walkitout (walkitout) wrote,

Negotiation: the Time article on health care

Jon Stewart on the Daily Show was so glowing in his praise of Time's coverage of the cost of health care in the US that I figured I should at least take a look at it. I'll warn you right now: if you're the kind of person who reads Consumer Reports and similar, there is _nothing_ here you haven't already heard about five different flavors of (sorry about the mixed metaphor).

But CR/CU doesn't have a lot of readers (the world would surely be a better place if they did), so it _is_ good, detailed coverage of the costs of health care both extraordinary and somewhat less so. I have one major complaint: the author keeps saying that ACA making annual and lifetime limits on what insurance will cover illegal will cause premiums to soar. I think the author is wrong.

We've gotten very accustomed to paying what the tag says when we shop here in the United States, but _all_ purchases are negotiations, even if they are not visible to you at the retail outlet or on the website. Websites know when we click away rather than buy. Physical retail operators do a ton of research about what kind of price and discount structure moves product vs. what does not. If we eliminate caps in insurance, insurance companies will be forced to step up their game and make the hospitals charge more reasonable amounts. If they don't, and jack the premiums instead, so many people will be unable to afford coverage that we will regulate premiums. And, if that's what it takes, we'll produce a nationwide chargemaster, a la Japan (which I believe has been experimented with in Maryland and there's some motion towards in Massachusetts).

These are solvable problems. Any piece of this thing can be gnawed on. And I think that Time's coverage suggests we are finally _ready_ to start gnawing.


ETA: Oh, and if we are _still_ going to insist on doing this all through the "free" market, then everyone who used to have an office job but got automated out of existence should be going into the negotiate-with-insurance-companies business. Because there's going to be a lot of it.

ETAYA: The article _does_ get more interesting as it goes along, getting into a discussion of how Medicare billing and payments work, the holes that allow too-high drug costs through (some of this looks like fraudulent billing to me, and sometimes Medicare will claw that back if they discover the average cost information the manufacturer is sending them is inaccurate), how privatized Medicare already is in terms of contractors vs. government employees, etc. There's also a little about the evil Betsy McCaughey (crazy lady, the Daily Show had her on during the death panel shenanigans and Stewart helped display her foolishness).

There will probably be further additions to this post.

ETA still more: Pay particular attention to page 10 on the web:


In particular, this section explains why raising the Medicare eligibility age is a huge giveaway to insurers and the rest of the health care industry, at direct cost to both the taxpayer as a person and the taxpayer as a payer of taxes:

"If covered by Medicare, Janice S.’s $21,000 bill would have been deeply discounted and, as is standard, Medicare would have picked up 80% of the reduced cost. The bottom line is that Janice S. would probably have ended up paying $500 to $600 for her 20% share of her heart-attack scare. And she would have paid only a fraction of that — maybe $100 — if, like most Medicare beneficiaries, she had paid for supplemental insurance to cover most of that 20%.

In fact, those numbers would seem to argue for lowering the Medicare age, not raising it — and not just from Janice S.’s standpoint but also from the taxpayers’ side of the equation. That’s not a liberal argument for protecting entitlements while the deficit balloons. It’s just a matter of hardheaded arithmetic.

As currently constituted, Obamacare is going to require people like Janice S. to get private insurance coverage and will subsidize those who can’t afford it. But the cost of that private insurance — and therefore those subsidies — will be much higher than if the same people were enrolled in Medicare at an earlier age. That’s because Medicare buys health care services at much lower rates than any insurance company. Thus the best way both to lower the deficit and to help save money for people like Janice S. would seem to be to bring her and other near seniors into the Medicare system before they reach 65. They could be required to pay premiums based on their incomes, with the poor paying low premiums and the better off paying what they might have paid a private insurer. Those who can afford it might also be required to pay a higher proportion of their bills — say, 25% or 30% — rather than the 20% they’re now required to pay for outpatient bills."

The author oversteps by saying single payer is the way most developed countries go -- I'm not convinced that is technically true. There are all kinds of developed countries that have bizarre mish-mashes of multiple payers, price lists and wtfery. There are many, many, many ways to solve this problem, and single payer is one of the least politically accessible within our system -- it's hard to get there incrementally from where we are now.
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