

Why an MRI costs $1,080 in America and $280 in France - Maven911
http://www.washingtonpost.com/blogs/wonkblog/wp/2013/03/15/why-an-mri-costs-1080-in-america-and-280-in-france/

======
VeejayRampay
As a French citizen who's enjoyed the goodness that is subsidized health care,
it needs to be stressed that all this has a cost for the country.

The vision that taxpayers support a system where everyone is granted access to
next-to-free / affordable health care has a natural cost in certain areas.

Sure it's great when you're both poor and sick cause you get to be treated
like everyone else, you get the day care for your kids, you get the MRI's, the
cancer treatment, you're being taken care of at the ER etc.

But at the same time, everyone has to realize that this has a cost in terms of
taxes. Taxes for companies, home buyers, CEOs, businesses, cigarettes and
alcohol, gas, etc.

It's the old chasm between putting the emphasis on the individual or on the
nation/country as a whole. America has traditionally favoured private/capital-
oriented solutions so far for most of its services (postal services, health
care, public transportation, part of its schools, water, electricity, Internet
infrastructure, etc.) and was thus able to keep the burden of taxes lower for
individuals.

If it were to move to a system where everyone pitches in for cheap state-
driven services, the money would have to come from somewhere and it would be
sure to somehow stifle economic growth in certain areas (see the economic
situation of France or other countries where the involvement of the state is
still strong).

TL;DR: The idea of cheap MRI is nice on paper (and I believe it to be awesome
in practice), but there's no magic wand to make that happen, the money has to
come from somewhere and it requires that a whole country accepts paying more
to the state to get more at the other end, a paradigm shift that will be tough
to swallow for the USA given its economic culture.

~~~
datalus
Health care taxes on cigarettes... morbidly hilarious.

~~~
corin_
Do people think health care taxes on cigarettes is a bad idea? As a smoker who
pays extremely high taxes on cigarettes here in the UK I have no problem with
them.

~~~
VeejayRampay
The problem with taxes on cigarettes (as I see it) is that most of the time
it's not proportional to one's income. A tax that is not progressive is
inherently unfair IMHO, as it places a heavier burden on the less fortunate.
EDIT: Someone mentioned that cigarettes are a life choice but I personally
believe that to be more of a nice theory than a fact. In reality smoking is
huge among people with lower income, due to lack of education about the risks,
cultural factors, advertising, etc. (see
[http://www.gallup.com/poll/105550/among-americans-smoking-
de...](http://www.gallup.com/poll/105550/among-americans-smoking-decreases-
income-increases.aspx)). As a result, a higher burden is put on people who
tend to smoke more on average, which are apparently the very same people who
don't have too much money to begin with. Still their mistake to be spending
the little money they have on a drug, but it's one of those "easier said than
done" things in my opinion.

~~~
paulgb
Smoking is a choice that makes someone more likely to have health problems
later. Under nationalized health care, taxing cigarettes is just aligning
incentives.

------
daniel_solano
This article didn't seem all that great. It just claims "the prices are
higher" without any substantive recommendations on how that problem can be
solved.

Nonetheless, it does make one interesting point:

 _This is a good deal for residents of other countries, as our high spending
makes medical innovations more profitable. “We end up with the benefits of
your investment,” Sackville says. “You’re subsidizing the rest of the world by
doing the front-end research.”_

In other words, the low prices for health care found in other countries is, in
part, subsidised by the American consumer. As a result, it would stand to
reason that if price controls were implemented in the U.S., it could result in
less medical innovation or rising prices elsewhere in the world.

~~~
jpdoctor
> _This article didn't seem all that great. It just claims "the prices are
> higher"_

They buried the reason: “It’s very much something people make money out of.
There isn’t too much embarrassment about that compared to Europe and
elsewhere.”

Profiting off of the sick and injured has _zero_ shame in the US. In fact, if
you can drive the patient to bankruptcy, then you have maximized the take.

For some reason, there is no outrage. Previous generations would have used the
word "profiteering", but the word seems unfashionable to apply in modern times
to medicine or the military.

~~~
snowwrestler
Health care companies seek a profit because innovation takes capital
investment, and the only way to build capital is to make a profit. The article
admits to the value of this when it talks about how U.S. consumers subsidize
innovations that have global benefits (like MRI machines).

