The number of Americans going up there is huge.

Country Life expectancy: USA: 78.1 UK: 79.1 Canada: 81.3
Infant Mortality Rate: USA: 6.9 UK: 4.8 Canada: 4.5
Physicians per 1,000 people: USA: 2.4 UK: 2.5 Canada: 2.2 (this is to show we don't really have a different number of physicians per person)
Per capita expenditure on health (USD): USA: 7,290 UK: 2,992 Canada: 3,895 (almost twice the cost of Canada for a lower life expectancy?)
Healthcare costs as a percent of GDP: US: 16.0 UK: 8.4 Canada: 10.1


Services aren't denied in these other countries. Instead, they perform a sort of triage for patients that places the people who need services more on the start of the list. This is why wait times are longer but they aren't a big deal. If you've got a bullet wound or a suspicious tumor, you go now. If your finger is tingly then the doctor can see you in a few months. This improves their life expectancy because the wealthy can no longer bully their way into earlier treatment unless they have their own private doctors and treatment is suddenly needs based.

Not only that, but look at this: For 80-90% of Canada's population diagnostic tests (non-emergency MRI, CT scans, angiographies) take an average of 2 to 3 weeks, Specialist physician visits average around 4 weeks, Non-emergency surgery is about 4 weeks. This is pretty much negligeable in difference from the US where a suspicious mole takes an average of 39 days to see a dermatologist. Though we are faster on average for other things, it doesn't really make a difference. Note again that these are all non-emergency issues and do not need to be done instantly.

Here's something we are number one in: 51% of sick Americans did not visit a doctor, get a needed test, or fill a prescription within the past two years because of cost. No other country is even close to that and I'm not proud of that fact.

% of government revenue spent on health: US: 18.5 UK: 15.8 Canada: 16.7
% of health costs paid by government: US: 45.4 UK: 81.7 Canada: 69.8

Sources:

Wait times in Canada: Health Canada (A government department) put out several studies, their government site will work as a source:
http://www.hc-sc.gc.ca/hcs-sss/pubs/system-regime/2008-fed-comp-indicat/index-eng.phpNumeric Data such as rates and expenditures: The Oecd (organization for economic co-operation and develepment), below is the actual PDF
http://www.oecd.org/dataoecd/46/33/38979719.pdf

But, beyond those sources, I have followed several elements to their starting points. These aren't smoke and mirrors but real studies. Things like national expenditures on health care are well-known facts. I have been agains the idea of publically funded healthcare until this information which I cannot deny would make more sense to us.

Oh yeah, for a huge source on comparations of America and other nations:
http://www.commonwealthfund.org/Maps-and-Data/ChartCart/View-All.aspx?charttopic=Access+++Equity&page=1
They did a great job. Again, while our average wait times are shorter, this is not necessarily a good thing for all the reasons I listed above. The times aren't nearly as bad as people say though. Most people claim some huge extremes that we also have here.

[Vaniver]

Forget prices; why don't we actually compare error rates between hospitals and doctors, and make that information far more public than it is?

[CorruptUser]

Forget prices; why don't we actually compare error rates between hospitals and doctors, and make that information far more public than it is?

You are assuming that stuff is actually reported in the first place. I worked for a medical malpractice insurance company, and a lot of errors aren't discovered until years later.

If you meant number of lawsuits, number of patient deaths, etc, those numbers can very easily be manipulated or misread. A doctor that treats 1000 people a year but has 1 lawsuit is better than a doctor who treats 100 people and has 1 lawsuit. Doctors could 'share' patients so each doctor could see 10000 patients in a year despite actually helping only 1000. Doctors would avoid risky patients like the plague, to avoid bad statistics even with good medicine. Etc.

[mmmcannibalism]

Here is an interesting question I once thought of.

Are health care costs actually going up besides inflation?

Obviously, I'm not talking about the amount we pay for healthcare. What I mean is to what extent are costs simply a matter of new(or improved) technology being used. For instance, if I wanted to buy insurance that would cover everything my grandparents could have had 50 years ago; how much would that costs compared to what I would pay for full insurance coverage.

[Vaniver]

Obviously, I'm not talking about the amount we pay for healthcare. What I mean is to what extent are costs simply a matter of new(or improved) technology being used. For instance, if I wanted to buy insurance that would cover everything my grandparents could have had 50 years ago; how much would that costs compared to what I would pay for full insurance coverage.

That's not "inflation," that's "innovation." One of the problems with American health care is that almost all of the research goes into new, expensive ways to treat conditions- selling a million dollar MRI machine to every hospital is a lot more profitable than developing a new kind of physical therapy. So, you pay twice as much for care that's possibly 30% better, instead of half as much for care that's just as good.

[Arrian]

Here is an interesting question I once thought of.

Are health care costs actually going up besides inflation?

