Comment by aftbit
12 days ago
Alright here are three health care reforms that we could implement without going all the way to Universal Health Care:
1. Anyone who pays cash for a procedure should pay a price that is no more than the lowest price that any insurance company has negotiated for the same service.
2. Anyone who buys a health care plan from the marketplace should get a price that is no more than 10% higher than the cheapest negotiated price any company pays for the same plan.
3. Anyone should be able to deduct the cost of health care for income tax purposes, not just companies that buy health insurance for their employees.
All else being equal, I'd rather see the pricing pressure done by market competition rather than enforced price caps benchmarked against some metric controlled by the industry (see Medicare Part D - gov. negotiates hard to only reimburse xx%, drug industry says fine, we'll just raise the book price - you'll get your talking point, and we'll still get our asking price).
So more significantly:
* bring back association health plans across state lines and industries, so small businesses can band together for group rates. https://news.bloomberglaw.com/daily-labor-report/biden-admin...
* Expand Direct Primary Care. https://www.dpcare.org/
* Allow primary care physicians, dentists, etc. to offer services without a state board providing "certification of need". This seems to just be gate-keeping / moat-building.
I'm not saying either or all of these are a perfect solution (nor do I think we need to find that solution immediately). As a small business owner, they'd make the health insurance handcuff problem easier to navigate by driving costs down.
I will say this - flying solo without health insurance does make you a FAR better consumer of healthcare services. You will comparison shop (made easier by price transparency rules). You will critically consider the necessity of gratuitous tests / procedures. You will learn that doctors are running profit-minded businesses like everyone else.
It also makes you reconsider some life choices (re: physically risky behavior).
I think the biggest fear I faced was the lack of catastrophic coverage (cancer, etc.). When we didn't have insurance (both small business owners) my wife and I probably consumed less than $1000 of direct services combined, per year. That part (direct pay for services used) was fine. Walking the tightrope without a safety net for expensive medical developments was our biggest risk. With kids it's even less of an option to operate that way. I've known many that have returned to corporate jobs for this reason alone.
It’s not as easy in reality as theory.
1) Services are often unique per patient. Even for patients with the same ICD-10 codes, the quality of service will vary. Hospitals cost different amounts to run. If you always peg the price to the lowest, it will be a race to the bottom for quality of service.
2) Patients are unique, with different health profiles, with different preferences for paying. Markets are different. Some markets only have one insurance payer.
3) Healthcare is already tax deductible
Regarding #3, do you mean in the United States? That's not generally true. Your health insurance premiums, under normal employer plans, are not tax deductible, but they are paid pre-tax.
Additional out of pocket healthcare expenditure is only deductible if you itemize your deductions and you're only allowed to deduct medical expenditures in excess of 7.5% of your income (AGI to be technical).
Paying something ‘pre tax’ is equivalent to, or even better, than it being deductible.
Or just have Medicare for everyone.
The current scheme only benefits rich people whose ability to pay outrageous insurance rates is easy and less than taxes. Poor people get substandard care, middle class workers get boned. I spend more on healthcare than taxes, and half my taxes are paying for stupid healthcare, either directly or through proxy.
Is that universal healthcare with extra steps? Almost, but on a serious note, why not go all the way with universality?
Because universal healthcare is not the best solution, as is becoming increasingly evident in Canada and the UK.
We need to fix the price gouging in the medical system by incentivizing competition. With the way things are currently set up in the US, the hospitals are essentially written a blank check any time a patient steps foot on their premises. If we bring competition between the hospitals with price transparency, the prices will fall dramatically.
> If we bring competition between the hospitals with price transparency, the prices will fall dramatically.
How do you envision this working for say emergency care, where as a patient you may not be in a state to make an informed decision about which hospital to visit?
5 replies →
How is the typical person supposed to decide the best path of care? How do you incentivize competition while keeping standards of care up so that people receive good care with highly complex tradeoffs.
Those aren’t mutual exclusive. In fact having healthcare not be gated to the single few that can afford it might accelerate the process of fixing the issues around pricing.
4. Go back to county hospitals. If you want to pay extra for the Cadillac plan and go private good for you. But let them compete against the county just like the 80s and prior.
Those are fair. But why impose them through regulations?
Entrepreneurs see business potential on this arbitrage opportunities.
Well, for starters, two things come to mind:
1. The healthcare and health insurance marketplace is riddled with regulation. There is no such thing as offering a health insurance plan or a healthcare service in the United States absent any regulation. Every existing service is, more or less, imposed via regulation.
2. The current health insurance system dates, in its current form, either to shortly after WWII or to the adoption of the ACA, depending on your perspective. That’s somewhere between 14 and 75 years. Where are the plans you speak of from these entrepreneurs? What are they waiting for, letting all of this sweet, sweet, arbitrage pass them by? Biding their time? Toward what end?