Part I Health Cost Problems (overview)

[Agape=Love]

Part I: Health Cost Problems (overview)

Why we have the health cost problems we have?

1. There are no published prices. In no other line of work is it legal to do this. Nowhere. You can't sell someone a hot dog and tell them after they eat it what it just cost them. You can't hire a lawyer and have him tell you "I'll tell you what this will cost when we're done." You can't hire an electrician and have him tell you "I'll make up a bill when I'm done." In every line of work except health care, this is illegal. There are even laws for "major" consumer work (e.g. contracting, auto repair, etc) where they must give you a binding written estimate before beginning work!
2. Robinson-Patman Act of 1936 (or Anti-Price Discrimination Act) makes it illegal to discriminate against like kind purchasers of goods in pricing decisions when the effect of doing so is to lessen competition. While it does not apply to services, it darn well should. Whether you are paying privately, you have private insurance or you're a Medicare patient if you need to have a sleep study due to apnea the complexity of the procedure does not change. Yet it is a fact that the privately-billed amounts for uninsured ("rack rate") patients are often ten times or more that billed to insurers or Medicare. Try charging a cash purchaser 10x more for a TV than someone who finances that TV on your in-house credit facility and you would be shut down and thrown in jail.
#1 and #2 exist because of explicit efforts by the "health care" industry to exempt themselves from the laws that every other merchant of every other good and service in the United States must adhere to.
To put this bluntly the “health care” industry has intentionally put forward a system by which it can screw you with impunity, obtaining exemptions from the laws that cover every other area of commerce, thereby effectively forcing you to buy overpriced services you do not want to purchase.

This is an extortion racket and absolutely none of the proposals being put forward have done a thing to address any of it.

It is my opinion that we should be treating those in the health-insurance lobby, including hospitals, physicians and health-insurance providers, as co-conspirators in a racketeering scheme that effectively trades on the fear of disease and imminent bankruptcy to bamboozle and screw the population, while waving around their "hippocratic oath" - something better described as the "hypocritic oath."

[Julie]

But consider the consequences... if pricing were the issue, who would decide (besides the MD and/or HMO) what you pay for things:- Suppose you saw a list of tests (and prices) that they want you to take, would you pick and choose based on price, not knowing that omitting one or another could be the one(s) that diagnose life or death for you, because you're not a doctor?

[cinco777]

Julie wrote

But consider the consequences... if pricing were the issue, who would decide (besides the MD and/or HMO) what you pay for things:- Suppose you saw a list of tests (and prices) that they want you to take, would you pick and choose based on price, not knowing that omitting one or another could be the one(s) that diagnose life or death for you, because you're not a doctor?

YES. I would do what I normally do before I "buy" something - become an "informed" shopper.

I would:
1) research the item, paying special attention to user reviews, and NOT the the marketing claims hyped by the manufacturer/provider,
2) comparison "shop" to find who offers the best "value" for my money,
3) decide, after becoming knowledgeable on the item, whether to buy now, later, or never (some things, after researching, turn out to be a bad "deal"),
4) revisit the item again if new information, funds, etc., become available and/or my priorities change.

I would love to see a General Health Forum patterned after our own CPAPTalk Forum. Many of us have tons of experience, advice, and recommendations on general health problems, surgery, procedures, etc. that would benefit others and help them make "Informed" decisions on their own health care (much like we do here on CPAPTalk regarding our own personal sleep therapy).

[sifr]

But consider the consequences... if pricing were the issue, who would decide (besides the MD and/or HMO) what you pay for things:- Suppose you saw a list of tests (and prices) that they want you to take, would you pick and choose based on price, not knowing that omitting one or another could be the one(s) that diagnose life or death for you, because you're not a doctor?

Competition for business in an open market would determine price.

I just got my first bill from my DME. They tried to charge my insurance company $35 for 2 normal filters. $35!!!

If they had actual competition, both in terms of patients using them and insurance companies paying them, that sort of thing wouldn't happen.

[Agape=Love]

I would love to see a General Health Forum patterned after our own CPAPTalk Forum. Many of us have tons of experience, advice, and recommendations on general health problems, surgery, procedures, etc. that would benefit others and help them make "Informed" decisions on their own health care (much like we do here on CPAPTalk regarding our own personal sleep therapy).

I agree this is why I brought up this topic in this forum (so many savy/caring like minded individuals). I wish that 10% of patients I see would be this involved in their care. I love this site because of my love of Sleep Medicine hats off to cpap.com for putting this together!

If we want to fix the health care pricing problem we can do so. Here's a proposed prescription:

All health care providers must publish a price list for the procedures and services they offer and the patient must be presented, when possible, with that information before services are performed or goods (e.g. medication) supplied, consenting to the charge in each case. All normal anti-trust provisions with regards to collusion between providers apply. If a physician doesn't like "flat-rate" billing they're free to publish a per-hour fee much like an attorney.
No physician or group may discriminate based on the form of any external payment. If they want to internally finance procedure(s), that's fine - they can charge interest or discount for that, or whatever. But for anyone who pays via any other means (including the government) money is money - the price may not change based on the source of payment.
No event caused by your presence in a medical facility or the actions of an employee there can come with cost to you. It is absolutely common for people to be billed for treatment of MRSA infections acquired in the hospital! That is equivalent to a mechanic that through incompetence or even malice cuts a wiring harness in your car while it is on the rack having the oil changed and then tries to charge you to fix what he broke!
Now clearly #1 doesn't work so well when you're unconscious due to a heart attack or just wrecking your car. But setting your broken leg or performing a cardiac procedure is something that's done for people who aren't incapacitated too, so guess what - the price is already published and thus the charge known.