Obviously, I'm not talking about the amount we pay for healthcare. What I mean is to what extent are costs simply a matter of new(or improved) technology being used. For instance, if I wanted to buy insurance that would cover everything my grandparents could have had 50 years ago; how much would that costs compared to what I would pay for full insurance coverage.

Yes. I can't remember the name of the theory but it made the blog rounds a year or so ago and then was promptly forgotten. It goes like this: Industries that rely purely on human performance, like the orchestra, don't get productivity gains with new technology. (A violin player in Austria 300 years ago provided about the same experience as a violin player in Carnegie Hall today.) Since their productivity doesn't increase, the cost of he product increases at the same rate as the producer's income, and if incomes remain constant relative everything else, the price of the product will increase relative everything else as well since everything else gets its price depresses through productivity gains.

Medical practice, especially primary care, is another field where technology doesn't really increase productivity a lot: You still have to go see the doctor and pay for his time regardless of whether he's using leeches or the newest synthetic antibiotic, so that's one of the factors driving the increase in medical costs.

I wish I could remember the name of the theorem, I think Megan MCardle, or maybe Gary Becker and Eric Posner blogged on it a while back. Whomever, they did a much better job of explaining it and pointed to the original author, but I can't remember the name or find the reference now.

selling a million dollar MRI machine to every hospital is a lot more profitable than developing a new kind of physical therapy. So, you pay twice as much for care that's possibly 30% better, instead of half as much for care that's just as good.

But why is this true only of medical care? Automobiles have tremendously better technology now, yet the cost (in number of hours worked to pay one off for an average worker) has only increased slightly over the past century or so. Most other products are hugely improved yet prices have fallen tremendously: Televisions, music playing devices, cell phones, computers, power tools, etc.

The incentives are set up differently in the medical market than in other markets. And I've got to think that third party payment systems where the consumer faces a low, fixed marginal cost has a lot to do with it, not everything, but a lot. (Note that your insurance premiums are sunk costs and don't really affect your consumption decisions. It's your copay or deductible that are the actual monetary costs of medical care, plus the opportunity cost of the time it takes to go to the doctor, which is a significant deterrent for many people working hourly positions with limited sick leave.)

[cphite]

Only .5% (half of a percent, not 50%) of Canadians even got healthcare in the US and 75% of that .5% only got it here because they were already in America when something happened or the closest hospital to where they live happened to be right across the border (in America). The rest specifically came here for something. Perhaps a hospital or doctor that specialised in something that they specifically needed. Even so, that's less than .2% coming here to be here. The number of Americans going up there is huge.

You do realize there are other countries besides the US and Canada, right?

Country Life expectancy: USA: 78.1 UK: 79.1 Canada: 81.3
Infant Mortality Rate: USA: 6.9 UK: 4.8 Canada: 4.5
Physicians per 1,000 people: USA: 2.4 UK: 2.5 Canada: 2.2 (this is to show we don't really have a different number of physicians per person)
Per capita expenditure on health (USD): USA: 7,290 UK: 2,992 Canada: 3,895 (almost twice the cost of Canada for a lower life expectancy?)
Healthcare costs as a percent of GDP: US: 16.0 UK: 8.4 Canada: 10.1

Life expectancy is influenced by many more factors than just health care. The USA has more gun violence, for example, than either of those two countries. The USA has many more deaths due to highway accidents, for example. Simply pointing to a difference in "life expectancy" is misleading. In regards to infant mortality rates, there is a strong correlation between economic status and infant mortality; again, it's not exclusively a matter of available health care.

Yes, we do spend more per capita; in large part because of over-insurance driving up the costs; which has been one of the main points of the thread so far. We also spend more of a percentage of GDP - we have over six times as many people as the UK, and over nine times as many people as Canada - and neither of those countries has a massive illegal immigration problem like we do - which is another pretty significant factor in our costs.

Services aren't denied in these other countries. Instead, they perform a sort of triage for patients that places the people who need services more on the start of the list. This is why wait times are longer but they aren't a big deal. If you've got a bullet wound or a suspicious tumor, you go now. If your finger is tingly then the doctor can see you in a few months. This improves their life expectancy because the wealthy can no longer bully their way into earlier treatment unless they have their own private doctors and treatment is suddenly needs based.

Services are absolutely being denied in other countries - England is a good example. Take a few moments to peruse their online news if you'd like examples. Try "cancer" or example.

Triage is performed everywhere, including the United States; it's not exclusive to these other countries.

Do you have any actual evidence of wealthy people "bullying" their way into earlier treatment? Let alone evidence that it happens enough to actually change nationwide life-expectancy numbers?

[Yakk]

You do realize there are other countries besides the US and Canada, right?

So your argument is that the US health care system is better than China's and Mexicos (or other 3rd world nation)?

Or is there some other first world, large, industrialized nation in which a huge percentage of the citizens fly overseas to the USA for health care in huge numbers that I don't know about?

Because the observation that few Canadians ever seek US health care was in response to "why do other nations come to the USA for health care if US health care is so crappy". Canada is the nearest large, industrial nation near the USA -- so how was that not rather strong evidence that what was described rarely happens?

