Who profits most from America's baffling health-care system?
economist.com
economist.com
The US doesn't have one healthcare system, it has 50+ (or 51, ...59, is healthcare in Puerto Rico part of the US healthcare system?, how about American Samoa?). Contrary to many peoples opinions the "healthcare system" is not operated or overseen primarily at a federal level. The federal government is one of the largest buyers of healthcare as an insurance provider, that is true.
Comparisons to other countries that are much much smaller than the US are sort of silly to me. Europe does not have one healthcare system. Subsidized education and price controls in foreign systems also make comparisons excruciating. I think it is usually a canard. OECD data is, in a word, "garbage", as it relates to healthcare. Just one example: In the US, eyewear for seeing purposes is healthcare. In almost no other countries do you need a prescription for eyeglasses. Prescription eyewear in the US is a 20-30 billion dollar market, depending on how you want to count it.
I think the mechanisms for paying for healthcare in the US are really inefficient and involve too many intermediaries. This is a result of a lot of accidents of history. America is a very physically large country with a lot of people all over it, we expect very high standards of care, we consume a tremendous amount of pharmaceuticals, we have wildy abundant and relatively inexpensive food that seems to be correlated to our being much more overweight than a lot of other peoples, we engage in a lot of dangerous activities at a rate that far exceeds what a lot of other peoples do that seems to correlated with our culture, on and on.
Instead of hand wringing about differences between ourselves and other cultures we would be better served looking at boring things like medicares 3 million pages of medical claim guidelines, clearing house operations and conflicts of interest, better incentives for state level responsibility, antitrust litigation, lots of practical things that don't make click bait headlines.
True, Europe does not have one healthcare system. And yet, thanks to the EHIC (European Health Insurance Card) [0], citizens of the 27 countries in the EU, Switzerland, the UK, and the EEA (Iceland, Liechtenstein and Norway), can use the healthcare systems from any other of the 31/28 [1] participant countries if they need healthcare on a temporary visit under the same conditions as the local resident citizens. The expenses incurred are reimbursed to the system providing the healthcare by the healthcare system of the citizen who is receiving it. This is done transparently to the patient, all they need to do is provide their EHIC card.
This means that each of these 32 different healthcare systems, with their own particularities (e.g. free at the point of use vs. copay), can be considered one single universal healthcare system.
If 32 different countries, with their own legal systems, legislation, languages, and healthcare system design (insurance based or state funded) can cover approximately 500 million citizens, then 50 US states under one single federal government should have no problem doing the same for their 333 million citizens.
[0] https://en.wikipedia.org/wiki/European_Health_Insurance_Card
[1] In the case of the UK, the EHIC only reciprocal with EU and Switzerland, not the EEA.
https://ec.europa.eu/social/main.jsp?catId=1021&langId=en&in...
If you work less than that, the accident insurance premium is not that high(less than 50 CHF per month).
This is literally what we've been doing for years. It doesn't work because we're trying to apply bandaids to a problem of fundamental rot within our healthcare system. Look at how many states and politicians blew up over the ACA and attempted to stonewall it. I'm old enough to remember my mother being denied healthcare by her insurance provider because she had a stroke and that counted as a preexisting condition. Our solution to this rot is trying to solve a problem after it occurs, rather than prevent it in the first place.
In both Australia and France, you need a prescription. This assertion makes me question the accuracy of the rest of your comment.
It would also be nice to reform the FDA and the clinical trial system: https://bessstillman.substack.com/p/please-be-dying-but-not-...
"Antitrust litigation" covers this, but to spell it out, the increasing monopolization of many local healthcare systems is a huge problem.
In defense of the FDA, which I promise is not an instituion I have much affection for, they are asked to strike an impossible balance. More or less the same regulatory impulse that allowed Richard Sackler to build an empire on the killing of millions of americans is the same one that allows very sick people to access very, at times dubious, drugs and trials that sometimes save their lives.
Most of medicine is very centrally built around the "first do no harm" approach, even at the cost of lives by non-intervention sometimes. With the FDA most people want a "do some harm, some of the time for the greater good" approach which is a really difficult thing for a federal agency to put into practice. I think they do an especially awful job with it but I appreaciate that it is a really hard balance to strike.
The Sacklers aren’t the problem here, corruption is.
People aren’t dying very young with tobacco addiction for the most part. There is cancer in youth sure , but tobacco is not the leading cause of that .
People who die of tobacco related illnesses are functioning adults and contributing members of society for the vast majority of their lives .
The disruption to the lives of drug addicts and their friends and family far exceeds those faced by tobacco addicts.
Not everything is a conspiracy or corruption people only react to what they see, the impact of drugs is far more visceral and immediate than tobacco or say obesity which kills even more, so pressure for legislation is higher
If tobacco killed because the of one wrongly cut cigarette you smoked , it would require prescription too
The FDA doesn't have jurisdiction over "many things".
I personally think the FDA shouldn't exist, or should not have power to regulate (and should be a toothless advisory/certification authority). That said, if they are to exist, they should do their job. They're not. We're paying the bill but not getting the service.
Same goes with OSHA. Every casino in Las Vegas demands their employees work in rooms filled with tobacco smoke. Why? Money. It's pure corruption.
We have the rules, they're just not enforced, because if you have enough cash flow, you get a special carve-out so that the rules that apply to everyone else don't apply to you.
Big Tobacco gets it from the FDA. Big Telecom gets it from the FCC. Boeing gets it from the FAA. It's everywhere, and once you see it, you can't unsee it. We're paying billions and billions for these huge bureaucracies and they're only pretending to provide us with the service they exist to provide.
Why not both?
This may be correct to say in the de jure sense, but in the de facto sense there is a set of common norms and characteristics across all of them that makes it possible to talk and reason about them as a "system" overall (especially when talking about Federal-level policies that have potential to create nationwide changes to how Americans experience that "system", e.g. as the ACA did in a few ways).
It's really not. If you asked the same question about Russia and their oil economy and oligarchs it would be perfectly reasonable despite the size.
These are not accidents though.
For example in Puerto Rico there was a good, affordable public health care system many decades ago (El plan Arbona). This was meticulously dismantled by the insurance industry through political lobbying and support of insurance-friendly politicians. Now they have the same debacle as in the US, sky high insurance profits and terrible health care. This was very intentional, not an accident of history.
The insurance companies dismantling a good public system was a pretty recent action, mostly in the 90s although the damage has taken a while to propagate.
And yet pretty much every single one of those is more equitable and efficient than what US can muster.
US, for better or worse, is much more individualistic society, without much emotions for plight of other citizens. Sort of buddhistic/hinduistic approach - if you suffer now, you must have done terrible things in your past life to deserve it, and why should I interfere.
This results in tons of wonderful things in economy but messes up quite a bit too and brings some bad incentives where they shouldn't be. You don't want to be below average/median income (and say have some health issues on top of that), the quality of life is significantly worse than similarly-positioned peers in say Western Europe. But everybody looks at the top 0.1%, which fares, at least financially better.
