I agree with the three issues they identify driving up costs. But I fear “Medicare for All” won't fix all the issues, which go much deeper. For example, the US has extremely high standards restricting who can practice medicine compared to the rest of world, limiting the supply of doctors and artificially driving up their demand. There is a need for standards, but perhaps the AMA has too much political influence. Likewise, manufacturers of medical supplies operate as monopolies because the moat to reach approval is really high. I fear the US medical system is becoming so insane the only fix will be to replace it entirely (It's not just about tearing down, but replacing institutions)
I worked in a hospital for 13 years. The economic incentives for the current system are quite perverse.<p>The FDA has no cost constraints and so maximizes safety instead of QALYs.<p>Medical equipment and drug manufacturers maximize profit and so fill the highest margin niches first instead of maximizing QALYs.<p>Radiology and lab services are lucrative and separate themselves from clinical providers to maximize profits instead of QALYs.<p>Individual physicians and especially surgeons can maximize profits by having their own practices vs. hospital or clinic environments where coordinated care maximizes QALYs.<p>Hospitals and clinics and especially ERs, cancer treatment, and skilled nursing facilities try to make ends meet with inpatient population and try to hold on to outpatient surgery, radiology, and lab services to make ends meet while providing whatever level of coordinated care they can, but still optimizing for profit over QALYs.<p>Insurance companies maximize profits by building actuarial plans that stratify patient populations by plan cost, skewing the burden of healthcare costs to the unemployed, underemployed, and low wage earners. A patient becoming uninsured is an economic win for insurance companies and employers. QALYs are proxied by cost/patient/year for anyone managing to stay insured which ignores deductibles, co-insurance and other out of pocket pay.<p>Medicare and medicaid programs are left to pick up the pieces by trying to piece together effective care with compensation restricted by arbitrary budgets and arbitrary service providers (many specialists, independent physicians, and facilities flatly refuse medicare/medicaid patients).<p>Actual patients have no clue how any of this works and end up with a pile of bills they try to pay off or if they know the trick they negotiate with the healthcare provider to settle for something slightly above the ~2% face value of debts written off to debt collectors who will hound sick people and their families incessantly.<p>Maximizing QALYs is hard enough in a centralized single-payer or universal healthcare system. Almost nothing in the U.S. healthcare system is aligned with that goal.
Their solution in the TFA is to focus on straight-through billing through standardization of payment mechanisms, arguing that each physician is paying $100K / year. Of course, this also puts the lie to the insurance companies, who are the other side of the transaction and essentially add another 20% in cost just to pay the bill! (Their loss ratios due to medical costs are about 80%.)<p>Insurance companies are basically just bill paying services, as almost all employer sponsored healthcare is self-insured by the employer as the risk pool is large enough to take care of the true "insurance" nature of the mutual pooling of risks.<p>So how do you think insurance companies will react to making it "easier to pay the bill through standardization?"<p>Chance of movement = zero.
Worthless paper, administrative costs is only a piece of the many issues with US "Healthcare". Medicare For All is the better and cheaper way forward. No one ever talks about what is the value all these Health Insurance companies bring? The whole point of their existence when they were created was to control costs. Obviously they have failed miserably. Medicare For All handles lowering or eliminating student loans for Doctors and Nurses. It regulates costs for pharmaceuticals and medical equipment. By having the government be the insure. It relieves business on having to provide insurance and creates a much healthier workforce. It would also create an explosion of entrepreneurship. Now that insurance isn't tied to a job.
We have standardized health care billing in Germany, both for the around 100 public health insurances and the private ones. We still have a relatively expensive health care system when compared with other European countries.
Even fairly mundane steps like assigning people uniform medical record numbers, so that every single organization doesn't need its own system, is a heated political issue in the US: <a href="https://ehrintelligence.com/news/house-votes-to-overturn-national-patient-identifier-ban" rel="nofollow">https://ehrintelligence.com/news/house-votes-to-overturn-nat...</a>
Recently I got laser eye surgery to help my vision. This was not covered by my insurance. It also happened to be the simplest medical procedure/payment I ever had to interact with. They told me "this procedure will cost $X.XX and we have a discount we can offer you that will save you X%" I said okay and paid them the money.<p>Compare that to insurance being involved recently in my wife's diabetes supplies. My wife is a type 1 diabetic and needs supplies that monitor her blood sugar, we noticed her supplies didn't arrive on the scheduled date, we waited a week to see if they would show up and they didn't. My wife called the company that was supposed to send them, they said our account was in collections? Why, we never received a bill, we never were notified, but in collections we were. We eneded up paying and got that sorted out and waited another week, still no supplies. I'll cut it short and just say it took us 3 weeks being on the phone multiple times a day being bounced around between our insurance, the supplier and her dr, to finally get told we couldn't get the supplies because my wife had gotten a new phone and so the insurance company didn't have enough data to prove that she needed these supplies, and wouldn't reauthorize them. The drama is still ongoing.<p>Let's get this straight a huge part of the healthcare costs are directly related to insurance and the money and laws tied up in that. We need to get rid of insurance, and the way it works if we honestly want to make any change. Any other effort will only further entrench the confusopoly.
I'm skeptical, because a key element of the US payment system is that everyone is highly motivated to shift costs to someone else, to be paid more money and to pay out less money, so doctors hire armies of accountants to do battle with similar armies deployed by insurance companies, hospitals, and drug companies. How will they fix that?