[Vaniver]

But why is this true only of medical care? Automobiles have tremendously better technology now, yet the cost (in number of hours worked to pay one off for an average worker) has only increased slightly over the past century or so. Most other products are hugely improved yet prices have fallen tremendously: Televisions, music playing devices, cell phones, computers, power tools, etc.

All of those are private, lightly regulated systems where the customer purchases goods for themselves with their own money.

[gavin]

You do realize there are other countries besides the US and Canada, right?

It's the nation that's close enough to take advantage of proximity and lax border crossing regulation that also has a legitimate healthcare system (not the kind of "might wake up without your kidney" failed state system that Mexico has).

Life expectancy is influenced by many more factors than just health care. The USA has more gun violence, for example, than either of those two countries. The USA has many more deaths due to highway accidents, for example. Simply pointing to a difference in "life expectancy" is misleading. In regards to infant mortality rates, there is a strong correlation between economic status and infant mortality; again, it's not exclusively a matter of available health care.

The UK and Canada are not poor countries so you can't simply dismiss their infant mortality rate like that. Look at these numbers http://en.wikipedia.org/wiki/List_of_countries_by_infant_mortality_rate. Note that in the UN numbers, we rank 34th (1 being best) where Canada and UK are 25 and 24 respectively. We're in the 7/1000 range whereas both the UK and Canada are in the 5's range.

Note also that we're below Cuba and several other very poor countries. The CIA factbook has us at 46, just beneath Guam and Cuba. I'm going to say that again, a higher percentage of babies die here than in GUAM and CUBA. As you go further down on the list (and look around the US), you'll begin to notice that the countries are only getting poorer. If you go up on the lists, the richer world powers begin to appear. Here's the kicker, we even have better access to abortion than those other nations do. So we're known to abort a fetus that may have complications and those aren't counted in these numbers. So our actual number should be even worse. How messed up is that?

As for their death rates, found here: http://en.wikipedia.org/wiki/List_of_sovereign_states_and_dependent_territories_by_death_rate, they are around the same as the US. According to the UN's numbers, the UK is 66th at 9.9/1000, the US is 96th at 8.2/1000, and Canada is 113 at 7.4. So the difference in mortality rates (sounds counterintuitive, I know) are somewhate negligeable since the UK has a higher mortality rate but a longer life expectancy (meaning the old must be much older to compensate for the dying). Not that Canada is closer to us than we are to the UK and yet their life expectancy is over three years higher than ours and that is significant.

Yes, we do spend more per capita; in large part because of over-insurance driving up the costs; which has been one of the main points of the thread so far. We also spend more of a percentage of GDP - we have over six times as many people as the UK, and over nine times as many people as Canada - and neither of those countries has a massive illegal immigration problem like we do - which is another pretty significant factor in our costs.

The percentage of GDP doesn't change with population size since a larger correctly functioning economy produces more. That's why it's done by percentage and not amount.

And why do illegal immigrants actually matter in this equation? People talk a lot about it but the other countries pay for all inhabitants and immigrants alike. Not only that, but according to the limited data we have, they account for only 2% of national medical spending. This is because they are mostly young and healthy because the journey over is difficult enough to prevent the chronically ill from trying to migrate (or making it successfully). This wiki links the data together nicely. http://en.wikipedia.org/wiki/Economic_impact_of_illegal_immigrants_in_the_United_States#Health_care (note that 22% of undocumented immigrants actually have health insurance, haha, I didn't know that)

It simply isn't the problem we think it is. It certainly wouldn't DOUBLE our healthcare costs. The problem is that the providers aren't exposed to the market pressures for two reasons. We don't know the prices up front nor can we really compare and health insurance takes away the motivation to shop around. If the price of healthcare went down, insurance would too since it IS tied to market factors.

Services are absolutely being denied in other countries - England is a good example. Take a few moments to peruse their online news if you'd like examples. Try "cancer" or example.

I've been presenting a lot of evidence to support my claims. I'm going to have to ask you to perform the same courtesy. The only time I've heard of England denying cancer treatment is when doctors believe that the patients are too old/frail to undergo treatment. Assuming this is what you're talking about, I'll respond to that. It's a call at the doctor's level. They are saying the service is not medically necessary because the bad outweighs the good. Note that they still get paid for it so it's not like they're particularly on the government's side. Followup studies show that the surgery only increases surviveability by 10-15%. Their medical field is probably just not caught up to that. This isn't a problem with the government being tight-fisted. It's a problem with the doctors thinking a 10-15% chance of three more years of life aren't worth it. That's another problem altogether.

Our insurance companies and hospitals are no better. We routinely deny life-saving services. You point out an extreme and claim it to be the rule. Do you really want me to drudge out the list of services we deny?

Triage is performed everywhere, including the United States; it's not exclusive to these other countries.