This prevents the common practice of hospitals gouging private payers, it exposes prices and brings competition to pricing, and allows the free market to work. It ends the preference for "insurance" on routine procedures.

"Insurance" products that are not true insurance products may not discriminate on reimbursement dependent on where the service is performed. The practice of requiring "in network" doctors or even hospitals lest you get "rejected" must end. In addition pre-qualification for any bona-fide non-elective procedure must be absolutely barred as a matter of law.

Finally, all providers of "insurance" must sell a true insurance product. Common HMO/PPO plans are not insurance - they are pre-paid medical care. Insurance is the purchase of a contract to cover damage caused by an unexpected event. Everyone needs health care of some form. Those who want to sell "pre-paid health plans" may do so, but they must also offer true insurance (e.g. covering ONLY hospitalization and related events, etc.)

If the health lobby won't cut out the nonsense and work for this sort of change to the system then I am forced to advocate for full nationalization of the entire health system, effectively placing everyone under Medicare. This will lead to forced rationing due to cost but that's happening already, and such a forced system will put a stop to the discriminatory practices of insurers, physicians, hospitals and others in the medical field who commonly bill private parties ten times what health "insurance" plans or Medicare pay for the very same procedure, while playing "let's deny coverage any time we think we can get away with it."

[OldLincoln]

When considering health care costs, don't forget to include that 40% of the practice gross goes to malpractice insurance. If tort reform reduced that by half costs would follow.

BTW, same thing applies to all the increased costs Obama intends to impose on business. It may not be a direct cost to the "middle class" but they pay for it through higher prices anyway. Same principle as higher oil prices to refineries means higher price at the pump. They don't pay for it, we do.

[roster]

I don't see it like that. Agape, you are crying for more regulation in what is already a very highly regulated segment of our economy.

Look at what is regulating the way the industry works: Medicare, Medicaid, FDA, 50 state medical boards, 50 state insurance boards.

Two segments where you have an efficient, effective medical practice: cosmetic surgery and veterinary services.

Cosmetic surgery is not covered by insurance so it misses the heavy regulatory burden of the insurance companies. What happens if you are considering cosmetic surgery? You do exactly what cinco777 is saying. You become a consumer, you evaluate the suppliers, and you know the cost before making a decision. You also know who is paying so you don't make the kind of irresponsible decisions people make when "somebody else" is paying. Running a cosmetic surgery practice is more like running a "real business". They satisfy their customers or they fail. Veterinary services are similar.

So, no, I am afraid more regulation is not the answer and having someone else pay is not the answer. We need to deregulate the insurance industry and let patients become consumers.

[cinco777]

OldLincoln wrote

When considering health care costs, don't forget to include that 40% of the practice gross goes to malpractice insurance. If tort reform reduced that by half costs would follow.

Please provide source(s) for your 40% claim. Over the past few years, I have raised this subject with my medical providers and have yet to find one that pays more than 5% of their gross for malpractice insurance. I have heard that Doctors who deliver babies make higher than 5% malpractice payments because of liability issues, but have no personal knowledge if this is true.

[cinco777]

Following article provides insight on primary Impeders to Health Care Reform. Well worth a read!

http://news.yahoo.com/s/usnews/20090909 ... carereform

[Agape=Love]

Rooster

I am advocating a free-market path which will dramatically control costs as free market competition will be forced to the forefront among health providers who will be compelled to make available their pricing schedules to everyone before they show up for treatment and are presented the bill.

That quite simply was the point I am trying to make.

I believe cinco777 got the point exactly. Allow the market to determine price.

This will do two things drive down cost and basically force the recipient of services to be more involved in their care/treatment. Something that disturbs me when I meet with (most) people everyday is their lack of and unwillingness to know and or understand their care/disease. This is most likely the root of why treatment fails. I am not advocating as Julie is concerned that people need to be MD's however this scenario would force people to do some homework and take some personal responsiblity for their health.

Thank you for all who replied or read this. I am not trying to be one who thinks they know it all (humble by nature), I am only sparking debate to learn more from the particpants of this forum (as you are a savvy/informed bunch). And I am almost positive that there is no single solution therefore bringing an idea of a free market health care debate.

I am forced to advocate for full nationalization of the entire health system, effectively placing everyone under Medicare. This will lead to forced rationing due to cost but that's happening already, and such a forced system will put a stop to the discriminatory practices of insurers, physicians, hospitals and others in the medical field who commonly bill private parties ten times what health "insurance" plans or Medicare pay for the very same procedure, while playing "let's deny coverage any time we think we can get away with it."

Was being facetious -note to self don't be so facetious