I totally disagree with the idea that health care companies actively seek to
drive patients to bankruptcy. Can you provide any proof of this other than
your own opinion?

~~~
jpdoctor
One example: One of Elizabeth Warren's crusades before the banking crisis
exposed that 46% of all bankruptcies circa 2007 were medically induced.

<http://www.pnhp.org/new_bankruptcy_study/Bankruptcy-2009.pdf>

It isn't exactly news that the industry maximizes profits.

The mere fact that you chose to write "Health care companies seek a profit
because innovation takes capital investment, and the only way to build capital
is to make a profit" is indicative of the problem. It's almost as if you can't
imagine any other means of solving the problem.

I don't think you're alone either. In quantitative medical rankings, the US is
33rd in life expectancy and 34th in infant mortality (behind Cuba!) yet is #1
in per-capita spending.

[http://en.wikipedia.org/wiki/List_of_countries_by_life_expec...](http://en.wikipedia.org/wiki/List_of_countries_by_life_expectancy)

[http://en.wikipedia.org/wiki/List_of_countries_by_infant_mor...](http://en.wikipedia.org/wiki/List_of_countries_by_infant_mortality_rate)

~~~
danielweber
_46% of all bankruptcies circa 2007 were medically induced._

There were obvious problems with Warren's methodology. If I live in a system
with excellent government healthcare, and I end up paralyzed, my family might
still go through bankruptcy because they've lost their primary income.

The number is more like 1/4 than 1/2. 26% of bankruptcies have medical debts
exceeding $1000. Obviously that includes someone owing $4000 to a dentist as
well as someone owing $450,000 to an oncologist, so the real number is some
portion of 26%.

~~~
jpdoctor
> _The number is more like 1/4 than 1/2._

Great. So the number of people that have been profitteered into bankruptcy is
only 1/2 of what I mentioned.

It doesn't change the basic fact: Profiting handsomely from the sick and dying
used to be considered unethical. Now, it is "just business".

------
ef4
> Health care is an unusual product in that it is difficult, and sometimes
> impossible, for the customer to say “no.”

But there are other products that we absolutely need to stay alive that don't
suffer the runaway prices we see in healthcare.

The best example is food. You can't say no to buying food.

So why don't food sellers have us over a barrel? Because consumers see prices
and force the many providers to bid competitively against each other.

My point is that inelastic demand is not the fundamental cause of high costs
in healthcare. It has much more to do with the many layers of abstraction we
place between patient and provider that prevent price signals from passing
through.

~~~
abstractbill
One doesn't generally have a sudden and unexpected need for a very particular
type of food that only relatively few specialists know how to produce.

~~~
jpdoctor
Exactly. As an example: One does not comparison shop for an ambulance service
after a car accident, nor a surgeon after arriving at the hospital.

And those charges for blood transfusions: Anyone up for a startup to find the
lowest bidder?

------
will_brown
First, it is good to look at this on an international perspective, but an
entirely separate article can be done on why an MRI costs $1,080 for a patient
with insurance and the same treatment would be arbitrarily more for an
uninsured patient usually about 4x as expensive. This issue has gone to court
in California (2006-2008) resulting in over $1 billion dollars returned to
uninsured patients because Courts found hospitals were illegally "price
gouging" uninsured. However, price gouging uninsured is a practice that
continues around the US, for example in September I received 17 stitches from
a FL hospital and the bill was over $12,000 because I am uninsured. I recorded
the entire event on my phone including asking how much the stitches would cost
and the staff telling me the bill would be $2,000 if I were insured. I
challenge the bill since I was quoted $2,000 for the treatment and my bill was
$12,000 and when I produced the video of the staff acknowledging different
price structures for insured and uninsured the hospital immediately agreed to
cover my entire bill.

Second, I can not believe the Washington Post would publish an article titled
"Why an MRI costs $1,080 in America and $280 in France", "America" really? I
try to never comment on a spelling or grammatical error, but honestly we are
talking the Washington Post who should know to use "US" not "America".

------
uvdiv
Is that why the US has four times as many MRI machines per person?

[http://www.oecd-
ilibrary.org/sites/health_glance-2011-en/04/...](http://www.oecd-
ilibrary.org/sites/health_glance-2011-en/04/02/index.html?contentType=/ns/StatisticalPublication,/ns/Chapter&containerItemId=/content/serial/19991312&itemId=/content/chapter/health_glance-2011-30-en&mimeType=text/html)

And has no queues for MRI scans, where France has a 32-day mean waiting
period?

[http://mjperry.blogspot.com/2007/09/canadian-medicine-is-
sic...](http://mjperry.blogspot.com/2007/09/canadian-medicine-is-sick.html)

[http://sante.lefigaro.fr/actualite/2011/05/10/10863-irm-
dela...](http://sante.lefigaro.fr/actualite/2011/05/10/10863-irm-delais-
dattente-stagnent-32-jours-france)