Do you have any actual evidence of wealthy people "bullying" their way into earlier treatment? Let alone evidence that it happens enough to actually change nationwide life-expectancy numbers?

Yes: http://www.nytimes.com/2011/04/30/your-money/30wealth.html?pagewanted=all let me present two excerpts for more easy reading:

"concierge medicine, a growing subset of medicine where patients pay doctors anywhere from $1,500 to $25,000 a year to receive personalized attention and care. (Dr. Glazer said he was paid toward the top of this range.) In most cases, patients presume that in an emergency their concierge doctor will push them to the front of the line to see a top specialist. "

"Concierge medical care is nothing new. In places like Florida, with a high concentration of Medicare patients, some upper-middle-class retirees pay extra fees so they can see a doctor when they need to.

MDVIP, which has 450 concierge doctors in 34 states, charges patients $1,500 to $1,800 a year. Their doctors are each limited to 600 patients, whereas, the company says, most primary care physicians serve at least 2,000 patients. It says appointments with doctors “start on time and last as long as necessary” and can usually be made the same day or the next one. The company’s fee is for the extended care and comprehensive annual physical and wellness plan, but its doctors still bill the patient’s insurance company for procedures."

So you see, things are far different from what is commonly being taught.

[Vaniver]

The UK and Canada are not poor countries so you can't simply dismiss their infant mortality rate like that.

You're right, it helps to look at race.

And why do illegal immigrants actually matter in this equation? People talk a lot about it but the other countries pay for all inhabitants and immigrants alike.

Do different countries have different levels of illegal immigration?

[CorruptUser]

You do realize there are other countries besides the US and Canada, right?

It's the nation that's close enough to take advantage of proximity and lax border crossing regulation that also has a legitimate healthcare system (not the kind of "might wake up without your kidney" failed state system that Mexico has).

Only idiots would steal a stranger's kidney. First, the thing rots and becomes useless after a few hours, so there is not much time to arrange for fencing the stolen goods. Second, if you need a kidney, not just any kidney will do; the odds of an unrelated kidney being compatible with you is on the order of 1 in thousands. Third, the people with enough money to buy black-market kidneys would find it cheaper, safer and more reliable to just bribe their way to the top of the transplant list. For example, Steve Jobs and his swanky new liver.

Sorry, repetition of urban myths and other obviously untrue stories is a pet peeve of mine.

[Sero]

I'd like to interject, if I may, to those discussing infant mortality rates.

I believe it is worth noting that there is a lot of variance in how infant mortality rates are calculated depending on country. The definition varies, in some places stillborn infants are considered to include those that die within 24 hours of birth, etc, any number of variations, which throws off infant mortality rates by a wide amount.

[CorruptUser]

I'd like to interject, if I may, to those discussing infant mortality rates.

I believe it is worth noting that there is a lot of variance in how infant mortality rates are calculated depending on country. The definition varies, in some places stillborn infants are considered to include those that die within 24 hours of birth, etc, any number of variations, which throws off infant mortality rates by a wide amount.

Yes, as an Actuary (soon!) with some experience in Life I can confirm this. Also, not counting births weighing under 500 grams, to say nothing of how fertility drugs are used, abortion rates, and a whole host of other things having little to do with the actual quality of healthcare.

[nitePhyyre]

If hospitals had to post prices for services, even though they are largely in flux, then hospitals would have to compete with eachother based on not only service but price.

The person walking into a hospital doesn't buy healthcare. They buy insurance. Insurance companies buy healthcare. And yes, hospitals advertise their prices to insurance companies. That's why there are a bunch of Insurance policies that only cover services received in certain hospitals.

[gavin]

Only idiots would steal a stranger's kidney. First, the thing rots and becomes useless after a few hours, so there is not much time to arrange for fencing the stolen goods. Second, if you need a kidney, not just any kidney will do; the odds of an unrelated kidney being compatible with you is on the order of 1 in thousands. Third, the people with enough money to buy black-market kidneys would find it cheaper, safer and more reliable to just bribe their way to the top of the transplant list. For example, Steve Jobs and his swanky new liver.

Sorry, repetition of urban myths and other obviously untrue stories is a pet peeve of mine.

This was a joke, I apologize that this particular line of joking struck a pet peeve of yours. I've been to Mexico a number of times and while there have been numerous things to fear, having an organ stolen was never one of them.

The person walking into a hospital doesn't buy healthcare. They buy insurance. Insurance companies buy healthcare. And yes, hospitals advertise their prices to insurance companies. That's why there are a bunch of Insurance policies that only cover services received in certain hospitals.

Insurance companies benefit as the prices are driven higher because they usually get the same percentage of profit regardless (so a larger pie means more money). They don't accept some hospitals because they still need to keep their premiums in competition with other companies so they need to have some sort of control over their intake vs. output.

This seperation between the person and the cost of the care they're recieving is exactly one of the problems I'm talking about.

I'd like to interject, if I may, to those discussing infant mortality rates.