Strange place and setup for me and not in a good way, but maybe our more egalitarian and friendly/helpful approach is too naive and harsher society is more robust. We shall see.
Let's be fair it's at the very least 10% (maybe up to 30-40% if not more) that are doing better financially than they would in Europe under similar circumstances (education, career etc. wise). In certain sectors like tech it's not even close.
e.g. real estate even in SF, NY, San Jose is significantly cheaper than for instance in Munich, Rome, Paris, Milan, London etc. when compared to median income.
Also it's not that obvious to me that Americans are that much less likely to care about 'the plight' of others on an individual level. For instances Americans donate many times more to charity on average than Europeans do (which makes sense if you expect the government to take care of everyone, but let's not equate that with intervening directly...)
- there is a big debate if doctors should serve 24 hours without break (non stop) in hospital.
- doctors may be forced to operate after 24 hours of non stop work. I know for fact anesthesiologist who did so. We have VERY strict regulations for truck drivers to only drive 8 hours per day...
- there are no basic medications in pharmacy, like penicillin or anti fever sirup for kids
- you pay 8% medical income tax (it is called insurance), but there is no chance to find dentist or GP. So you go private an pay it out of pocket
- no chance to sue doctor or hospital for mistreatment. I could tell stories about tampons and tools forgotten inside patient...
- we have highest numbers of doctors per capita in Europe, yet system is very inefficient
- doctors spend about 40% of their time with paperwork
- base salary for doctor (without overtimes) is very low, they would not even qualify for mortgage..
- once I waited 12 hours at emergency room in public hospital (with life threatening condition), at end I gave up, and went to private clinic. I took second job to pay it...
It may be the EU, but why not use a more comparable country?
This is a fact that people, non-US but also many US Americans ourselves, have a really hard time in understanding. The vast majority of laws are left to the states. It's just incredibly hard to get national laws, and as a consequence, we have relatively few national laws. For example, there isn't a national standard for murder, there are 50+. Well, there is one if you commit the murder in a post office, but outside the post office, you're in the other 50 definitions.
It's a miracle even the half-baked ACA got passed in this context.
Federal law trumps state law. And, in fact, we do have 3 national healthcare implementations, Medicare, Medicaid, and Vertaren Affairs healthcare.
Socializing healthcare could be done easily under the commerce clause of the constitution, but that doesn't happen because it's not popular among elected officials (it's only popular among the most progressive Democrats, for everyone else it's a no).
ACA was so half baked and all over the board because there was a lot of carve outs to win over centrist Democrats. A much simpler "Medicare for all" could be implemented simply by changing the Medicare statute's enrollment age to 0.
The reason national laws are so hard is the filibuster in the Senate and the fact that Republicans are pretty much universally opposed to expanding government healthcare. It's got nothing to do with there being 50 states.
Also this is slightly pedantic, but your examples are NOT national health systems. The closest thing in the U.S. is military medicine, which is (mostly) federally funded with doctors working for and paid by the government.
Not really. The comment I was responding to argued there couldn't be a national healthcare system in the US. I wasn't arguing that those systems are perfect.
> The reforms needed are much, much more than simply setting Medicare’s enrollment age to 0
Agree
> especially with the thousands of pages of weird exclusions and conditions enshrined into Medicare over the years.
I agree to an extent. The thing is, healthcare is messy regardless. I simply could not imagine any healthcare payment system that wasn't fairly complex to code out.
> Also this is slightly pedantic, but your examples are NOT national health systems. The closest thing in the U.S. is military medicine, which is (mostly) federally funded with doctors working for and paid by the government.
Agree, and honestly if I had my way I'd nationalize healthcare top to bottom. Capitalism is a race to the bottom with healthcare. There's no real incentive to produce quality (you have a captured market). That incentive is to raise prices as high as possible and cut staff as lean as possible.
That is an strange and reactionary misconstruction. My whole comment was talking about the misunderstanding of US Federalism. Healthcare was a flippant comment as an example in the closing sentence.
Where do I dispute that?
> The reason national laws are so hard is the filibuster in the Senate and the fact that Republicans are pretty much universally opposed to expanding government healthcare. It's got nothing to do with there being 50 states.
That's a very narrow historical view. Look at any landmark laws passed that have significance on an average person's life - ACA, 2008 Bank Bailout, Patriot Act, AWB. They are few and far between compared to other Western democracies.
I probably read too much into your earlier comment, but it seemed like your discussion of state laws meant national ones would be harder to pass.
To the rest of your comment.
Federal laws have been historically a lot easier to pass, the gridlock of DC is (semi) recent history that started around the 90s.
Regan kicked the Republicans down a path of deregulation and privatization of the gov. Bush Srs loss from "no new taxes" started the "never compromise" attitude of Republicans. Newt Gingrich codified that under Clinton. And with Obama we saw basically the end of any sort of major across the isle legislation.
I don't know why you are saying this is a narrow view. From roughly Eisenhower to Regan, major federal laws were fairly common. national highways, NLRB, social security, Medicare, EPA, CCC, OSHA, various federal law enforcement, etc. These all have pretty high impacts on day to day life.
It's a relatively old analysis (2009), but McKinsey did some research that I think highlights some pretty important differences in the US healthcare system that actually points to where the money is going.
https://www.mckinsey.com/~/media/mckinsey/dotcom/client_serv...
If you look at Exhibit 2, page 4, they basically compare US spending, as a percentage of GDP, and breaks down the difference between price and volume. The result are some very interesting facts that run counter to common belief:
- health administration and insurance is a tiny contribution to high costs, accounting for about 5% of excess spending
- spending on pharmaceuticals and "non-durable" (supplies) is pretty small and only contributes to 5% of excess spending
- in-patient care (where the patient stays in the hospital overnight) spending is only 10% higher than the OECD average relative to GDP
- 68% of the higher spending is out-patient care (where the patient doesn't stay in the hospital overnight); price is a factor here, but in reality, Americans get way more out-patient procedures than other countries
Many people in the US seem to still think that they will be way more screwed if they leave their job than they actually would be.
Have you tried? I did, when between jobs. Over $3000/month for a family of three.
Is this the correct book? And where’s the best place to buy it. https://www.amazon.com/Hacking-Healthcare-Standards-Workflow...
How much are regulations to blame for this mess? ie if we cut regulation, would that lead to lower cost and better outcomes?
What is the path to fix this?
The heart of the question comes back to what you actually want to fix. I don't know you. A lot of people would just like to pay less for the thing they currently receive which is a nice sentiment but often hard to resolve. A large set of those people are actually upset because they have been led to believe they are paying a lot more than other people for the same thing, which I do not believe to be actually true.
One solution that does seem palatable to a lot of people, not me, but a lot, is "I would like like to appear to pay less for what I receive while the real costs are hidden and subsidized in a way that is much less visible to me". While popular this view is not popular enough to adopt legislation to that effect.
