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Comment by knubie | Hacker News Reader

Really any healthcare procedure that is not typically covered by insurance has seen costs go down over time. Things like lasik eye surgery, or orthodontics are great examples in addition to the ones you've already mention. The service and technology gets better while the price continues to go down.

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> Really any healthcare procedure that is not typically covered by insurance has seen costs go down over time.

Health "insurance" companies are incentivized to raise the cost of care. Why? Their profits are capped to a percentage of the cost of care. The only way for them to make more money is to have more revenue -- which they do by increasing the cost of care!

Bakeries are also incentivized to raise the cost of bread, in spite they have no official cape of the profit (unless you consider 100%?).

The difference is that if a bakery tries to charge you a ridiculous price, you can politely decline tu buy, or buy and promise never to return.

Let say you go and pick up a loaf of bread from the store. You don't pay, however. Instead, you have the bakery send a bill to your "buyer." Your buyer then negotiates the price. One thing about your buyer: the more revenue that flows through them, the more money they get to make. The bakery tells the buyer that the cost for the loaf of bread is $500. However, the buyer wants to keep you happy, so they reject the price, and come back with a lower price: $350. The bakery rejects the $350 price, and eventually, the two parties agree that the price should be $400. (Note, that other bakeries, where you buy directly, charge $4 for a loaf of bread.)

The buyer gets to say they negotiated. The baker doesn't have to look you in the eye when they gouge you.

It gets a little more complicated,though. Instead of just paying $400 for the loaf of bread, the buyer bundles the cost of all the purchases together, and then charges a monthly fee, based on the previous year's overall revenue. They then tack on 20%. So, it turns out, with that extra 20% you're actually paying almost $500 for the loaf of bread anyways.

Is it a scam?

Yes, it's a scam.

The difference is that the customer pays 100% of the entire price. The industry doesn’t have a plan where you pay $0.10 for an eggs benedict brunch, or 10% a year after spending $100, and then get to charge your employer or your fellow citizens massive sums.

And someone can start a competing bakery across the street that doesn't over charge. You can't do that with healthcare.

> The service and technology gets better while the price continues to go down.

What did you think the farmer who was charged $6,589.77 for 6 stitches might have to say about that proposition?

GP is talking about:

> any healthcare procedure that is not typically covered by insurance

Which I (not American) assume stitches in the emergency room are.

Yeah that doesn’t preclude the farmer from having an opinion about the proposition.

Why do you think this discrepancy occurs?

Sure the farmer can have an opinion, but I’m not sure how

> who was charged $6,589.77 for 6 stitches

is relevant when OP was talking about procedures NOT covered by insurance.

"I wish stitches were done on a fee for service model like shooting lasers into people's eyes is."

That was still a FFS model. The difference is whether the procedure is typically covered by insurance.

I don't see how it's fee for service if nobody can tell you what it's going to cost upfront.

The uncertainty comes from not knowing exactly what services will be performed, who will be performing them, and how much the insurance company will cover (which has a ton of variables, many of which aren't known until everything is settled).

In my opinion, getting away from the fee for service model is one of the routes we ought to be taking to address healthcare spending in the US (if you're charging per service, you're incentivized to perform as many services as possible in a given encounter).

In other professions if you make a bid and fail to capture required work, you eat it generally speaking.

Contractors, many of whom are small businesses or individuals, do this all the time. They also give estimates like "If we find mold behind the wall, it will be an extra ten thousand".

Medicine is also odd in that you have to pay for the doctors mistake. If the doctor prescribes a less effective drug, it has no effect and then after doing your own research find a better drug and get the doctor to prescribe that instead. You still have to pay for the first visit. If a plumber decides to go from plastic to copper pipe mid job, he doesn't get paid for the work he ripped out.

Multi billion dollar hospital groups, full of highly educated professionals apparently can't pull this off but the guy who poops in a bucket on the job site can.

The most insane part are the out of network professionals. It's like you have a deal with the plumber to fix tout kitchen for $100. But in the middle of the fix, you hear a surprise ring in a front door and it's a helper of the plumber that comes an does something. And the next day the plumber notifies you that you must pay an additional $500 for the other guy.

The hospital is reimbursed on a fee for service basis. Most (all?) countries use a fee for service model, but most countries also don't have for-profit payers that are incentivized to drive up the cost of care.

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