I believe it is worth noting that there is a lot of variance in how infant mortality rates are calculated depending on country. The definition varies, in some places stillborn infants are considered to include those that die within 24 hours of birth, etc, any number of variations, which throws off infant mortality rates by a wide amount.

These sources provided ran their own tests with their own standards for measurement. That's why I presented multiple sources because each one gives similar results. We simply aren't keeping up with our counterparts.

[Sero]

Gavin, what sources do you refer to? I checked your previous posts and unless I missed one, you only posted one link about infant mortality, and it was to the wikipedia list on the topic. That, in turn, has only two (well, three, but two of them link to the exact same place) references, and one of them is the CIA World Factbook, which is...not likely to be heavily involved in health demographics research. So...what additional sources do you refer to?

[gavin]

Gavin, what sources do you refer to? I checked your previous posts and unless I missed one, you only posted one link about infant mortality, and it was to the wikipedia list on the topic. That, in turn, has only two (well, three, but two of them link to the exact same place) references, and one of them is the CIA World Factbook, which is...not likely to be heavily involved in health demographics research. So...what additional sources do you refer to?

http://www.oecd-ilibrary.org/economics/country-statistical-profile-united-states_20752288-table-usa
http://www.commonwealthfund.org/Maps-and-Data/ChartCart/View-All.aspx?charttopic=Access+++Equity&page=1 (page 10)

The wiki included numbers from both the United Nations World Population Prospects report and the CIA World Factbook

Now then, please let me know which one of these sources you particularly disbelieve and why you're correct that they're wrong.

[Sero]

Err...I believe I specifically already mentioned the CIA World Factbook is not a source I'd consider likely to do any independent research. It's an almanac. An aggregator of information from a variety of public information sources. I have no doubt that both organizations, however, are accurately reporting such data as they have...just that the data they have is not inherently comparable due to differing standards used in each nation.

For instance, from your own links, this explains that some of the variation in OECD infant mortality rates are due to, well, look at that, differing standards as to what counts as infant mortality in various countries.

I'm not trying to make any point here about how good or bad the US's healthcare and healthcare outcomes are. I'm simply saying that infant mortality is not an ideal meterstick for that because it is difficult or impossible to accurately compare the data on an international level. Other rubrics are likely to be more suitable for your purposes.

[gavin]

Err...I believe I specifically already mentioned the CIA World Factbook is not a source I'd consider likely to do any independent research. It's an almanac. An aggregator of information from a variety of public information sources. I have no doubt that both organizations, however, are accurately reporting such data as they have...just that the data they have is not inherently comparable due to differing standards used in each nation.

For instance, from your own links, this explains that some of the variation in OECD infant mortality rates are due to, well, look at that, differing standards as to what counts as infant mortality in various countries.

I'm not trying to make any point here about how good or bad the US's healthcare and healthcare outcomes are. I'm simply saying that infant mortality is not an ideal meterstick for that because it is difficult or impossible to accurately compare the data on an international level. Other rubrics are likely to be more suitable for your purposes.

Is there any specific data on why the US's standard would place us so much further down the totem than our counterparts? If you'd like to dismiss the results, there needs to be some actual examples here as to why the US results are an outlier. Something we do that none of the comparable countries do.

[stevenf]

Declaration of potential conflict of interest - I have worked in the UK's National Health Service for more than thirty years.

The market/capitalism is an amoral mechanism for the reassignment between parties of assets.

An asset is worth what someone is prepared to pay for it or, more realistically, what they can be persuaded to pay.

The commodification of health is impractical because of its infinite complexity, context dependency, its variability over time etc. etc. The transaction costs of commercial healthcare are the single largest and most pernicious cause of cost inflation.

The USA has chosen a largely private route in which a naive and therefore vulnerable population is ruthlessly exploited, mostly, by highly organised corporations who have no interest in outcomes beyond the bottom line. This results in runaway costs, over medicalisation of life, over investigation, over treatment, avoidable morbidity and mortality, avoidable existential angst, sociopathic levels of recourse to litigation and galloping health neurosis.

The UK has chosen a largely public route in which almost all health care is free at the point of use and paid for from general taxation. A patient will, ideally, receive a technically competent opinion uncorrupted by external factors (such as profit) upon which they may choose to act. No-one is turned away. The problems that beset the NHS are many: Whereas the NHS used to be administered and chronically underfunded, it was made to work - more or less - by ad hoc local autonomous decision processes. Now the NHS is managed and, arguably, almost equitably funded it does not work any more because of bureaucratic paralysis/sclerosis and the removal of autonomy.

Anything that is perceived as free will be abused by some. The modern universal sense of entitlement stokes demand. Politics and media mess everything up. Technical advances and demographic change increase demand. The dwindling of personal responsibility is damaging to individuals and society.

The starting point for the control of healthcare costs should be a constantly refined definition of the scope of public provision. Public provision should relieve the fear of illness, injury, suffering and death through the provision of ubiquitous professional assessment of anything, any time, anywhere followed by advice on self care (or other private provision) or objective-evidence-based interventions where appropriate. Public provision ought not to be everything for everybody all of the time.

