[acslater00]

Oh look, another attempt to argue that market forces somehow don't apply to medical care.

In this one, the author makes the argument that "competition" leads to a proliferation of firms, a proliferation of firms leads to administrative complexity, and administrative complexity leads to additional cost. Supposedly, removing this cost would save us enough money "to provide health care to all Americans."

It is easy to attempt to verify this claim by looking at actual data.

OECD: "Administration of the US health system alone accounts for about 7% share of total spending. This is on a par with other systems such as France and Germany which also have multipayer systems (even if in some of them there is no or little competition across payers). In comparison, Canada and Japan devote around 4% of health spending on administration."

https://www.oecd.org/unitedstates/49084355.pdf

So, if we adopted a true single payer system, by this math, the total spend in the US healthcare system would drop by 3%. US healthcare costs have recently been growing by 6% per year, so this would bring our costs all the way down to where they were on election day, 2016.

Next.

[xenadu02]

Price discovery requires the ability to price some customers out of the market. For serious healthcare (the only kind that costs a lot of money) that means life-long disability or death. There is no such thing as a free market without the ability to set prices for maximal profit (vs maximal coverage).

BY DEFINITION a free market in healthcare MUST kill people (or allow them to die of treatable diseases if you prefer). Period. Full-stop. Do not pass GO, do not collect $200.

A free market means if you are unlucky and born into a poor family, get bonked in the head, and have a retinal detachment then you should go blind. Despite the massive dead-weight economic loss to our society of converting an able-bodied person into one with a life-long disability, if you can't pay for retinal re-attachment then fuck you buddy.

I wish all your free-market healthcare proponents would address this fundamental inescapable fact. I suspect most don't because the idea is repugnant and the argument falls apart. Please don't bring out the charity canard. That's largely how our system functioned in the past (and still does for some people thanks to states refusing Medicaid expansion) and it simply doesn't work.

I don't want to live in a society that so prizes the god of free markets that it is willing to let people suffer and die of completely treatable diseases. I'm happy to seize as much money as required from whoever is required to make non-elective healthcare free for all citizens. Fortunately a minor tax on the top 10% along with a larger tax on the 0.1% is more than enough to cover healthcare. As a member of the top 10% I say that knowing I will pay higher taxes.

[MarkMc]

> BY DEFINITION a free market in healthcare MUST kill people

I'm not sure this is true. Does a free market in food require that some people starve to death? Right-wing ideology says that even the poor have enough to buy food, clothing, shelter and medical insurance. If a poor person buys a mobile phone instead of health insurance, it's because they value the phone more than their health - why should you force someone to buy something that is less valuable?

Perhaps you argue that the poor don't have enough money to buy health insurance. In that case the right-wing answer is to give the poor money with which to buy whatever they prefer. Hypotheically everyone could buy health insurance and noone would die of treatable diseases.

[taylodl]

Please cut it out with pretending the poor prefer to buy a cellphone instead of health care. The most expensive phone on the market, the iPhone, costs less than one month of health insurance premiums. And most poor people aren't using iPhones - most are using Androids they bought for a few bucks on a plan. That is to say, a modern smartphone costs the same as a landline phone of yore. That's not even getting into the whole discussion of their smartphone is typically the only computer they have. Try navigating our healthcare system without a phone or a computer. Good luck with that.

[MarkMc]

Actually I'm not pretending anything - I'm just stating the right-wing, free-market ideology. I happen to support a single-payer healthcare model because it will reduce overall health costs and maximise long-term GDP. But let me play devils advocate for a minute and respond your your comment about smartphones:

Nobody is claiming that a smartphone would pay the full cost of a persons healthcare. But it would pay for some health insurance - perhaps two or three weeks, by your count. (And don't confuse this with internet access: A 5-year-old smartphone with a cracked screen costs next to nothing on eBay). Therefore anyone who buys a brand new phone - either outright or on a contract - has given up the opportunity to buy a few weeks of health insurance.

And there are many other similar opportunities for poor people, including:

- If you buy branded goods like Nike or Adidas, buy non-branded clothes and shoes instead

- If you drink or smoke, stop

- If you are overweight or obese, eat less

- If you buy food from convenience stores or restaurants, stop. Instead, make a weekly trip to Costco or Walmart and buy food in bulk.

- Change your diet to the cheapest foods that still provide nutrition. For example, maybe potatoes are cheaper than bread and just as healthy. Don't like potatoes? Too bad.

- Typically the best-paid jobs are in a city or town center, while cheapest accommodation is far away. So if your total weekly commute and work time is less than 60 hours per week, live further away from your job to increase your commute time and decrease your rent or mortgage payments.

- Look up the top 5 cities in the US with the highest wages and lowest unemployment, then move to one of them.

- If there are less than 2 people per bedroom in your household, take in a paying lodger. If your landlord doesn't allow it, move. If you are a single person then move into a 3-bedroom house with 5 other single people.

