Why an MRI costs $1,080 in America and $280 in France

From a Booklist review of the book:

  By demonizing trial attorneys and exaggerating high-profile litigation
  awards -- the famous McDonald's hot-coffee case -- campaigns for limiting
  damage awards threaten to jeopardize the American right to civil jury
  trials guaranteed by the Bill of Rights. Investigative reporter Mencimer
  examines the Republican campaigns for tort reform that would protect
  large corporations from "frivolous lawsuits." The campaigns carry the
  dual benefit of supporting the interests of corporations that are major
  Republican campaign contributors and hurting trial lawyers, who are part
  of the contribution base of Democrats. Mencimer criticizes the media for
  their lack of understanding about civil litigation, willingness to
  swallow reports of litigation abuses, and failure to understand that
  Republican tort reform will also limit the ability of news organizations
  to sue for information. Drawing on national data and scrutiny of
  individual cases, Mencimer defends the civil justice system and its
  reliance on jurors, average citizens who are the same people who vote.
  This is an eye-opening look at an important issue for readers concerned
  with the civil justice system.

From the Booklist review:

  However disliked lawyers have become, they have played an essential role
  in the development of the American democracy, assert legal scholars
  Strickland and Read. Taking aim at media critics -- left and right -- who
  blame lawyers for a host of social ills, Strickland and Read debunk
  several popular myths about lawyers. They begin with the notion that
  there are too many lawyers and lawsuits, citing statistics to put things
  into perspective, and they point to the benefits that have come from
  lawsuits, including increased consumer protection from faulty products.
  But they concede the need for reform in a chapter that calls for major
  research into alternative legal mechanisms. Finally, Strickland and Read
  look toward the next generation of lawyers and outline the
  characteristics most essential for the practice of law: competency,
  responsiveness, and integrity. They emphasize that it’s not what lawyers
  bring to the law but what they give that makes a difference. This book
  is not likely to stop lawyer jokes, but it is an insightful look at a
  much-maligned profession.

[2] - http://www.amazon.com/The-Lawyer-Myth-American-Profession/dp...

All you've identified is that rich nations have good health care regardless of how much regulation they have. This is hardly surprising - the evidence suggests that once health care exceeds a certain minimum level, it has little effect on health outcomes.

Incidentally, the Indian health care system is excellent and less regulated than the US one. I'm very lucky that I blew out my back in over here rather than in the US. I didn't come over here as a medical tourist (my startup is in Pune), but I strongly recommend that more people consider it.

Granted, the vast majority of people here are too poor to use the health care system effectively, but that's not the fault of the system.

If so, then compared to what exactly?

The US has some of the highest costs per treatment of just about anywhere in the world, so if the insurance companies are dramatically lowering prices, then the only conclusion I can draw is that the US healthcare providers must be powering all their equipment by burning money for fuel or something.

Health insurers in the U.S. have a captive audience. Most people before the age of 60 who have insurance get it through their employer. What the employer pays for insurance comes out of money that would be paid in salary. It seems to me that the insurance companies don't have a great incentive to lower cost of healthcare. On the surface the evidence suggests that they haven't since procedures cost so much more here than elsewhere.

As mentioned in the article, American insurance companies appear not to be very good at negotiating prices, partly because the providers are permitted to negotiate different prices with different companies, and to treat these negotiated prices as trade secrets. This is a highly unusual state of affairs.

The lack of MRI is a big problem in France anyway. Regardless of the effect on prices (except maybe if they triple or something like that) having 100% more would be a lot better.

Exactly. The level of care is not addressed, therefore you can call the US a backwater and hence receive upvotes.

By few, you mean two, soon to be one. The US and New Zealand, and New Zealand has passed legislation to phase it out.

The US will be the only country in the world where you can be advised of your potential need for a prescription drug not by a medical professional, but by an actor on a television screen.

Well, with many insurance companies there can be an additional cost. Submitting the claims, filling out the paperwork, proving the work was done, etc... all add up. Depending on how much work a person does with an insurance company it could easily add up to another full time employee.

Two possible issues here. First, it _does_ cost more to reclaim payment from an insurance company than to get it from the consumer. There are the forms to be considered, and also the fact that insurers often pay substantially in arrears. Also, did you end up paying cash? Some providers of services like this will prefer a cash deal, as they do not necessarily plan to declare it.