Preventative public health measures are the foundation stones of any civilised society's healthcare. Research provides for future benefit. Continuing training is a sine qua non. Without public education and awareness most activity becomes otiose. All of which will contribute to future cost containment.

Risk pooling is important for cost containment and is best achieved with the largest possible pool - the nation state, I suggest.

[Sleeper]

Gavin, you had a pretty good idea there in the OP. Others have had the same idea, but I'm surprised it hasn't gotten more play than it has.

Last year Representative Steve Kagen (D-WI) introduced a bill to do just what you suggested.

2/25/2010--Introduced.
Transparency in All Health Care Pricing Act of 2010 - Requires any and all individuals or business entities, including physicians, pharmacies, pharmaceutical manufactures, and insurance entities, that offer or furnish health care related items, products, services, or procedures for sale to the public to publicly disclose, on a continuous basis, all prices for such items, products, services, or procedures. Authorizes the Secretary of Health and Human Services (HHS) to: (1) investigate any individuals or business entities that fail to comply with the requirements of this Act; and (2) impose civil fines, or other civil penalties, as appropriate.

It's called "H.R. 4700: Transparency in All Health Care Pricing Act of 2010". It died when the 2011 legislative session began. There have been two similar bills that also died whimpering.

I was really excited about Kagen's bill when I read about it last year. But I've started to question that now.

Here's why transparency, as proposed, may not be such a good idea: http://www.policymed.com/2010/05/transparency-in-health-care-pricing-using-subways-5-dollar-foot-long-combinations.html

As a former attorney in the Federal Trade Commission’s (FTC) antitrust division, Mr. Cowie asserted that “wholesale negotiations — such as those between a hospital and device maker — should be kept private to ensure vendors don’t simply match prices.” He added that companies get “better outcomes if they negotiate head to head, privately,” and noted how FTC has opposed regulation requiring public posting of pricing terms.

He emphasized that collusion among companies to raise prices is more likely in industries where pricing terms are known among competitors. For example, if a company knows how its rivals set prices, that company may raise its own prices to meet those of its competitor. Why work to undercut the competition if you know customers will pay a higher price?

Mr. Cowie added that “[t]he availability of comprehensive price information makes it easier for industry to coordinate prices tacitly and to detect and discourage deviation from the consensus price in pharmaceutical pricing. The has even warned that the posting of “precise details of rebate arrangements” would make “tacit collusion . . . more feasible.” And despite Ms. Herzlinger’s testimony, CBO has also recognized that mandatory posting of pricing terms may reduce incentives to discount.

It may have the opposite effect from what was intended. Rather than more expensive providers being forced to match cheaper providers, cheaper providers may simply realize they can get away with higher prices when they see what more expensive providers get away with. Then again, maybe that just means that the law ought to include other provisions that would discourage healthcare providers from simply moving in the wrong direction on price. (though I don't know how such provisions would work.)

[Algrokoz]

No one here seems to actually work in medical billing, so let me give you an example of exactly how the system is broken. Insurers demand a discount from hospital systems because they funnel large #s of patients into said system. Hospitals don't want to give discounts because there is really no incentive to besides appeasing insurance companies. So in order to appease insurance companies while still maintaining desired profit margins, hospitals jack up the paper price of a certain exams/tests.

For example, the hospital has an MRI machine. Their costs are $500 per test (these numbers are ballparked for easy math; the real numbers are hard to pin down as you are averaging lots of inputs over several years/outputs, such as the cost of the machine averaged over its lifetime, the cost of the technicians and doctors, the cost of electricity, etc.) The hospital wants an additional $500 over their costs per test. This is the price that they will charge to insurance companies. But in order to do this, they have to jack up the paper price of the test to the $5000 range so that the huge discounts that insurers want brings the price down to the level they were going to charge anyway. This means that if you walk into a hospital and pay with cash out-of-pocket, you will get reamed. (Also hospitals tend to charge Medicare the full paper price as well, since the Federal Government is pretty loose with their cash.)

Furthermore, most doctors do not work on salaries. They are paid piecemeal based on the number of diagnostic studies/surgeries/consults that they do. This, coupled with a desire to cover one's own ass against frivolous lawsuits, are the leading causes of unnecessary testing that provides no practical data to the doctors trying to diagnose a patient. In turn, this creates in the mind of the patient the mentality that more testing = better, which is rarely the case.

If you want to reign in healthcare costs, 2 simple fixes would go a huge way to fixing the problem of out of control costs. Rather than simply disclosing the price of items, require hospitals to charge everyone the same price regardless of payment type and source. The other fix is put all doctors everywhere on salary. Please note that I am not calling for a pay cut for doctors, but rather removing the temptation to over-diagnose/test patients in order to line their own pockets. This obviously wouldn't fix everything, but I feel pretty confident that's more than 50% of the problem solved in one fell swoop.

