The Affordable Care Act is flawed, why not public pricing?

[poorcedure]

Submitted this on reddit, but thought the tech-savvy might have differing opinions.

"The Affordable Care Act creates no incentive for insurance companies to reduce prices, only their margins. Why not instead create a public service that forces health care providers to lock in a price?

If health care providers were not allowed to manufacture a starting price as part of negotiation, everyone could shop for the service that suits them. Insurance would still be helpful, just like it is for normally good drivers. The masses pay into a system in case they might need it, and those with the misfortune of needing help are funded.

Medical institutions and doctors can set realistic prices, the ones that insurance companies are already negotiating. The transparency would make billing simpler and more efficient. There could be some rating system, but I doubt that belongs in a government system. But any technology company will have access to prices and could amend with ratings.

Thoughts?"

[romgrk]

Leaving private companies in charge of healthcare is pure madness. Most of the developed countries have realized this. (see https://en.wikipedia.org/wiki/Universal_health_coverage_by_c...)

The reason is that healthcare is somewhere you don't want the profits to be the main goal. The goal is to make sure everyone is taken care of, at the best cost for the society. Did you know the US is the country that spends most on healthcare, and still doesn't have universal coverage? (http://www.investopedia.com/ask/answers/020915/what-country-...)

Therefore, public pricing is not the optimal solution. Public heath system is.

[maxerickson]

What does in charge of healthcare mean?

There's quite a few countries that have universal coverage with private medical providers (and maybe mostly private insurance).

For example, click through Switzerland at your link:

https://en.wikipedia.org/wiki/Healthcare_in_Switzerland

Of course with the ACA, the US system looks a lot more like Switzerland than it did before (private providers and insurance, guaranteed access, individual mandate).

I wonder if this sort of comparison points to there being some less drastic regulatory changes that could be made in the US to help reduce prices.

I also wonder how much things like population density factor into US costs. We have a lot of small rural hospitals (with 24 hour emergency room coverage and CT scanners and so on). Medicare reimburses small rural hospitals at a higher rate than other hospitals (but Medicare is our most efficient spending, so probably this is not a problem).

[poorcedure]

Agreed.

But replacing all of the private entities involved with health care overnight is not a likely next step. It should be a goal, eventually.

[beowulf_cluster]

> It should be a goal, eventually.

Warning: Completely tangential musing/rant...

That "eventually" word is killing me. When we leave these sorts of issues up to the forces in power, they never seem to get done. What we get instead are watered-down, doomed-to-fail, design-by-political-committee "solutions" such as the ACA.

I think we need an official roadmap. I think the public deserves a direct voice in guiding the direction of the country. At the very least, I think we need to set in stone a clear vision of what milestones we want to achieve as a nation.

My entire lifetime, our leadership has repeatedly demonstrated it is incapable of moving us in any single direction long enough and far enough to be meaningful (aside from war, perhaps). Let us choose the direction; let them work-out the implementation.

/end rant

I'm just speaking my mind. What do you all think? Is this even a "good" idea? How could we even begin to make this happen?

[maxerickson]

I think we need an official roadmap. I think the public deserves a direct voice in guiding the direction of the country. At the very least, I think we need to set in stone a clear vision of what milestones we want to achieve as a nation.

My entire lifetime, our leadership has repeatedly demonstrated it is incapable of moving us in any single direction long enough and far enough to be meaningful (aside from war, perhaps). Let us choose the direction; let them work-out the implementation.

To some extent the back and forth you talk about is evidence that the public doesn't agree on the direction to take.

[beowulf_cluster]

Sure, there's never going to be unanimous agreement. Put it to a vote. I'm mainly just talking about letting the public choose which issues the leaders should focus on, and holding them accountable if they don't.

[maxerickson]

How would that be different than what we have now?

I think there are things that would be incremental improvements (like having more members in the House of Representatives) and maybe better districts, but most elections have the candidates crafting a message based at least partly on what they hear from people and pretty high desire to get reelected (so they have to at least appear to follow through on their message).

There's a lot of things I see people proposing that end up boiling down to wishing that others would 'vote better'. That's a tough problem to solve.

[InASeaOfCode]

Yup

[codegeek]

"The transparency would make billing simpler and more efficient."

But the insurance companies, lobbyists and the big pharmas don't want this transparency. They make record profits only because of this non-transparency. Imagine the jobs of hundreds of medical billers, transcriptionists going away as well if this whole healthcare "thing" becomes simpler.

[omonra]

Reading the comments below, I am guessing that most people simply don't understand the terminology you are using. Ie you have to define what are:

1. Public service 2. Lock in a price 3. What are the prices (vs margins) 4. What's a starting price

I understand your question because I get regular bills from my insurance company that say "Doctor usually charges $1,000 for the procedure you had but we have negotiated price $100, so that's what you owe, as you are still below your deductible."

[poorcedure]

As I understand the current system, medical institutions negotiate different prices with every insurance company. They start high and the size of the insurance company's patient pool helps them get better price per service.

It seems weird, because it is weird. I can not think of another industry that works like this, where prices can be unknown until it goes to billing. Forcing them to fix a price and publish it to a government registry could possibly allow market forces to drive lower prices than even the largest insurance companies can negotiate.

[gpsx]

I recall a very good article that said there are many problems with healthcare in the US which causes it to be as expensive as it is, rather than a single big problem. I would list them if I remembered a good number of them. One of my favorites is that the health care industry is not paid to keep people healthy, it is paid to treat people. As a result, we get lots of treatment and medicine, and not great health.

[commentzorro]

If you allow the young and healthy to purchase plans at one third the price then the old and ill are going to have to pay three or more times more. How are they supposed to afford that after a lifetime of working just above minimum wage?

Without the young paying in during the early years they're going to have annual premiums of $40-50,000 as they approach their 60s.

[poorcedure]

Might seem backwards, but the goal here would be to turn patients back into customers. Right now, there is no visibility for the individual into prices for services. Without it there is no competition at all to find common, realistic prices for services.

Lower prices should reduce premiums for everyone, since insurance companies have strict margins per the ACA. Lower premiums should increase those that are covered by insurance, hopefully.

[commentzorro]

Nothing wrong with turning patients into customers. Lower prices will only happen for the young and healthy. Higher prices will be the only possible future for the old and those with pre-existing conditions. The insurance companies are not going to cover a particular class at a loss. They'll just walk away, as they should.

The ACA is going away. Please don't use it as a crutch.

Lower premiums mean higher deductables. We see that now and we saw it before the ACA. Healthcare costs $18,000 per person this year regardless of how you divide the premium and deductable. Take away the young and the price goes up for everyone else. And this is with a cap in place by the ACA. Only going to get worse with the regulations removed.