[rtpg]

The assumption is that more productive AI + humans leads to cost reductions.

But if everyone involved has a profit motive, you end up cutting at those cost reductions. "We'll save you 100 bucks, so give us 50", done at the AI model level, the AI model repackager, the software suite that the hospital is using, the system integrators that manage the software suite installation for the hospital, the reseller of the integrator's services through some consultancy firm, etc etc.

There are so many layers involved, and each layer is so used to trying to take a slice, and we're talking about a good level of individualization in places that aren't fully public a la NHS, that the "vultures" (so to speak) are all there ready to take their cut.

Maybe anathema to say on this site, but de-agglomeration really seems to have killed just trying to make things better for the love of the game.

[rayiner]

Nobody has a profit motive since doctors get their bills paid per procedure and health insurers have a profit cap.

[rtpg]

Consider that the profit cap is a percentage, so increased costs in fact increase the amount of profits to be scooped up. So health insurers that would like to see more cash are incentivized to have costs increase!

I also think that the profit cap percentage is not something that applies across the board to every single player in the healthcare space.

[tptacek]

Wait, explain. The insurer thing, I get: they're capped. The doctors seem definitely to have a profit motive!

[rtpg]

I think the idea there is that generally speaking doctors get rebated on some sort of defined cost schedule. They'll get $40 from the insurance company for some basic kind of visit, and that is "fixed"...

I don't live in the US and when I did wasn't paying doctors very often... but my impression was that even if the rebate schedule is fixed they could "just" ask for more/less, and the rebate schedule is defined by the insurance company (so the insurance company can increase their costs through this schedule, leading to ways to make profit elsewhere!)

I could be totally offbase, I've always thought the Obamacare profit percentage cap to be a fake constraint.

[rayiner]

The doctor doesn’t have a motive to replace himself with an AI? That’s what I meant.