You may think that these opportunities are not valid, or that they still would not pay the full cost of health insurance. In that case the right-wing solution is to give money to poor people - and not to force them to buy health insurance or provide government-run healthcare.

[cmurf]

Well strictly speaking the free market would say "you're on your own, you're not our problem". And then you'd hopefully look cute, and do some neat tricks to get a benefactor to voluntarily help you pay for your needs. Otherwise, sorry, the needs of the many outweigh, you.

The reality is, the only thing that makes for-profit free market people alter their perspective, is if they or someone they care about gets really sick and is subject to the bad aspects of the for-profit system. It's like anti-gay uncle who finally starts to moderate once he learns he has a gay nephew. Oh really, hmm, guess I need to moderate my total ignorance of the complexity of the world and things aren't so simple afterall.

I attribute this to lack of imagination identifying with other people. People confuse that with feeling sorry for others, or pity. John Rawls "veil of ignorance" thought experiment should be a political test. If you aren't willing to imagine yourself or a family member directly subject to the deleterious side effects of policies you want made into law, you're incompetent. Instead of having "regular Joe Bob" as politicians, they should be professional, interdisciplinary, ethical, and be auditable.

[zaptheimpaler]

The fundamental point is that incentives are horribly misaligned between making money and providing health care the way the current system works.

Try having a pre-existing condition before ACA - no one will insure you because you're too expensive, or your premiums go ridiculously high. Think about that. The people who need insurance the most were denied it - this is perfectly in line with market forces of course because its cheaper. The other alternative is to believe healthcare is expensive for everyone because the healthy subsidize the ill, but oops if you're ill your costs are astronomically high anyways and insurance companies will fight you tooth and nail over expensive claims, so that doesn't hold much water either.

If you want to talk data look at spending on health care vs outcomes [1]. If market forces were working so well maybe we wouldn't spend 2x - 4x more than other countries with worse life expectancy to show for it? We can argue over where the money is going but its clear theres a lot more of it going in for worse outcomes coming out than most of the world.

Honestly, seeing that if you don't see ANY contradiction or perverse misalignment between the ideal goals of a health system and the current system, you must be a very healthy guy.

[1] https://ourworldindata.org/the-link-between-life-expectancy-...

[Mindless2112]

> Try having a pre-existing condition before ACA - no one will insure you because you're too expensive, or your premiums go ridiculously high.

Insurance is paying someone (the insurer) to take ownership of a risk from you (the insured) by compensating you if the risk is realized. If the risk has already been realized then, of course, no insurer will be willing to take ownership of it for less than the cost of the compensation.

The system we have today can hardly be considered "insurance".

[jrs235]

Yup. There's a very real issue of people conflating health insurance "coverage" and health care coverage. The ACA doesn't ensure care, it ensures insurance coverage. Many people may now be able "afford" insurance coverage but just as many or more still can't "afford" care.

[dragonwriter]

> There's a very real issue of people conflating health insurance "coverage" and health care coverage.

The Essential Benefits defined in the ACA guarantee that, within certain bounds, that isn't an inaccurate equivalency. It's true that every version of then Republican modifications characterized as “repeal and replace” has not only attacked insurance coverage but also made insurance coverage less likely to be care coverage, so it's certainly important to recognize the difference.

[noobermin]

That's a great article.

It looks like we spend a large amount more than every other country in every category they define, but the primary difference thing that makes the huge difference is we pay for specialists a lot more. Their conclusion is just that, well, the cost is higher.

Interesting but leaves a huge question as to why.

[acslater00]

Yeah.

My personal opinion is that it's because insurance leads to, basically, 1/2 of a market. We allow suppliers to set prices however they want, but we mandate that insurance buy the thing, which essentially gives them no negotiating leverage. (Worse: post-obamacare, we mandate that insurance co profits are a fixed percentage of insurance premiums, so they don't have any incentive to negotiate low prices anyway). The data showing "specialists are expensive", I think, is mostly just a historical accident; primary care and prescription drugs have traditionally been more sensitive to demand pressure because of the way deductibles and copays worked. I suspect that since primary care is now a required $0 copay service, in 10 years those costs will look aberrantly high as well.

[wwweston]

> We allow suppliers to set prices however they want, but we mandate that insurance buy the thing, which essentially gives them no negotiating leverage.

As far as I can tell, it's the opposite -- insurers have the most negotiating power by virtue of aggregated information about pricing and services and a revenue stream that's subscription/toll rather than service.

Patients are limited in their power to negotiate with providers by some combination of largely inelastic demand (nothing's more valuable than life itself, full health or as close to it as possible is a close second) and a lack of expertise (how do you know what you can forgo or substitute?).

Providers are in a better position (and generally do somewhere from pretty well to very well), but often carry heavy investment costs and must continue to provide services to collect fees.