I think under "administrative costs" they might have hidden consolidation of the providers market. Anecdote: I wen to podiatrist about 4 years ago and now. The same doctor the same place, everything is the same. Except 4 years ago it was ~ $200 per visit, now I am looking at ~$350. What's changed? His practice became part of the big group footandankle. Similar situation happens with other specialists and family doctors, hospital networks consolidate all they could find in vicinity under their roof. There's no promised administrative cost reduction. Everything goes up in price. But apparently it's a "faux pas" to criticize hospital networks because somehow it reflects may reflect bad on the doctors.
> Estimates suggest that the country wastes more than $265 billion annually due to this administrative complexity, and that the rate of increase in administrative costs has outpaced that of overall health care expenditures<p>This happens for a reason. A 265 Billion industry (however fragmented) has developed to create/maintain and profit off the complexity. I am extremely pessimistic that they will allow this to be fixed. It might be just too big to fail at this point. However, it might plague "medicare for all" systems too, unless it's completely a separate system somehow. These entities will make every effort to get into the "medicare for all" flows as well.
Considering how enmeshed everything is at Standard is with private sector businesses, and how many of these businesses can prosper due to these inefficiencies, I am quite skeptical.<p>Even if the particular businesses these professors work with stand to gain from such reform, this sort of approach that thinks we can technocrat our way around the antagonism that is precisely <i>why</i> things like medicare-for-all are so difficult seems incredibly politically naive.
Some have noted 'bottlenecks' at the MD entrance level.<p>There is an opportunity to allow for procedural specialization so that 'techs' can do a lot of the work normally done by docs and nurses.<p>'Early detection' is a new, major shift in how medicine works, because the things we get now 'come on slowly in a hidden way'. Allowing for technical specialists to run operationalized testing with standards, clear rules etc. may enable us to get costs down and possibly improve outcomes.<p>My bet is that someone with very narrow and focused training may be even 'better' at that thing - so long as we can put a nice dotted line around it because of course it's always more complicated than just 'one thing'.<p>Perhaps requiring 'best price' for all so that individual payers can get the same price as insurers might work, though it's not exactly 'free market' it mostly is. Transparency - so that everything is published and public might work as well.<p>It may also be worth not billing specifically for low-cost materials used, and just roll it into the type of visit.
The problem with healthcare is that inefficiency and lack of transparency is profitable.<p>The government has deep pockets, and everyone is trying to get as much money as they can from it. Pharmaceutical industries, insurance providers, healthcare facilities, etc.<p>Pharmaceutical research is important and expensive, but there must be a way for that research to happen without doing stupid shit like making insulin expensive.<p>Labor costs in healthcare are high, but there must be a way to not make a bag of water with salt not cost $500.<p>People pay for costs that are completely unrelated for the products and services they are receiving.
This speaks about standardizing contracts but neglects to mention that the competing proprietary electronic medical record standards also add cost, complexity, and increase medical errors.<p>And there are still about 14 other layers of the healthcare onion to peel.<p>Medical talent is kept artificially scarce thanks to the lobbying and control of licensing by the AMA. We should hand control of licensing over to the AARP and the March of Dimes instead.<p>Hospitals and insurance have perverse incentives because they are separate. But when insurance and provisioning is combined as with Kaiser Permanente, then incentives are aligned and bureaucracy can be streamlined.<p>Hospital consortiums currently carve up monopolies within a given piece of turf. We should break that up, and allow a proliferation of low-cost community clinics for less advanced procedures.<p>And this hasnt even covered obscene pharmaceutical costs, electronic medical device manufacturers, the diagnostic industry oligopoly, and so on.
Link to the actual paper (paywall): <a href="https://onlinelibrary.wiley.com/doi/10.1111/1475-6773.13649" rel="nofollow">https://onlinelibrary.wiley.com/doi/10.1111/1475-6773.13649</a>
So how do they plan on getting private capitalist enterprise to start implementing reforms that would lower their profits? Because by definition administrative cost to the consumer is profit for the company.
What a joke. The only thing that would lower the costs would be to increase the competition, but the government has allowed merger after merger after merger (in health insurance, and in providers, just like everything else lately), taking away more and more pressure to compete.<p>Why is every other ad on TV for one of the car insurance companies? Competition, which drives down price. The way to fix US health care is to create a market environment where I can buy health insurance like I can buy car insurance. It's too regionally regulated now. Make the market national. Make it possible for a young, unmarried man to buy into a group policy with other young, unmarried men (with zero benefits for maternity or female-specific illnesses), and let the market sort it out.<p>Tying insurance to employment has got to be one of the most BALLER moves of Capitalism the world has ever seen. I mean, how much harder could you force your employees to bend over than to tie their literal life and health to working for the company?<p>GET MY EMPLOYER OUT OF MY FUCKING INSURANCE. People say there's no money for nationalized healthcare. Bullshit. We're already paying it. Give me the money that my company is paying on my behalf -- about $20,000/year -- and let me combine that with my portion -- about $8,000 -- and let me go buy a plan that makes sense for me on the open market.<p>Do these 2 things, and the market would sort this out in a New York minute.
> A new analysis by Stanford researchers suggests the health care industry can reap many of the economic benefits of a “Medicare for All” program through incremental changes to the private health care market.<p>Why not just implement Medicare for All, instead of trying to band-aid the private healthcare market?