In practical terms detailed policy legislation that makes losers out of a lot of low value transactional middle men would see some very meaningful across the board cost reductions, probably 7-10% (500 billion or more). Top of that list would be intelligent standardization and regulation of transactional medical billing process. This would/could look a little bit like how we regulate banking between financial institutions. Very sexy I know.
The current system is a tragedy of the commons. Costs are opaque and distributed. Patients have insurance and may as well buy the most expensive treatment (everybody else is doing it). There is nobody in the entire health system with incentives to trade 1% less benefit for 99% cost reduction.
In Europe, this is often handled by government purchasing discretion (not price caps as many simplistically believe). If X treatment is too expensive, it simply isnt covered. If generics medication get 99% of the job done, that is what you get.
This might mean replacing employee healthcarecare with employee payments, MORE copays, and more transparent pricing (there has already been some improvement in this area).
If a CT cost is 10x at one hospital, and 1x at the other, the patient needs an incentive to seek out the 1X cost. Similar, if one cancer drug is 10k and the other 100k, with a life extension of X days, the patient is the only one that can really make the call.
Medical coding being different between every system, seems like the mechanism used to negotiate prices. Is that correct? Would standardizing on the VA medical coding[1] help, or just force the problem onto doctors to change their coding.
[1] One person told me the VA system was good.
Less regulation can solve competition problems. Is this the USA problem? I don't know.
Interesting points. The Economist is great (so long as you read it with an eye open for their normal media bias).
Nitpick:
> In almost no other countries do you need a prescription for eyeglasses.
In New Zealand the eye details from your optician are called a prescription. Opticians and eyewear is mostly paid for privately (except people on government benefits and children get theirs paid for by the public). I'm not sure if private insurance offers a glass coverage option.
Mostly, this article is pointing out emergent behaviours of a set of rules. How can we design self-optimising economic systems that are better than capitalism & democracy?
What are your thoughts on how effective something like Medicare for all would be?
The main question is how do you actually go about making the change in the US with so many entrenched vested interests in keeping the status quo? How do you get people to agree to effectively fire millions of admin and health insurance actuaries? Seems like an impossible problem, especially given the political state of the country.
What the European systems have in common is price controls. The major difference between the Dutch and Swiss systems and Obamacare is that the Dutch and Swiss systems directly regulate the price of services.
Besides my lazy and misleading usage of the term “socialized,” I guess the question still stands: how do we change our system to more closely reflect these other systems? Highly discouraging to think about.
I started in tech, but went back and got an econ degree. A market for insurance works well for unpredictable things, like broken legs. But it doesn’t work well if some can predict their need, like life-long conditions. So, there is a role for non-market solutions. At that point, you need to address how to keep patients from consuming “too much” healthcare, because they’re not paying the full cost.
Many countries spend less and have longer lives. But it is hard to get the US to implement one of those systems when healthcare companies spend more than $1 million per member of Congress on lobbying and campaign donations.
Does anyone know which state has taken the most steps toward universal health care?
Then people would stop paying crazy amounts of money for insurance and treatments. Some will continue to do it, but if the Public system becomes good enough, it will make all those private parasites disappear.
This is false. Plenty of very good systems around the world have private health care systems.
The issue in the US seems more that the system has been corrupted by special interests. I guess the fix is maybe more fixing the political system a bit?
The whole term "socialised" is a bit indicative of the politics. You don't call other stuff that is government funded socialised like US's socialised road construction or socialised military?
That’s not remotely true at all.
This is not actually true. Some other countries have private insurance and those countries also have lower costs than the US. The US system is unusually mismanaged/corrupt.
> better health outcomes than the United States on pretty much every measure
This is also not true. The main way universal systems get better numbers on some metrics is that people with no coverage often have extremely poor outcomes, which when averaged in results in poor averages. But the average for people in the US with insurance is better than it is in many systems with universal coverage, which is an important metric because the large majority of people in the US do have insurance and their own outcomes is very much a thing that they care about.
You could bring about a large improvement in average outcomes in the US merely by providing an insurance subsidy for lower income people to increase the number of people with coverage. That wouldn't affect the cost much though -- it might lower it a little if it converts some emergency care to preventative, but only for that small percentage of the population that doesn't currently have insurance. The cost issue would still remain in general.
> spends less of their income on healthcare, even after taxes are included.
This is the legitimate criticism of the US system, but it doesn't tell you what to do about it. For example, Medicare in the US still pays more for equivalent care than many other countries do, so just putting everyone on Medicare without changing anything else wouldn't resolve the high costs in the US. And might even make Medicare look even worse because Medicare is in many ways currently subsidized by the high cost of private insurance.
None of that proves that you can't address the high costs without a socialized system -- but making the necessary reforms isn't easy for the same reason that bringing about your own proposal in the US isn't easy. Either way you'd have to overcome the political influence of all the people profiting from the status quo. Doing that is the hard problem.
I work in the industry and in general you see high margin (50-75%+) in areas like outpatient surgery centers, senior primary care ACO groups (ie providers getting paid by CMS to fully manage Medicare Advantage patients), etc.
PBMs and health plans generally have lower margins (in the 5-15% range), dictated largely by state and federal MLR regulations.
Watch who the large medical insurers are buying and you will get a good feel where there is margin to be had. They can use this to generate cash flow for other activities, drive savings within their insurance book, offer more competitive group pricing to their clients(ie employers, state govts, etc),drive affordability directly to consumers or some combo based on what business goals they need to hit that quarter.
Some wags added a speedometer type thing to their monitoring dashboard to show "velocity" of revenue. (Actually proved pretty useful as a global system health indicator.)
https://www.bloomberg.com/news/articles/2023-10-11/new-walgr...
Specifically, pharmacy chain Boots in the UK sells a lot more cosmetics and stuff in the front of the store relative to prescription drugs and they thought they could do the same w/ Walgreens. Except the UK has NHS and price controls whereas the U.S. has “cost disease” where certain sectors (health care) are on an entirely different scale of pricing compared to everything else. There’s that to begin with but after you have paid for your health insurance (directly, in terms of wages you didn’t get, taxes, …) and all your out of pocket expenses, you might not have much money left to buy stuff from the front of the store.
I recently had a planned, non-emergency outpatient procedure that did not involve any incisions, nor medications, lasted about 2-3 hours. Hospital billed $100K, insurance negotiated to about $20K. The actual doctor only got $2-3K.
Makes me wonder why doctors don’t build their own hospitals…
Doctors are not allowed to own hospitals. That was one of the stipulations of the ACA (Obamacare).
Link to the AMA, though not endorsing them as saints on the topic of healthcare costs. https://www.ama-assn.org/about/leadership/end-restrictions-p...
Doctors who own DI practices on the side, or shares therein, tend to vastly over-refer their patients for DI.
I shudder thinking about this applied across a whole trauma center.
But those numbers have no relation to reality. The amount you would pay as a private individual would be something else again.