[EdgarJPublius]

Only .5% (half of a percent, not 50%) of Canadians even got healthcare in the US... The number of Americans going up there is huge.

The fuck? How many exactly are in 'is huge'? What percentage of the U.S. populations makes up 'is huge'?

You can't just start tossing around numbers and then leave an 'is huge' right there on the table where everyone can see it.

[gavin]

The fuck? How many exactly are in 'is huge'? What percentage of the U.S. populations makes up 'is huge'?

You can't just start tossing around numbers and then leave an 'is huge' right there on the table where everyone can see it.

Some things are considered common knowledge. The fact that Americans cross the Canadian border for cheaper services should be considered one of those things. To give you numbers on the fly though:

We buy upwards of 1 billion dollars in prescription drugs from Canada each year. Medical tourism in Canada can save a US citizen 30-60% without any diminished quality of service http://www.cmaj.ca/content/170/6/945.full?etoc
Any proceedure that medical marijuana could aid in also brings in a lot of medical tourism from the US due to our ridiculous laws against the medical use of a substance that isn't as harmful as our pain killers.

We recieve around 60-85 thousand medical tourists each year. Compare this to our estimated 750 thousand americans that travel to other countries from 2007. They projected around 6 million in 2010, though I haven't seen the most recent study results to confirm that I do know 2009 was between 1 and 2 million so I wouldn't think it'd be more than 3 million. Still, if true it'd be a full 1% of the US population which is simply sick. http://www.ipa.org.au/publications/960/a-revolution-in-healthcare

To be fair though, not all of the 750 thousand (from the year 2007) are going to Canada. For example, India charges only $10,000 for a coronary bypass as compared to $50,000 in the US. Note that India has a slightly higher success rate at that procedure than the US (98.7 compared to 97.5). This infor is also found in the link immediately above.

We think that our country is great in the medical field. That's just damn wrong. We're great in medical research though.

No one here seems to actually work in medical billing, so let me give you an example of exactly how the system is broken. Insurers demand a discount from hospital systems because they funnel large #s of patients into said system. Hospitals don't want to give discounts because there is really no incentive to besides appeasing insurance companies. So in order to appease insurance companies while still maintaining desired profit margins, hospitals jack up the paper price of a certain exams/tests.

For example, the hospital has an MRI machine. Their costs are $500 per test (these numbers are ballparked for easy math; the real numbers are hard to pin down as you are averaging lots of inputs over several years/outputs, such as the cost of the machine averaged over its lifetime, the cost of the technicians and doctors, the cost of electricity, etc.) The hospital wants an additional $500 over their costs per test. This is the price that they will charge to insurance companies. But in order to do this, they have to jack up the paper price of the test to the $5000 range so that the huge discounts that insurers want brings the price down to the level they were going to charge anyway. This means that if you walk into a hospital and pay with cash out-of-pocket, you will get reamed. (Also hospitals tend to charge Medicare the full paper price as well, since the Federal Government is pretty loose with their cash.)

Furthermore, most doctors do not work on salaries. They are paid piecemeal based on the number of diagnostic studies/surgeries/consults that they do. This, coupled with a desire to cover one's own ass against frivolous lawsuits, are the leading causes of unnecessary testing that provides no practical data to the doctors trying to diagnose a patient. In turn, this creates in the mind of the patient the mentality that more testing = better, which is rarely the case.

If you want to reign in healthcare costs, 2 simple fixes would go a huge way to fixing the problem of out of control costs. Rather than simply disclosing the price of items, require hospitals to charge everyone the same price regardless of payment type and source. The other fix is put all doctors everywhere on salary. Please note that I am not calling for a pay cut for doctors, but rather removing the temptation to over-diagnose/test patients in order to line their own pockets. This obviously wouldn't fix everything, but I feel pretty confident that's more than 50% of the problem solved in one fell swoop.

Those are some good points that should be part of the solution. They may be a natural result of exposing medical care to economic forces though.

[EdgarJPublius]

The fuck? How many exactly are in 'is huge'? What percentage of the U.S. populations makes up 'is huge'?

You can't just start tossing around numbers and then leave an 'is huge' right there on the table where everyone can see it.

Some things are considered common knowledge. The fact that Americans cross the Canadian border for cheaper services should be considered one of those things. To give you numbers on the fly though:

Common knowledge is neither data nor evidence.
You can't compare 'half a percent to 'is huge' because one is a number that is factually verifiable, and the other is a wild generalization with no support or reasonable basis in reality. It's not comparing apples to oranges, it's comparing apples to unicorns.
The statement that "Only .5% (half of a percent, not 50%) of Canadians even got healthcare in the US... The number of Americans going up there is huge." is barely even half of an actual argument, it's meaningless.


If you look at the actual numbers you've just posted.
750,000 Americans is only .2% of the population, roughly equal to the percent of Canadians who actively seek U.S. healthcare.

