[vundercind]

I spent quite a bit of time trying to figure out what drives such high costs in US healthcare, some years back.

My conclusion is everything does. This conveniently makes it easy to dismiss criticism of any one part (all of which are responsible) because “well they’re just increasing it a little—go look at these other things, they’re bad too, and if you add up all of that, they’re worse!”

Right, but if you keep not addressing the one in front of you because of that kind of misdirection, you never fix any of it, because all of it is taking too much money.

I will say that our private insurance system in particular seems to be responsible for most of the insanely-high indirect costs of our system.

Dozens of hours for patients and their families lost per major incident, playing middleman between insurance and provider billing departments, trying to make insurance do what they’re supposed to. Stupid billing systems where the prices are all kinda fake, which wastes time in a few ways. Tons of time shopping for and managing healthcare plans by folks in HR. Government social safety net people having to dick around with private insurance nonsense to sort out who’s getting what from where. Employees losing time poring over plans to figure out which one they should get (is it just me, or if you’re offered three is there always one that doesn’t make any sense compared to the other two, no matter what kind of usage pattern or expectations you can think up?) Tons and tons of overhead staff at providers.

[jdietrich]

Healthcare costs in the US are broadly in line with the level of consumption. Americans have a uniquely insatiable demand for tests, drugs and elective surgery. Most countries with significantly lower costs have very different cultural attitudes and/or some form of rationing, because the only way to meaningfully reduce the cost of health are is to reduce how much of it you consume.

In the US system, insurers are the only actor with any real incentive or ability to constrain costs by limiting consumption; a very large part of the bureaucracy involved in the insurance system is about trying to manage consumption. We're seeing exactly how well that's working out for them, spilled all over the sidewalk.

Talk to people in the UK or Canada or Germany or Australia. See how their media covers healthcare. They're furious about their healthcare systems too, they're talking about a mounting crisis, just for different reasons. These systems accept long waits and the flat refusal to fund less cost-effective interventions as a necessary evil.

[shiroiushi]

>I will say that our private insurance system in particular seems to be responsible for most of the insanely-high indirect costs of our system.

Lots of developed nations have private insurance systems, somewhat similar to the US. Both Japan and Germany have such systems, yet healthcare costs here in Japan are pretty cheap usually. (Here, it's a public/private system, kinda like Obamacare: if you don't have a job or are between jobs or a part-time worker, you'll get government-provided insurance, which you have to pay depending on your prior income I think; when you have a regular full-time job, you get private insurance that your company contracts for. But the insurance works basically all the same way: you pay 30% of the actual cost, and the insurance company pays 70%.)

There's something uniquely bad about the American system, but honestly I don't know what it is. I suspect it has to do with very bad regulation, or a lack of it. Here, it seems the costs for many things (like necessary medical procedures) are strictly regulated by the government. Also, no one pays bills to insurance companies AFAICT: you just pay the healthcare provider, and they go to the insurance company for the remainder.

[vundercind]

Sure, the actual universal element of other OECD healthcare systems is price controls, de facto or direct, not necessarily whether private insurance still exists. I don’t think even a majority outlaw private insurance, and it’s a major part of quite a few.

[mgh95]

Realistically, the big cost differential in absolute terms in healthcare are borne in the elder group (65+). See this:https://pmc.ncbi.nlm.nih.gov/articles/PMC7411536/. This is exactly where the "government social safety net" takes effect (medicare and medicaid) and, in my opinion, the real spending bazooka of US subsidies take effect.

I say this as someone who wound up owning one business in this area (health insurance agency/producer) and was looking at expanding directly to the insurance providing aspect. I really think people underestimate just how generous (high cost) the "social safety net" is, and have a grass-is-greener view towards other countries healthcare systems for people currently working.

[vundercind]

Yes, we pay more per-capita for our public healthcare system than some countries do for universal coverage, but we don’t cover everyone. Just for the public parts.

Once you actually tally up how many people are having their healthcare paid for by public dollars—local, state, and federal workers plus retired; the military, active and retired; Medicare (old people); Medicaid (poor and disabled); CHIP (poor kids); the families of some of those categories; et c—it’s really not the case that moving to entirely public-funded would even be as big a leap as one might suppose. A whole lot of people already have government-funded healthcare.