> The actual doctor only got $2-3K
Could the doctor do the procedure on the street with their bare hands? That $2k also gets taxed and pays for education (it isn't disposable). I think you are hinting that you think the worker should get much more of the profit - but I'm unsure what economic theory that is called.
Exactly. The worst horror stories I've heard aren't of uninsured billing—self-pay individuals typically get a steep discount from what I've seen—it's the out-of-network hospital bills (especially pre-No Surprises Act) that consistently screw people over.
In those cases the hospital would bill the insane number they officially ask for from insurance companies, the insurance company says "nope" and pays the portion they consider fair, and then the patient is (or at any rate used to be) on the hook for the remainder. If they were billing as uninsured the hospital wouldn't have come up with the insane number they started with, but now that's on record and that's the number they want.
An obvious incentive is that the insurance company wants a big number so they can sell the patient on just how amazing their insurance is!
You’re interpreting this wrong. For a hospital to be in-network, it has to have a contract in place with the insurance company that sets its reimbursement rates.
What’s closer to what’s happening in your example is that the hospital knows that the insurer will only reimburse 20% of the “cost” of the service, so it inflated the nominal cost fivefold to ensure the actual cost of the service is covered by the insurer.
Of course that creates an awkward situation when the insurance turns out not to cover it and a private individual gets hit with the nominal cost.
But to anyone who doesn’t think to question it, it’s great for the insurance company. It looks like they stood up to some asshole hospital, they’re giving you an amazing deal, and that healthcare would be impossibly expensive without them.
Not that everyone else is jacking up their posted prices for the purpose of negotiating with the insurance companies.
> Chargemaster rates serve as baselines when negotiating the rates at which these payers will reimburse hospitals, which is why they're often much higher than actual costs. A Health Affairs study found that in 2013, the typical hospital with 50 or more beds marked up the costs contained in its chargemaster more than fourfold. Some services such as CT scans have charge-to-cost ratios of almost 30, while others like routine inpatient procedures are much lower at only 1.8.
> Insured patients do not normally pay chargemaster rates, since their payer reimburses at the negotiated rate and passes on any co-pays and below-deductible responsibilities.
https://healthcaremba.gwu.edu/blog/chargemaster-hospital-adm...
The guy who maintains archive.today and friends has beef with Cloudflare for leaving off certain location information from their DNS requests, so he redirects all traffic coming from their DNS servers right back to Cloudflare.
This fixes the problem for me.
Works with Tor though
The patient will pick the $300 device over the $1 device every time, because their copay is the same either way. However, it means insurance premiums go up next year.
The doctor, hostpital, insurance, and manufacturer all get paid more the higher the price.
There is literally nobody in the system who wants to choose the cheaper but 99% as good product.
Naturally this leads to middle men because it's all opaque. They'll eventually run up costs because they keep taking more of the profits.
We would build entirely new system, and then migrate people over to that slowly
- there are companies dedicated to detecting “missing” treatment codes based on a patients chart
- companies dedicated to detecting hospitals gouging insurance companies, and deciding which instances to push back on and which to just ignore
- a whole slew of companies that essentially make awful old tooling “online enabled” by just syncing troubling amounts of data to salesforce
The companies making tons of money live in the margins and you’ll never see them. They can make one tiny thing more efficient and the hospitals are so poorly managed they’ll just add more contractor to the mix and pass the cost on.
There are no rules for hospital management and administrative reporting etc. it’s all a giant shit show
The hospitals required to treat charity patients (to maintain not for profit status) as you say are actually doing the best. Hospitals get most their profits/surplus from surgery.
A 15% profit doesn’t begin to explain the double cost of American healthcare. The article postulates it’s all the middlemen, which, incidentally, the insurers are acquiring in search of higher profits.
That said, I haven’t gone into this in tremendous depth, so I’m kinda hoping someone can confirm or deny my understanding.
Something like Kaiser is closer to the solution if we don’t have a government led rationalization.
Insurance company can't make more than 15% profit... OK, easy solution... just buy the hospitals.
Now you can set the prices... if a service costs you $1,000, you can advertise things cost $10,000, but only have the parent company pay some small fraction of that... and leave others to pay $7,500 out of pocket (or other insurance carriers out of network). There are all these shady deals that aren't transparent to the end user.
I think the only solution is socialized medicine.
And just remember, we'd have that today if it wasn't for Joe Lieberman. He torched the public option, then didn't even run for re-election after. This guy could have prevented so much suffering in America today. He knew it, he just wanted to side with the insurance companies in 2009.
https://slate.com/news-and-politics/2009/10/did-sen-joe-lieb...
The government needs to take charge of insurance like we have in the UK, at the very least they need to stop doing stupid things that break the system.
Nothing is worse in my opinion than some sort of half capitalist, half arsed regulation, it’s the worst of all the worlds, it’s not free markets and it’s not socialist, it’s Frankenstein.
A great example is the 340B law. It forces drug makers to give hospitals that have a high proportion of indigents (low income patients) massive discounts.
So what happened? Hospitals saw a cash cow and bought up a ton of small oncology clinics and brought them in house. The cost of providing oncology care in a hospital system is more expensive.
Basically the law did nothing for passing savings to patients and actualy drove up healthcare costs.
It one example of many in the US system.
Let's compare outcomes. Do you personally think the healthcare received by the average UK citizen is better than the US? It is easy to whinge about the problems. It is hard to find solutions. For all the glaring deficits of the US systems - maybe it works okay? Democracy is the worst system...
I'm in NZ. The public healthcare system has its benefits but it definitely has its costs (I've recently been dealing with expensive private healthcare providers in a situation where the public system wasn't achieving the outcomes we needed).
It does better in cancer survival rates (but the data seems old).
- https://www.internationalinsurance.com/health/systems/
- https://www.healthsystemtracker.org/chart-collection/quality...
- https://en.wikipedia.org/wiki/List_of_countries_by_quality_o...
- https://worldpopulationreview.com/country-rankings/best-heal...
Our life expectancy is falling (and is worse than the UK), people are afraid to go to the hospital because of bankruptcy and we pay far more than other nations on healthcare. In all aspects of outcome our healthcare system costs more for less. The only exception is if you're extremely wealthy, and the gap between wealthy and not has widened. I, as a fairly well-off software engineer could be bankrupted by healthcare costs if a hospital decides I'm out of network during an emergency.
Objectively it is. Average US healthcare outcomes are towards the bottom end of industrialized countries, comparable to Czechia or Turkey. And they pay a hell of a lot more for it. US outcomes for "I can pay as much as it takes" wealthy people are very good - but they're very good in the UK too (private medicine does exist in the UK, it's just not very popular because why waste money on something you can get for free?).
And then people don't want to pay attention to the details and pretend that the solution is some generic political ideal like "more regulation" or "less regulation" when in fact what you need is to remove the regulations that inhibit competition and preserve or bolster the ones that protect it.