~~~
Rexxar
MRI exams, 2009 :

\- US 91.2 per 1000 inhabitants

\- France 55.2 per 1000 inhabitants

Better usage ratio => lower price

~~~
scarmig
And to make an equally relevant point: more MRIs doesn't necessarily equate to
better health outcomes. It depends on who is getting them, and how likely they
are to actually be sick.

Lots of rich people getting marginally useful MRIs in the USA may be an
inferior system to everyone having access to MRIs but fewer being done in
total.

------
saturdaysaint
Also see Time's extensively researched "Why Medical Bills are Killing Us"
<http://healthland.time.com/why-medical-bills-are-killing-us/>

the tl;dr of it: hospitals are charging the uninsured exhorbitant markups over
Medicaid (which they bitch about, but they actually do well enough that they
_advertise_ to Medicaid patients) because _they can_. Without pricing
information (which they hide as much as possible), every emergency is a
miniature monopoly. "Non-profit" hospital administrators have every incentive
to expand the facilities/prestige of their institution, so they act like the
most rapacious "for-profit" corporations imaginable.

------
zbruhnke
before clicking on this post to read it and even still after reading it I
think the true reason for this can be summed up in a single word "Litigation"

As someone who has been in court rooms and seen the amount of litigation that
businesses deal with in America I would find it hard to believe it does not
play a significant role in the higher prices than places where Class Action
Lawsuits and Ambulance chasing attorneys aren't the norm

~~~
rayiner
Wrong guild: <http://www.press.uchicago.edu/Misc/Chicago/036480.html>,
[http://prescriptions.blogs.nytimes.com/2009/08/31/would-
tort...](http://prescriptions.blogs.nytimes.com/2009/08/31/would-tort-reform-
lower-health-care-costs/),
<http://dartmed.dartmouth.edu/fall05/html/disc_myth.php>,
[http://www.forbes.com/sites/rickungar/2010/09/07/the-true-
co...](http://www.forbes.com/sites/rickungar/2010/09/07/the-true-cost-of-
medical-malpractice-it-may-surprise-you/),
[http://online.wsj.com/article/SB1000142412788732409640457835...](http://online.wsj.com/article/SB10001424127887324096404578356544137516914.html)

------
arbuge
I went to the ER here in Dallas a couple of weeks ago because of some chest
pains I was having.

The good news - it's just some stomach acid. ER doctor prescribed Prilosec OTC
and sent me away.

The bad news - $4,500 in medical bills for 3 hours spent in the ER. Most of
that was spent watching TV waiting for the results of blood tests & x-rays to
be announced.

~~~
morsch
Sprained my ankle very badly on January 1. Had an x-ray (nothing broken, yay).
Got some crazy painkillers and some Diclofenac gel. Waited for about 15
minutes. Never saw a bill and didn't pay a dime.

And by that I mean besides the roughly 300 EUR that's taken out of my pay
check every month now that I'm gainfully employed. People less fortunate get
it for free, of course.

------
sachingulaya
An MRI doesn't have a cost in America. The cost depends on, obviously, your
perspective. Are you a patient? If so, are you insured? Are you a hospital?
Medicare? What state are you in?

Are we talking cost or are we talking reimbursement?

------
codex
My thesis: Health care costs are higher in the US largely because the US has
more per capita wealth than other counties. Look at per capita spending:
<http://www.oecd.org/norway/BriefingNoteNORWAY2012.pdf>

The biggest spenders are the US, Norway, Switzerland and Luxembourg--the same
counties with the highest per capita GDP. Health care is simply something a
person will spare no expense on: everybody eventually enters a period of
chronic poor health as they age in affluent Western societes, but would pay
anything to remedy it.

------
piyush_soni
The giant "insurance scam" that the US medical industry is... By the way, it
costs something around $83 in India. Of course we can't compare directly just
by converting the currency, but it's also true that a lot of American
insurance companies these days pay patients to go and get themselves treated
in the best hospitals of India as that (including the trip costs) would still
be cheaper than getting themselves treated here.

------
Nathanael47
+1 for price controls in medicine

~~~
stevesearer
I like the idea of transparent pricing that some surgery centers are
implementing. One example is the Surgery Center of Oklahoma which simply
displays the prices of their procedures on their website.

This way, people can make informed decisions about their health and purchase
procedures at rates far below what is charged through insurance.