> mandate that insurance co profits are a fixed percentage of insurance premiums, so they don't have any incentive to negotiate low prices anyway

This is only true to the extent that (a) they've already maxed out that profit and (b) don't have any other constraints. When you're suddenly forced to community rate, have new customers who've probably been under/uninsured joining your pool, have new care requirements to meet, dealing with an absence of lifetime limits, and limited in your ability to raise premiums without approval among other things, there might well still be financial incentives to reduce costs.

[noobermin]

How does our system not work as well as say Switzerland's system? After ocare, we're closer to their system. Also history? I admit I'm not super knowledgeable about this.

[EGreg]

First of all, "the best doctors" may not be better for outcomes overall:

https://www.google.com/amp/www.sandiegouniontribune.com/sdut...

Secondly, other countries have more doctors and hospital beds per patient. That whole refrain about "we get better service for the money" really starts to sound hollow when you realize that, at some point, everyone having a hospital bed is better than half the people having a super amazing hospital bed.

[lemoncucumber]

Your math is completely wrong, though not in the way the other poster said. You're making the classic mistake treating percentages as though they add and subtract when they really multiply.

> "So, if we adopted a true single payer system, by this math, the total spend in the US healthcare system would drop by 3%. US healthcare costs have recently been growing by 6% per year, so this would bring our costs all the way down to where they were on election day, 2016."

Assuming the numbers are right, if we adopted a true single payer system, costs would drop from 7% to 3%, a 42% reduction. After such a reduction, the spending would take nearly 10 years to grow back to whatever its original dollar value was at a 6% growth rate, not 6 months.

[smnrchrds]

I don't understand your math. Even if administrative costs dropped to zero, prices would fall only 7%. This is the point that OP is arguing for.

[lemoncucumber]

Fair enough, I see now. I thought OP was saying that administrative costs would bounce back that quickly, not overall costs.

[MarkMc]

Some people are questioning your math - I think this is due ambiguity in the expression, "Administration of the US health system alone accounts for about 7% share of total spending". My initial thought was this meant 7% of GDP, but it seems the OECD article means 7% of health spending.

[georgebarnett]

Given that countries with single payer systems achieve similar or better life expectancy outcomes for in most cases half the cost of the US system, I'm inclined to believe that you have no idea what you're talking about. The US system is literary the only first world system that's not working.

Next.

[theSpaceOctopus]

> So, if we adopted a true single payer system, by this math, the total spend in the US healthcare system would drop by 3%. US healthcare costs have recently been growing by 6% per year, so this would bring our costs all the way down to where they were on election day, 2016.

But with the "true single payer" system you mentioned, everyone would be covered, and have equal access to care?

Including the ~28 million Americans without care?[1]

For the same costs as Election Day, 2016?

That sounds like a pretty good start to me.

[1] https://www.cdc.gov/nchs/fastats/health-insurance.htm

[zaptheimpaler]

In summary, respecting "market forces" acting in a market created by the people, for the people is more important than ensuring peoples health - arguably the most basic of human needs... right. ALL HAIL THE FREE MARKET WOO.

[peculiar]

In summary, respecting market forces is more efficient than regulation and gov monopoly.

[hedonistbot]

What are you talking about. Health is the definition of inelastic demand. Then add the almost missing negotiating powers of a single consumer vs an insurance giant and you have a very efficient system for those on the supply side of the equation and a death sentence for a lot of people on the demand side. The American system is efficient only for health insurance companies and no one else.

[peculiar]

>> a single consumer vs __an insurance giant__

Exactly. And that's a result of regulations.

[hedonistbot]

Then how is it possible for the rest of the developed countries with heavier government role in healthcare to provide better care that costs less?

[jrs235]

Many will say that "better care" is up to opinion and debate.

[MarkMc]

I agree that a 3% reduction in total health spending would not make a single payer system worth it.

Hypothetically, if that figure was 30% would you be in favour of a single payer system?

[addicted]

Wait what? Your math is completely off. The 3% drop in administrative costs is not directly deductible from the 6% growth because that 3% drop would mean the growth would also be lower (since it's a %age of the total costs).

[acslater00]

Ok

Jun 2016: US spends $100 on health care ($7 on administration) Dec 2016: US spends $103 on health care ($7.21 on administration) Jun 2017: US spends $106 on health care ($7.42 on administration) --> US administration costs drops from 7% to 4%, saving $3.18 Now US spends ~$102.82 on health care

I rounded

[nwah1]

I also think that there's benefits that are harder to calculate. I switch health insurance often, and I always seem to have a bunch of healthcare bills to deal with.

Even just calling all the billing companies to get my insurance applied is a huge hassle, and when it comes due it can take a number of hours out of my day.

And occasionally, I'll get a bill from long ago that didn't have insurance applied, and it can be a big hassle all around.

The hassle and aggravation is almost certainly worse than the IRS that people are always complaining about (and rightfully so).