Then we do the exact opposite and continue to pile on regulations that impair competition, the effects of which corporations use to justify removing ones that preserve it, the consequences of which are used by regulators to keep piling on the ones that destroy competition.
They're not all the same. It's not about "regulation" or "deregulation" -- it's about promoting competition instead of destroying it. You need to keep costs low on small businesses while inhibiting corporation consolidation.
It's real money because of the sovereign fiat nature of the US dollar, but it's not necessarily value. This is ultimately artificial inflation and the subject of Graeber's critique of the modern economic system in his essay Bullshit Jobs.
>Hint: it isn’t big pharma
When the Economist - the neoliberal paper of record writes an article downplaying the profitability of a particular industry I have to say I get a little suspicious.
And I discovered that the Journal of American Medical Association apparently doesn't agree that Pharma makes mediocre profits:
https://www.biospace.com/article/how-profitable-is-the-pharm...
On the normative question of blaming groups, it’s like that imposter Spider-Man meme of each person pointing at the other. Hospitals charge 10x the actual market price and health insurance boasts on your explanation of benefits that they got you a 90% discount. Americans demand cutting edge maximum intervention perfectly safe treatment with no formal government rationing, or HMO rationing.
Health care is a for profit sector. Fees are paid by third parties (so patients are not directly exposed to routine costs). There is heavy quality regulation. Providers are incentivized to treat more through fee for service so the sicker you get and the more procedures they perform the more revenue they earn (perverse incentive). There is no counterweight to negotiate prices down. The end result is 7% medical inflation per year.
You'd think the medical schools might remain independent under their universities, but that often turns out to not be the case as well. Turns out asking for handouts from the endowment looks a lot like bankruptcy, and the rest of the university takes a dim view of it, especially considering how home addresses of their physician colleagues (hint: very large houses in the best neighborhoods). See Tulane, Georgetown, etc. The state school systems, like the UCs, tend to do better, or are at least shielded by the state budget.
If you point to Mayo, Stanford, and Partners as exceptions, I'd say they're the exceptions that prove the rule. Mayo has always been a self-sustaining business. Stanford and Partners have ready consultation with the strongest business schools in the US, if not the world, and the endowments to match.
Seriously what's wrong with the U.S. Here in Europe, heating bills can bankrupt people and they have to overpay for rent because gas is so expensive they can't rent further from their jobs - their commute radius is frequently limited with gas costs that are insane - resulting in needlessly dense cities. A separate house is a thing for upper class. All of it sucks, but... no one gets bankrupted by healthcare costs here. This is simply unheard of. And health insurance costs an invisibly small amount. I guess it removes a great deal of worry for health-concerned people.
There is a compounded med that isn’t covered by insurance and I wonder if I could find a pharmacy in my homeland(Poland) to compound and ship it directly to patients. I have found some places that apparently do it but the sites are bad and don’t seem legit.
where in the eu are you talking about? every time i visit/talk to friends there it seems to be the opposite because public transit is ubiquitous and you can get a train out to all sorts of small towns and villages.
>needlessly dense cities
Guess you've never been in Asia? European cities are far from too dense.
It completely ignores survivorship bias. You can't just look at the profit margin of the biggest public companies. You're basically just selecting for the winners. And the entire business model of biotech is 90% are losers and of the 10% that win, they win big to make up for all the losers.
You'd need to do an analysis that looks at profitability of the entire industry. Look at all the VC backed biotechs that get $500M in funding then go belly up. Look up the multiple acquisitions in the past decade that were just written off.
> Over the past decade these firms have quietly increased their presence in America’s vast health-care industry (see chart ). They do not make drugs and have not, until recently, treated patients. They are the intermediaries—insurers, chemists, drug distributors and pharmacy-benefit managers (PBMs)—sitting between patients and their treatments. In 2022 the combined revenue of the nine biggest middlemen—call them big health—equated to nearly 45% of America’s health-care bill, up from 25% in 2013.
Their answer to the question "who profits most?" is this category of company. That's still compatible with the fact that the manufacturers of the pharmaceuticals have extremely high profit margins.
The article says Big Health, which is defines as the middle-men between providers and consumers (such as perscription benefit management system), takes the biggest slice of the cake.
A bit related but separate, one of the most compelling arguments that anti-vax has is that vax mandates translate to a built in mandatory market for manufacturers. You don’t have to agree with these but it’s an obvious factor in a follow the money type of way
The article barely mentions Big Pharma except in this blurb at the top. It's not an attempt to downplay Pharma profits, it's an attempt to draw attention to lesser-known players with even larger profits.
The commenter took issue with that which I think is correct.
Next, the insurance companies.
Last, the medical system owners (various) to include Big Pharma but also the other niches.
The better but related question is why it is such a shit show. The answer has always been that insurance was introduced into it. If medical treatment had been kept tied to market forces, then what people could generally afford would have continued to set pricing. As well as kept pathological industry motivations (harm) in check.
Example: I just got some medication I take daily forever. Insurance will only allow it to be distributed at 90 days (qty 90) and my co-pay is $30, so 4 trips to Walgreens and $120. I just got them to fill the entire 360 pills using a GoodRx coupon and paid $53. It took a but of convincing the front clerk I knew what I was doing, he couldn't add it up in his brain how it was cheeper not to go through insurance.
Now imagine managing your health was like running your car. Everytime you went to the gas station you would pay a fixed amount through insurance, but you're only allowed to gas up once every two weeks. Need car repair? I agine your mechanic calling your car insurance to try to get the work approved -- you need a brake job, and instead of costing $500 it will cost $5000, but since the mechanic is in-network they have pre-negotiated the rate to $600 and you pay that amount until you hit your annual deductible of $5000 for the year.
The system is built for manipulation, anti-competitive practices and fraud. Think about it. Who wins? Everyone except the consumer, who has been convinced its the only way to transact is through insurance, and if it were just bigger and more centralized it would certainly be more efficient so lets get a single-payer system! That will be the final nail in the coffin of our world-class healthcare in the US. There will be no more specialization, as the system will incentivize (if not demand) commoditization of skills and services.
The reality is that price transparency already is federally mandated and you can get a list of every contracted rate for every procedure any doctor that is credentialed with your health plan will perform. They’re all available on every national payer’s directory in a machine readable format and updated every month. Startups have formed around making this data available to consumers. This has been the case for a while (well, the number of procedures was limited before, but the concept still existed). It made headlines years ago.
The problem is three-fold (there are multiple but these tend to be the most problematic):
1) It’s almost impossible to know, for any non-trivial visit, the actual procedures that will be performed. This makes price shopping almost impossible to begin with. Not only is it difficult to understand up front, it can (and does, with regularity) change halfway through the procedure - sometimes even after the fact if the procedure was improperly coded. To some extent this is just a result of an overly bloated and complicated billing machine, but it’s a real issue today.