What we really lack, that every single other OECD state I’ve looked at has as a feature of their healthcare systems, is more-aggressive price controls, either set directly or via partial or complete monopsony. We’ve sniffed around at it, but never taken a full bite.

[mgh95]

> Yes, we pay more per-capita for our public healthcare system than some countries do for universal coverage, but we don’t cover everyone. Just for the public parts.

Yes, because the US is currently experiencing an adverse selection bias where healthy avoid enrolling until an issue occurs. See this: https://www.aeaweb.org/articles?id=10.1257/app.20170117

> Once you actually tally up how many people are having their healthcare paid for by public dollars—local, state, and federal workers plus retired; the military, active and retired; Medicare (old people); Medicaid (poor and disabled); CHIP (poor kids); the families of some of those categories; et c—it’s really not the case that moving to entirely public-funded would even be as big a leap as one might suppose. A whole lot of people already have government-funded healthcare.

Government funded but it's not a social safety net or mandate in a conventionally sense: it's an insurance subsidy. It effectively incentivizes depressing your own personal income to achieve high-subsidy plans (namely, the silver plan in most if not all states) resulting in abnormally high subsidies. It's just a form of tax planning today. See people taking "early retirement" with substantial assets (>1mm, which isn't much for HN but substantial in much of the country) at 40, reducing disbursements, and effectively costing the taxpayer ~36k/year in subsidies.

In an idea world, your assets would be subject to seizure under means testing on assets, not just income, before subsidies are provided. Seriously, go check out reddit /r/fire. They talk about it (and how a reduction in ACA subsidies in 2025 will force them out of retirement at the advanced age of 45).

> What we really lack, that every single other OECD state I’ve looked at has as a feature of their healthcare systems, is more-aggressive price controls, either set directly or via partial or complete monopsony. We’ve sniffed around at it, but never taken a full bite.

I'm going to be real: this is just wrong. Price controls only works in two circumstances:

* You are willing to tolerate reduced availability of goods and services * You are actively willing to prohibit others from purchasing goods and services with their own money

1 is complete anathema to the US consumer market. If price controls were to be implemented, the elderly would likely get care first, which is unlikely to yield practically the needed result relative to current costs curves -- keeping the working population working with preventative and minimizing the cost on the elder bracket. In my opinion, this mispricing is in part due to the ACA, but that's neither here nor there.

2 would require Norway style controls of Ozembic and similar. I don't think Americans would ever tolerate "your money, you aren't allowed to buy it". Prices are high because Americans can pay in dollars more than other nations and are willing to do so.

There is a very real perception that medicine can fix poor health choices and we should spend arbitrarily large amounts of money to fix it. It's a fantastic business to be in -- people insist "healthcare is a human right" and are willing to tax others to pay it.

[amanaplanacanal]

Look at the ratios though. US spending is about double in every age bracket. The really isn't anything special about the over 65 group.

[mgh95]

Age 65+ is roughly 17% of pop and accounts for 37% of all spending. It's quite literally the place to focus on cost savings.

[vineyardmike]

You can't genuinely believe that the reason that the 65+yo group costs more is the social safety net?

As you get older, you start to experience more adverse health affects. You start to need medical attention more. Especially if you've been denied healthcare for the first 65 years.

> I really think people underestimate just how generous (high cost) the "social safety net" is, and have a grass-is-greener view towards other countries healthcare systems for people currently working.

Well I think you misrepresent that greener grass is greener. Other countries literally live longer and healthier when they have socialized healthcare. It's a pretty easy metric to track, and pretty straightforward. Do you want the general population to live longer? Do you want the general population to be healthier? Do you want the general population to be saddled with crippling medical debt? Sometimes the grass is greener. And we have the data to prove it.

In the link you shared, other social-safety-net countries had lower spend per capita. They have a better social safety net. So how can that be the issue?

At least you're honest that you own a health-insurance business and you're biased. A single-payer system would destroy your income, and I guess that's pretty scary, so it's in your best interest to fear-monger.

[mgh95]

> As you get older, you start to experience more adverse health affects. You start to need medical attention more. Especially if you've been denied healthcare for the first 65 years.