Regardless, it's great that you have a happy story to tell. It's mostly meaningless. The original point is, Canada's system isn't better. It's just another system, with it's own problems. I mean, do you really think your story will change the facts of mine? Does it matter? No.

And, to top this all off, you try to equate "not being impressed" with abuse? Really?

* 2011 Nobel prize for medicine went to an international crew (2 from europe, 1 USA)

* 2010 Nobel prize for medicine went to a British man.

* 2009 2 women from the USA, and one man from UK.

* 2008 1 german man, 1 french woman, 1 french man.

Anyway, medical care isn't just about what drugs multi national companies produce (with much funding from Asia and actual research done in Asia and sales done in USA+worldwide). It includes things like reducing obesity, stopping people smoking in bars, and providing good medical care for all people - which reduces sickness spreading. It does take research, and development to figure these things out and implement them on a social level successfully. Many of these things are classed as social science, and not included in R&D in many places. They can't even get R&D funding for this stuff in some places because it is not real science apparently.

Tax credits for r&d also distort the real costs. The UK gives 225% r&d tax credits, and Australia gives 175% tax credits of the cost now(USA has them too, but lower). This means you make money purely from just doing the R&D without worrying about the results.

btw, the USA is massively in debt, and over 22% of US companies being foreign controlled. So even if the US companies were contributing that much R&D, shouldn't that proportion be attributed somewhat to other countries? With all the funding into the USA also coming from other countries, shouldn't some of that be counted towards the other countries? Shouldn't the fact that lots of the workers in R&D labs for US companies have been outsourced to other countries count towards those countries?

Inasmuch as it is possible for companies of this size to be from any one particularly country, large American pharmaceutical companies spent $27bn on R&D in 2009, while European ones spent €28.5bn (i.e. 40% more at today's exchange rate.)

source: http://en.wikipedia.org/wiki/List_of_pharmaceutical_companie...

Current account deficit is what I wanted to type, not only trade. It works like this since Bretton Woods (okay, 40 years ago): US has current account deficit, that means that US dolars (or bonds in USD) are collected by other countries, and the US receives physical values (traded goods, raw materials, etc.) in return. When the USD loses value vs other currencies, the other countries posess now less value, because the USD they own is worth less physical stuff/other currencies.

The US is trying hard to do the same thing with China currently, since China has bunkered some 3 trillion USD. Devalue the USD a few percent vs the Renminbi and the US has saved a lot of value it would otherwise have to "pay back" to China some day.

Its a good thing to run the leading international currency (ie the USD) because of the implicit value transfer to your own country.

Medical R&D in the US amounts to about $100 billion/year. (I misremembered a slightly higher number previously, but the ballpark is the same.) Meanwhile, the US is spending in the neighborhood of $1 trillion/year more on health care than if spending were on the same level as a typical European country. Yes, I understand that those R&D costs get baked into medical costs, but they simply don't account for the vast majority of the discrepancy.

If the US system cost the same as a typical European system with the exception of US R&D spending on top, the discrepancy would only be around 10% of what it actually is.

MRI's are used in Japan the way antibiotics are used in the US. Patients are often unsatisfied if the doctor tell them to go rest and hope things improve on their own (even if that is the best treatment), so doctors perform some harmless token medical procedure to make the patient feel he helped them.

A needs-based study based on having MS, sure, but just getting an MRI as part of a routine checkup, probably not.

Not on the basis of exposure to anything dangerous, but certainly they can be overused on cost grounds. That is the case in the US. They are routinely ordered without an adequate indication; we order many times more than physicians in other countries.

Maybe; let a doctor look at it and decide. An MRI may be useful. It might just provide complex hard to interpret images that don't provide any more information than an experienced orthopod could find with some manipulation.

> Using MRI technology for health screening and preventative/proactive treatment is great.

You need to provide some evidence for that claim. There's a number of flaws.

Giving everyone screening MRIs needs many more staff. Those staff are diverted from other areas of healthcare, so that's one negative impact.

You'll get bottlenecks in screening and interpreting results, so some people who need treatment may end up waiting longer than someone who's just getting a screening MRI.