2) Healthcare consumers at their most vulnerable (and, typically, most expensive) are not in a mental space to be price shopping for care. Savvy individuals might comparison shop before an orthopedic surgery, but nobody who just suffered cardiac arrest or was diagnosed with cancer will spend weeks finding the affordable doctor.
3) Healthcare is an intensely personal and emotional interaction. People don’t want to price shop for care even if they can and are in the headspace for it. You don’t want the budget doctor performing the bypass surgery, you want the good one if that’s an option for you.
This can and likely will change in the future. But today the system is broken much beyond price transparency.
First, this just isn't true. Some providers are choosing to pay fines instead of releasing their prices. More importantly though, there's no standardization of codes, so you can't actually compare the prices.
Second, there is a standardization of codes for the most common procedures one would shop for, which is CPT. There are HCPS, DRG, and other codes as well - but they’re much less common among the types of care one would reasonably shop for in advance. A crosswalk between code sets is also possible for many procedures.
There is certainly not a standardization of the use of codes in all cases, which I alluded to in my message. It’s extremely challenging to know what codes you will receive. And placing provider malice aside, often times providers themselves do not even know what it will be before going in.
To this end, bundled episodes have become increasingly common for certain types of procedures. But it’s far from exhaustive and there’s much room to go.
In any case, the goal was never for this data to be directly used by patients. It was to expose the data, and make it available for third parties. Most of those efforts have fallen flat not for lack of data, but lack of a patients ability to reasonably engage with it for the reasons mentioned above.
You can see more about the act here: https://www.cms.gov/healthplan-price-transparency/plans-and-...
Same thing plays out with utilities, they are given a monopoly with guaranteed percentage of profit. They are incentivized to spend a lot of money. If these regulations were lifted, utilities would incentivize demand shifting instead of building more and more natural gas peaker plants. Warren Buffet owns many utilities, he invests in things that are monopolies, guaranteed to extract rents forever.
https://www.boredpanda.com/absurd-medical-bill-bernie-sander...
https://www.vox.com/2016/5/13/11606760/emergency-facility-fe...
I'm not saying that's a good thing, but most countries have one or more of these.
Does anybody have a link to this info?
https://www.ama-assn.org/about/research/trends-health-care-s...
Medicaid for all and drs must accept certain level of Medicaid patients.
Everyone should be able to get BASIC treatment. Don’t make employers deal with it.
If you want all sorts of joint and organ replacements because you’re a slob or a lost cause, that’s on you.
Saved you a read. I hope Amazon and CostPlusDrugs can disrupt. I also would love to see regulation come to insurance especially with all the horror stories of denied claims/disability/etc even with support from a team of medical professionals.
Edit: To be clear, the 17% is more a system footprint than a cost. The number we want is GDP delta with one system versus some other system, irrespective of system size.
The money’s gonna come from somewhere, dude.
This is why we should not accept any health care reform proposal that any of the American Medical Association, the Pharmaceutical Research and Manufacturers of America, or the American Hospital Association are generally supportive of. Whatever we try, they should be vehemently against, just like they were with Medicare.
That seems like a lot of people to piss off to get any reform done.
Wouldn't an actual smart negotiator play off one against the other, and make the doctors support the initiative at the expense of the pharma industry, or vice versa?
Middle men jobs, no matter how good, need to be on the chopping block if all they do is be extractive pests. They can't both be protected from the pressures of the free market, and not have any accountability from an improved service standpoint.
As for the actual workers, Doctors can charge what they like, but they shouldn't be able to limit the supply of doctors within the nation. That is NIMBY mentality.
(Full disclosure: family member works for Big Pharma)
You might not get them to admit it out loud, but Big Pharma sees the USA as the cash cow that funds R&D for everyone on the planet. If a potential product can't or won't ever make it to market in the USA, or if there aren't enough potential patients in the USA to be prescribed said product, then it might never get off the drawing board.
It's (unfortunately) that simple.
Speaking of negotiators. These groups have very skilled so they wouldn’t just let themselves be played off against each other to their own detriment.
Healthcare? Doctors, hospitals, insurance, etc all are taking a bigger cut than they should. You'll get a ton of pissed people if you want to solve it.
Housing? Nimbys are just regular homeowners that block housing to implicitly (or explicitly) protect their property value. Solving that gets a ton of homeowners pissed.
Universities? Tons of university admins and loan programs that benefit from restricting tertiary education supply. Fixing is pissing lots of people.
So much of our economy is captured by large cohorts of people that are not explicitly conspiring to do so, but their incentives moves them to behave like that.
Why? We're currently undergoing a major shift in labor wrt to automation, AI which will absolutely destroy entire sectors. Not a lot of people give a shit, it's considered good for the bottom line and for profitability. But when it comes to healthcare, the narrative is that we suddenly care about labor? People applauded the tech layoffs but the parasitic private insurance overhead is just too important? Disgusting
A lot of people __do__ give a shit and this is a very common conversation among blue collar workers. I've heard about it every Christmas for the past 5 years from people who don't know how to google. Mass shifting in jobs has always been a big conversation but there's just a big divide between the working class where people aren't talking together as much.
We have coal miners complaining about "big solar" taking their jobs. We have the whole "just teach to code" fiasco. We have a lot of discussions about Amazon. And I can keep going. If you think this is a "suddenly care" type of thing then you're likely in a bubble or not paying attention (a different bubble).
There’s a parallel to that observation: these parasites are a major part of the S&P (not as much as the article claims, per another comment) which means if they decline it will look like a secular decline in the market (=> peoples’ retirement savings) which will cause vocal anguish.
That latter phenomenon is why bills like the IRA splash out so much money on the fossil fuel companies.
I agree with your concerns with the AMA et al. It’s clear that we are way overpaying SOME doctors and hospitals.
It’s also clear that our demand for medical treatment is almost insatiable and about as inelastic as it gets.
Ie we need to tell some drs and hospitals, fu the gravy train is over; but we also need to tell Joe Public, no you don’t have an existential right to wegovy.
Worst part of the privatization of the Swedish school system is that we know that the tax-money we pay to educate our kids is being diverted to Neo-Nazi funders and Saudi oil funds.
And small and big fortunes. Don't forget that those that protect fortunes are way more effective than all other.
I don’t know if the outcome you want is the outcome you’re gonna get with that strategy. Might want to consider the humans actually affected and how they might react instead of treating everyone as some faceless cabal of evildoers bent on pulling money out of your pocket.
Speaking of which, I am not sure why doctors are allowed to limit the number of doctors who can become licensed each year.
Hospitals can veto any building plans of a hospital near them. This is to “keep the current hospital profitable”
The AMA artificially limits the number of doctors coming out of school (limiting supply).
FDA puts a ton of regulation around producing drugs and equipment.
Insurance companies and Medicare set the price for goods and obviously need to make a profit so they gouge. There’s a long tail there, so the average person pays FAR more than their share to cover the long tail.