"Transparent, direct, package pricing means the patient knows exactly what the
cost of the service will be upfront. Fees for the surgeon, anesthesiologist
and facility are all included in one low price. There are no hidden costs,
charges or surprises."

<http://www.surgerycenterok.com/pricing.php>

~~~
will_brown
I too like the transparent pricing, CVS Minute Clinics are a great example, if
they offer a service it is listed on their price chart.

In FL medical facilities that post prices of their 50 most common treatments
are given a discount on their license fee. I think that is great, but you have
to laugh at how pro-business states get businesses to do anything pro-
consumer.

Separately, under the FL Patient Bill of Rights, even if a medical facility
does not post their pricing, if requested by the patient the provider must
provide a reasonable estimated charges of such service.

------
InclinedPlane
Because in the US there are vastly more MRI machines and they are newer.

France has 1/3 the number of CT machines per capita and 1/5th the number of
MRI machines per capita compared to the US. And the US has the highest number
of MRI scans per capita per year in the developed world (4 times more than
French citizens).

Stats: [http://www.oecd-
ilibrary.org/sites/health_glance-2009-en/04/...](http://www.oecd-
ilibrary.org/sites/health_glance-2009-en/04/03/index.html?contentType=%2Fns%2F+Chapter%2C%2Fns%2FStatisticalPublication&itemId=%2Fcontent%2Fserial%2F19991312)

~~~
Negitivefrags
A doctor I was talking to recently told me that they do way too many scans in
America because of liability concerns that don't exist in other countries.

If there is a tiny chance that a condition might actually be something more
serious than the obvious diagnosis they will send you in for a scan to be sure
even though the doctor "knows" that it's not.

~~~
chris_mahan
Wait a minute... Are you saying that because French doctors can't be sued for
making a mistake they don't order MRIs?

What? you're not saying that? Then why would American doctors order more MRIs?
Perhaps to detect those tiny chance conditions, that might actually be more
serious? So you're saying that sometimes the MRIs reveal something important
about the patient's health? And you're wanting to blame US doctors to find
that out? How does the doctor "know" that it's not? Should they not "make
sure" instead of just "know"?

I think I prefer the US system in that regard.

~~~
danielweber
Your uncalled-for sarcasm is burying several important points.

First, when doctors in the US are sued they need to show they met the
"standard of care." If every other doctor in your community is doing MRIs, you
have to do them to, _even if they provide no health benefit to the patient_.
Even if you think that MRIs are leading to _worse_ patient outcomes, that's
not the standard you are being judged by.

Second, being sued is a very expensive proposition, even if you did nothing
wrong, and doctors are very risk averse of going to court even if they are
perfectly confident they did nothing wrong and can prove it.

 _How does the doctor "know" that it's not? Should they not "make sure"
instead of just "know"?_

While they can have benefits, all medicare procedures have costs as well as
side-effects. In fact, some procedures can _decrease patient outcomes_ ,
meaning even if they were absolutely free you wouldn't do them. They still get
done, because whenever anyone talks about effectiveness research, someone else
has a fit. (If Democrats suggest it, Republicans talk about the government
getting between you and your doctor. If Republicans suggest it, Democrats talk
about how they are putting profits over patient health.)

We can't have the grown-up conversations about what procedures are and aren't
worth spending money on, because someone insists that all doctors should "make
sure."

~~~
chris_mahan
I lived in France, and I have relatives, including my sister, who lives in
France now (and is a recipient of the French medical establishment's
services). I worked for a US HMO for 5 years. I also worked for a US medical
malpractice insurance company for 1 year. The points you make are valid, and I
agree the system is messed up. Alas, I recognize that all massive systems are
messed up and cost a lot more than they should, because large systems
introduce inefficiencies. It is possible that the US system is less cost-
effective than systems in Europe because of the size of the US population
versus that of other European countries. Japan seems to be a hybrid system,
and has a population of 125 million or so, but I don't know much about it
despite the fact that my wife is Japanese.

In the other large-population countries such as China, India, Indonesia, I
don't know that things are any better.

(As an aside, I don't think sarcasm is ever "called-for".)

------
dmishe
medicare for everybody!

------
abrown28
Do they include the amount the government kicks in to pay for that MRI in
France?

------
allsystemsgo
I don't see how this is related to Hacker News.

~~~
SkyAtWork
We talk a lot about disrupting businesses here; there's a reasonable number of
folks in the audience who want to do this to health care. Likely no deeper
than that, but understanding the entrenched solutions in a market can be
valuable if that's your plan.