Sort of: as you get older, time catches up to you. In the USA for, heart disease kills 1015/100k for both genders (see: https://usafacts.org/articles/what-are-the-top-causes-of-dea... in Germany, it is just 673/100k for just men alone. We have an obesity problem, not a healthcare problem, when it comes to life expectancy.

> Well I think you misrepresent that greener grass is greener. Other countries literally live longer and healthier when they have socialized healthcare. It's a pretty easy metric to track, and pretty straightforward. Do you want the general population to live longer? Do you want the general population to be healthier? Do you want the general population to be saddled with crippling medical debt? Sometimes the grass is greener. And we have the data to prove it.

The question here is QALYS. We quite literally avoid this discussion in the US at all (see this: https://pubmed.ncbi.nlm.nih.gov/19738253/). The issue isn't that we disagree about the issues: it's that the issues are not addressed and Americans pretty much always say "spend more".

Europe has already begun rationing, by the way (see this: https://pmc.ncbi.nlm.nih.gov/articles/PMC1831659/#:~:text=Be....) It's not as though it doesn't already occur; we simply choose to blame insurance companies instead of a national system.

> In the link you shared, other social-safety-net countries had lower spend per capita. They have a better social safety net. So how can that be the issue?

Healthier populations. Americans make awful health choices.

> At least you're honest that you own a health-insurance business and you're biased. A single-payer system would destroy your income, and I guess that's pretty scary, so it's in your best interest to fear-monger.

Not really. Margin shifts along value chains; it's rarely destroyed. All that would happen is the profits would shift to another location. Then the game becomes how to get there.

[evanjrowley]

The list of things at the end of your comment are all basically drivers for GDP. Our economic policies seem to incentivize the construction of Kafkaesque dystopias. I just can't see how such a leviathan could ever be dismantled.

[vundercind]

It was reported in The Nation (and nowhere else that I ever found when I went looking—so, grain of salt) that Obama said that all the totally unnecessary jobs that’d be eliminated are exactly why he wouldn’t push full single payer.

It’s a regressive-tax-funded white collar makework jobs program. JFC.

[triceratops]

He didn't have the votes to get single payer through Congress. Simple as.

[vundercind]

Yes, I agree that is at least one reason that happened, and possibly the main one.

I think the Nation’s quote of him on the topic points out something that may be true, which is that he might have balked at doing it given how many people would be laid off (hundreds of thousands, surely) and what the optics of that would be, though I kinda doubt the quote itself.

But yeah, even if he’d been gung-ho behind it, it wasn’t happening.

[shiroiushi]

Yeah, this really makes me think that America's soaring GDP is really just BS numbers, because a lot of the "productivity" that it reflects is just BS jobs that add negative value to society. I'm wondering if, at some point, there's going to be a big correction as the rest of the world realizes that it makes no sense to value the USD as highly as it is, since much of that "value" is in stuff like Americans selling each other overpriced houses (due to artificially constricted supply) and overpriced healthcare.

[Mountain_Skies]

That third plan might be there just to make the other two look reasonable. Restaurants do this all the time with menus.

You conclusion reminds me of yesterday's thread about Rogue where one the best players was that way not due to some amazing trick or skill but because he was just a bit better than average on most aspects of the game. He didn't have to be the best at anything, all the little parts above the median added up.

[maxerickson]

We heavily regulate the supply and heavily subsidize payments.

Like a major premise of US healthcare policy is that preventing investment reduces costs. Good luck when that's the starting condition.

For example, reducing costs is the justification for limiting how many doctors are trained. Fortunately, our planning has been perfect rather than disastrous.

[TheOtherHobbes]

The thing that drives high costs is the bottom line: profit is more important than human lives.

If you stick a gun in someone's face and demand they hand over their cash, you're a criminal.

If you do the same thing with contracts, paperwork, and quarterly reports for Wall St, you're a CEO.

There is no difference between these. One is camouflaged by the abstractions of profit and bureaucracy. But both are murderously violent, and there should be no legal or moral distinction between them.

Likewise climate change and ecocide; online disinformation, media lies, and other kinds of semantic pollution; workplace violence, and other "externalities."

Invention and daring can be good things. But when all you're contributing are death, stress, illness, mass bankruptcy, declining opportunities for most of the population, and other symptoms of corporate sociopathy, you are over the line.