MRI scans are complex and hard to interpret. Knowing that every MRI is called for by a doctor makes people screening them look hard for problems. Knowing that there's a bunch of screening of probably healthy people means that screeners may not look so hard, and may miss minor (or major and hard to see) problems.

A patient who is healthy but who has a blob on MRI will be under considerable stress until that blob is investigated and ruled safe.

Investigations carry some risk. You have to drive to the hospital (which will cause many deaths and injuries); you're mixing with ill people; you're increasing the number of people visiting hospitals and thus increasing the numbers of people with MRSA and NORO virus and etc visiting hospitals - you're increasing the number of healthy people carrying illnesses visiting hospitals which have people unable to resist those illnesses.

That's just off the top of my head. I'm sure there are many more problems.

But I don't have numbers, so I can be persuaded if someone has good quality reports.

There's your mistake. You didn't see a doctor who owned (or who had bought a share in) an MRI machine. Those doctors are 4.2 times more likely to refer patients for MRI than doctors who don't.

Low bandwidth costs mean that it can be done halfway around the world.

The panic that the US gets itself into when discussing fuel prices is amusing to watch. Australia is a big country with spread out cities like the US (or even more than the US) and similar wage levels, yet we don't have problems with post-paying cash for our fuel. In six weeks of driving around the US west a couple of years ago, I never found a single place where I could post-pay with cash - they were all too afraid of drive-offs. Weird.

Also, you've mangled the statistics - for example, you've used Vietnam's price per litre against the US's price per gallon.

I imagine it would also be different for a hospital MRI (which needs to be available for emergencies) and outpatient MRI centers (which is where I've always gone).

1) The trucks -- a lot of times MRI trucks are driven around to various hospitals, and scheduled in advance, for non-emergent studies. These obviously get scheduled during "working hours", and then the emergent off-hours MR studies are done by transporting the patient to a higher level facility and thus might get shot whenever.

2) The whole "doctor owned imaging center" scam or "perverse economic incentive", where doctors own imaging centers and then refer a lot of patients to them, increasing the use of the technology for basically no need. These are easy to schedule during working hours, too.

http://www.washingtonpost.com/blogs/ezra-klein/post/how-much...

People don't "shop" for healthcare the same way they shop for televisions or other consumer products. In fact the overwhelming majority tend not to all. Either someone like me at their insurance company picks a primary care physician for them, or they pick one from a list based on simple factors like someplace convenient, seems like it's a good part of town, etc. Unless the doctor is so unbelievably terrible, it's extremely unlikely they will switch. My wife, who is frustrated by many aspects of our healthcare system, attributes much of this to the complete and utter lack of medical literacy possessed by the general population. The average person simply has no idea how modern medicine works on any substantial level, so they have little to no basis for making an informed decision about their care or provider. When you are sick, even with something routine and non life-threatening, you don't think "Hmm I could go see the doctor today because I feel awful, but I think I'll price shop for a day or two beforehand." Even people with strong financial incentive, i.e., people with limited means, don't do this. If a child or loved one is involved you're even less likely to start thinking about dollars over medicine.

I do agree that most patients have no accurate understanding of the real cost of their care, and that more education in that department certainly can't hurt, but no matter how you slice it, that cost is simply much higher than it is in other developed societies, and that is a serious problem that needs to be addressed.

Edit: Something I wanted add: I know in a community like HN, many will be of the sentiment that if you fail to educate yourself about a product or service, you borderline deserve the consequences. I agree with this in most respects. However, taken to it's logical conclusion, that would require me to become an expert on everything under the sun. I have no idea how the plumbing in my home works, or how to do anything but routine maintenance on my car. It's not that I lack the interest to learn about these things, it's simply that there aren't enough hours in the day to plausibly accomplish this. When faced with the need of a professional expert, I have to use a little common sense mixed in with any superficial knowledge I do have, and trust that there is a system in place that prevents me from being totally screwed price wise.

Moreover, in a system like the US health care the "average" isn't very meaningful, because if you and I have a sore knee, and you get 2 MRIs per year, and I get none, well...

I didn't find a place in the article that talked about administrative costs (i.e. salaries, bonuses, profits) that go to insurers.

I still doubt that it is the extra cost of caring for elderly people really well that is the major factor that is keeping the other costs high though. Especially since there are less very elderly people, as a percentage of population, than in other developed countries.