When you wrap this all up, yes. But the solution is massive deregulation. Let the market drive down prices similar to Mexico or India. Socializing medicine basically just regulates it to maximize profits, which is why Europe and US has insanely expensive healthcare (I added Europe because they’re subsidized by taxes, not massively cheaper).
Then you don't know what you're talking about. European prices are much cheaper including tax spend. In fact, the US has about the same public spending on healthcare as European countries do. You just don't get covered by it
wow that is absolutely wild and maybe one the most transparent profits over people i've heard of
This is an emergent problem of third party payment. Normal supply and demand mechanisms are not at play.
As of a few year ago, anyway. I haven't been paying attention recently and the situation may have developed.
This might be true for primary care and family practice. I don't think it's true for specialities. And part of why it is true for primary care is because nurse practitioners can do that job now.
Do you have a source you can point to? This is the opposite of everything I’ve heard or read.
The same thing drives government bureaucracy growth and the ridiculous amount of administrative overhead at universities. At the root I think a lot of this kind of thing is a kind of unplanned jobs program.
I also think a related sort of dynamic might drive complexity growth in software. Every layer and every feature has stakeholders and people employed to maintain it, and all those people become defenders of all these things.
One of the factors behind “worse is better” in software and systems engineering might be that worse employs more people. Clean well thought out systems are not inefficient enough to create large communities around them because they don’t need enough babysitting.
The reality is that the current standard of living could be maintained or even increased with many fewer people working. Or an even better standard could be reached if those people could be doing jobs that are actually useful like construction, nursing, or basic scientific research.
Unfortunately the economic system doesn’t value those things so people only do them if they’re desperate, passionate, or independently wealthy.
Our system does put a price on "well you have to earn your keep and you have to sit here all day."
I'm not sure how or if it could be done, but there is definitely enough wiggle room and waste in our current system that we could have people start doing more useful things with their time.
Or, as Oscar Wild stated:
The bureaucracy is expanding to meet the needs of the expanding bureaucracy.
Let me guess, are American hospitals a bit cleaner? Are nurses underpaid? Are doctors underpaid like in France, as in, a webdeveloper earns more than a doctor?
What you're describing is probably closer to what publicly funded schools in the US have become, in terms of deviation from base expectations. But no, there is almost no such thing as a doctor who doesn't get paid in the US, and definitely no such thing as a hospital or insurance executive that doesn't get paid.
His post had a detailed breakdown of all the costs. Here's the post: https://news.ycombinator.com/item?id=5814728
The same issue plagues the American higher education system, which is wildly overpriced.
> Since 2016-17, the average net tuition and fee price paid by first-time full-time in-state students enrolled at public four-year institutions has been declining after adjusting for inflation; it was an estimated $2,250 in 2022-23.
https://research.collegeboard.org/media/pdf/trends-in-colleg...
If you want to criticize colleges on their cost, the data to use is expenditure data, which is much cleaner.
These are probably emergent effects of capitalism. I have a systematic fix, but I can find no margin to write it.
One big driver to health care costs is artificial price inflation through insurance negotiations. Where insurance brokers need to get a deal but hospitals can't give a better one, so they raise the price and give a bigger discount on that. You know, the same thing that happens on Prime day.
Schools do this too, in many different forms. Let's look at graduate student pay, for instance. A lot of graduate students don't actually pay because they're doing a lot of work for the school and bringing in a lot of money. But if you go look at the pricing of credits you'll find that it is common for graduate credits to be more expensive than undergraduate. Is this because graduate students cost more? No, they definitely cost a lot less. So why is this number high? Because it is used to validate any pay from outside the university for those graduate workers, where the school takes a large chunk of that not just for admin fees, but to cover "the student's academic costs." This too is an artificial "book keeping" number and why we should not be counting this as income (yes, some states want to do that). It also creates for weird situations when a student needs to pay for credits themselves.
Or how about business class on airplanes? Few people are paying that actual rate.
Also, I think you cherry picked form your source. They also say:
> Over the 30 years between 1992-93 and 2022-23, average published tuition and fees increased from $2,340 to $3,860 at public two-year, from $4,870 to $10,940 at public four-year, and from $21,860 to $39,400 at private nonprofit four-year institutions, after adjusting for inflation.
I should also mention that the $2,500/yr claim you're making (drawing from their numbers, but your interpretation) is a clear example of an Aggregation Paradox (see Simpson's and Berkson's). If we took this number at face value the $1.63 trillion debt level wouldn't make sense. Room and board isn't that much, even if many colleges require Freshmen to stay in dorms and buy a meal plan. Given that number, clearly there's a large variance to those numbers. There's always an advantage to reporting the mean, and if we have the mean and average we know these are within one standard deviation of one another. It is interesting to see that college board is reporting averages but when they talk about incomes they are using medians (which are reported from the fed).
Averages, alone, are often a terrible metric and you need significantly more information that that to make any reasonable conclusion from data. Relying on averages alone will make you come to poor conclusions. Reports like these are for bureaucrats, not people trying to understand or solve problems.
https://research.collegeboard.org/media/pdf/trends-in-colleg...
College is mostly about the private institutions at a national level. That's where people would like to go.
https://fivethirtyeight.com/features/fancy-dorms-arent-the-m...
Federal student loans start at 5.5 and go to over 8% interest.[1]
Private student loans start at 5% and go to 17%.[2]
I'm not sure where you get "almost no interest" from.
[1] https://studentaid.gov/understand-aid/types/loans/interest-r...
[2] https://www.nerdwallet.com/m/loans/student-loans/private-stu...
And some of the ones we do have might have contractual arrangements with corporations that funnel students into jobs at those corporations (possibly by contractually binding the students into a job at those corporations for a defined period of time). There are both pros and cons to that sort of apprenticeship arrangement. It would be bad, though, if the apprentice also had to monetarily pay part of the cost of attending college.
> In 2022 the combined revenue of the nine biggest middlemen—call them big health—equated to nearly 45% of America’s health-care bill, up from 25% in 2013.
That's 45% waste, and excludes other middlemen. It's unclear if the increase from 25% is due to driving other middlemen out of the industry, or due to becoming even more parasitic.
How is this sector siloed against a newcomer that undercuts every incumbent while remaining profitable?
Turns out maximizing profit is not a panacea for efficient system design
> Fueled by international private equity funds, consolidating firms have been on a tear in health-professional fields, buying up practices in fields such as veterinary medicine, dental care, optometry and pharmacies and assembling them into chains
https://www.theglobeandmail.com/business/article-private-equ...
Health care is a situation where competition cannot be a spur to reasonable costs because individual consumers are simply not in the position to make the kind of "free market" choices that economists (or more often free market ideologues) expect they'll make.
Moreover, the malignant and abusive US health care system is in fact a product of layer upon layer of failed "efforts to create competition" intended to reduce cost "through competition" to the point that by now all the abusers really know the dance and will be profiting next year from any further or replacement layer you add this year. (and "no regulation then!" as the US 1900 results in doctors being just heroin dealers - like my great grand father interestingly enough).
