Hacker News Reader

Comment by sha256sum | Hacker News Reader

Competency? The system is working as intended, it prioritizes the needs of capital flowing to the elites. You must come from somewhere else, one that places citizens on a slightly higher strata than the US does.

View on HN

To believe this shows total ignorance of the history of the healthcare system in America. The whole thing is a crazy pile of hacks and accidents with 0 design or intent. It’s tape and string all the way down. We just stumble from unintended consequence to unintended consequence. Shit, the only reason it’s tied to employment is because of post war wage and price controls.

This is true. But fatal flaws such as the fact that Medicare cannot negotiate prices with drug companies are not accidents but rather artifacts of corporate lobbying. There are many examples of rent seeking like this across the system

Medicare didn't cover drugs at all until 2003 when Bush put together Medicare Part D to bolster flagging support. Medicaid doesn't negotiate prices either, but it's mandate that it will pay the lowest negotiated price in the market. When Part D was passed it almost had a similar structure. In 2016 there was a move to add negotiation but it fizzled. In both cases the CBO estimated that negotiating prices would save precisely no money. The way Medicare plans actually work is that plan provider bid to be part of the program and they are selected on a cost basis, and they then negotiate drug prices. Could Medicare administrators do a better job? Well the CBO has twice said no. Medicare Part D was a huge hack to cover a made up problem, which is to say seniors too wealthy for Medicaid not being able to afford their heart medicine. It was essentially GWB trying to buy voted before the 2004 election. So I think you're wrong on the history here.

Who do you think cane up with and wrote his domestic policies? That’s literally what lobbyist are for. They have these things drafted up ready to go years in advance (just like the Heritage foundation and SC picks). The only thing that might be last minute is the decision to go with it.

They know exactly what the downstream effects of these programs will be. Regulatory capture is a well attested phenomenon, so I’m skeptical of any claims that all the Byzantine policies that just so happen to favor big business came about haphazardly

Bill Frist wrote most of the legislation that became Medicare Part D, he was old buddies with Rove. Frist was a hospital guy and a bit of a scammer before going to congress, I won’t deny that he was in the tank for hospitals, but the pharma lobby didn’t write his law. The original version was pretty modest, people criticized it at the time for not spending enough money, though it may now bankrupt Medicare. I remember it pretty well because I was just then getting interested in politics, but a ton has been written about it.

I guessed and was basically directionally correct. That guy seems like he fits the Bush mold - Cheney and Rumsfield privatizing huge parts of the military comes to mind. Don’t get me wrong what you are saying makes sense. I’d be more surprised if it were a coherent system.

But I do believe many government regulations and laws that may seem like sphaghetti against the wall at first are actually very intentional and lucrative to someone.

We’ll this thing in particular was Frist’s pet project for years, Bush and Rumsfeld just needed seniors on board for the election so it finally got done.

A lot of things happen that way, just horse trading and trying to get re-elected.

> To believe this shows total ignorance of the history of the healthcare system in America. The whole thing is a crazy pile of hacks and accidents with 0 design or intent.

No. The health insurance companies spend a lot of effort and influence on lobbying to make sure they are there in the loop to cash in on every health care transaction. It's all very intentional.

What percentage of healthcare spending would you guess is health insurance company profits?

The number is around 3% of healthcare becomes health insurer profits.

https://content.naic.org/sites/default/files/inline-files/20...

The more frightening thing is how many middlemen's costs are baked in. Of course insurers aren't sitting around twirling their moustaches, figuring out how to be incrementally more evil; but they are spending astronomical amounts on compliance and other side-things that aren't actually healthcare.

As someone else pointed out the insurance industry’s profits account for a grand total of 3% of expenditures. The majority of healthcare spending is through Medicare, Medicaid, and the VA. You can also see in the thread below how I explain the non insurance industry history of Medicare Part D.

There are so many times in the history of American healthcare history that someone had an idea for a fix, sold it to their voters, wrote the law, got it passed, and then it flopped.

> As someone else pointed out the insurance industry’s profits account for a grand total of 3% of expenditures.

The insurance industry profit is not a meaningful number in this context.

Profits are only what is left over after all expenses are deducted. These expenses include all the operating costs of the medical insurance industry (salaries of all employees, massive CEO bonuses, real estate costs and on and on and on).

Every penny of those costs are unnecessary overhead. All those (hundreds of) thousands of administrators and CEOs getting bonuses are not providing any health care to anyone, only adding overhead to the system. They feed off the work of doctors, nurses and medical staff but don't provide any value.

So the number to look at is the total gross revenue of all medical insurance companies. All that money could be saved by simply eliminating the insurance industry middleman and paying medical staff (those who actually directly contribute to providing health care) directly.

The reason for the initial bad design is that it was all hacked together.

The reason it hasn't been fixed is that there are powerful people that don't want it to be fixed.

I wouldn’t attribute to malice what could be more easily explained by incompetence. There are a ton of broadly agreed upon tweaks that could in aggregate fix a lot but none of them are big enough to campaign on, and they don’t fit neatly into either party’s platform. For example funding more residency positions could drive down the cost of delivering a lot of services over the course of 10 years, but that’s at the edge of CBO accounting and doctors are maybe mildly against it. It’s too free market oriented for dems and a little to spendy for Republicans.

I could go on, but the point is a lot of fixes just aren’t sexy, we elect dummies, and well intentioned people make mistakes.

https://stanmed.stanford.edu/2017spring/how-health-insurance...

You should read this before claiming I show "total ignorance of the history of the healthcare system in America". Stop making excuses for shitty politicians.

I'll quote some for you to start:

>By the 1990s, the Blues, which offered insurance in all 50 states, were hemorrhaging money, having been left to cover the sickest patients. In 1994, after state directors rebelled, the Blues’ board relented and allowed member plans to become for-profit insurers. Their primary motivation was not to charge patients more, but to gain access to the stock market to raise some quick cash to erase deficits. This was the final nail in the coffin of old-fashioned noble-minded health insurance.

>WellPoint’s first priority appears no longer to be its patient/ members or even the companies and unions that choose it as an insurer, but instead its shareholders and investors. As in any for-profit enterprise, executives are compensated for how well they perform that financial function and are compensated well. In 2010 WellPoint had intended to hike premiums in California by 39 percent, before an attorney general effectively nixed the plan. CEO Angela Braly received total annual compensation of more than $20 million in 2012, despite the fact that she resigned under pressure that year because the company revenues were down. Joe Swedish, the new CEO appointed in 2013, is a longtime health care executive who served at the for-profit Hospital Corporation of America. His starting salary and bonus totaled about $5 million, not including stock options.

>To express their collective frustration, members gathered signatures for a MoveOn.org petition: “Anthem Blue Cross: Stop Playing Politics with Our Premiums.” They urged their insurer “to stop spending corporate funds on political campaigns, disclose everything it has spent directly or indirectly on political campaigns, and use the money to lower rates for Anthem policy-holders and California taxpayers.”

>To increase profits, all insurers, regardless of their tax status, have been spending less on care in recent years and more on activities like marketing, lobbying, administration and the paying out of dividends.

Yep

- artificial limit on number of doctors

- unlimited lobbying by pharma companies

- unlimited advertising for said companies

- single payer system gutted every time

- insurance company lobbying prevents insurance across state lines

- on and on

Reply on news.ycombinator.com