Not that using medical tourism as some sort of indicator of healthcare quality is particularly sensical either way.

[gavin]

The fuck? How many exactly are in 'is huge'? What percentage of the U.S. populations makes up 'is huge'?

You can't just start tossing around numbers and then leave an 'is huge' right there on the table where everyone can see it.

Some things are considered common knowledge. The fact that Americans cross the Canadian border for cheaper services should be considered one of those things. To give you numbers on the fly though:

Common knowledge is neither data nor evidence.
You can't compare 'half a percent to 'is huge' because one is a number that is factually verifiable, and the other is a wild generalization with no support or reasonable basis in reality. It's not comparing apples to oranges, it's comparing apples to unicorns.
The statement that "Only .5% (half of a percent, not 50%) of Canadians even got healthcare in the US... The number of Americans going up there is huge." is barely even half of an actual argument, it's meaningless.


If you look at the actual numbers you've just posted.
750,000 Americans is only .2% of the population, roughly equal to the percent of Canadians who actively seek U.S. healthcare.

Not that using medical tourism as some sort of indicator of healthcare quality is particularly sensical either way.

Again, that was back in 2007. It is now in the millions. They project this year to be around 6 million but I have less than much confidence in their estimations.

The facts remain that going to another country can improve the chance of success AND reduce the price of the proceedure by 80% (as with the India Example).

The numbers don't include the fact that we go to canada for prescription drugs. It's a billion dollar industry and is changing the face of pharmaceuticals as we know it. Do not think that prescription drugs aren't part of the equation here.

[EdgarJPublius]

The fuck? How many exactly are in 'is huge'? What percentage of the U.S. populations makes up 'is huge'?

You can't just start tossing around numbers and then leave an 'is huge' right there on the table where everyone can see it.

Some things are considered common knowledge. The fact that Americans cross the Canadian border for cheaper services should be considered one of those things. To give you numbers on the fly though:

Common knowledge is neither data nor evidence.
You can't compare 'half a percent to 'is huge' because one is a number that is factually verifiable, and the other is a wild generalization with no support or reasonable basis in reality. It's not comparing apples to oranges, it's comparing apples to unicorns.
The statement that "Only .5% (half of a percent, not 50%) of Canadians even got healthcare in the US... The number of Americans going up there is huge." is barely even half of an actual argument, it's meaningless.


If you look at the actual numbers you've just posted.
750,000 Americans is only .2% of the population, roughly equal to the percent of Canadians who actively seek U.S. healthcare.

Not that using medical tourism as some sort of indicator of healthcare quality is particularly sensical either way.

Again, that was back in 2007. It is now in the millions. They project this year to be around 6 million but I have less than much confidence in their estimations.

The facts remain that going to another country can improve the chance of success AND reduce the price of the proceedure by 80% (as with the India Example).

The numbers don't include the fact that we go to canada for prescription drugs. It's a billion dollar industry and is changing the face of pharmaceuticals as we know it. Do not think that prescription drugs aren't part of the equation here.

Again though, you're only making half an argument. U.S. medical tourism may be up since 2007, but the .2% number for Canadian tourism to the U.S. is unattributed, Without knowing when it was current and whether the latest numbers are up, down or the same, attempting to make comparisons is dishonest.

And again, it's not clear to me at all that medical tourism figures even constitute a valid measure of healthcare system efficiency, as there are many other variables that can greatly influence those figures. Even comparing the cost and success rates of specific procedures falls short as it fails to consider many contributing variables and even variations amongst different procedures.

[gavin]

Again though, you're only making half an argument. U.S. medical tourism may be up since 2007, but the .2% number for Canadian tourism to the U.S. is unattributed, Without knowing when it was current and whether the latest numbers are up, down or the same, attempting to make comparisons is dishonest.

And again, it's not clear to me at all that medical tourism figures even constitute a valid measure of healthcare system efficiency, as there are many other variables that can greatly influence those figures. Even comparing the cost and success rates of specific procedures falls short as it fails to consider many contributing variables and even variations amongst different procedures.

Good point. The legitimate comparison between the US and Canada would require knowing what percentage of their populations seek healthcare at all in the given year. I do not have such a source.

The point though, was that America's healthcare was no better than Canadian healthcare. Did I fail to illustrate this point? We're more expensive (30-60% more expensive than Canadian services) and not necessarily even as good. Compare to India that may have a higher success rate and costs of 80% less than ours.

[EdgarJPublius]

Did I fail to illustrate this point?

Not to put too fine a point on it, but yes. As written, your argument does not seem to make a compelling case one way or the other, which is not the same as showing that one is not better than the other.

Compare to India that may have a higher success rate and costs of 80% less than ours.

For one procedure. This is not even close to a reliable or accurate comparison to show which healthcare system is better than the other. Would India's success rate hold up if it handled a similar rate of heart disease as the U.S.? For that matter, how representative is coronary bypass surgery of other major surgeries?