Most other industrialized nations have a state run medical system that's far superior and cheaper than the US system. They didn't solve their problem with "competition".
Europe arguably has more competition in the healthcare manufacturing and labor sectors than the US.
Europe has the same pharma and device companies. Im not aware of any country that has price controls.
What Europe has is purchasing controls. If something is too expensive, the national insurance plans simply dont buy it and dont provide it.
This is what the US lacks.
The hard truth is that, ultimately, providers, are to blame. Skilled professionals should NEVER say "I don't know how much it costs" to their clients and get away with it. It's your JOB to know how much it costs and to understand the experience of your patient. I get it that you don't WANT to know, that it's complicated and depressing. I get that because all patients get that. That is not an excuse for not paying attention to the details.
It is providers who regularly make their patients wait for hours after the appointment time. It's providers who order expensive and unnecessary tests for every condition, or who refer to multiple specialists. Each of these decisions increases the cost of care, the provider profit margin, and the stress on the patient. Because the provider is ultimately the one with the skill that the patient needs, I blame them for this systemic failure. If you're a doctor and you give in to the status quo, hire a large staff of billing agents and write scripts for all the tests and drugs you can, YOU are the problem. If you took your oath seriously, you'd never accept the way things are. Instead you advocate to maximize your profit margins instead of patient outcomes, and as a result you make the entire system sick. With any luck, it will get so sick it will die.
It is not as if there are other nations with formidable health care systems that are way more efficient that one could look into.
However, doctors are very well compensated, and in HCOL often enough to underwork & choose their own hours. And there is an entire cartel system to ensure we don't produce more doctors domestically via our educational system, nor do we allow doctors to immigrate from elsewhere and start practicing. So supply is artificially limited.
The really enterprising doctors then setup all sorts of alternative income streams, like building their own clinic with other specialists to which they then refer you for all procedures.
Then you have all the doctors pushing elective procedures when you just want to talk about health.
And finally don't forget all the free golf resort trips they get in the form of "conferences" paid for by pharmaceutical reps. Basically kickbacks. The opioid crisis relied on a lot of this in order to happen, and 1000s and 1000s of doctors failed the moral test.
Plenty of doctors went into it for the right reason, are overworked, and underpaid.. and I don't exactly want to say "its a choice" but.. the option not to be certainly exists..
Hah. All of the large diagnostic imaging manufacturers, Siemens, GE, Philips, have formal programs for physicians to help them set up their own imaging practice - they'll help navigate Certificate of Need bureaucracy, they'll provide fantastic financing, they'll help you get set up with practice management.
And you, as a physician, if you also own a DI provider (or a stake in one) will go on to refer your patients for DI far more often than other providers do for patients with the same ICD-10 codes.
Shocking...
Educational costs and duration means putting their life on hold well past the point your median FAANGer is taking in big bucks. So they expect the pay to start paying down that debt & lost time.
But other countries get by without their doctors accruing a mountain of educational costs and time spent in apprentice like conditions.
AMA is a cartel.
Imagine if SWEs managed to create a certification process essentially locking out H1Bs and constrained the number of new SWEs domestically minted.
Throughout the discussions on the topic, the comparison with SWEs keeps sticking with me: there's no world where someone hacking together JS scripts should make more than someone healing human bodies (in terms of "real" take home pay, ie, after fees, debt payback, etc)
It really isn't. But it's a trope that helps the AMA's argument about limiting supply of new doctors.
Anesthesiologist average salary: $410K/year, average malpractice insurance: $13K.
Family practice: $250K, $10K.
Obstetricians: $390K/year, $42K.
Not that these aren't negligible amounts, but these are well within affordability AND only going down as more and more states implement caps on malpractice lawsuit payouts.
I don't know that I'd consider 10% in many cases "affordable", but you made the same point I was making: combatting the external influences on prices requires action.
Two pull quotes to whet your appetite:
> The country spends about $4.3trn a year on keeping citizens in good nick. That is equivalent to 17% of gdp, twice as much as the average in other rich economies. And yet American adults live shorter lives and American infants die more often than in similarly affluent places.
> Much less attention is paid to a small number of middlemen who extract far bigger rents from the system’s complexity.
Me too, but the medical system knows no matter how healthy we were when we were young, in the end we'll need the medical system in one way or another.
It's a system (or whatever word you want to use) designed to benefit companies and corporations. Everything is designed the way it is to create maximum profit for the owners.
Think about the whole concept of an LLC, look at tax rates and the kinds of fines a company gets when they do something bad. They profit hundreds of millions and get a $400,000 fine for breaking the law. This is not an accident.
You will note that this is literally the concrete political definition of "fascism". Typical definitions highlight more the cultural features of such a politics (i.e., deference to authoritarian rule, ethno-based identitarianism) but the literal organizational aspects of fascism are described well by the above quote (bundling the governmental, industrial, and cultural aspects of a nation into a singular mass directed centrally for the purpose of benefit of those at the top -- primarily high-ranking government officials and owners of massive critical industry leaders -- by support or extraction from the bottom).
Can you give an example of this?
I have loved the Economist for 40 years but you have to check things sometimes:
> Big health accounts for eight of the top 25 companies by revenue in the s&p 500 index of America’s leading stocks, compared with four for big tech and none for big pharma.
Actually tech constitute 9 of the top 25 and pharma four, while of the parasitic rentiers discusssed in the article, only one, United Health, makes the list (https://www.investopedia.com/ask/answers/08/find-stocks-in-s...):
Apple (AAPL): 7.05% Microsoft (MSFT): 6.54% Amazon (AMZN): 3.24% NVIDIA (NVDA): 2.79% Alphabet Class A (GOOGL): 2.13% Tesla (TSLA): 1.95% Alphabet Class C (GOOG): 1.83% Berkshire Hathaway (BRK.B): 1.83% Meta (META), formerly Facebook, Class A: 1.81% UnitedHealth Group (UNH): 1.28% Exxon Mobil (XOM): 1.27% Eli Lilly (LLY): 1.21% JPMorgan Chase (JPM): 1.18% Johnson & Johnson (JNJ): 1.07% Visa Class A (V): 1.05% Procter & Gamble (PG): 0.99% Mastercard Class A (MA): 0.93% Broadcom (AVGO): 0.92% Home Depot (HD): 0.85% Chevron Corporation (CVX): 0.81% Merck (MRK): 0.75% AbbVie (ABBV): 0.75% Costco (COST): 0.67% PepsiCo (PEP): 0.67% Adobe (ADBE): 0.65%10
But when you need emergency in-person medical care, or even not-so-emergency ongoing care for chronic conditions, it is generally not an option to visit another country for that.
There was a post recently about a diabetic patient not able to afford the daily medicines. Most chronic problems require chronic medicines and regular consultation which can be solved.
One issue someone might raise is the quality of doctors. I have heard tons of cases from friend I know where the doctors have messed up here. It is mostly about reviews and trust, and applies globally, and can be an individual preference.